Questerre Lays Groundwork for Commercial Development of Utica

Questerre Lays Groundwork for Commercial Development of Utica

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CALGARY, ALBERTA--
(Marketwire - Nov. 12, 2010) -


NOT FOR DISTRIBUTION ON U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES


Questerre Energy Corporation ("Questerre" or the "Company") (TSX:QEC) (OSLO:QEC) reported today on its operating and financial results for the third quarter of 2010.


Michael Binnion, President and Chief Executive Officer of Questerre, commented, "During the quarter we began to address some of the prerequisites to the next phase of establishing commerciality of the Utica shale. We are looking forward to the completion and testing of St. Gertrude and Fortierville next year and further work on our commercial demonstration project in the St. Lawrence Lowlands."


He added, "Despite the delays to the previously announced timeline, we intend to use this time to lay the groundwork for the next phase. The additional technical information and new hydrocarbon legislation will give industry the comfort it needs to make the necessary investment in the multi-well program. A local service sector will follow which increases the likelihood of optimizing well costs. This will move the Utica out of the pilot phase and, with continued success, to validating the reserve potential of this massive resource."



Highlights


Gentilly horizontal well test meets expectations at an initial stabilized rate of 720 Mcf/d from three fracs in the middle Utica or approximately 240 Mcf/d per frac
Completion of Fortierville and St. Gertrude horizontals deferred by operator to the first half of 2011
Concluded pipeline agreement and commenced permitting a 3-D seismic program for the commercial demonstration project targeting the St. Edouard area
Cash flow from operations of $1.44 million and production of 649 boe/d with improved operating efficiencies during the quarter
Sustained financial position with over $154 million in positive working capital and no debt



Production of 649 boe/d over the third quarter (2009: 632 boe/d) was improved from the second quarter volumes of 620 boe/d and includes early additions from our ongoing drilling program in Antler. Petroleum and natural gas revenue in the third quarter was $2.95 million (2009: $2.79 million) with oil and natural gas liquids accounting for 53% of the product mix.


Improved operating efficiencies resulted in cash flow for the period of $1.44 million for the quarter (2009: $0.50 million) and $2.15 million (2009: $2.28 million) for the year to date.


The Company reported a working capital surplus of $154.53 million at September 30, 2010 compared to $49.02 million at September 30, 2009.


Questerre Energy Corporation is an independent energy company focused on shale gas in North America. The Company is concentrated on establishing commerciality of its Utica shale gas discovery in the St. Lawrence Lowlands, Quebec. Questerre is committed to the economic development of its resources in an environmentally conscious and socially responsible manner.


Questerre Energy Corporation is an independent energy company focused on shale gas in North America. The Company is concentrated on establishing commerciality of its Utica shale gas discovery in the St. Lawrence Lowlands, Quebec. Questerre is committed to the economic development of its resources in an environmentally conscious and socially responsible manner.