CANADIAN PHOENIX RELEASES SECOND QUARTER RESULTS AND ANNOUNCES TERMINATION OF
SARS PLAN AND ISSUANCE OF OPTIONS

Symbol: CXP-TSXV

CALGARY, Aug. 27 /CNW/ - CANADIAN PHOENIX RESOURCES CORP. ("Canadian Phoenix") announces its consolidated results for the three and six months ended June 30, 2010:

SUMMARY OF SECOND QUARTER AND YEAR-TO-DATE 2010 FINANCIAL RESULTS

    
                                     For the three months  For the six months
    ($000's except as indicated)          ended June 30      ended June 30
    -------------------------------------------------------------------------
                                          2010      2009      2010      2009
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Avg P&NG Production (boe/d)            530       882       761       975
    Avg realized price - ($/boe)         54.50     53.27     60.09     43.55

    P&NG revenue                         2,628     4,278     8,280     7,683
    Netbacks - $/boe                     16.09     22.74     20.54     17.15
    Equity Investment loss              (1,543)     (836)   (1,026)   (5,780)

    Income (Loss) for the period        16,389   (11,083)   12,868   (20,292)
      Per share - basic & diluted      $354.34    ($0.24)  $278.21    ($0.45)
    Funds from Operations               (3,898)      149   (3,200)      (148)

    Capital Expenditure                     85     1,070      566      8,036
    Cash on hand                        66,934       474   66,934        474
    Working Capital (Deficiency)        65,844   (11,533)  65,844    (11,533)
    Total assets                        70,114   107,795   70,114    107,795

    Weighted Average Number of Shares
     Outstanding - Basic &
     Diluted (000's)*                 46,252    45,276   46,252     45,276

    Number of Shares
     Outstanding (000's)*             46,252    45,276   46,252     45,276
    Number of Shares
     Outstanding - Diluted (000's)*   74,447    73,634   74,447     73,634

    * all figures have been adjusted to reflect the 25 for 1 share
        consolidation effective Nov 16, 2009
    

During the second quarter of 2010, Canadian Phoenix made two significant divestments:

    
    -   On May 26, 2010, the shareholders of the Corporation and the
        shareholders of the Corporation's subsidiary Serrano Energy Ltd
        ("Serrano") approved the sale of all of Serrano's shares to an
        intermediate oil and gas producer. The disposition of the
        Corporation's 10,981,000 shares in Serrano yielded gross proceeds of
        $24.8 million, of which $2.1 million were immediately used to repay
        the Corporation's mezzanine loan.

    -   On April 27, 2010 the Corporation entered into a voting agreement
        with its 58% owned investee Marble Point Energy Ltd ("Marble Point",
        now Teine Energy Ltd) and a third party, pursuant to which the
        Corporation agreed to vote its shares held in Marble Point in favor
        of an amalgamation between Marble Point and the third party, subject
        to receipt of requisite shareholder and regulatory approval.

        The Corporation's shareholders approved the transaction at a special
        meeting of shareholders held on May 26, 2010, while the shareholders
        of Marble Point approved the transaction (under slightly modified
        terms, none of which impacted the cash consideration available to the
        Corporation) on June 25, 2010. Gross proceeds on the sale of the
        Corporation's 90 million shares in Marble Point were $45 million.
    

With the closing of these transactions, the Corporation now has significant cash holdings (approximately $67 million) to go along with approximately $61 million of tax pools, and is positioned for a significant re-investment into the oil and gas sector. The Corporation's Special Committee is currently analyzing and evaluating opportunities in this regard.

    
    Financial Summary
    -----------------
    

Note - the results of Serrano are included to the disposition date of May 26, 2010, and the equity results of Marble Point are included to the disposition date of June 25, 2010.

The second quarter of 2010 saw oil prices remain at levels consistent with the past two quarters at around US$78/bbl (WTI), but poorer natural gas prices which averaged $3.86 (AECO spot) compared to $5.36 in the first quarter of 2010. While oil prices are expected to remain in the $75-$90 range for the remainder of the year, natural gas prices are likely to remain at the current low levels due primarily to excess supply in the North American market. With the disposal of the Corporation's investments in Serrano and Marble Point, movements in oil and natural gas prices are more relevant to the Corporation's re-investment strategies and opportunities than their impact on the Corporation's financial performance.

For the three and six months ended June 30, 2010 the Corporation recorded income after tax of $16.4 million and 12.9 million. Heavily impacting these results were the accounting gains recorded on the dispositions of Serrano ($13.2 million) and Marble Point ($12.8 million) noted previously. Excluding these gains, and also excluding a $5 million impairment charge on property, plant and equipment, a loss of $4.6 million was realized in the second quarter, and a loss of $8.1 million year-to-date.

Netbacks from oil and gas sales were approximately $0.8 million and $2.8 million for the three and six months ended June 30, 2010. After general and administrative costs of $4.5 million and $5.9 million, funds from operations were negative at $3.9 million and $3.2 million for the respective three and six month periods.

The $5 million impairment charge recorded at June 30, 2010 was in relation to the Corporation's property, plant and equipment, as the carrying value exceeded the future discounted cash flows associated with proved and probable reserves.

Financial Position

At June 30, 2010, the Corporation had cash on hand of $66.9 million, net assets of $67.5 million, and no debt. As noted previously, the significant increase in cash on hand is due to the dispositions of Serrano and Marble Point.

The consolidated financial statements and related MD&A can be found on SEDAR's website at www.sedar.com and the Corporation's website at www.canadian-phoenix.com.

    
    Cancellation of SARs Plan and Issuance of Options to Directors
    --------------------------------------------------------------
    

The Board of Directors approved today the termination of the Corporation's Stock Appreciation Rights ("SARs") Plan, which was originally put in place in June 2009. Under the SARs Plan, termination of the plan results in the immediate exercise of all outstanding unexercised rights. The estimated payout of the 1.92 million outstanding SARs to holders is $1 million, which had been accrued in the June 30, 2010 consolidated interim financial statements as a liability.

Concurrent with the termination of the SARs Plan, the Board of Directors approved the issuance of 2.3 million options (5 % of outstanding common shares) to directors of the Corporation. The options, which vest immediately, will have an exercise price of $1.28 (the current share price) and a five year term to expiry.

About Canadian Phoenix

Canadian Phoenix Resources Corp. is a publicly-traded junior oil and gas exploration, development and production company with operations in Western Canada. Canadian Phoenix's shares trade on the TSX Venture Exchange under the symbol "CXP".

FORWARD-LOOKING STATEMENTS: This news release may contain forward-looking information. All statements and information other than statements of historical fact are forward-looking information. In some cases, forward-looking information can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", or the negative of these terms or other comparable terminology. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond the control of Canadian Phoenix, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers are cautioned that actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits Canadian Phoenix will derive there from. The forward-looking statements and information contained in this news release are made as of the date hereof and Canadian Phoenix undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

%SEDAR: 00010421E

For further information: For further information: Michael Atkinson, President & CEO, Phone: (604) 689-1428; Tim Moran, Chief Financial Officer, Phone: (403) 920 0040

Organization Profile

CANADIAN PHOENIX RESOURCES CORP.

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