Exall Energy Corporation announces results for the three and six months ended
June 30, 2010

CALGARY, Aug. 11 /CNW Telbec/ - Exall Energy Corporation ("Exall") (TSX:EE) is pleased to announce its financial and operating results for the three and six months ended June 30, 2010. Exall's public filings can all be found at www.exall.com or www.sedar.com.

Highlights:

    
    -   A second quarter 2010 production average of 839 boe per day a
        234 percent increase over the same quarter in 2009 (productive
        capability of 1,450 boepd),

    -   Successfully completed, tied in and placed on production the 10-25
        (formerly 12-25) discovery well announced on April 13, 2010,

    -   Completed construction of an all weather road to the 10-12 well site
        allowing the Company to re-commence completion work on the 10-12 dual
        leg well drilled during the first quarter of 2010,

    -   Successfully drilled the first of four offset wells to the 10-25
        discovery well, in the Marten Mountain B Sand project area,
        encountering productive oil-saturated reservoir sandstone. The well
        is expected to be tied in and on production through the Exall
        facility by the end of the third quarter 2010,

    -   Updated Reserves Report to June 30, 2010, reflecting the Company with
        Total Proved ("TP") reserves of 2,082.0 Mboe (an increase of 81
        percent from December 31 2009) and Total Proved plus Probable ("P+P")
        reserves of 2,999.2 Mboe (an increase of 21 percent from December 31
        2009), equating to a 60 percent increase in the Net Present Value
        (NPV) of the P+P reserves to $93.5 million for the period ended
        June 30, 2010 (discounted at 10 percent, before tax, utilizing the
        AJM price forecast effective December 31, 2009) up from $58.6 million
        as at December 31, 2009, and

    -   Successfully negotiated an increase to the Company's revolving demand
        credit facility of $2.0 million from $6.5 million to $8.5 million,
        and renegotiated the Company's non-revolving bridge loan facility.
        The facility now bears interest at 10.0% (previously 12.5%) and
        matures December 31, 2010 (previously May 31, 2010).


    HIGHLIGHTS              Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
                       2010       2009  change       2010       2009  change
    -------------------------------------------------------------------------
    Financial ($)
    Gross
     revenue     10,485,603  3,971,361     164  5,124,704  1,015,700     405
    Funds from
     operations   2,088,073    115,950   1,701  3,981,579  1,239,062     221
    Funds from
     operation
     per share -
     basic             0.04       0.00       -       0.08       0.04     100
    Net income
     (loss)         794,765   (642,771)    224    669,398 (1,587,380)    142
    Net income
     (loss)
     per share -
     basic             0.02      (0.01)    300       0.01      (0.03)    133
    Capital
     expendi-
     tures, net   2,563,050     59,468   4,210  7,897,822    542,115   1,357
    Net debt              -          -       -  8,796,664  5,427,283      62

    Operations
    Daily
     production
      Crude oil
       (bbl)            719        133     441        706        354      99
      Natural gas
       liquids
       (bbl)             10         11      (9)        11         12      (8)
      Natural gas
       (mcf)            660        642       3        654        620       5
    Total daily
     production
     (boe at 6:1)       839        251     234        826        470      76
    Netback per
     boe (6:1) ($)    35.52      24.02      48      34.56      23.96      44
    

Company Reserves

Exall received the results of an independent engineering evaluation of its oil and gas reserves conducted by AJM Petroleum Consultants Ltd. effective June 30, 2010. This evaluation was prepared in accordance with National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities (NI 51-101). This instrument, which was adopted by the Canadian Securities Administrators, sets out standards of disclosure for oil and gas activities and mandates the application of evaluation standards defined in the Society of Petroleum Evaluation Engineers (SPEE) Canadian Oil and Gas Evaluation Handbook (COGEH).

Highlights of June 30, 2010 reserves update include:

    
    -   The addition of 930.4 Mboe of Total Proved ("TP") reserves and
        525.7 Mboe of Total Proved plus Probable ("P+P") reserves,

    -   Period Ended June 30, 2010 Company TP reserves of 2,082.0 Mboe
        (an increase of 81 percent from December 31 2009) and Company P+P
        reserves of 2,999.2 Mboe (an increase of 21 percent from December 31
        2009),

    -   A 60 percent increase in the Net Present Value (NPV) of the P+P
        reserves to $93.5 million for the period ended June 30, 2010
        (discounted at 10 percent, before tax, utilizing the AJM price
        forecast effective December 31, 2009) up from $58.6 million as at
        December 31, 2009.

    -   Reserve replacement was 6.3 times Total Proved and 3.6 times Proved
        plus Probable, and

    -   Reserve life index of 4.5 years Total Proved and 6.2 years Proved
        plus Probable based on the 2010 annual average production rate and
        the June 30, 2010 period-end reserves.
    

The substantial additions to reserves in 2010 are attributed to successful operations in the Marten Mountain area of Mitsue, AB. Light oil and solution gas reserves in the prospect area account for 89 percent of total proved and 89 percent of proved plus probable reserves of the Company. Exall's operations for the balance of 2010 will focus largely on continued exploitation and development of this property.

During the first six months of Fiscal 2010 Exall added total proved reserves at $14.68 per boe (including future development costs) and added total proved plus probable reserves at $10.39 per boe (including future development costs) for inception to date finding and development costs as at June 30, 2010 of $26.43 per boe on the total proved reserves and $18.36 per boe on the proved plus probable reserves including future development costs.

RESULTS OF OPERATIONS

    
    Production
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
    Daily production   2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Oil (bbl/d)         719          1     440        706                 99
    NGLs (bbl/d)         10                (10)        11                 (5)
    Natural gas
     (mcf/d)            660        642       3        654        620       6
    -------------------------------------------------------------------------
    Total production
     (boe/d) (6:1)      839          2     234        826                 76
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Production for the second quarter of 2010 averaged 839 boe per day, a 234 percent increase over the same quarter in 2009. This increase was primarily the result of the January 2010 approval for Waterflood Project status and Good Production Practice (GPP) from the ERCB. Prior to the GPP approval, the 14-1 and 2-12 wells were restricted to a daily allowable production rate of 148 (90 net) boe/d. With the GPP and waterflood in place each of the 14-1 and 2-12 wells produced an average of 410 (271 net) boe/d during the second quarter. Additionally, the 10-25 well (formerly 12-25) produced an average of 220 (160 net) boe/d during the second quarter.

On a year over year basis production has increased 76 percent to 826 boe per day in 2010 due primarily to the June 30, 2009 approval for Waterflood Project status and Good Production Practice (GPP) from the ERCB. With the approvals in place Exall built a pipeline and battery facility which allow for higher production rates from the 14-1 and 2-12 wells. Additionally, water source and injection wells in the Marten Mountain area were completed and equipped and were operational during the second quarter of 2009.

For the six months ended June 30, 2010 oil and natural gas liquids accounted for 86 percent of production which is expected to continue to increase as the oil production from additional successful drills in the Marten Mountain area of Alberta are placed on production.

    
    Commodity Pricing
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
    Average sales                            %                             %
     prices realized   2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Oil ($/bbls)      73.71      64.65      14      76.57      53.26      44
    NGLs ($/bbls)     62.13      42.44      46      65.35      43.24      51
    Natural gas
     ($/mcf)           4.11       3.24      27       4.80       4.13      16
    -------------------------------------------------------------------------
    Weighted average
     ($/boe) (6:1)    67.14      44.42      51      70.11      46.72      50
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

The average price received per boe in the second quarter of 2010 increased 51 percent over the same period in 2009 to $67.14. The average price received per boe in the first six months of 2010 increased 50 percent over the same period in 2009 to $70.11. The price for light, sweet oil at Edmonton in 2010 averaged $77.22 per barrel in the second quarter and $77.88 for the first six months of 2010, up from an average of $66.20 in 2009. Alberta natural gas at AECO averaged $4.09 per mcf in the second quarter of 2010, $4.64 per mcf for the first six months of 2010 and is currently trading at approximately $4.40 per mcf. The Company's Marten Mountain oil production attracts a price approximating the Edmonton light, sweet oil price due to its high quality. The Company has not entered into any commodity hedges to date.

    
    Oil and Gas Production Revenue
    -------------------------------------------------------------------------
                                                          Three months ended
                                                                     June 30
                                                  2010                  2009
                                          $          %          $          %
    -------------------------------------------------------------------------

    Oil                           4,821,667         94    783,345         77
    NGLs                             55,976          1     43,077          4
    Natural gas                     247,061          5    189,278         19
    -------------------------------------------------------------------------
    Total                         5,124,704        100  1,015,700        100
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
                                                            Six months ended
                                                                     June 30
                                                  2010                  2009
                                          $          %          $          %
    -------------------------------------------------------------------------

    Oil                           9,782,484         93  3,410,724         86
    NGLs                            134,492          1     97,733          3
    Natural gas                     568,627          6    462,904         11
    -------------------------------------------------------------------------
    Total                        10,485,603        100  3,971,361        100
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Oil and gas revenue in the second quarter of 2010 increased 405 percent from the same period in 2009 as a result of the 234 percent increase in production, the 51 percent increase in commodity prices received and the shift in production weighting to 85 percent oil from 53 percent in 2009. For the Six months ended June 30, 2010 oil and gas revenue increased 164 percent to $10,485,603 with oil and liquids sales contributing 94 percent of the revenue. The 164 percent increase for the six months ended June 30, 2010 from the same period in 2009 was a result of the 76 percent increase in production, the 50 percent increase in commodity prices received and the shift in production weighting to 85 percent oil from 75 percent in 2009.

    
    Royalties
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
                       2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Royalties $   1,867,790    231,913     705  4,252,515  1,278,559     233
    -------------------------------------------------------------------------
    Average
     royalty
     rate (%)            36         23      57         41         32      28
    -------------------------------------------------------------------------
    Royalties
     ($/boe)          24.47      10.14     141      28.44      15.04      89
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

The increased royalty rates in the second quarter of 2010 and the first six months of 2010, as compared with those in 2009, were the result of the higher rates incurred by the high volume horizontal wells in the Marten Mountain area. This increase in royalty per boe reflects the introduction of the new royalty rates in the province of Alberta that came into effect in January 2010 and the higher production rates from the Marten Mountain properties.

    
    Oil and Gas Production Expenses
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
                       2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Operating
     expenses       545,948    234,672     133  1,062,739    655,804      62
    -------------------------------------------------------------------------
    Operating
     expenses
     ($/boe)           7.15      10.26     (30)      7.11       7.72      (8)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Operating expenses in the second quarter of 2010 increased 133 percent from the same period in 2009, primarily as a result of the 234 percent increase in production. On a per boe basis, operating costs declined 30 percent, to $7.15 per boe due to the fact that the increased production is the result of the higher volume wells in Marten Mountain / Mitsue which are economical to produce. Operating expenses in the first six months of 2010 increased 62 percent from the same period in 2009, primarily as a result of the 76 percent increase in production. On a per boe basis, operating costs declined 8 percent, to $7.11 per boe. Exall's expectation is that operating costs will continue to decline as infrastructure is completed and additional production is tied in at Marten Mountain.

    
    Operating Netback
    Exall realized the following netbacks from oil and gas operations:
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
    Netback per                              %                             %
     boe (6:1)$        2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Production
     revenue          67.14      44.42      51      70.11      46.72      50
    Royalties         24.47      10.14     141      28.44      15.04      89
    Operating
     expenses          7.15      10.26     (30)      7.11       7.72      (8)
    -------------------------------------------------------------------------
    Operating
     netbacks
     ($/boe)          35.52      24.02      48      34.56      23.96      44
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Operating netbacks in the second quarter of 2010 increased 48 percent to $35.52 per boe compared to the second quarter 2009 operating netbacks of $24.02 per boe. This is primarily the result of two factors: first, overall commodity prices improved 51 percent on a second quarter over second quarter basis. Second, operating expenses per boe improved 30 percent due to the fact that the increase in production in the second quarter of 2010 was from higher volume wells in Marten Mountain / Mitsue, which are more economical to produce.

On a six month period over six month basis, 2010 operating netbacks increased by 44 percent to $34.56 per boe. This is primarily the result of two factors: first, overall commodity prices improved 50 percent on a period over period basis. Second, operating expenses per boe improved 8 percent due to the fact that the increase in production in the six months ended June 30, 2010 was from higher volume wells in Marten Mountain / Mitsue.

    
    Depletion, Depreciation and Accretion ("DD&A")
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
    $                  2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Depletion
     expense        813,316    816,912       0  2,778,789  3,034,771      (8)
    Accretion
     expense         12,908      9,424      37     25,074     18,878      33
    Depreciation
     expense          2,613      4,419     (41)     5,152      6,597     (22)
    -------------------------------------------------------------------------
    Total           828,837    830,755       0  2,809,015  3,060,246      (8)
    -------------------------------------------------------------------------
    DD&A ($/boe)      10.86      36.34     (70)     18.78      36.00     (48)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Depletion is calculated using the unit-of-production method based on total estimated proved reserves. DD&A for the second quarter of 2010 was $828,837 compared to $830,755 for the same period in 2009. DD&A in for the first six months of 2010 was $2,809,015 or $18.78 per boe compared to $3,060,246 or $36.00 per boe for the same period in 2009. DD&A expense per boe in 2010 have declined from 2009 due to additional reserves being recognized by our independent reserves evaluator, as a result of successful drilling operations at Marten Mountain, Alberta. The Company's ceiling test calculation, performed as at June 30, 2010, resulted in no additional depletion being recorded.

    
    Administration Expenses
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
    $                  2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Administration,
     gross          543,687    363,129      50  1,084,151    736,827      47
    Overhead
     recoveries     (64,810)    (9,288)    598   (149,183)   (47,795)    212
    -------------------------------------------------------------------------
    Administration,
     net            478,877    353,841      35    935,318    689,032      36
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Administration
     ($/boe)           6.27      15.43     (59)      6.25       8.11     (23)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

General and administration costs represent the costs required to effectively operate a public company. The increase in costs from 2009 reflects the increased cost of staffing commitments made in conjunction with the increased production and capital expenditures in 2010 as Exall continues to achieve positive results with regard to its drilling program in the Marten Mountain, Mitsue area. General and administration expenses per boe in 2010 have declined from 2009 due to additional reserves being recognized by our independent reserves evaluator, as a result of continued successful drilling operations at Marten Mountain, Alberta. Management is continually monitoring general and administrative expenses to ensure that they are being managed effectively and efficiently.

    
    Stock-Based Compensation Expense ("SBC")
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
    $                  2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Stock-based
     compensation   136,871    133,966       2    197,366    251,196     (21)
    -------------------------------------------------------------------------
    SBC ($/boe)        1.32       5.84     (69)      1.32       2.96     (55)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Stock-based compensation expense represents the expense for options granted and are recorded over the vesting period of the options. Additional unamortized stock-based compensation costs will be charged to income over the remaining vesting period of the options outstanding as well as any additional options that may be granted in the future. See note 7 of the financial statements for additional details on the options granted and outstanding.

Exall recorded $136,871 or $1.32 per boe of non-cash, stock based compensation expense for the three months ended June 30, 2010 and $197,366 or $1.32 per boe for the first six months of 2010. In comparison, Exall recorded $133,966 or $5.84 of non-cash, stock based compensation expense for the three months ended June 30, 2009 and $251,196 or $2.96 for the first six months of 2009.

    
    Interest Expenses
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
    $                  2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Interest        144,016     79,324      82    253,452    108,904     134
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Interest
     ($/boe)           1.89       3.46    (100)      1.69       1.27      33
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Interest costs represent the costs required to effectively finance the capital program of Exall. Exall recorded $144,016 or $1.89 per boe of interest expense for the three months ended June 30, 2010 and $253,452 or $1.69 per boe for the first six months of 2010. In comparison, Exall recorded $79,324 or $3.46 of interest expense for the three months ended June 30, 2009 and $108,904 or $1.27 for the first six months of 2009. The increase in interest expenses from 2009 are directly attributable to the significant increase in operations during 2010 from the activity levels in 2009 and the associated debt levels used to finance these activities.

    
    Net Income and Funds from Operations
    -------------------------------------------------------------------------
                                    Three months ended      Six months ended
                                               June 30               June 30
    $                                  2010       2009       2010       2009
    -------------------------------------------------------------------------

    Net income (loss)               794,765   (642,771)   669,398 (1,587,380)
    -------------------------------------------------------------------------
    Basic per share                    0.02                  0.01      (0.03)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Diluted per share                  0.01                  0.01      (0.03)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Funds from operations         2,088,073    115,950  3,981,579  1,239,062
    -------------------------------------------------------------------------
    Basic per share                    0.04                  0.08       0.03
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Diluted per share                  0.04                  0.08       0.03
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Liquidity and Capital Resources

Exall has a revolving demand credit facility with a Canadian chartered bank for $8.5 million that bears interest at the lender's base prime rate plus 1.25 percent which is reviewed periodically by the bank. In addition, Exall has a fixed demand credit facility with a private merchant bank for $1.75 million that bears interest at the 10.0 percent which matures December 31, 2010. This demand credit facility currently calls for payments of $250,000 per month to commence on August 31, 2010 with the balance to be paid out upon maturity.

At June 30, 2010, the Company had approximately $5.72 million outstanding on its revolving credit facility, $1.75 million outstanding on its fixed credit facility and an approximate working capital deficiency excluding bank indebtedness, of $1.3 million for total net debt of approximately $8.8 million.

During the six month period ended June 30, 2010, the Company used an increase in bank debt, funds received through its March 2010 brokered private placement, funds received through the merchant bank facility, and cash flow from operations to fund capital expenditures and other financial requirements. In 2010, the Company's capital expenditures will be limited by the cash flow available from operations, additional debt or equity as market conditions may allow and potential asset sales if the Company so chooses.

Capital Expenditures

Oil and gas exploration and development expenditures were $2,563,050 for the second quarter of 2010 and $7,897,822 for the six month period ended June 30, 2010. Oil and gas exploration and development expenditures were $59,468 for the second quarter of 2009 and $592,484 for the six month period ended June 30, 2009. During 2009 the Company did not participate in drilling of any wells, as all capital expenditures were focused on completing and equipping the Marten Mountain / Mitsue wells for waterflood production.

The Company did not acquire any land during the second quarter of 2010. The Company has acquired 3,680 gross (2,429 net) acres of undeveloped land in the Mitsue area, during the six month period ended June 30, 2010. As at June 30, 2010, the Company had 18,091 acres (10,639 acres net) of undeveloped land in Canada.

The following table sets forth a summary of the capital expenditures incurred for the periods ended June 30.

    
    -------------------------------------------------------------------------
                            Three months ended              Six months ended
                                       June 30                       June 30
                                             %                             %
    $                  2010       2009  Change       2010       2009  Change
    -------------------------------------------------------------------------

    Land              4,368      4,590      (5)   352,951     52,022     578
    Geological &
     Geophysical     40,905          -      NA    106,696          -      NA
    Drilling and
     completions  1,281,698     76,869   1,567  5,854,882    340,027   1,622
    Equipping,
     Tie-ins &
     Facilities   1,234,939    (23,341)     NA  1,579,736    148,716     962
    Adminis-
     trative
     assets           1,140      1,350     (16)     3,557      1,350     163
    -------------------------------------------------------------------------
    Exploration &
     development
     expen-
     ditures      2,563,050     59,468   4,210  7,897,822    542,115   1,357
    -------------------------------------------------------------------------
    Asset
     retirement
     obligation           -          -       0     62,624     35,466      77
    -------------------------------------------------------------------------
    Total Capital
     Expen-
     ditures      2,563,050     59,468   4,210  7,960,446     577,581  1,278
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Capitalization

The Company had 52,232,745 shares, 3,331,113 warrants and 4,867,500 options to purchase shares outstanding as at June 30, 2010. At August 10, 2010, the Company had 52,382,745 shares, 2,887,426 warrants and 4,717,500 options outstanding. Additionally, the Company has outstanding, as at August 10 2010, broker warrants entitling the holder to acquire 295,791 Units (each unit consisting of one common share of Exall and one-half of one share purchase warrant) exercisable at $0.675 per broker warrant.

Outlook

In January 2010 Exall announced the completion and commissioning of an oil production pipeline and battery facilities, and the approval of the waterflood project and Good Production Practice (GPP) status for the wells in the Marten Mountain area of Alberta. All facilities and all approvals were in place and the project was on stream at full rates in February 2010.

Exall has focused its capital in development of the Marten Mountain Prospect area. Two wells have been drilled to date offsetting the previously announced "B" Sand discovery drilled by Exall in Q1. The wells are currently undergoing completion operations and will be placed on production immediately thereafter as they are adjacent to the Exall pipeline completed in Q4 of last year.

Permanent access to the north Marten Mountain "A" Sand extension test well has been completed and a work-over was performed on the well. During the operation it was determined that the wellbore integrity had been compromised at 2,700 meters measured depth, the point of the lateral casing exit, and the portion of the wellbore below that depth has been abandoned. Exall plans to move on a drilling rig and drill a new lateral into the reservoir identified by the well. The Company also plans to drill the offsetting well utilizing the same drilling rig. These operations are planned for the third quarter of 2010.

The wells drilled this summer have established continued sand development with a number of offset drilling opportunities. The ability to continue development of this key property through the summer allowed Exall to accelerate development plans in the Marten Mountain area.

Exall will also be expanding battery facilities and tying into a gas line in order to facilitate increased production rates. The Company's wells are currently constrained by restrictions on gas flaring and by limits to water injection. The application to provide additional water injection has been made to the ERCB and a disposition to do so is anticipated shortly. The gas tie-in is in the process of negotiation with a third party who requires gas for an under-utilized plant. Details of the arrangement will be released once the final contracts have been signed with completion anticipated in October of this year.

The recently completed Midyear Reserves Update has quantified the additional Total Proved and Proved plus Probable Reserves, and Net Present Value established by the Company through the capital program of the first half of 2010. The capital program for the remainder of the year is expected to provide additional production potential and add substantially to the Q4 results for Exall.

About Exall

Exall is a junior oil and gas company active in its business of oil and gas exploration, development and production from its properties in Alberta, British Columbia and Texas. Exall Energy is currently developing the new Mitsue area "Marten Mountain" discovery in north-central Alberta.

Exall Energy currently has 52,382,745 common shares outstanding. The Company's common shares are listed on the Toronto Stock Exchange under the trading symbol EE.

Reader Advisory

This news release contains forward-looking statements, which are subject to certain risks, uncertainties and assumptions, including those relating to results of operations and financial condition, capital spending, financing sources, commodity prices and costs of production. By their nature, forward-looking statements are subject to numerous risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, actual results may differ materially from those predicted. A number of factors could cause actual results to differ materially from the results discussed in such statements, and there is no assurance that actual results will be consistent with them. Such factors include fluctuating commodity prices, capital spending and costs of production, and other factors described in the Company's most recent Annual Information Form under the heading "Risk Factors" which has been filed electronically by means of the System for Electronic Document Analysis and Retrieval ("SEDAR") located at www.sedar.com. Such forward-looking statements are made as at the date of this news release, and the Company assumes no obligation to update or revise them, either publicly or otherwise, to reflect new events, information or circumstances, except as may be required under applicable securities law.

For the purposes of calculating unit costs, natural gas has been converted to a barrel of oil equivalent (boe) using 6,000 cubic feet equal to one barrel (6:1), unless otherwise stated. The boe conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method and does not represent a value equivalency; therefore boe may be misleading if used in isolation. This conversion conforms to the Canadian Securities Regulators' National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities.

SOURCE Exall Energy Corporation

For further information: For further information: Exall Energy Corporation: Frank S. Rebeyka, Vice Chairman & CEO, Tel: 403-815-6637; Warren F.E. Coles, Vice President - Finace & CFO, Tel: 403-237-7820 x 224, info@exall.com; Please visit Exall Energy's website at: www.exall.com; Renmark Financial Communications Inc.: Henri Perron, hperron@renmarkfinancial.com; Maurice Dagenais, mdagenais@renmarkfinancial.com, Tel.: (514) 939-3989, (416) 644-2020; www.renmarkfinancial.com

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Exall Energy Corporation

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