Iteration announces closing of $25 million bought deal financing



    /NOT FOR DISSEMINATION IN THE UNITED STATES OR OVER UNITED STATES
    NEWSWIRE SERVICES/

    CALGARY, Oct. 17 /CNW/ - Iteration Energy Ltd. ("Iteration") (TSX - ITX)
is pleased to announce that it has completed its previously announced bought
deal financing, pursuant to which Iteration issued 5.21 million Subscription
Receipts (the "Subscription Receipts") at a price of $4.80 per Subscription
Receipt for aggregate gross proceeds of approximately $25 million (the
"Offering"). The net proceeds from the Offering will be used to reduce the
amount outstanding under Iteration's credit facility, a portion of which
financed the acquisition by Iteration of certain petroleum and natural gas
properties and related assets (the "Acquisition"), which closed on
September 28, 2007.
    Each Subscription Receipt entitles the holder, without payment of
additional consideration, to one Common Share in the capital of Iteration upon
the later of the (i) closing of the Acquisition; and (ii) the closing of the
Offering. With the closing of the Offering today, holders of Subscription
Receipts will immediately receive one Common Share for each Subscription
Receipt held without any further action or payment of additional
consideration.
    The underwriting syndicate was led by FirstEnergy Capital Corp. and
included Peters & Co. Limited and RBC Capital Markets.

    This news release shall not constitute an offer to sell or the
solicitation of an offer to buy the securities in any jurisdiction. The
Subscription Receipts and the Common Shares will not be and have not been
registered under the United States Securities Act of 1933 and may not be
offered or sold in the United States absent registration or an applicable
exemption from the registration requirements.

    %SEDAR: 00002576E




For further information:

For further information: (403) 261-6883 or info@iterationenergy.com,
Brian Illing, President and CEO; Sean Johnson, CFO

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ITERATION ENERGY LTD.

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