ESTRELLA INTERNATIONAL ENERGY SERVICES LTD. ANNOUNCES A CONVERTIBLE DEBENTURE
PRIVATE PLACEMENT

/NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRES/

CALGARY, Dec. 23 /CNW/ - Estrella International Energy Services Ltd. (TSX-V:EEN) ("Estrella" or the "Company") is pleased to announce that it has entered into an agreement with Canaccord Genuity Corp. ("Canaccord Genuity"), pursuant to which Canaccord Genuity has agreed to underwrite the purchase of 100 subscription receipts (the "Subscription Receipts") for aggregate gross proceeds of $10,000,000 (the "Offering").  Upon closing of the acquisition by the Company of a controlling interest in a private South American company that owns three drilling and nine work-over rigs (the "Acquisition"), each Subscription Receipt will entitle the holder thereof to receive, without payment of additional consideration or further action, one unit ("Unit") at a price of $100,000 per Unit (the "Offering Price").  Each Unit consists of:  (a) $100,000 par value of one 5-year convertible subordinated unsecured debentures bearing a coupon interest rate of 12% per annum, payable semi-annually in arrears in cash or common shares (the "Convertible Debentures"); and (b) one common share purchase warrant (the "Warrant") entitling the holder to acquire 12,500 common shares of Estrella ("Common Shares") at $0.80 per Common Share, exercisable for a period of 5 years from the closing date of the Offering (the "Closing Date"). All of the securities issued in connection with the proposed Offering are subject to a hold period of four months and one day.

The principal amount of the Convertible Debentures, plus all accrued and unpaid interest is at the option of debentureholders convertible Common Shares at any time at a conversion price of $1.00 per share.

The principal amount of the Convertible Debentures, plus all accrued and unpaid interest will be redeemable, in whole or in part, at the option of Estrella without penalty, provided that the weighted average trading price of the Common Shares, for the 20 consecutive trading days ending five trading days preceding the date on which notice of redemption is given is not less than $1.50.  Estrella may satisfy its obligation to repay the principal amount of the Convertible Debentures on redemption or maturity, by payment in Common Shares with a deemed issue price equal to 95% of the current market price of the Common Shares on the TSXV or the TSX as applicable.

Estrella has also granted Canaccord Genuity an option (the "Over-Allotment Option") to solicit subscriptions for and offer for sale up to an additional 25 Units (the "Additional Units"), for additional gross proceeds of up to $2,500,000, at the same price and at the same terms as the Units.  The Over-Allotment Option shall expire on the Closing Date and if exercised in full would result in total gross proceeds of $12,500,000.

Estrella will use the net proceeds of the Offering to complete the Acquisition, and for working capital purposes.  Any net proceeds from the exercise of the Over-Allotment Option will be used to acquire additional shares of the private South American company pursuant to the Acquisition, and for additional general corporate purposes.

The Offering is subject to certain conditions including normal regulatory approvals, including the approval of the TSX Venture Exchange.  The Closing Date of the Offering is anticipated to occur on or about January 18, 2011.

Statements in this press release may contain forward-looking information.  Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expects" and similar expressions.  Forward-looking statements in this press release include, but are not limited to, statements with respect to the future business plans and services and final Exchange approval of the Merger.

The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Estrella.  The reader is cautioned not to place undue reliance on any forward-looking information.  Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated.  Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.  The forward-looking statements contained in this press release are made as of the date of this press release, and Estrella does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.

THIS PRESS RELEASE, REQUIRED BY APPLICABLE CANADIAN LAWS, IS NOT FOR DISTRIBUTION TO U.S. NEWS SERVICES OR FOR DISSEMINATION IN THE UNITED STATES, AND DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO SELL ANY OF THE SECURITIES DESCRIBED HEREIN IN THE UNITED STATES.  THESE SECURITIES HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS UNLESS REGISTERED OR EXEMPT THEREFROM.

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.

For further information:

Estrella International Energy Services Ltd.