ALANGE ENERGY ANNOUNCES FILING OF FIRST QUARTER 2011 RESULTS

TORONTO, June 30, 2011 /PRNewswire/ - Alange Energy Corp. (TSXV: ALE) announces the filing of its interim condensed consolidated financial statements for the three months ended March 31, 2011, together with its Management's Discussion and Analysis. These documents will be available on the Company's website at www.alangeenergy.com and at www.sedar.com.

Luciano Biondi, the Company's Chief Executive Officer, stated "We are pleased with the progress that executive management and operational staff have made thus far in 2011, taking the company in its new direction towards improved operational efficiencies and communications. These factors contribute to the ongoing improvements in reduced operational costs and enhanced netbacks, enabling us to focus all of our resources on exploring and developing our core assets and meeting our production growth target."

The Company reported revenues for the first quarter of 2011 of $20.8 million, more than double the same period a year ago, driven by the sale of 231,727 barrels of oil at an average selling price of $93 per barrel and 148,827 mcf of gas at an average selling price of $4.35 per MMbtu. Operating netbacks averaged $52 per barrel oil-equivalent (boe) in the first quarter, a $30 per boe improvement from the fourth quarter of 2010, as a direct result of the measures taken by current management to improve the Company's profitability and cash flow. As previously announced, the Company has also taken steps to significantly reduce its G&A expenses. Excluding non-recurring expenses incurred in the first quarter related to the internal review process and costs associated with the staff who have been terminated, G&A on an adjusted basis would have been approximately $3.7 million in the first quarter. The Company is continuing its initiatives to reduce its quarterly G&A run rate.

For the first quarter of 2011, the Company reported a net loss of $10.0 million or $0.01 per share, including the impact of a one-time charge of $6.3 million related to the 2011-2014 equity tax levied on companies in Colombia.

Current management took steps during the first quarter of 2011 to strengthen the Company's balance sheet and improve its liquidity, including the completion of a CA$70 million equity financing. The Company closed the first quarter with a cash balance of $30.5 million, including $25 million of cash set aside to fund its 2011 exploration program, and a $53 million reduction in its working capital deficit. Total short- and long-term debt was reduced by $35 million to $10 million by early April 2011 to reduce the debt service burden on the Company's operating cash flow.

In April 2011, the Company completed a $25 million acquisition of an additional 32% interest in the eastern block of the Cubiro property in the Llanos Basin. Financed through a CA$31 million 9% Senior Notes offering that closed in early May, the acquisition immediately increased the Company's share of production (before royalties) to an average of approximately 2,800 boed, up 22% from the daily average production of 2,294 boed in the first quarter of 2011. However, in mid-May, the wash-out of a major highway north of the city of Yopal in the province of Casanare triggered by severe weather conditions resulted in a short-term production disruption at the Cubiro property due to limitations of truck availability. Consequently the Company's daily average production slipped to approximately 2,200 boed over a period of about 32 days. Temporary repairs to the highway have since been made by the government and the flow of traffic has resumed. Over the last 6 days, the Company's daily average production has returned to 2,800 boed.

Recent results from testing at the La Punta 4 well, which reached total depth in May, indicate that the well is dry. Discussions are underway with the operator at La Punta regarding timing and other considerations for the planned La Punta 5 well to be drilled later this year.

Alange Energy is continuing its efforts to realize value from its non-core assets, essentially the gas assets and the Las Quinchas heavy oil property. The Company is currently in discussions with several parties pursuing opportunities to joint venture, farm out or dispose of its interests in these assets.

On May 9, 2011, a total of 36,607,500 stock options were granted to directors, officers, employees and consultants of the Company at an exercise price of CA$0.30 per common share. The options vested immediately and have a term to expiry of five years.

Management will hold a conference call on Thursday, June 30, 2011 at 9:30 a.m. (Eastern Time) to provide an operational update and to discuss the first quarter results. Analysts and interested investors are invited to participate as follows:

A playback of this conference call will be available by dialling 416-849-0833 or (800) 642 1687 with the above conference ID number until July 14, 2011.

Alange Energy is a Canadian-based oil and gas exploration and production company, with working interests in 19 properties in five basins in Colombia. Further information can be obtained by visiting our website at www.alangeenergy.com .

All monetary amounts in U.S. dollars unless otherwise stated. This news release contains certain "forward-looking statements" and "forward-looking information" under applicable Canadian securities laws concerning the business, operations and financial performance and condition of Alange Energy. Forward-looking statements and forward-looking information include, but are not limited to, statements with respect to estimated production and reserve life of the various oil and gas projects of Alange Energy; the estimation of oil and gas reserves; the realization of oil and gas reserve estimates; the timing and amount of estimated future production; costs of production; success of exploration activities; and currency exchange rate fluctuations. Except for statements of historical fact relating to the company, certain information contained herein constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan," "expect," "project," "intend," "believe," "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Many of these assumptions are based on factors and events that are not within the control of Alange Energy and there is no assurance they will prove to be correct. Factors that could cause actual results to vary materially from results anticipated by such forward-looking statements include changes in market conditions, risks relating to international operations, fluctuating oil and gas prices and currency exchange rates, changes in project parameters, the possibility of project cost overruns or unanticipated costs and expenses, labour disputes and other risks of the oil and gas industry, failure of plant, equipment or processes to operate as anticipated. Although Alange Energy has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Alange Energy undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements.

Statements concerning oil and gas reserve estimates may also be deemed to constitute forward-looking statements to the extent they involve estimates of the oil and gas that will be encountered if the property is developed. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Estimated values of future net revenue disclosed do not represent fair market value.

Neither 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 news release.

 

SOURCE Alange Energy Corp.