NEWSROOM

TORONTO, Nov. 8, 2011 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PRE) (BVC: PREC) announced today the release of its unaudited consolidated financial results for the quarter ended September 30, 2011, together with its Management Discussion and Analysis ("MD&A") for the corresponding period. These documents will be posted on the Company's website at www.pacificrubiales.com and SEDAR at www.sedar.com.

Ronald Pantin, Chief Executive Officer of the Company, commented:

"We are very pleased with third quarter results which continue to show strong underlying production growth and financial results. Across all financial measures, the Company showed significant increases, driven by higher production and netbacks, with a more than doubling of Sales Revenue, EBITDA, Adjusted Net Earnings and Funds Flow from Operations, compared to the same period a year ago. Gross field production hit a record 242 thousand boe/d in September, and average net production for the quarter increased by 54% reaching over 87 thousand boe/d despite two unscheduled operational disruptions at Rubiales/Quifa that reduced net production by over five thousand barrels per day. At this moment production continues growing in these two fields."

Management will hold a live conference call in English with simultaneous Spanish translation on Wednesday, November 9, 2011, to discuss the Company's financial results beginning at 9:30 a.m. (Toronto/Bogotá time).

The Company will post a presentation on the web site prior to the call, it can be accessed at www.pacificrubiales.com.

Analysts and interested investors are invited to participate as follows:

Participant Number (International/Local): (647) 427-7450
Participant Number (Toll free Colombia): 01-800-518-0661
Participant Number (Toll free North America): 1-888-231-8191
Conference ID (English Participants): 24677939
Conference ID (Spanish Participants): 25573167

The conference call will be webcast which can be accessed through the following link: http://www.pacificrubiales.com.co/investor-relations/webcast.html

A replay of the call will be available until 23:59 p.m. (Toronto/Bogota time), November 23, 2011, which can be accessed as follows:

Financial Summary

A summary of the financial results for the three and nine months ended September 30, 2011 follows:

Operating Netback Crude Oil and Gas:

Third Quarter Highlights

During the third quarter of 2011, the Company continued its trend of production growth and exploratory success, leveraging its technical know-how and operational expertise. Nevertheless, the third quarter 2011 production was affected by two labour disturbances causing unscheduled operational disruptions at the Rubiales and Quifa fields, as previously announced on July 20, September 20 and 22, and October 26, 2011.  Despite these disruptions, the results for this period underline the strength of the Company's operational activity and its capacity to increase production, as well as management's commitment to deliver robust financial results. Management is focused on achieving challenging operational goals, as well as pursuing an ambitious exploration and production ("E&P") investment program, under the umbrella of the Company's paramount strategic focus: Growth.

• Production continues to grow. Average gross field production in the third quarter of 2011 was 219,136 boe/d, 87,159 boe/d net after royalties and field consumption, 55% higher than the same period of 2010. However, the third quarter 2011 production was affected by two labour disturbances causing unscheduled operational disruptions at the Rubiales and Quifa fields, which resulted in a total gross production loss of 1,343,084 bbl during this period, representing 491,933 bbl net to the Company (5,347 bbl/d).
   
• Significant improvement in operating netbacks. Crude oil operating netback during the third quarter of 2011 was $56.12/bbl, 44% higher in comparison to the same period in 2010 ($38.89/bbl), due to higher realized prices. Natural gas operating netback was $34.15/boe, higher by 34% in comparison to the same period of 2010.
   
• Strong financial results. The third quarter confirmed the capacity of the Company to deliver strong financial results, reflected by a significant increase in production and improvements in realized prices.  Consolidated net earnings for the third quarter of 2011 were $193.7 million, or $0.71 per common share, compared with net earnings of $113.2 million for the third quarter of 2010, or $0.43 per common share. Adjusted net earnings for the third quarter of 2011 were $176 million, compared to $104.6 million in the third quarter of 2010. Revenues increased to $828.3 million compared to $408.5 million recorded for the same period in 2010.
   
• EBITDA doubled. EBITDA for the third quarter of 2011 totaled $465 million, which represents a two-fold increase as compared to EBITDA for the previous year's third quarter of $218.1 million. EBITDA for the third quarter of 2011 represents a 56% margin in comparison to total revenues for the period.  Funds flow from operations increased to $350 million in the third quarter of 2011, compared to $161 million in the third quarter of 2010.
   
• Continued focus on exploratory activities with a success rate of 83%.  During the third quarter, the Company drilled a total of 18 exploratory wells, 15 wells were successful. Also, the Company commenced the acquisition of 526 km² of 3D seismic and 739 km of 2D seismic with a total net investment of $64.5 million.
   
• Important growth in the Company's net proved and probable reserves (2P). During the third quarter, the Company received independent reserves evaluation reports for the Rubiales-Piriri, Quifa and Sabanero blocks, which established that the net proved and probable reserves ("2P") have grown to a total of 350 million barrels of oil equivalent ("MMboe") as of the evaluation dates (June 30 and September 15, 2011), an increase of 15.2% (without deducting production for the period) when compared to the reserves reports dated February 28, 2011.
   
• Resource evaluation of 25 exploration blocks.  During the third quarter, the Company received independent resource assessment reports for the Company's exploration blocks in Colombia (21), Peru (3) and Guatemala (1), resulting in a Net Best Estimate for Contingent and Prospective Resources of 2,777.45 MMboe for those exploration blocks. The prospectivity of the exploration portfolio together with 2P reserves sets the foundation to build the Company´s future growth.
   
• Inventory levels.  The standard operational inventory of the Company is 1.9 million bbls and during the third quarter the Company's inventory increased by a net of 734,219 bbl which remained unlifted at the end of the quarter and have since been sold in cargoes for October and December.  During October 2011, 800,000 bbls from third quarter inventory were sold at an average realized price of $104.4 per bbl, generating gross revenue of $83.5 million which will be reflected along with the related costs in the earnings of the fourth quarter 2011.
   
• Investment in capital expenditure activities.  Capital expenditures during the quarter ended September 30, 2011 totaled a net amount of $276.7 million (2010 - $200.0 million), of which $124.9 million were invested in the expansion and construction of production infrastructure; $64.5 million went into exploration activities including seismic, aerogravimetry, aeromagnetometry and drilling in Colombia, Peru and Guatemala; $52.9 million for development drilling; and $34.4 million were invested in other projects, including STAR.
   
• Continued development of producing facilities. During the third quarter of 2011, new facilities were built at the Rubiales and Quifa fields to reach a total of 197,000 bbl/d operated production level, and 40,000 bbl/d, respectively.
   
• Joint Venture in Peru. On October 12, 2011 the Company announced the signing of a letter of intent with Les Establisssements Maurel & Prom S.A. ("Maurel & Prom") to acquire a 50% working interest in the exploration contract for Block 116 located in northeastern Peru, whereby the Company will assume a full carried obligation of up to $75 million, which is initially intended to cover the first and second wells of the contract for Block 116. Under the terms of the letter of intent, once operatorship of the block is transferred to the Company, we will be entitled to receive a reimbursement of these costs through cash flows derived from future hydrocarbon production from the block. The transaction is subject to government and regulatory approvals, as well as legal and financial due diligence to the Company's satisfaction.
   
• Investment in Guyana. On October 13, 2011, the Company purchased 58,720,000 common shares in the capital of CGX Energy Inc. ("CGX"), a company listed on the TSX Venture Exchange, at a price of C$0.70 per common share, for an aggregate investment of C$41.1 million. CGX is a Canadian-based oil and gas exploration company focused on the exploration for oil in the Guyana/Suriname Basin. The Company holds approximately 18% of the issued and outstanding common shares in the capital of CGX.
   
• Filing for BDR Listing in Brazil.  On October 6, 2011, the Company announced that it has filed before the Comissao de Valores Mobiliarios (the "CVM"), the Brazilian regulatory entity in charge of supervising public issuers, and the Brazilian stock exchange called BM&FBOVESPA S.A., the documentation required for the trading of Brazilian Depositary Receipts (the "BDRs") representing the Company's common shares. Temporary Incentive Conversion Rate Increase for the Debentures.  On October 25, 2011 the Company provided notice to all holders of the Company's C$240 million convertible, unsecured, subordinated debentures due on August 29, 2013 (the "Debentures") of an incentive program to convert their Debentures at the current conversion rate plus an additional number of the Company's common shares with value equal to C$200 per C$1,000 face value of Debentures.
   
• Cash dividend paid to shareholders on September 30, 2011. On September 8, 2011, the Company announced a cash dividend in the aggregate of $25 million, or $0.093 per common share.  The dividend was paid on or about September 30, 2011 to shareholders of record as of September 20, 2011.

More details on the Company's operational and exploration activities can be found in the MD&A.

Pacific Rubiales, a Canadian-based company and producer of natural gas and heavy crude oil, owns 100 percent of Meta Petroleum Corp., a Colombian oil operator which operates the Rubiales and Piriri oil fields in the Llanos Basin in association with Ecopetrol, S.A., the Colombian national oil company, and 100 percent of Pacific Stratus Energy Corp. which operates the La Creciente natural gas field. The Company is focused on identifying opportunities primarily within the eastern Llanos Basin of Colombia as well as in other areas in Colombia and northern Peru. Pacific Rubiales has working interests in 46 blocks in Colombia, Peru and Guatemala.

The Company's common shares trade on the Toronto Stock Exchange and La Bolsa de Valores de Colombia under the ticker symbols PRE and PREC, respectively. 

Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 5.7 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. 

Cautionary Note Concerning Forward-Looking Statements

This press release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding estimates and/or assumptions in respect of production, revenue, cash flow and costs, reserve and resource estimates, potential resources and reserves and the Company's exploration and development plans and objectives) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: uncertainty of estimates of capital and operating costs, production estimates and estimated economic return; the possibility that actual circumstances will differ from the estimates and assumptions; failure to establish estimated resources or reserves; fluctuations in petroleum prices and currency exchange rates; inflation; changes in equity markets; political developments in Colombia, Guatemala or Peru; changes to regulations affecting the Company's activities; uncertainties relating to the availability and costs of financing needed in the future; the uncertainties involved in interpreting drilling results and other geological data; and the other risks disclosed under the heading "Risk Factors" and elsewhere in the Company's annual information form dated March 10, 2011 filed on SEDAR at www.sedar.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.