Pacific Rubiales Closes Kappa Energy Acquisition
Sep 3, 2008

    TORONTO, Sept. 3 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PEG)
announced today that it has closed the acquisition of Kappa Energy Holdings
Ltd. for a cash payment of approximately US$168 million, subject to minor
post-closing adjustments and regulatory approval in Colombia. Proceeds were
financed through the previously announced issuance of a convertible unsecured
subordinated debenture offering of C$240 million with an 8% coupon and a
conversion price of C$13.00. GMP Securities L.P. acted as the exclusive
financial advisor in connection with this transaction.
    Kappa is a Colombian oil and gas exploration and production company which
holds exploration and production licenses in Colombia with a commanding land
position totaling 747,000 acres. This acreage consists of nine leased and
operated blocks in the Catatumbo, Lower, Middle and Upper Magdalena, and
Llanos basins of Colombia.
    Kappa has a strong existing reserve base with, as of May 31, 2008,
approximately 10.3 million barrels oil equivalent (MMBOE) of proven and
probable reserves and 24.2 MMBOE of proven, probable and possible reserves. In
addition, 166 MMBOE of prospective resources have been identified in the best
estimate case. There is no certainty that any portion of the resources will be
discovered. If discovered, there is no certainty that it will be commercially
viable to produce any portion of the resources. All the reserve numbers quoted
above are net before royalties.
    The reserve and resource estimates set forth herein were prepared by
Petrotech Engineering Ltd., of Burnaby, Canada effective as of May 31, 2008 in
accordance with the Canadian Oil and Gas Evaluation (COGE) Handbook and the
requirements of the Canadian National Instrument 51-101 standards of
disclosure for oil and gas activities. The independent reserve and resource
evaluation report has been filed on SEDAR.
    Ronald Pantin, the company's Chief Executive Officer, stated "We are
thrilled with the potential upside of the Kappa acquisition and have exciting
plans to maximize the value of this investment."

    Pacific Rubiales, a Canadian-based company and producer of natural gas
and heavy crude oil, owns 100 percent of Meta Petroleum Limited, 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.
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 a current net production of approximately
22,500 barrels of oil equivalent per day, with working interests in the
Rubiales, Piriri and Quifa concessions and the Caguan, Dindal, Rio Seco, Puli
B, La Creciente, Moriche, Guama, Arauca, Tacacho and Jagueyes blocks in
Colombia and blocks 135, 137 and 138 in Peru.

    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.

    %SEDAR: 00007953E

For further information:
For further information: Mr. Ronald Pantin, Chief Executive Officer and
Director, Mr. Jose Francisco Arata, President and Director, Mr. Manfred
Kruger, Vice President, Investor Relations, (416) 362-7735