Cequence Energy Announces $30.4 Million Bought Deal Financing

Not for distribution to U.S. newswire services or for dissemination in the United States. Any failure to comply with this restriction may constitute a violation of U.S. securities law.

CALGARY, Feb. 24 /CNW/ - Cequence Energy Ltd. (“Cequence“ or the “Company“) (TSX: CQE) is pleased to announce that it has entered into an agreement with a syndicate of underwriters led by Peters & Co. Limited, and including FirstEnergy Capital Corp., Cormark Securities Inc., Stifel Nicolaus Canada Inc., National Bank Financial Inc. and CIBC World Markets Inc., pursuant to which Cequence has agreed to issue an aggregate of 8,100,000 common shares (“Common Shares“) at a price of $2.85 per Common Share and 2,100,000 flow-through common shares to be issued on a “CEE flow-through“ basis pursuant to the Income Tax Act (Canada) (the “Flow-Through Shares“) at a price of $3.50 per Flow-Through Share, for total gross proceeds of approximately $30.4 million. In addition, Cequence has granted the underwriters a 15% over-allotment option to purchase additional Common Shares for additional gross proceeds of $3.46 million if the over-allotment option is exercised in full.

The Common Shares and Flow-Through Shares will be offered in all provinces of Canada (other than Quebec) by way of short form prospectus, and the Common Shares may be offered in the U.S. on a private placement basis pursuant to exemptions from registration requirements. The closing of the Offering is expected to occur on March 17, 2011, and is subject to certain conditions, including, but not limited to, the receipt of all necessary regulatory approvals, including the approval of the TSX.

The Company intends to use the proceeds from the offering to initially reduce indebtedness under its credit facility, which will then be available to be redrawn to expand the Company's capital program and for general corporate purposes.

The purchasers of the Flow-Through Shares will be entitled to renunciations of Canadian exploration expenses in an amount equal to the subscription amount from Cequence.

Cequence is a publicly traded Canadian energy company involved in the acquisition, exploitation, exploration, development and production of natural gas and crude oil in western Canada. Further information about Cequence may be found in its continuous disclosure documents filed with Canadian securities regulators at www.sedar.com.



Forward Looking Information

Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Such forward-looking information is provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions. Forward-looking information typically contains statements with words such as “anticipate“, “believe“, “expect“, “plan“, “intend“, “estimate“, “propose“, “project“ or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information in this press release may include, but is not limited to, information with respect to: the timing and completion of the offering; the use of proceeds; operational decisions and the timing thereof, development and exploration plans and the timing thereof; and future production levels. Forward-looking information is based on a number of factors and assumptions which have been used to develop such information but which may prove to be incorrect. Although the Company believes that the expectations reflected in such forward-looking information is reasonable, undue reliance should not be placed on forward-looking information because the Company can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this press release, assumptions have been made regarding and are implicit in, among other things: the performance of the underwriters obligations in relation to the offering; field production rates and decline rates; the ability of the Company to secure adequate product transportation; the impact of increasing competition in or near the Company's plays; the timely receipt of any required regulatory approvals; the ability of the Company to obtain qualified staff, equipment and services in a timely and cost efficient manner to develop its business; Cequence's ability to operate the properties in a safe, efficient and effective manner; the ability of the Company to obtain financing on acceptable terms; the ability to replace and expand oil and natural gas reserves through acquisition, development of exploration; the timing and costs of pipeline, storage and facility construction and expansion; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters; and the ability of the Company to successfully market its oil and natural gas products. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used.

Forward-looking information is based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by the Company and described in the forward-looking information. The material risk factors affecting the Company and its business are contained in the Company's Annual Information Form which is available under the Company's issuer profile on SEDAR at www.sedar.com.

The forward-looking information contained in this press release is made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. The forward looking information contained in this press release is expressly qualified by this cautionary statement.


Additional Advisories

The Toronto Stock Exchange has neither approved nor disapproved the contents of this press release.

The Common Shares and Flow-Through Shares have not been and will not be registered under the United States Securities Act of 1933, as amended, or any states securities laws and may not be offered, sold or delivered in the United States or to or for the account or benefit of U.S. persons absent registration or applicable exemption from the registration requirement of such act or any applicable states securities laws. This news release does not constitute an offer to sell or a solicitation of an offer to buy securities in the United States.



For further information:

Paul Wanklyn, President and Chief Executive Officer, (403) 218-8850, pwanklyn@cequence-energy.com; or David Gillis, Vice President, Finance and Chief Financial Officer, (403) 806-4041, dgillis@cequence-energy.com; www.cequence-energy.com