Last updated on April 24, 2014 at 17:35 EDT

Ivanhoe Energy Reports Third Quarter 2012 Financial Results

November 8, 2012

Note:  All figures are quoted in U.S. dollars unless otherwise noted.

CALGARY, Nov. 8, 2012 /PRNewswire/ – Ivanhoe Energy Inc. (TSX: IE; NASDAQ:
IVAN) is reporting today its financial results for the third quarter of

Third Quarter Financial Summary

Ivanhoe Energy filed its quarterly financial report on Form 10-Q with
the Securities and Exchange Commission and its Interim Financial
Statements with the Canadian Securities Administrators for the period
ended September 30, 2012.

                                          Three months       Nine months
                                         ended Sept. 30,   ended Sept. 30,
    (US$000s, except per share amounts)
    (unaudited)                             2012     2011     2012     2011

    Oil revenue                            8,797   10,769   27,997   28,277

    Net loss                            (34,547)  (4,157) (49,912) (19,394)

    Net loss per share, basic and         (0.10)   (0.01)   (0.15)   (0.06)

    Net cash used in operating           (3,089)  (5,214) (14,165) (18,678)

    Capital investments                    9,827   16,843   43,371   48,078

    Cash and cash equivalents (end of     16,882   58,168   16,882   58,168

    Restricted cash                       20,500        -   20,500        -

In the third quarter of 2012, the Company had a net loss of $34.5
million, as compared to a $4.2 million net loss in the same period of
2011.  The increase in net loss was mainly due to $22.6 million of
capitalized exploration and evaluation costs written-off and charged to
earnings.  The costs included $19.7 million for drilling IP-17 in
Ecuador and $2.9 million for the second Mongolian well drilled in 2011.

Ivanhoe Energy’s oil revenue in the three months ended September 30,
2012 decreased from the same period in 2011.  This was due to a
combination of lower net volumes and pricing.   Oil production from the
Dagang field in China was relatively constant; however, there was
minimal capital activity.   The terms of the Production Sharing
Contract with the Chinese National Petroleum Corporation (CNPC)
stipulate that capital expenditures are to be funded 100% by Ivanhoe
Energy and CNPC’s portion of the costs are reimbursed through the
receipt of additional oil sales. With less capital activity in the
third quarter, the result was less oil production allocated to the

Capital Expenditures, Operating Costs, General and Administrative

Capital expenditures for the Company totalled $9.8 million in the third
quarter of 2012. These expenditures were primarily incurred in Ecuador,
China and Canada.

        --  In Ecuador, expenditures of $7.4 million were related to the
            drilling of IP-17, the exploration well in the southern part of
            Block 20.
        --  In China, the Company spent $2.0 million primarily on the
            continuation of a fracture stimulation program at Dagang.
        --  In Canada, the Company spent $0.4 million on work to support
            the regulatory approval process for Tamarack.

Operating costs in China were lower in the third quarter of 2012, as
compared to the same period of 2011.  This is mainly due to a lower
Windfall Levy resulting from lower realized prices. Third quarter
operating costs at the Heavy to Light (HTL) Feedstock Test Facility in San Antonio, Texas were consistent
with the comparable period in 2011.

General and Administrative (G&A) expenses were $1.6 million lower in the
third quarter of 2012, as compared to the third quarter of 2011. This
is primarily due to the streamlining of operations in Latin America and
reduced contract labor and engineering costs related to Ivanhoe
Energy’s HTL technology.  Additionally, G&A expenses were $5.9 million
lower in the nine months ended September 30, 2012 than in the same
period of 2011.  This reduction is due to a combination of streamlining
activity in operations, reduced human resource related costs, a
reduction of non-cash stock based compensation and reduced activity in
the Company’s Asia segment.

Liquidity and Capital Resources
The divestiture of Sunwing’s interest in the Production Sharing Contract
for the Zitong block in China’s Sichuan Basin to Shell China
Exploration continues to advance.  All partners have signed the
definitive Sale and Purchase Agreement and the Chinese National
Petroleum Corporation has submitted the transaction documents to the
Ministry of Commerce for its review and final approval. The transaction
is anticipated to close by the end of 2012, which would result in
Ivanhoe Energy receiving $105 million in cash proceeds, in addition to
the release of the $20 million performance bond associated with the
Supplementary Agreement’s work program.

Once these funds are received, the Company is obligated to retire the
short-term $50 million loan from UBS Securities.

In addition to the Zitong divestiture, management is focusing the
Company by seeking to divest other non-core assets and completing
partnership discussions that will help commercialize the HTL process
and secure financial support for the core properties in Canada and
Ecuador.  Additional options are being considered to strengthen the
financial position of the Company.

Project Highlight

Canada – Tamarack
In the third quarter the Company continued to make progress on the
regulatory approval process, working with regulators to answer
technical questions and with local area stakeholders to gain their
support for the project.  The Company received a third round of
Supplemental Information Requests on October 15, 2012, which is common
in the regulatory approval process and consistent with other projects
currently in review.  Ivanhoe Energy expects to provide responses to
these questions before the end of November 2012. Due to the additional
round of questions, the Company anticipates receiving regulatory
approval in the first quarter of 2013.

Ivanhoe Energy is an independent international heavy oil exploration and
development company focused on pursuing long-term growth in its
reserves and production using advanced technologies, including its
proprietary heavy oil upgrading process (HTL(TM)). Core operations are in Canada, United States, Ecuador, China and
Mongolia, with business development opportunities worldwide. Ivanhoe
Energy trades on the Toronto Stock Exchange with the ticker symbol IE
and on the NASDAQ Capital Market with the ticker symbol IVAN.

For more information about Ivanhoe Energy Inc. please visit www.ivanhoeenergy.com.

FORWARD-LOOKING STATEMENTS: This document includes forward-looking statements, including
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995.  Forward-looking statements include, but
are not limited to the potential for commercialization and future
application of the heavy oil upgrading technology and other
technologies, statements relating to the continued advancement of
Ivanhoe Energy’s projects, statements relating to the timing and amount
of proceeds of agreed upon and contemplated disposition transactions,
statements relating to anticipated capital expenditures,  statements
relating to the timing and success of regulatory review applications,
and other statements which are not historical facts. When used in this
document, the words such as “could,” “plan,” “estimate,” “expect,”
“intend,” “may,” “potential,” “should,” and similar expressions
relating to matters that are not historical facts are forward-looking
statements.  Although Ivanhoe Energy believes that its expectations
reflected in these forward-looking statements are reasonable, such
statements involve risks and uncertainties and no assurance can be
given that actual results will be consistent with these forward-looking
statements.  Important factors that could cause actual results to
differ from these forward-looking statements include the potential that
the Company’s projects will experience technological and mechanical
problems, new product development will not proceed as planned, the HTL(TM) technology to upgrade bitumen and heavy oil may not be commercially
viable, geological conditions in reservoirs may not result in
commercial levels of oil and gas production, the availability of
drilling rigs and other support services, uncertainties about the
estimates of reserves, the risk associated with doing business in
foreign countries, environmental risks, changes in product prices, our
ability to raise capital as and when required, our ability to complete
agreed upon and planned asset dispositions, competition and other risks
disclosed in Ivanhoe Energy’s 2011 Annual Report on Form 10-K filed
with the U.S. Securities and Exchange Commission on EDGAR and the
Canadian Securities Commissions on SEDAR.



SOURCE Ivanhoe Energy Inc.

Source: PR Newswire