Last updated on April 19, 2014 at 7:50 EDT

Pacific Rubiales announces dividend

March 6, 2013

TORONTO, March 6, 2013 /PRNewswire/ – Pacific Rubiales Energy Corp. (TSX: PRE;
BVC: PREC; BOVESPA: PREB) announced today a cash dividend of U.S.$0.11
per common share payable on March 26, 2013 to shareholders of record as
of March 18, 2013 and to holders of Brazilian Depositary Receipts (the
“BDRs”) of record as of March 13, 2013. The ex-dividend date for
shareholders trading on the Toronto Stock Exchange and the La Bolsa de
Valores de Colombia (or the Colombia Stock Exchange) as well as for
those trading BDRs on the Bolsa de Valores Mercadorias e Futuros (or
the Brazilian Stock Exchange) is March 14, 2013.

For shareholders trading on the Colombian Stock Exchange, the Colombia
peso equivalency shall be calculated based on the exchange rate as
certified by the “Central Bank” on the date of monetization and will be
published on the SIMEV website at the proper time.

With respect to the BDRs traded on the Brazilian Stock Exchange, the
Depositary Institution in Brazil will execute the exchange agreement as
of the date of the payment of the dividend to the holders of BDRs, on
or about March 26, 2013, for conversion purposes. Also, the holders of
BDRs registered on March 13, 2013 shall be entitled to receive the
dividends from the Depositary Institution on April 4, 2013.

Subject to approval from the Board of Directors, the Company expects to
continue paying a dividend on a quarterly basis at this level, with
such decision being determined based on funds from operations,
earnings, financial requirements, commodity price levels, legal
requirements and other conditions existing in the future. While a
formal policy is not in place with respect to dividends, the payment of
quarterly dividends will continue to be reviewed by the Board of
Directors, as needed, from time to time. Future dividends on Pacific
Rubiales common shares and, consequently, BDRs, are not guaranteed.

The Company intends to designate all dividends as “eligible dividends”
for purposes of the Income Tax Act (Canada) unless a notification of
change is otherwise posted on the Company’s website at www.pacificrubiales.com and on SEDAR at www.sedar.com. Provided designation is made, the dividend will be considered an
“eligible dividend” for tax purposes. An eligible dividend received by
a Canadian resident individual shareholder is entitled to the enhanced
dividend tax credit.



The information in this release is not intended to be an exhaustive
discussion of all possible income tax consequences and considerations,
but a general guideline. It is not intended to be legal or tax advice
to any particular investor or potential investor. Investors or
potential investors should consult their own tax advisors as to their
particular tax consequences and reporting obligations.

The following information is provided for general information only.
Investors are encouraged to seek advice from a qualified tax advisor in
their country of residence to obtain guidance with respect to
appropriate tax treatment of their distributions.

For Canadian Residents

For Canadian income tax purposes, the dividend paid to shareholders of
Pacific Rubiales will be a taxable dividend. In the case of a
shareholder who is an individual resident in Canada, dividends will be
subject to the gross-up and credit rules contained in the Income Tax
Act (Canada), and, in the case of a shareholder that is a “private
corporation” or a “subject corporation” (both as defined in the Income
Tax Act (Canada)), a refundable tax will apply to the amount of the
dividend. Shareholders should contact their tax advisor or their local
office of the Canada Revenue Agency with respect to any questions
regarding the taxation of eligible dividends.

For Colombian Residents

Dividends paid to non-residents of Canada should be subject to a 25%
Canadian withholding tax on 100% of the gross distribution. However,
pursuant to the Canada – Colombia Tax Treaty, the applicable rate of
Canadian withholding tax may be reduced to 15% where the recipient is a
resident of Colombia. Under Colombian general tax rules, dividends will
be subject to tax. Generally a corporation resident in Colombia is
subject to tax at 33% of net income and individuals are subject to tax
based on a progressive table as applicable. Amounts paid as foreign
taxes may be eligible for a foreign tax credit in Colombia. For a more
detailed discussion on the logistics and tax implications, shareholders
should contact their tax advisor or their local office of the Colombian
tax agency (DIAN), with respect to any questions regarding the taxation
of these dividends or the application of foreign tax credits. In
addition, they should consult the dividend circular that will be made
available on the SIMEV.

For U.S. Residents

Subject to various U.S. statutory holding period requirements,
distributions made by the Company out of its current or accumulated
“earnings and profits” may be considered “qualified dividend income” as
defined under U.S. tax law, and thus may be taxed at the reduced tax
rates applicable to long term capital gains, provided that the Company
has the status of a “qualified foreign corporation” and is not a
“passive foreign investment company” for the year ending December 31,
2013 or the year ended December 31, 2012. These reduced rates may not
be available to shareholders of the Company other than U.S. resident
individuals. In addition, distributions in excess of the Company’s
current or accumulated “earnings and profits” may reduce the U.S. tax
basis of the shareholder’s shares of the Company.

Pursuant to the Canada – U.S. Tax Treaty, dividends paid to residents of
the United States may be subject to a 15% withholding tax on 100% of
the gross distribution. Amounts paid for foreign taxes may be eligible
for either a deduction for foreign taxes or a foreign tax credit in the
United States; both the deduction and credit for foreign taxes are
subject to numerous limitations imposed by U.S. tax law which are not
discussed in this summary.

Shareholders should contact their tax advisor or their local office of
the Internal Revenue Service with respect to any questions regarding
the taxation of such dividend distributions.

For Brazilian Residents

Dividends paid to residents of Brazil will be subject to a 25% Canadian
withholding tax on 100% of the gross distribution. In the case of a BDR
holder who is an individual resident in Brazil, dividends will be
subject to income tax based on a progressive table as applicable, which
rates vary from 0% to 27.5%. In the case of a BDR holder that is a
corporation domiciled in Brazil, dividends will subject to income tax
at a rate of 34%. Amounts withheld in Canada as taxes may be eligible
for a tax credit in Brazil. BDR holders should contact their tax
advisor in Brazil with respect to any documents which may be necessary
for this tax credit and any questions regarding the taxation of
eligible dividends.

Pacific Rubiales, a Canadian company and producer of natural gas and
crude oil, owns 100% of Meta Petroleum Corp., which operates the
Rubiales, Piriri and Quifa heavy oil fields in the Llanos Basin, and
100% of Pacific Stratus Energy Colombia Corp., which operates the La
Creciente natural gas field in the northwestern area of Colombia.
Pacific Rubiales has also acquired 100% of PetroMagdalena Energy Corp.,
which owns light oil assets in Colombia, and 100% of C&C Energia Ltd.,
which owns light oil assets in the Llanos Basin. In addition, the
Company has a diversified portfolio of assets beyond Colombia, which
includes producing and exploration assets in Peru, Guatemala, Brazil,
Guyana and Papua New Guinea.

The Company’s common shares trade on the Toronto Stock Exchange and La
Bolsa de Valores de Colombia and as Brazilian Depositary Receipts on
Brazil’s Bolsa de Valores Mercadorias e Futuros under the ticker
symbols PRE, PREC, and PREB, respectively.

This news release was prepared in the English language and subsequently
translated into Spanish and Portuguese. In the case of any differences
between the English version and its translated counterparts, the
English document should be treated as the governing version.

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: the closing of
the proposed transaction or the possibility that such transaction may
not close, delays in completing the proposed transaction, 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, Peru, Guatemala, Brazil, Papua New
Guinea or Guyana; 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 14, 2012 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.

SOURCE Pacific Rubiales Energy Corp.

Source: PR Newswire