August 9, 2011

Pacific Rubiales announces financial results for the second quarter ended June 30, 2011

TORONTO, Aug. 9, 2011 /PRNewswire/ - Pacific Rubiales Energy Corp. (TSX: PRE;
BVC: PREC) announced today the release of its unaudited consolidated
financial results for the quarter ended June 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 and SEDAR at

Ronald Pantin, Chief Executive Officer of the Company, commented: "The
second quarter was an exceptional quarter for the Company. With average
net production, after royalties, of 88,092 boe/d, the Company grew its
share of operated production by 60% compared to the same period last
year, primarily through increased production at the Rubiales, Quifa and
La Creciente fields. The Company increased revenues by 168% to $957.5
million and EBITDA increased to $558 million, an increase of 181% from
the same period last year. With a doubling of EBITDA this quarter, the
Company is very well positioned for the remainder of 2011, and through
the 2012 financial year. It is also demonstrating the ability to
self-fund its prolific exploration portfolio in Colombia, the largest
exploration portfolio in Colombia after the state-owned oil company, as
well as in Peru and Guatemala."

Pacific Rubiales has a current gross production of approximately 235,000
boe/d, including natural gas and light and medium oil fields, with
interests in 40 blocks in Colombia, 2 blocks in Guatemala and 3 blocks
in Peru, totaling approximately 12,562,597 net acres. During the second
quarter of 2011, the Company continued its exploration drilling
campaign in the Rubiales-Piriri, Quifa, CPE-6, Abanico and Dindal-Rio
Seco Blocks for a total of 13 wells drilled during this period and a
success rate of 92%.

Management will hold a live conference call in English with simultaneous
Spanish translation on Wednesday August 10, 2011, to discuss the
Company's financial results beginning at 8:00 am (EDT) / 7:00 am
(Bogotá time).

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

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): 89077832

Conference ID (Spanish Participants): 89110913

A replay of the call will be available until 23:59 pm (EST), August 24,
2011, which can be accessed as follows:

Encore Toll Free Dial-in Number: 1-855-859-2056

Encore Local Dial-in-Number:  416-849-0833

Encore ID (English Participants):  89077832

Encore ID (Spanish Participants): 89110913

Financial Summary

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

                                        Three Months
                                            Ended         Six Months Ended

                                            June 30              June 30

    (in thousands of US$ except per                    
    share amounts or as noted)          2011    2010       2011      2010



    Oil and gas sales(1)                    $       $           $
                                      957,509 356,848   1,541,058 $ 736,279


    EBITDA(2)                         558,339 198,585     920,866   430,551

    EBITDA Margin                    
    (EBITDA/Revenues)                     58%     56%         60%       58%

    Per share - basic                
    ($)(4)                               2.08    0.76        3.43      1.66


    Net earnings                      349,375  14,438     279,782    90,565

    Per share  - basic               
    ($)  (4)                             1.30    0.05        1.04      0.35

       - diluted ($)                     1.20    0.05        1.00      0.33


    Adjusted Net earnings from       
    operations(3)                     266,707  49,910     400,928   148,839

    Per share - basic                
    ($)  (4)                             0.99    0.19        1.49      0.57


    Funds Flow from                  
    Operations                        400,202 148,382     666,909   297,770

    Per share - basic                
    ($) (4)                              1.49    0.56        2.49      1.15

    1)      See additional details explained in the MD&A under the Section
            entitled "Commercial Activity".

    2)       See Section 10 of the MD&A under the Sections entitled
            "Discussion of 2011 Second Quarter Financial Results - EBITDA"
            in the MD&A and "Additional Financial Measures".

    3)      Adjusted earnings from operations is a non-IFRS financial
            measure that represents net earnings adjusted for certain items
            of a non-operational nature including non-cash items.  The
            Company evaluates its performance based on adjusted net
            earnings from operations. The reconciliation "Adjusted Net
            Earnings from Operations", lists the effects of certain
            non-operational items that are included in the Company´s
            financial results.  Adjusted net earnings from operations may
            not be comparable to similar measures presented by other
            companies. See the Section entitled "Additional Financial
            Measures" in the MD&A.

    4)      The basic weighted average number of common shares outstanding
            for the second quarter ended June 30, 2011 and 2010 was
            268,717,010 (fully diluted - 298,832,627) and 263,009,942
            (fully diluted - 276,177,629), respectively.

Operating Netback Crude Oil and Gas:

                                           Threemonths ended June 30,

                           2011   2011       2011         2010

                           Oil    Gas   Combined     Combined 


    Average net                                         55,102
    production (after    77,259 10,833     88,092  
    royalties and field

    Average daily                                       64,329
    production sold      98,265 10,723    108,988  


    Operating netback                                         
    ($/boe) (2)

    Crude oil and                                        60.96
    natural gas sales    103.60  31.85      96.54  

    Cost of production     5.45   2.65       5.18         4.75

    Transportation                           8.84
    (trucking and          9.74   0.56                    6.01
    pipeline) (4)

    Diluent cost (5)      16.33      -      14.73        10.26

    Other costs (6)        6.26   1.98       5.84         1.25

    Overlift/Underlift     1.50 (0.65)       1.29         0.18

    Operating netback     64.32  27.31      60.66        38.51


    1)      See additional comments in the MD&A under the Section entitled
            "Reconciliation of Barrels Produced and Purchased vs. Barrels

    2)      Combined operating netback data based on weighted average daily
            production sold which includes diluents necessary for the
            upgrading of the Rubiales blend.

    3)      Cost of production mainly includes lifting costs and other
            production costs such as personnel, energy, security, insurance
            and others.

    4)      Includes the transport costs of crude oil and gas through
            pipelines and tank trucks incurred by the Company to take the
            products to the delivery points to customers. The increase over
            the prior period of 2010 is mainly due to the higher volume of
            crude oil transported via tank truck due to increased
            production, coupled with an increase in the overall land
            transport costs in Colombia during 2011.

    5)      Net blending cost is estimated at $3.0 per bbl of Rubiales
            crude, considering an average diluent purchase price delivered
            at the Rubiales field of $106.7 / bbl (Light Crude Oil 37oAPI
            and Natural Gasoline 81.6oAPI), plus pipeline fees from the
            Rubiales field to Coveñas of $7.76 per bbl, less the average
            Rubiales Blend (Castilla) sale price of $102.19 per bbl, times
            the Rubiales average blending ratio of around 24%. The increase
            in dilution cost over the previous period of 2010 is primarily
            due to the purchasing cost increase of the diluents required to
            upgrade the Rubiales crude oil, in line with increased WTI
            international prices.

    6)      Other costs mainly correspond to royalties on gas production,
            external road maintenance at the Rubiales field, inventory
            fluctuation, crude oil trading cost, storage cost and the net
            effect of the currency hedges of operating expenses incurred in
            Colombian pesos during the period. See additional comments in
            the MD&A under the Section entitled "Risk Management

    7)      Corresponds to the net effect of the overlift position for the
            period amounting to $12.7 million, which generated a reduction
            in the combined production costs of $1.29/boe as explained in
            the Section entitled "Discussion of 2011 Second Quarter
            Financial Results  - Financial Position - Operating Costs" in
            the MD&A.


During the second quarter of 2011, the Company continued the trend of
outstanding production growth and exploration success, leveraging its
technical know-how and operational expertise for rapid growth. The
results for this period underline the strength of the Company's
operational activity and its capacity to steadfastly increase
production, as well as management's commitment to deliver robust
financial results. Management is focused on achieving challenging
operational goals, while pursuing an ambitious exploration and
production investment program, under the umbrella of the Company's
paramount strategic focus: Growth.

Set out below are the highlights of the Company's second quarter

        --  Strong financial results. Second 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 second
            quarter of 2011 were $349.4 million, or $1.30 per common share,
            compared with net earnings of $14.4 million for the second
            quarter of 2010, or $0.05 per common share. Adjusted net
            earnings for the second quarter of 2011 were $266.7 million,
            compared to $49.9 million in the second quarter of 2010.
            Revenue increased 168% to $957.5 million compared to $356.8
            million in the same period in 2010.

        --  EBITDA doubled resulting in significant funds generation.
            EBITDA for the second quarter of 2011 totaled $558.3 million, a
            significant increase of 181% as compared to EBITDA for the
            previous year's second quarter of $198.6 million. EBITDA for
            the second quarter of 2011 represents a 58% margin in
            comparison to total revenues for the period. Funds flow from
            operations increased to $400.2 million in the second quarter of
            2011, compared to $148.4 million in the second quarter of 2010.

        --  Production continues to grow. Average gross production in the
            second quarter of 2011 was 221,896 boe/d, 88,092 boe/d net
            after royalties and field consumption, 60% higher than in the
            same period of 2010 and is the result of the production from
            more than 43 new development wells, mainly in the Rubiales and
            Quifa fields.

        --  Continued focus on exploratory activities with a success rate
            of 92%. During the second quarter, the Company drilled 13
            exploratory wells and acquired 772 km of 2D seismic with a
            total net investment of $117.2 million.

        --  Significant improvement in operating netbacks. Crude oil
            operating netback during the second quarter of 2011 was
            $64.32/bbl, 50% higher in comparison to the same period in
            2010, due to higher realized prices. Natural gas operating
            netback was $27.31/boe, 70% higher in comparison to the same
            period of 2010, also due to higher realized prices.

        --  Continued development of capital expenditure program.  Capital
            expenditures during the quarter ended June 30, 2011 totaled a
            net amount of $307.7 million (2010 - $134.7 million), of which
            $109 million were invested in the expansion and construction of
            production infrastructure; $117.2 million were invested in
            exploratory activities; $50 million were invested in production
            drilling activities; and $31.5 million were invested in other

        --  Environmental permits for Quifa.  In June 2011, the Ministry of
            the Environment of Colombia granted the required environmental
            permits for Quifa Southwest and Quifa North which allow the
            Company to continue its development drilling campaign in Quifa
            Southwest and to proceed with its exploration drilling campaign
            in Quifa North.

        --  Maurel & Prom.On May 6, 2011, the Company acquired a 49.9999%
            interest in Maurel and Prom Colombia B.V. ("Maurel & Prom")
            from Les Establissments Maurel & Prom, for cash consideration
            of $63.4 million and subject to certain exploratory
            commitments. Maurel & Prom holds interests in five exploration
            blocks located onshore in Colombia.

        --  Standard & Poor's raised the Company's credit rating. On July
            6, 2011, Standard & Poor's Ratings Services raised its
            corporate credit rating on Pacific Rubiales to "BB" from "BB-".
            They also raised their rating on Pacific Rubiales' $450 million
            senior unsecured notes due 2016 to "BB". Standard & Poor's also
            indicated that the Company's outlook is stable.

        --  Operational update in the Arauca Block. On July 18, 2011, the
            Company announced an operational update for the Arauca Block,
            where the Company drilled the TORODOI-1X exploratory well, the
            first of two exploratory wells planned for 2011 in the Arauca
            Block.  This well is currently being tested.

        --  Cash dividend paid to shareholders on June 30, 2011. On June
            13, 2011, the Company announced a cash dividend in the
            aggregate of $25 million, or $0.093 per common share.  The
            dividend was paid on June 30, 2011 to shareholders of record as
            of June 17, 2011; the ex-dividend date in Canada was June 15,
            2011.  Despite the current global economic uncertainty in the
            marketplace, as a result of the Company's strong balance sheet
            and cash flow, the Company intends to continue the quarterly
            dividend policy subject to formal approval from the board of

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. 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 45 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,

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 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.