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Press release from CNW Group

Pacific Rubiales Energy announces closing of US$300 million 7.25% senior unsecured notes offering

Monday, December 12, 2011

Pacific Rubiales Energy announces closing of US$300 million 7.25% senior unsecured notes offering16:01 EST Monday, December 12, 2011NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATESTORONTO, Dec. 12, 2011 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PRE; BVC: PREC) announced today that it has successfully closed an offering of U.S.$300 million in senior unsecured notes at a rate of 7.25% due 2021 (the "Notes").  The net proceeds from the sale of the Notes will be used by the Company for general corporate purposes, which may include acquisitions and investments in oil and gas sector assets and related infrastructure. The Notes have been assigned ratings of BB by Fitch Ratings and Standard & Poor's Corporation, and Ba2 by Moody's Investors Services.The Notes were placed through a syndicate of underwriters, led by Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Joint Lead Manager and Sole Bookrunner, and including J.P. Morgan Securities LLC and RBC Capital Markets, LLC, as Joint Book-running Managers, and GMP Securities L.P., as Co-Manager. The Notes were placed with Qualified Institutional Buyers in the United States pursuant to the registration exemptions provided by Rule 144A of the Securities Act of 1933, and on a private placement basis in certain provinces of Canada, as well as internationally as permitted by applicable securities laws in such jurisdictions.Ronald Pantin, the Company's Chief Executive Officer commented: "We are extremely pleased with the success of this offering.  The order book for the offering was over 5 times oversubscribed and there was broad participation from over 130 investors in the United States, Canada, Latin America (including Colombia), Europe and Asia, thereby demonstrating the confidence of international investors in Pacific Rubiales and its business model."The Company has applied to the Luxembourg Stock Exchange to admit the Notes for listing on the Official List of the Luxembourg Stock Exchange and to trade the Notes on its Euro MTF market.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from registration requirements.  This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities.  In Canada, the Notes were only offered to accredited investors (as defined under applicable securities laws).  None of the Notes were offered to undetermined Colombian residents or to more than a 100 determined Colombian residents.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, and 100 percent of Pacific Stratus Energy Corp. which operates the La Creciente natural gas field. 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 46 blocks in Colombia, Peru and Guatemala.The Company's Shares trade on the Toronto Stock Exchange and La Bolsa de Valores de Colombia under the ticker symbols PRE and PREC, respectively.Cautionary Note Concerning Forward-Looking StatementsThis 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 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.For further information: Mr. Christopher (Chris) LeGallais SR VP Investor Relations (647) 295-3700 Ms. Carolina Escobar V Manager, Investor Relations (57 1) 628-3970 Ms. Belinda Labatte (647) 428-7035