Questerre Executes Unconventional Oil Strategy

CALGARY, ALBERTA--(Marketwire - Dec. 16, 2011) -

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Questerre Energy Corporation ("Questerre" or the "Company") (TSX:QEC) (OSLO:QEC) is pleased to announce that it has entered into a letter of intent to develop oil shale opportunities in North America.

Michael Binnion, President and Chief Executive Officer, commented, "We expect oil from shale will become the foundation of our unconventional oil strategy. Through this letter of intent, we will participate, both directly and indirectly, in the development of an existing oil shale project and a new project both in the western United States. We will also have access to the processes and technology for any oil shale projects developed by Questerre."

Pursuant to the letter of intent with Red Leaf Resources Inc. ("Red Leaf"), an oil shale technology and resource company, Questerre intends to participate for a 10% working interest in the development of Red Leaf's 5120 acres in Wyoming. Subject to the execution of a joint venture farm-in and operating agreement, the partners plan to carry out a preliminary field assessment program on these lands in early 2012. Questerre anticipates its total capital exposure to this project for 2012 to be US$0.25 million.

The letter of intent also contemplates that Questerre will acquire an equity interest in Red Leaf through participation in the company's planned financing. Subject to participation by a super major for approximately US$400 million, Questerre would invest US$25 million. Red Leaf's primary assets are an oil shale project covering approximately 17000 acres in Utah, the project covering 5120 acres in Wyoming and the proprietary Eco-Shale In-Capsule Technology™. Red Leaf has recently successfully completed a pilot project in Utah and plans to expand this pilot utilizing the proceeds from its proposed equity offering and direct participation by a super major. Red Leaf anticipates commercial production from this project could commence in 2015.

Questerre also announced that it has entered into a ten-year non-exclusive option agreement to license the Red Leaf processes and technology for any project identified by Questerre. Subject to the project meeting the criteria for commerciality, Questerre will pay Red Leaf a fee of US$2 million for each license issued. Red Leaf will receive a gross overriding royalty on the project on mutually acceptable terms.

Closing is subject to final due diligence and is scheduled for January 31, 2012.

Questerre has also recently acquired the exploration rights for approximately 100,000 acres in northeast Saskatchewan on an oil shale deposit.

Questerre Energy Corporation is an independent energy company focused on unconventional oil and gas projects. The Company is developing a portfolio of light oil assets primarily in Saskatchewan. The Company is also leveraging its expertise to commercialize its Utica shale gas discovery in the St. Lawrence Lowlands, Québec. Questerre is committed to the economic development of its resources in an environmentally conscious and socially responsible manner.

This news release contains certain statements which constitute forward-looking statements or information ("forward-looking statements"), including shale becoming the foundation of the Company's oil strategy, participation to earn a 10% interest in Red Leaf's Wyoming properties, the carrying out of a preliminary field assessment program on the Wyoming lands and Questerre's capital exposure for the project, the acquisition of an interest in Red Leaf by Questerre, the proposed use of proceeds by Red Leaf from its proposed equity offering, anticipated timing for commencement of commercial production, scheduled closing of the transaction and expected announcements regarding the project. Although the Company believes that the expectations reflected in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information available to the Company. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking statements. As such, readers are cautioned not to place undue reliance on the forward looking statements, as no assurance can be provided as to future results, levels of activity or achievements. The risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in our Annual Information Form and other documents available at www.sedar.com. Furthermore, the forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, the Company does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

This news release does not constitute an offer of securities for sale in the United States. These securities may not be offered or sold in the United States absent registration or an available exemption from registration under the United States Securities Act of 1933, as amended.