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Canacol Energy Ltd. and ExxonMobil Sign Agreement for Shale Oil Exploration Project in Colombia
Canacol Energy Ltd. (“Canacol” or the “Corporation”) (TSX:CNE) (BVC:CNEC) is pleased to announce that its wholly owned subsidiary, Carrao Energy Sucursal Colombia (“Carrao Colombia”), has entered into a farm-out agreement (the “FOA”) with ExxonMobil Exploration Colombia Limited, a wholly-owned subsidiary of ExxonMobil Corporation (“ExxonMobil”) (NYSE:XOM) for the exploration of the Corporation’s non-operated VMM 2 exploration and production (“E&P”) contract located in the Middle Magdalena basin of Colombia. The VMM 2 E&P contract is one of three adjacent contracts that Canacol has interests in, representing 126,000 net acres that expose Canacol to a potentially large, unconventional shale oil play. With $ 91 million in cash, cash equivalents, and restricted cash on hand as of December 31, 2011, and strong cash flow from its operated oil producing assets in Colombia, the Corporation remains fully funded to execute its exploration and development programs for 2012.

Canacol Awarded Contract for Associated Gas and Gas Liquids from the Rancho Hermoso Field in Colombia
Canacol Energy Ltd. (“Canacol” or the “Corporation”) (TSX:CNE) (BVC:CNEC) is pleased to announce that Canacol Energy Colombia S.A., a subsidiary of the Corporation, has been awarded a contract by Ecopetrol S.A. for a 100% working interest in the associated gas and gas liquids stream from the Rancho Hermoso Field, located in the Llanos Basin of Colombia.

Canacol Energy Initiates Heavy Oil Exploration Drilling Program in Colombia
Canacol Energy Ltd. ("Canacol" or the "Corporation") (TSX VENTURE:CNE) (BVC:CNEC) is pleased to announce the start of its heavy oil exploration drilling program on its Tamarin and Cedrela Exploration and Production ("E&P") contracts located in the Caguan - Putumayo Basin in Colombia. The Corporation has 100% working interest and is operator of both contracts, which represent approximately 388,000 net acres. The Corporation plans to drill two stratigraphic wells, one on each of the Tamarin and Cedrela contracts, in a back to back drilling campaign that will commence in mid July 2011. This will be followed by the drilling of five conventional exploration wells, the first to start in late Q3 2011, and the last to end midyear 2012.

Canacol Announces US$ 106 Million Capital Program for 2011
Canacol Energy Ltd. is pleased to announce a US$ 106 million capital budget in 2011 for exploration and development activities in Colombia, Guyana, and Brazil. The budget includes the drilling of 39 gross wells (13 net wells), which include 6 exploration wells and 33 appraisal and development wells. The budget also includes the acquisition of 650 kilometers (“km”) of 2D exploration seismic, the building of an early production facility at the Capella discovery, the continued expansion of its operated Rancho Hermoso production facilities, and funding of the Corporations share of the OBC pipeline project in Colombia. The budget consists of US$ 52 million to fulfill exploration work program and pipeline commitments in Colombia, Guyana, and Brazil, and US$ 54 million in discretionary spending dedicated primarily to development drilling and production programs in Colombia. The Corporation anticipates to average between 10,000 to 11,000 barrels of oil per day (“bopd”) of net after royalty production in 2011, which excludes any production resulting from exploration success.