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NEWS RELEASE TRANSMITTED BY Marketwire

FOR: PAN ORIENT ENERGY CORP.

TSX VENTURE SYMBOL: POE - | View Quote |  View Chart |  View Financials | 

Pan Orient Reports Third Quarter Income of $9.1 Million

Nov 21, 2008 - 17:21 ET

CALGARY, ALBERTA--(Marketwire - Nov. 21, 2008) - 

NOT FOR DISSEMINATION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Pan Orient Energy Corp. (TSX VENTURE:POE) is pleased to provide highlights of its third quarter results in conjunction with the Company's 2008 3rd quarter financial statements and associated management's discussion and analysis which can be found online at www.sedar.com.

HIGHLIGHTS

- Third quarter of 2008 oil revenues increased to $43.2 million, up 22% from Q2. Oil revenues have increased over tenfold from 2007 levels.

- Q3 2008 net income of $9.1 million, representing Pan Orient's highest quarterly income in its history.

- September 30, 2008 positive working capital of $37.7 million along with zero debt.

- $17.4 million of funds flow from operations in Q3 2008, representing cash flow from operating activities, up from $10.9 million in Q2 2008.

- Q3 2008 Thailand oil production averaged 7,152 bbl/d gross (4,291 bbl/d net to Pan Orient), despite downtime relating to producing wells being shut-in during the drilling of adjacent development wells from the same surface pad. October 2008 production averaged greater than 11,000 bbl/d gross (6,600 bbl/d net).

- Pan Orient reaffirms its targeted 2008 exit rate of 15,000 bbl/d gross (9,000 bbl/d net to Pan Orient).

/T/

Selected Quarterly Information
----------------------------------------------------------------------------
                                       2008                      2007
----------------------------------------------------------------------------
                                 Q3      Q2      Q1      Q4      Q3      Q2
----------------------------------------------------------------------------
($000s unless indicated)

Revenues
 Oil - Thailand              43,241  35,486  32,498  15,435   4,214   2,812
 Royalties - Thailand        (2,808) (2,349) (2,254)   (931)   (242)   (265)
 Interest - Canada              209      93     265     234     118      98
----------------------------------------------------------------------------
                             40,642  33,230  30,509  14,738   4,090   2,645
----------------------------------------------------------------------------

Expenses
 Stock-based compensation       214     446     296   1,487     235     237
 General & administrative     1,777   1,378     885   1,086     764     764
 Foreign venture expenditures   619       -       -       -       -       -
 DD&A                         5,000   2,955   3,086   1,185   1,566   1,164
 Operating & transportation   1,939   2,066   1,686   1,065     411     866
 Non-controlling interest      (104)   (149)     12     457     (23)      4
 Foreign exchange (gain) loss  (931)    696    (205)   (473)  1,079     807
 Current income tax          11,041   8,262   6,360   4,646       -       -
 SRB                          8,196   9,601  11,335       -       -       -
 Future income tax increase
  (reduction)                 3,833    (483)  3,631  (1,414)    (28)     40
----------------------------------------------------------------------------
                             31,584  24,772  27,086   8,039   4,004   3,882
----------------------------------------------------------------------------

Net income (loss)             9,058   8,458   3,423   6,699      86  (1,239)

 Per share basic ($)           0.20    0.19    0.08    0.15    0.00   (0.03)
 Per share diluted ($)         0.19    0.17    0.07    0.14    0.00   (0.03)

Average production, net
 (bbl/d)                      4,291   3,894   4,604   2,320     722     501

Capital expenditures (1)     13,627   6,686   3,581   6,524   9,035   5,277
Funds flow from
 operations (2)              17,366  10,947  10,612   7,942   2,455   1,014
Shares outstanding (000s)    45,650  45,770  45,247  45,218  41,635  40,135


----------------------------------------------------------------------------
                                                               2007    2006
----------------------------------------------------------------------------
                                                                 Q1      Q4
----------------------------------------------------------------------------
($000s unless indicated)

Revenues
 Oil - Thailand                                               1,573     431
 Royalties - Thailand                                          (119)    (52)
 Interest - Canada                                              125     206
----------------------------------------------------------------------------
                                                              1,579     585
----------------------------------------------------------------------------

Expenses
 Stock-based compensation                                       642     518
 General & administrative                                       550     711
 Foreign venture expenditures                                    40     126
 DD&A                                                           790     444
 Operating & transportation                                     546     535
 Non-controlling interest                                      (128)    (29)
 Foreign exchange (gain) loss                                   (88)   (201)
 Current income tax                                               -       -
 SRB                                                              -       -
 Future income tax increase (reduction)                         (70) (1,072)
----------------------------------------------------------------------------
                                                              2,282   1,032
----------------------------------------------------------------------------

Net income (loss)                                              (703)   (447)

 Per share basic ($)                                          (0.02)  (0.01)
 Per share diluted ($)                                        (0.02)  (0.01)

Average production, net (bbl/d)                                 344     118

Capital expenditures (1)                                      1,390   4,250
Funds flow from operations (2)                                  442    (786)
Shares outstanding (000s)                                    40,057  40,057


(1) Not including acquisition of Indonesian companies. 
(2) Refer to "non-GAAP Measures" for calculation


Production and Corporate Netback
----------------------------------------------------------------------------
                                     Three Months Ended   Nine Months Ended
                                           September 30        September 30
                                         2008      2007      2008      2007
----------------------------------------------------------------------------

Oil revenue ($000s)                    43,241     4,214   111,225     8,598
----------------------------------------------------------------------------

Average daily production (bbls/d)       4,291       722     4,263       524
----------------------------------------------------------------------------

Operating netback ($)
 Realized oil price                    109.54     63.44     95.22     60.14
 Royalties                              (7.11)    (3.64)    (6.34)    (4.38)
 Operating expenses                     (2.30)    (3.70)    (2.31)   (10.25)
 Transportation expenses                (2.61)    (2.49)    (2.56)    (2.50)
----------------------------------------------------------------------------
Total operating netback                 97.52     53.61     84.01     43.28
----------------------------------------------------------------------------
 Interest income                         0.53      1.77      0.49      2.38
 General & administrative expenses      (4.50)   (11.50)    (3.46)   (14.54)
 Foreign new venture expenditures       (1.57)        -     (0.53)        -
 Realized foreign exchange               0.75     (6.93)    (0.27)    (3.22)
 Special Remuneratory Benefit          (20.76)        -    (24.94)        -
 Income tax                            (27.97)        -    (21.97)        -
----------------------------------------------------------------------------
Total corporate netback                 44.00     36.95     33.33     27.90
----------------------------------------------------------------------------
----------------------------------------------------------------------------

/T/

Pan Orient is a Calgary, Alberta based oil and gas exploration and production company with operations currently located onshore Thailand, Indonesia and in Western Canada.

This news release contains forward-looking information. Forward-looking information is generally identifiable by the terminology used, such as "expect", "believe", "estimate", "should", "anticipate" and "potential" or other similar wording. Forward-looking information in this news release includes, but is not limited to, references to: well drilling programs and drilling plans, estimates of reserves and potentially recoverable resources, and information on future production and project start-ups. By their very nature, the forward-looking statements contained in this news release require Pan Orient and its management to make assumptions that may not materialize or that may not be accurate. The forward-looking information contained in this news release is subject to known and unknown risks and uncertainties and other factors, which could cause actual results, expectations, achievements or performance to differ materially, including without limitation: imprecision of reserve estimates and estimates of recoverable quantities of oil, changes in project schedules, operating and reservoir performance, the effects of weather and climate change, the results of exploration and development drilling and related activities, demand for oil and gas, commercial negotiations, other technical and economic factors or revisions and other factors, many of which are beyond the control of Pan Orient. Although Pan Orient believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurances that the expectations of any forward-looking statements will prove to be correct.

45,568,366 common shares issued
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Pan Orient Energy Corp. Jeff Chisholm President and CEO (403) 294-1770 or Pan Orient Energy Corp. Jason Bednar Vice President Finance and CFO (403) 294-1770 Email: jason@panorient.ca