Petrolifera Petroleum Limited has entered into a binding agreement with an international oil and gas exploration and production company with operations in South America to sell a 25% working interest in its Sierra Nevada License in Colombia. Petrolifera will receive cash payment of US$10 million, payable in instalments in December 2010 and January 2011, in respect of this disposition.

The assignment of the working interest is subject to approval of Agencia Nacional de Hidrocarburos of Colombia ("ANH"). Petrolifera intends to use the proceeds from this sale primarily to fund the drilling of an exploratory well, San Angel X1001, on its Magdalena License in the Lower Magdalena Basin onshore Colombia. Site preparations for the drilling of this well are currently underway and the company anticipates the spudding of this well in late January 2011.

This disposition is in part a result of the strategic alternatives process ("process") announced by Petrolifera on September 7, 2010. Petrolifera is continuing to assess and consider other strategic alternatives available to the company.

Tags: Petrolifera Petroleum Limited