PACIFIC RUBIALES ANNOUNCES DIVIDEND

TORONTO, Nov. 24 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PRE; BVC: PREC) announced today a cash dividend in the aggregate amount of US$25,000,000 which translates to US$0.094 per common share.  The dividend is payable on December 16, 2010 to shareholders of record as of December 3, 2010.  The ex-dividend period begins on December 1, 2010. For shareholder trading on the Colombian stock exchange, the peso equivalency will be calculated based on the exchange rate as certified by the Superintendencia Financiera de Colombia for December 16, 2010 and will be published by Pacific Rubiales on the SIMEV website at the proper time.

Subject to approval from the Board of Directors, the Company expects to pay a dividend on a quarterly basis, with such decision being determined based on funds from operations, earnings, financial requirements, commodity price levels, legal requirements and other conditions existing in the future.  This policy will continue to be reviewed by the Board of Directors, as needed, from time to time.  Future dividends on Pacific Rubiales common shares are not guaranteed.

Ronald Pantin, Chief Executive Officer of the Company commented: "We are very pleased to initiate a dividend policy at this time. The issuance of a dividend at this juncture in the Company's development is further evidence of its commitment to solid and sustainable financial performance, and the Company having not only a robust investment portfolio but also the ability to generate cash flow for the benefit of all our shareholders. This initiative also has the benefit of potentially broadening our shareholder base to yield-based institutional funds and yield-seeking funds in South America."

The Company intends to designate all dividends as "eligible dividends" for purposes of the Income Tax Act (Canada) unless a notification of change is otherwise posted on the Company's website and www.sedar.com.  Provided designation is made, the dividend will be considered an "eligible dividend" for tax purposes. An eligible dividend received by a Canadian resident individual shareholder is entitled to the enhanced dividend tax credit. 

TAX CONSIDERATIONS

General

The information in this release is not intended to be an exhaustive discussion of all possible income tax consequences and considerations, but a general guideline.  It is not intended to be legal or tax advice to any particular investor or potential investor.  Investors or potential investors should consult their own tax advisors as to their particular tax consequences and reporting obligations.

The following information is provided for general information only. Investors are encouraged to seek advice from a qualified tax advisor in their country of residence to obtain guidance with respect to appropriate tax treatment of their distributions.

For Canadian Residents

For Canadian income tax purposes, the dividend paid to shareholders of Pacific Rubiales will be a taxable dividend.  In the case of a shareholder who is an individual resident in Canada, dividends will be subject to the gross-up and credit rules contained in the Income Tax Act (Canada), and, in the case of a shareholder that is a "private corporation" or a "subject corporation" (both as defined in the Income Tax Act (Canada)), a refundable tax will apply to the amount of the dividend.  Shareholders should contact their tax advisor or their local office of the Canada Revenue Agency with respect to any questions regarding the taxation of eligible dividends.

For Colombian Residents

Dividends paid to residents of Colombia will be subject to a Canadian 25% withholding tax on 100% of the gross distribution. Under Colombian tax rules, dividends will be subject to tax. Generally a corporation resident in Colombia is subject to tax at 33% of net income and individuals are subject to tax based on a progressive table as applicable.  Amounts paid as foreign taxes may be eligible for a foreign tax credit in Colombia.  For a more detailed discussion on the logistics and tax implications, shareholders should contact their tax advisor or their local office of the Colombian tax agency (DIAN), with respect to any questions regarding the taxation of these dividends or the application of foreign tax credits. In addition, they should consult the dividend circular that will be made available on the SIMEV.

For U.S. Residents

Subject to various U.S. statutory holding period requirements, distributions made by the Company out of its current or accumulated "earnings and profits" may be considered "qualified dividend income" as defined under U.S. tax law, and thus may be taxed at the reduced tax rates applicable to long term capital gains, provided that the Company has the status of a "qualified foreign corporation" for the year ended December 31, 2010. Further information regarding the Company's status as a "qualified foreign corporation" and the portion of its distributions that may be treated as dividends for U.S. federal income tax purposes will be posted on the Company's website in early 2011. These reduced rates may not be available to shareholders of the Company other than U.S. resident individuals.  In addition, distributions in excess of the Company's current or accumulated "earnings and profits" may reduce the U.S. tax basis of the shareholder's shares of the Company. 

Pursuant to the Canada - U.S. Tax Treaty, dividends paid to residents of the United States may be subject to a 15% withholding tax on 100% of the gross distribution. Amounts paid for foreign taxes may be eligible for either a deduction for foreign taxes or a foreign tax credit in the United States; both the deduction and credit for foreign taxes are subject to numerous limitations imposed by U.S. tax law which are not discussed in this summary.

Shareholders should contact their tax advisor or their local office of the Internal Revenue Service with respect to any questions regarding the taxation of such dividend distributions.

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. 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 a current net production of approximately at 70,000 barrels of oil equivalent per day, after royalties, with working interests in 40 blocks in Colombia, Guatemala and Peru.

The Company's common 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 Statements

This 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 12, 2010 filed on SEDAR at www.sedar.com and in the Prospectus Information published on January 22, 2010 on the SIMEV at www.superfinanciera.gov.co. 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. Ronald Pantin
Chief Executive Officer and Director

Mr. José Francisco Arata
President and Director

[phone]

Ms. Belinda Labatte
Investor Relations, Canada
[phone]

Ms. Carolina Escobar V
Investor Relations, Colombia
(57 1) 628 3970