EXALL ENTERS NEW BANKING ARRANGEMENTS

CALGARY, Sept. 2 /CNW Telbec/ - Exall Energy Corporation (TSX: EE) ("Exall" or the "Company") is pleased to provide an update concerning its banking arrangements.

Highlights of the new banking arrangements are:

• Successfully negotiated a new $15.0 million revolving demand credit facility,
• Paid out the Company's $1.75 million non-revolving bridge loan facility, and
• Restored the Company's minimum working capital covenant ratio to 1.0 : 1.0 from the previous 1.1 : 1.0 ratio.

Debt Facilities

As at September 02, 2010, the Company has replaced its existing $8,500,000 revolving demand credit facility with a $15,000,000 revolving demand credit facility with an alternate Canadian financial institution.  The new facility bears interest at the lender's base prime rate plus 1.50 percent.  The limit of the credit facility is subject to adjustments from time to time to reflect changes in the Company's asset base.  There are no principal repayments required on the loan.  The facility requires the Company to maintain certain financial ratios and other covenants and is collateralized by a general security agreement providing a security interest over all present and after acquired personal property and a floating charge on all lands. Exall's new banking arrangement resets the minimum working capital covenant ratio to 1.0 : 1.0 from the previous 1.1 : 1.0 ratio.

Additionally, as part of the new revolving demand credit facility Exall has repaid the Company's non-revolving bridge loan facility of $1.75 million as at September 02, 2010.

Roger Dueck, Exall's President and Chief Operating Officer states, "We are very pleased with our new operating facility as it provides Exall the ability to complete the field operations required to remove current gas constraints. The facility also gives Exall the flexibility to increase drilling activities scheduled in the Marten Mountain Area for the 2010 - 2011 winter drilling season. Additionally, the new facility provides Exall with the financial flexibilility to actively pursue additional property acquisitions, whether through land sales, property or corporate acquisitions".

About Exall

Exall Energy Corporation is a junior oil and gas company active in its business of oil and gas exploration, development and production from its properties in Alberta, British Columbia and Texas. Exall is currently developing a new oil discovery at Marten Mountain in north-central Alberta.

The Company currently has 52,397,745 common shares outstanding.  The Company's common shares are listed on the Toronto Stock Exchange under the trading symbol EE.

Reader Advisory

This news release contains forward-looking statements, which are subject to certain risks, uncertainties and assumptions, including those relating to results of operations and financial condition, capital spending, financing sources, commodity prices and costs of production. By their nature, forward-looking statements are subject to numerous risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, actual results may differ materially from those predicted. A number of factors could cause actual results to differ materially from the results discussed in such statements, and there is no assurance that actual results will be consistent with them. Such factors include fluctuating commodity prices, capital spending and costs of production, and other factors described in the Company's most recent Annual Information Form under the heading "Risk Factors" which has been filed electronically by means of the System for Electronic Document Analysis and Retrieval ("SEDAR") located at www.sedar.com. Such forward-looking statements are made as at the date of this news release, and the Company assumes no obligation to update or revise them, either publicly or otherwise, to reflect new events, information or circumstances, except as may be required under applicable securities law.

For the purposes of calculating unit costs, natural gas has been converted to a barrel of oil equivalent (boe) using 6,000 cubic feet equal to one barrel (6:1), unless otherwise stated. The boe conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method and does not represent a value equivalency; therefore boe may be misleading if used in isolation. This conversion conforms to the Canadian Securities Regulators' National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities.

For further information:

Exall Energy Corporation Frank S. Rebeyka Vice Chairman & CEO  Tel: [phone]

Roger N. Dueck President & COO Tel: [phone] x 223

[email protected]

Please visit Exall Energy's website at: www.exall.com

Renmark Financial Communications Inc.
Henri Perron: [email protected]
Maurice Dagenais : [email protected]
Tel. : [phone] or [phone]
www.renmarkfinancial.com