PanWestern Energy Inc. announces filing of final short form prospectus

CALGARY, May 17 /CNW/ - PanWestern Energy Inc. ("PanWestern" or the "Corporation") (TSX-V: "PW") is pleased to announce that it has filed a final short form prospectus dated May 14, 2010 (the "Final Prospectus") with the securities commissions in the provinces of British Columbia, Alberta, Saskatchewan and Ontario, with respect to the qualification of the distribution of 51,100,000 common shares of the Corporation ("Common Shares") issuable pursuant to the exercise of 51,100,000 special warrants of the Corporation (the "Special Warrants"). The Special Warrants were previously issued by the Corporation on April 16, 2010 on a private placement basis through National Bank Financial Inc. and Cormark Securities Inc., as co-lead underwriters, together with GMP Securities L.P., Canaccord Genuity Corp. (formerly Canaccord Financial Ltd.) and FirstEnergy Capital Corp.

Each Special Warrant entitles the holder thereof to receive, subject to adjustment in certain circumstances, one Common Share on the exercise of each Special Warrant. All Special Warrants will be deemed to be exercised in accordance with the terms of the special warrant indenture governing the terms of the Special Warrants, for no additional consideration and without any further action on the part of the holder, immediately prior to 5:00 pm (Toronto time) on May 21, 2010, being the date that is the fifth business day following the date on which a receipt for the Final Prospectus was issued.

The original private placement of Special Warrants provided gross proceeds of $24.017 million (net proceeds of approximately $22.5 million after fees and expenses) to the Corporation. The Corporation is currently debt-free with a cash balance of approximately $28.0 million and is pursuing a number of potential acquisition opportunities in Latin America and North Africa to further a new international growth strategy. The Corporation is encouraged by the number of opportunities available to it, which in part is a reflection of the international track record of the management team and board and the success of the recent financing.

About PanWestern

PanWestern Energy Inc. is a Calgary, Alberta based public company currently engaged in the exploitation, development and production of petroleum and natural gas in Western Canada. The Corporation is pursuing a new strategy to expand internationally to selected countries in Latin America, the Middle East and North Africa region and the Mediterranean basin. The Corporation's common shares are listed on the TSXV under the trading symbol "PW".

Neither the 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 news release.

For further information: Jim McFarland, President and CEO, PanWestern Energy Inc., [phone], [email protected]; Steve Bjornson, CFO, PanWestern Energy Inc., [phone], [email protected], www.panwesternenergy.ca