ProspEx Resources Enters into Agreement to Sell Undeveloped Mineral Rights in
Brazeau

CALGARY, Dec. 6 /CNW/ - ProspEx Resources Ltd. ("ProspEx" or the "Company") has entered into an agreement with a private company to sell certain undeveloped mineral rights in the Brazeau area in West Central Alberta for $8.1 million in cash proceeds. Closing is expected to occur in late December, 2010. The mineral rights to be sold consist of 6,240 gross acres (4,954 net acres) of rights to shallower zones in Brazeau, including the Cardium rights. ProspEx had no near term plans to drill the Cardium or other shallow formations included in the disposition. The rights to the deeper formations, including the rights to the Notikewin formation which the Company has recently targeted with horizontal drilling, are not included in the sale. There are no wells, production or reserves associated with the transaction.

ProspEx's strategy is currently focused on the development of liquids rich natural gas utilizing horizontal drilling with multi-stage fracturing technology. The disposition further focuses the Company's asset base on lands with this potential, and adds additional financial flexibility to fund ProspEx's 2011 capital program. Assuming closing of the transaction prior to year end, the Company expects net debt at December 31, 2010 to be in the range of $21 to $23 million, depending on the timing of capital expenditures over the remainder of 2010. The Company expects that the transaction will have no impact on its currently approved credit facility of $40 million.

ProspEx Resources Ltd. is a Calgary based junior oil and gas company focused the development of liquids rich natural gas in the Western Canadian Sedimentary Basin, utilizing horizontal drilling with multi-stage fracturing technology.

Reader's Advisory

Guidance regarding net debt may constitute a "financial outlook" as contemplated by National Instrument 51-102 of the Canadian Securities Administrators entitled Disclosure Obligations. The purpose of such financial outlook is to forecast the anticipated net debt of the Company as of December 31, 2010, assuming the closing of the proposed transaction. Please be advised that the information may not be appropriate for other purposes.

Certain information contained in this press release constitutes forward-looking information or statements including, without limitation, information and statements respecting: anticipated capital programs, dispositions, and available credit facilities.

Forward-looking information and statements are often, but not always, identified by the use of words such as "anticipate", "seek", "believe", "expect", "hope", "plan", "intend", "forecast", "target", "project", "guidance", "may", "might", "will", "should", "could", "estimate", "predict" or similar words or expressions suggesting future outcomes or language suggesting an outlook. By their very nature, forward-looking information and statements involve inherent risks and uncertainties, both general and specific, and risks that predictions, forecasts, projections and other forward-looking information and statements will not be achieved. We caution readers not to place undue reliance on these statements as a number of important factors could cause the actual results to vary materially from the forward-looking information or statements. These factors include, but are not limited to: the volatility of oil and gas prices; production and development costs; capital expenditures; the imprecision of reserve and resource estimates and estimates of recoverable quantities of oil, natural gas and liquids; the Company's ability to replace and expand oil and gas reserves; environmental claims and liabilities; incorrect assessments of value when making acquisitions or dispositions; increases in debt service charges; the loss of key personnel; the marketability of production; defaults by third party operators; unforeseen title defects; fluctuations in foreign currency and exchange rates; inadequate insurance coverage; compliance with environmental laws and regulations; changes in tax and royalty laws; the Company's ability to access external sources of debt and equity capital; and the Company's ability to obtain equipment in a timely manner to carry out development activities. Further information regarding these factors may be found under the headings "Description of Business - Risk Factors Relating to Our Business" and "Industry Conditions" in the Company's most recent Annual Information Form, under the heading "Operational and Other Business Risks" in the Company's Management's Discussion and Analysis for the year ended December 31, 2009, and in the Company's most recent consolidated financial statements, management information circular, quarterly reports, material change reports and news releases available under the Company's profile on SEDAR (www.sedar.com). Readers are cautioned that the foregoing list of factors that may affect future results is not exhaustive. When relying on our forward-looking statements to make decisions with respect to the Company, investors and others should also carefully consider information set forth in the section "Forward-Looking Information" of the Company's most recent Annual Information Form respecting the assumptions upon which the Company bases certain forward-looking information and the uncertainties inherent in such assumptions.

The Company does not assume responsibility for the accuracy and completeness of the forward-looking information or statements and such information and statements should not be taken as guarantees of future outcomes. Subject to applicable securities laws, the Company does not undertake any obligation to revise these forward-looking information or statements to reflect subsequent events or circumstances. Furthermore, the forward-looking information contained in this press release are made as of the date of this document and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. The forward-looking information and statements contained in this press release are expressly qualified by this cautionary statement.

For further information: John Rossall, President & CEO, or George Yee, Vice President Finance & Chief Financial Officer, at [email protected] or [phone]