Churchill Announces First Quarter 2009 Results

• Press Release
• Source: Churchill Energy Inc.
• On 9:29 am EDT, Friday May 15, 2009

CALGARY, ALBERTA--(Marketwire - May 15, 2009) - Churchill Energy Inc. (TSX VENTURE:CEI - News; "Churchill") today filed its first quarter unaudited financial statements for the three months ended March 31, 2009 and related Management's Discussion and Analysis on SEDAR (www.sedar.com) and on the Company's website at www.churchillenergy.ca.

Related Quotes

Symbol	Price	Change
CEI.V	0.25	0.00

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MESSAGE TO SHAREHOLDERS

Churchill Energy Inc. ("Churchill" or the "Company") is pleased to report to shareholders the Company's activities in the first quarter of 2009.

On February 12, 2009, Churchill closed its acquisition of Welton Energy Corporation ("Welton"). Welton is now a wholly owned subsidiary of Churchill. Through the acquisition, the Company added a new light oil waterflood project in Brazeau which complements its existing waterflood project in Grand Forks. Both of these waterflood reserves are long life reserves. The Brazeau pool has an estimated 8 MMbbls of original oil in place with an estimated 36 percent proved plus probable recovery factor of which 30 percent has been recovered to date and in Grand Forks the pool has an estimated 5.6 MMbbls of original oil in place and an estimated 12 percent proved plus probable recovery factor of which 1 percent has been recovered to date based on GLJ's March 1, 2009 and January 1, 2009 reserve reports respectively. These two projects are critical to the Company as they have the capability to show growth in the near term with minimal capital investment and more importantly, in the medium to longer term, potentially add significant reserve gains as the producing wells respond to the water injection.

Funds from operations were $48,131 for the first quarter of 2009 which is net of general and administrative expenses. This was primarily a result of the Grand Forks property being shut-in for the month of January due to the battery expansion and low commodity prices. The Grand Forks field was restarted in February as the Bow River Hardisty reference price improved. Funds from operations for March were $119,000. Production for the first quarter of 2009 was down to 314 boe/d due to shut-in production in January. In addition, the acquisition of Welton closed in mid February so the first quarter average only partially reflects the inclusion of the production that was acquired. Current production is approximately 425 boe/d.

Capital markets and the commodity price environment remain challenging in 2009. Churchill will continue to protect its balance sheet by deploying its cashflow to projects that deliver the highest return for shareholders. The Company will continue to optimize its two waterflood projects in 2009.

Capital spending in the first quarter was focused solely on completing the facility expansion in Grand Forks which was started in the prior year. The facility expansion will allow the Company to handle increased fluid volumes from the waterflood project. In addition, the Company farmed out its interest in the 12-7-59-5W6M well in Chime which was successfully deepened to the Nikanassin. Churchill retained a 25 percent working interest in the well, incurred no costs in the operation and will receive $168,000 from its partner to equalize into the surface facilities and equipment. The well is currently producing 350 mcf/d gross (88 mcf/d net).

With continued uncertainty and low commodity prices, particularly with natural gas prices, the Company is focused on investing its cashflow in the highest return projects and looking to strengthen its balance sheet and asset base which may include mergers or acquisitions.

On behalf of the Board of Directors,

Kelly D. Cowan, Chief Executive Officer

FINANCIAL AND OPERATING HIGHLIGHTS

                                       Three Months Ended March 31,
                                                 2009         2008  Change
----------------------------------------------------------------------------
FINANCIAL ($, except share data)

Oil and gas revenues, before royalties      1,012,534    2,485,136     (59%)

Funds from operations                          48,131    1,029,388     (95%)
 Per Share- Basic and diluted ($ per share)      0.00         0.03    (100%)

Net income (loss) including extraordinary
 gain                                       2,871,209     (540,377)    631%
 Per Share - Basic and diluted ($ per
  share)                                         0.07        (0.02)    450%

Capital Expenditures                          162,839    1,608,546     (90%)
Proceeds on property dispositions            (167,976)           -       -

Total assets                               36,910,338   58,377,486     (37%)

Working capital deficit (1)                 2,455,532    1,772,749      39%

Bank debt                                   2,003,298   11,307,130     (82%)

Weighted average shares outstanding
 Basic                                     38,621,269   35,691,669       8%
 Diluted                                   38,621,269   35,691,669       8%

----------------------------------------------------------------------------
OPERATIONS (units as noted)

Average Daily Production
 Crude oil and NGLs (bbls/d)                      131          126       4%
 Natural gas (mcf/d)                            1,096        2,122     (48%)
Barrels of oil equivalent (boe/d)               314(2)         479     (34%)

Average Product Prices Received (3)
 Crude oil and NGLs ($/bbl)                     44.18        78.59     (44%)
 Natural gas ($/mcf)                             4.82         8.00     (40%)
Combined ($/BOE)                                35.31        56.03     (37%)

Netback ($/BOE)                                 13.12        31.88     (59%)

Wells Drilled
Gross                                               -         1.00       -
Net                                                 -         0.50       -

Success                                             -          100%      -

Undeveloped land (net acres)                   66,547       50,139      33%


(1) Excludes bank debt and the risk management contracts
(2) Current production is approximately 425 boe/d
(3) Before realized hedging gains and losses

Churchill is a Calgary-based junior oil and natural gas company headquartered in Calgary. Our focus is the exploration, development and exploitation of hydrocarbon reserves in the Western Canadian Sedimentary basin. The common shares of Churchill are listed on the TSX Venture Exchange and trade under the symbol "CEI".

Forward Looking Information and Statements

This news release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends", "strategy" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: the volumes and estimated value of Churchill's oil and gas reserves; the life of Churchill's reserves; the volume and product mix of Churchill's oil and gas production; future oil and natural gas prices and Churchill's commodity risk management programs; the amount of future asset retirement obligations; future liquidity and financial capacity; future results from operations and operating metrics; future costs, expenses and royalty rates; future interest costs; future development, exploration, acquisition and development activities (including drilling plans) and related capital expenditures and future taxes payable by Churchill; and Churchill's tax pools.

The forward-looking information and statements contained in this news release reflect several material factors and expectations and assumptions of Churchill including, without limitation: that Churchill will continue to conduct its operations in a manner consistent with past operations; the general continuance of current industry conditions; the continuance of existing (and in certain circumstances, the implementation of proposed) tax, royalty and regulatory regimes; the accuracy of the estimates of Churchill's reserve and resource volumes; certain commodity price and other cost assumptions; and the continued availability of adequate debt and equity financing and cash flow to fund its plans expenditures; Churchill believes the material factors, expectations and assumptions reflected in the forward-looking information and statements are reasonable but no assurance can be given that these factors, expectations and assumptions will prove to be correct.

The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information or statements including, without limitation: changes in commodity prices; changes in the demand for or supply of Churchill's products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Churchill or by third party operators of Churchill's properties, increased debt levels or debt service requirements; inaccurate estimation of Churchill's oil and gas reserve and resource volumes; limited, unfavorable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time to time in Churchill's public disclosure documents (including, without limitation, those risks identified in this news release).

The forward-looking information and statements contained in this news release speak only as of the date of this news release, and none of Churchill or its subsidiaries assumes any obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable laws.

BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this news release.

Kelly D. Cowan
Churchill Energy Inc.
Chief Executive Officer
(403) 693-3001
Email: kcowan@churchillenergy.ca

Thanh C. Kang
Churchill Energy Inc.
Chief Financial Officer
(403) 698-8246
Email: tkang@churchillenergy.ca

780, 700 - 4th Avenue S.W.
Churchill Energy Inc.
Calgary, Alberta  T2P 3J4
Website: www.churchillenergy.ca