Mr. Jonathan Schroeder reports

BROWNSTONE ENERGY ANNOUNCES FINANCING

Brownstone Energy Inc. has entered into an agreement in connection with an overnight-marketed private placement of units in all the provinces of Canada, other than Quebec. Each unit shall consist of one common share of the company and one-half of one common share purchase warrant. Each whole warrant will be, for a period of 18 months, exercisable at a premium to the unit price and will entitle the holder thereof to acquire one common share. Though the offering will be priced in the context of the market, with final terms of the offering to be determined at the time of pricing and entering into an underwriting agreement, the company expects to issue units in the total amount of approximately $25-million. The offering will be conducted through a syndicate of underwriters led by Jennings Capital Inc. and Dundee Securities Ltd. as co-lead underwriters.

The company will also grant the underwriters an overallotment option to purchase additional units in an amount up to 15 per cent of the number of units sold pursuant to the offering, exercisable in whole or in part at any time up to the closing date of the offering.

The company intends to use the net proceeds of the offering to finance its exploration and development programs in Colombia and offshore Israel, for working capital, and for general corporate purposes.

PowerOne Capital Markets Ltd. is acting as an adviser to Brownstone.