Contemplated private placement

Panoro Energy ASA ("PEN", OSE ticker code), the independent oil and gas company with assets in West Africa and Brazil, is contemplating raising between NOK 400 and 600 million in new equity and has retained Pareto Securities AS and Carnegie ASA as joint lead managers (together the “Managers”) to advise on and effect a private placement of new shares directed towards Norwegian investors and International institutional investors. The price will be determined through an accelerated book-building process.

The book-building period opens today (February 3, 2011) at 17:30 CET and closes on February 4, 2011 at 08:30 CET. The Board of PEN may, however, at any time resolve to close or extend the book building period at its own discretion. The minimum order and allocation in the private placement has been set to the number of shares that equals an aggregate purchase price of at least the NOK equivalent of EUR 50,000.

Use of proceeds will be to strengthen the Company’s balance sheet in order to progress development projects in Brazil and Congo and further develop the underlying values in the portfolio.

Settlement of 16.4 mill shares will take place on or around  February 4, 2011, by delivery of existing and unencumbered shares in the Company that are already listed on Oslo Stock Exchange, pursuant to a share lending agreement entered into between Pareto Securities, Panoro and certain existing shareholders. Allocation of the shares exceeding the existing authorization granted to the Board of 16.4 mill shares, will be conditional upon approval at the EGM in the Company, expected to take place on or around March 1, 2011 and will not be tradable until the share capital increase has been registered in the Norwegian Register of Business Enterprises, and a listing prospectus has been approved by Finanstilsynet (FSA) and published.

Subject to a successful completion of the Private Placement, the Board of Directors will, based on various factors including the final Offer price, consider proposing to the EGM a subsequent offering directed towards PEN shareholders as of  February 3, 2011 (as recorded in VPS on  February 8, 2011) who were not allocated shares in the private placement (a “Subsequent Offering”). There can, however, be no guarantee that the board of PEN will propose a Subsequent Offering or that such Subsequent Offering will be resolved or authorized by the EGM.

IMPORTANT NOTICE:

This notice is not for distribution to United States new services or for dissemination in the United States, Canada, Japan or Australia or elsewhere where such dissemination is not appropriate. The contents of  this announcement have been prepared by and are the sole responsibility of Panoro Energy ASA ("PEN"). Pareto Securities AS and Carnegie ASA are acting exclusively for PEN and no one else and will not be responsible to anyone other than PEN for providing the protections afforded to their respective clients, or for advice in relation to the contemplated Private Placement and the contents of this announcement or any of the matters referred to herein.

The distribution of this announcement and other  information in connection with the Private Placement may be restricted by law in certain jurisdictions.  Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions.

This announcement may not be used for, or in connection with, and does not constitute, any offer to sell, or an invitation to purchase, any securities. The Private Placement will not be made in any jurisdiction or in any circumstances in which such offer or solicitation would be unlawful.The securities referred to herein have not been and will not be registered under the US  Securities Act of 1933, as amended, and may not be  offered or sold in the United States or to US persons unless the securities are registered under the Securities Act, or an exemption from the registration requirements of the Securities Act is available. No public offering of the securities will be made in the United States.

For further information, please contact:

Anders Kapstad, CFO
Tel: +47 23 01 10 01
Cell: +47 918 17 442
Email: anders.kapstad@panoroenergy.com

Jonas Gamre, Finance & Investor Relations Manager
Tel: +47 23 01 10 02
Cell: +47 971 18 292
Email: jonas.gamre@panoroenergy.com