CER Circumpacific Energy Corp

Circumpacific Energy Corporation (TSX VENTURE:CER) ('Circumpacific') and
Drillsearch Energy Limited (ASX: DLS) ('Drillsearch') are parties to a joint
venture agreement for evaluation of eight blocks in the Cooper Eromanga Basin of
South West Queensland, Australia ('the SWQ Blocks').


Under their agreement, Drillsearch must conduct an evaluation plan for the SWQ
Blocks. Drillsearch does so as agent of Circumpacific in respect of the seven
SWQ Blocks for which Circumpacific holds preferred tenderer status.


Circumpacific Notice of Dispute

On October 23, 2009, Circumpacific served a notice of dispute on Drillsearch. By
that notice, Circumpacific sought disclosure by Drillsearch of information that
Drillsearch is required to provide under their agreement. Circumpacific also
requested that a meeting of the joint venture management committee take place to
discuss current status of the evaluation tasks, budgets and other relevant
matters in the mutual interests of both parties going forward.


Circumpacific served the notice of dispute as a last resort after its legitimate
requests for information, and the convening of a management committee meeting,
remained unfulfilled.


Circumpacific is pleased to advise that Drillsearch has, in response to that
dispute notice, agreed now to provide the requested information and to
participate in a meeting of the management committee in the spirit of
co-operation.


Drillsearch has also tabled a joint operating agreement as a starting point, and
has informed Circumpacific that the parties can move forward to negotiate in
good faith and develop a model agreement that both parties are happy with.
Circumpacific management is presently reviewing the draft joint operating
agreement. A market update on the proposed operating agreement will be provided
shortly.


Drillsearch Notice of Dispute

On October 28, 2009, Drillsearch served a notice of dispute on Circumpacific
(see Drillsearch announcement of November 3, 2009). The three disputes asserted
by Drillsearch were that Circumpacific had:


- attempted to farm-out its interests in the SWQ Blocks without the consent of
Drillsearch;


- breached obligations of confidentiality, and

- failed to pay a cash call for evaluation costs under their agreement.

Drillsearch has raised the first and second disputes in legal proceedings filed
in the Supreme Court of British Columbia on October 14, 2009 (see Circumpacific
press release October 19, 2009).


Drillsearch has also notified Circumpacific that Drillsearch does not consent to
the farm-out or disposal of any interest in the SWQ Blocks at this time until
the native title clearance process and technical evaluation of the SWQ Blocks
are complete.


On November 11, 2009, and as a result of the Drillsearch notice, Circumpacific:

- notified Drillsearch that Circumpacific would not farm out its pre-ATP
participating interests in the SWQ Blocks without Drillsearch's consent;


- advised third parties that no farm-out is permissible without Drillsearch's
consent and requested immediate return of any information relating to the SWQ
Blocks;


- provided Drillsearch with details of parties contacted by Circumpacific, and
all information disclosed by Circumpacific, in respect of Circumpacific's
interests;


- paid to Drillsearch the amount of $25,783.33, being the corrected amount
claimed by Drillsearch and agreed by Circumpacific to be payable for operating
costs under their agreement.


Drillsearch's notice states that such actions by Circumpacific will settle the
disputes set out in that notice.

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