CEO Coastal Eng

Coastal Energy Company (the "Company" or "Coastal Energy") (TSX:CEN) (AIM:CEO), an independent exploration and production company with assets in Thailand, announces the financial results for the three months ended March 31, 2012. The functional and reporting currency of the Company is the United States dollar.

First Quarter 2012 Highlights

• The Company reported record levels of production, cash flow and earnings in the first quarter of 2012. Total Company production increased by 125% to 22,773 boe/d in the first quarter from 10,125 boe/d in the same period last year. The Company's offshore production was 21,031 bbl/d, with the increase due to the inclusion of production from both platforms at Bua Ban North. Onshore production of 1,742 boe/d increased from Q4 '11 levels as natural gas demand recovered following the flooding in Thailand in late 2011. Onshore production was below Q1 '11 due to the aftermath of the 2011 flooding as well as the power plant at Nam Phong being shut down for maintenance for approximately 5 days during the quarter.
• EBITDAX for Q1 2012 was $128.4 million, 202% higher than the $42.5 million recorded in Q1 2011.  Revenue and EBITDAX were driven higher by increased production and commodity prices. Crude oil inventory was approximately 569,258 barrels at March 31, 2012, the revenue from which will be recognized in the second quarter. The Company added 232,924 barrels (approximately 41%) during the current quarter.
• The Company announced successful discoveries in the Miocene and Oligocene reservoirs at Bua Ban South. The discoveries have been appraised and determined to be commercial. 
• The Company acquired an additional 2.9% of Apico LLC, which holds its onshore oil & gas concessions. This brings its working interest in the Sinphuhorm field to 13.7%.

Randy Bartley, President and CEO of Coastal Energy, commented:

"The first quarter of 2012 built upon the Company's success in 2011. The Company recorded record levels of production, cash flow and profits. We also delivered another successful exploration discovery at Bua Ban South in both the Miocene and Lower Oligocene reservoirs. We plan to drill further appraisal wells to delineate the discovery once production facilities arrive on location in the third quarter.

"We purchased two production facilities in the first quarter, one at Songkhla A and one for Bua Ban South. We plan to continue using a portion of our free cash flow to acquire currently leased production facilities to reduce our operating costs. We are also evaluating bringing in an additional drilling rig to accelerate our exploration and development program.

"2012 is off to a great start. We all look forward to another successful year with Coastal."

The following financial statements for the Company are abbreviated versions. The Company's complete financial statements for the three months ended March 31, 2012 with the notes thereto and the related Management Discussion and Analysis can be found either on Coastal's website at www.CoastalEnergy.com or on SEDAR at www.sedar.com. All amounts are in US$ thousands, except share and per share amounts.

Three Months Ended March 31,	2012	2011
Revenues and Other Income
Oil sales, net of royalties (Note 12)	168,836	66,711
Other income (Note 13)	(10,171)	(21,084)
	158,665	45,627
Expenses
Production	36,210	22,218
Depreciation and depletion (Note 7)	20,044	13,286
General and administrative	8,327	5,263
Exploration (Note 6)	--	5,553
Debt financing fees	281	234
Finance	1,006	1,162
	65,868	47,716
Net income (loss) before income taxes and share of
Net income from Apico LLC	92,797	(2,089)
Share of net income from Apico LLC (Note 8)	4,007	3,256
Net income before income taxes	96,804	1,167
Income taxes (Note 17)
Current	36,608	--
Deferred	11,703	3,183
	48,311	3,183
Net loss from discontinued operations (Note 18)
Net income (loss) and comprehensive income (loss)	48,493	(2,016)
Net income (loss) and comprehensive income (loss) attributable to:
Shareholders of Coastal Energy	48,135	(2,362)
Non-controlling interest	358	346
	48,493	(2,016)
Net income (loss) per share:
Basic (Note 15)	0.42	(0.02)
Diluted (Note 15)	0.40	(0.02)
The accompanying notes are an integral part of these condensed interim consolidated financial statements (unaudited).

	March 31	December 31,
As at	2011	2011
	$	$
Assets
Current Assets
Cash	40,900	22,995
Restricted cash (Note 3)	6,411	28,447
Accounts receivable (Note 4)	32,476	16,939
Derivative asset (Note 11)	83	59
Inventory (Note 5)	19,637	14,161
Prepaids and other current assets	346	1,094
Total current assets	99,853	83,695
Non-Current Assets
Exploration and evaluation assets (Note 6)	43,392	31,881
Property, plant and equipment (Note 7)	379,736	355,052
Investment in and advances to Apico LLC (Note 8)	60,955	47,698
Deposits and other assets	405	405
Total non-current assets	484,488	435,036
Total Assets	584,341	518,731
Liabilities
Current Liabilities
Accounts payable and accrued liabilities (Note 9)	90,832	59,471
Current portion of long-term debt (Note 11)	16	55,662
Current portion of derivative liabilities (Note 11)	19,192	14,557
Derivative liability - Warrants (Note 10)	2,899	2,853
Total current liabilities	112,939	132,543
Non-Current Liabilities
Long-term debt (Note 11)	47,353	22,156
Non-current portion of derivative liabilities (Note 11)	670	1,274
Deferred tax liabilities	81,470	69,767
Decommissioning liabilities	39,899	42,124
Total Non-Current Liabilities	169,392	135,321
Shareholders' Equity (Note 15)
Common shares	213,491	211,554
Contributed surplus	17,453	16,401
Warrants	--	--
Retained earnings	65,238	17,630
Total Shareholders' Equity	296,182	245,585
Non-controlling interest	5,828	5,282
Total equity	302,010	250,867
Total liabilities and equity	584,341	518,731
Commitments and contingencies (Note 16)
The accompanying notes are an integral part of these condensed interim consolidated financial statements (unaudited).

Three Months Ended March 31,	2012	2011
Operating activities
Net income (loss)	48,493	(2,016)
Adjustments:
Share of net income from Apico LLC	(4,007)	(3,256)
Unrealized loss on derivative instruments	4,007	18,257
Depletion and depreciation	20,044	13,286
Finance expense	1,006	946
Amortisation of debt financing fees	281	234
Stock-based compensation	2,991	2,122
Deferred income taxes	11,703	3,183
Unrealized foreign exchange loss (gain)	92	(149)
Exploration expense	--	5,553
Interest received	2	1
Interest paid	(721)	(312)
Earnings distributions from Apico LLC	--	903
Change in non-cash working capital (Note 18)	(3,014)	(7,315)
Cash flow provided by operating activities	80,877	31,437
Financing Activities
Issuance of common shares, net of issuance costs	992	4,693
Borrowings under long-term debt	--	6,275
Repayment of long-term debt	(30,000)	--
Loan arrangement fees	(746)	--
Payments to non-controlling interest	--	(156)
Cash flow provided by financing activities	(29,754)	10,812
Investing Activities
Increase in restricted cash	22,036	6,533
Purchase of property, plant and equipment	(45,229)	(36,470)
Acquisition of increased stake in Apico LLC	(9,250)	--
Deposits and other assets	--	(43)
Cash flow used in investing activities	(32,443)	(29,980)
Effect of exchange rate changes on cash	(775)	(241)
Increase in cash	17,905	12,028
Cash - Beginning of period	22,995	3,884
Cash - End of Period	40,900	15,912
The accompanying notes are an integral part of these condensed interim consolidated financial statements (unaudited).

Additional information, including the Company's complete competent person's report may be found on the Company's website at www.CoastalEnergy.comor may be found in documents filed on SEDAR at www.sedar.com.

This statement contains 'forward-looking statements' as defined by the applicable securities legislation. Statements relating to current and future drilling results, existence and recoverability of potential hydrocarbon reserves, production amounts or revenues, forward capital expenditures, operation costs, oil and gas price forecasts and similar matters are based on current data and information and should be viewed as forward-looking statements. Such statements are not guarantees of future results and are subject to risks and uncertainties beyond Coastal Energy's control. Actual results may differ substantially from the forward-looking statements.

The Coastal Energy Company logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=10062

CONTACT: Coastal Energy Company
         Email: investor@CoastalEnergy.com
         +1 (713) 877-6793
         
         Strand Hanson Limited (Nominated Adviser)
         +44 (0) 20 7409 3494
         Rory Murphy / Paul Cocker / Scott McGregor
         
         Macquarie Capital (Europe) Limited (Broker)
         +44 (0) 20 3037 2000
         Paul Connolly / Jeffrey Auld
         
         FirstEnergy Capital LLP (Broker)
         Hugh Sanderson / Travis Inlow
         +44 (0) 20 7448 0200
         
         Buchanan
         Tim Thompson / Ben Romney
         +44 (0) 20 7466 5000