Canadian Leader Energy Inc. - Nine Months-96 Results - Tunisia Gusher Announced.

CALGARY, ALBERTA--(BUSINESS WIRE)--Dec. 6, 1996-- Canadian(TSE: LOL.) Canadian Leader Energy Inc. reports record revenues, earnings and cash flow for the nine months ended September 30, 1996.

                                      $Thousands
                                      ----------
                           Nine Months Ended
                           September 30, 1996     Third Quarter
                           ------------------------------------
                           1996        1995     1996      1995
                           ------------------------------------
Oil and gas sales, net
of royalties               $7,032    $2,023     $2,532   $ 653

Net Income (Loss)          $1,364    $( 367)    $  693   $(275)

Net Income Per Share       $0.035    $0.000     $0.015   $0.000

Cash Flow                  $3,955    $  503     $1,374   $   82

Cash Flow Per Share        $ 0.10    $ 0.02     $ 0.03   $ 0.00

HIGHLIGHTS

- As previously announced, Canadian Leader participated (29.5 percent) in the El Biban Tunisia horizontal well which tested at 5,500 bopd (1,622 bopd net);

- Average daily production increased more than three fold over third quarter 1995;

- Continued drilling success in Canada at Leaman and Pembina, Alberta and at Prairiedale, Saskatchewan;

- Warrants exercised in the amount of $1,218,167.

OPERATIONS

Tunisia - The El Biban well #3 re-entry horizontal well was drilled offshore in Tunisia, North Africa and tested at 5,500 bopd (1,622 bopd net). It is expected that the well will be on production by the end of Q2, 1997 upon construction of an 8 inch pipeline. Because of tax pools associated with the concession, no income taxes will be paid on production from this field and netbacks based on current oil prices will be approximately $20 Cdn. per barrel. At initial production rates, this field will add approximately 20 cents per share of net cash flow to Canadian Leader.

Several development drilling locations have been identified at Ezzaouia which is onshore Tunisia. The most recent well was drilled in February, 1996 and came on stream at 2,600 barrels per day. Canadian Leader has a 12.6 percent interest in the field.

Canada - The Company drilled two wells during the quarter at Prairiedale, Saskatchewan. One has production capability of 100 barrels of oil per day and the second is expected to produce similar volumes once it is completed. Several more drilling locations are planned for this pool. Plans are in progress to install a battery of waterflood to maximize ultimate recovery of the oil reserves.

FINANCIAL RESULTS

Oil and natural gas sales, net of royalties, for the nine months ended September 30, 1996 were $7,032,000 (average production of 1,187 bpd of oil and 6.6 MMcf/d of natural gas) compared to $2,023,000 (average production of 262 bpd of oil and 2.3 MMcf/d of natural gas) for 1995, an increase of $5,009,000 (248 percent). The increase is attributable to the Tunisian production purchase, commencement of Kitto Lake production, corporate acquisitions, and other wells drilled after Q3-95.

Operating costs for the nine months ended September 30, 1996 were $1,968,000, an increase of $984,000 (100 percent) over the corresponding period in 1995. The increased costs reflect the significantly higher production levels. Operating costs per BOE for 1996 are $3.59 compared to $5.56 for 1995. The reduction on a BOE basis reflects bringing reserves on stream that have lower production costs, as well as increasing the proportion of company- operated reserves, which are operated in a more efficient manner.

General and administrative costs for the nine months ended September 30, 1996 before amounts capitalized were $938,000, an increase of $395,000 (73 percent) over the amount for the nine months ended September 30, 1995. This increase reflects the costs of an enhanced infrastructure. After $176,000 were capitalized as fixed asset additions and $104,000 were allocated to share issue expense, the net general and administrative costs for the period were $658,000.

Net income for the nine months ended September 30, 1996 was $1,364,000 ($0.035 per share) compared to a loss for the nine months ended September 30, 1995 of $367,000 ($0.020 per share). Cash flow for the period was $3,995,000 ($0.10 per share) compared to $503,000 ($0.02 per share) in 1995.

Capital expenditure for the nine months ended September 30, 1996 totalled $12,891,000.

Working capital at September 30, 1996 was $2,172,000 compared to $123,000 at September 30, 1995. The Company has an operating line of credit of $7.5 million. There is no bank loan outstanding at September 30, 1996.

Canadian Leader Energy Inc. is a public company with shares trading on the Toronto Stock Exchange under the trading symbol "LOL".

CONTACT: Canadian Leader Energy Inc.

Jeffrey L. Standen, 403/264-1095

403/264-6111 (FAX)

or

Canadian Leader Energy Inc.

Barry W. Swan, 403/264-1095

403/264-6111 (FAX)