Cobalt Announces 2nd Quarter 2007 Financial Results

NOT FOR DISTRIBUTION TO US NEWSWIRE SERVICES FOR DISSEMINATION IN THE UNITED STATES.

Cobalt Energy Ltd. (TSX VENTURE:CB.A) (TSX VENTURE:CB.B) ("Cobalt" or the
"Company") is pleased to announce that it has filed with applicable Canadian
securities regulatory authorities its unaudited second quarter financial
statements and related Management Discussion and Analysis for the three months
ended June 30, 2007. These filings are available for review at www.sedar.com.


Highlights

- Cobalt closed its initial public offering on May 29, 2007, raising gross
proceeds of $5,288,000. Following the closing, Cobalt has 7,222,240 Class A
Shares and 465,344 Class B Shares outstanding. The Class A Shares and Class B
Shares of Cobalt commenced trading on the TSX Venture Exchange ("TSX-V") on June
8, 2007 under the trading symbols CB.A and CB.B, respectively.


- Cobalt is in the pre-production stage of a junior oil and gas exploration
company. The Company is active in land acquisition, farm-ins and seismic
activity as it executes the initial phase of its exploration and drilling
program.


- The Company acquired an additional 1,920 acres, gross (1,056 acres, net) of
strategic undeveloped Crown land in its core exploration area in the Peace River
Arch. At the end of the second quarter, Cobalt controls a 55-100% working
interest in nine sections of contiguous, operated lands in the Peace River Arch
which have potential for liquids rich natural gas in multi-zone geological
formations.


- At June 30, 2007, Cobalt had $5,325,341 in cash and short term deposits, a
working capital surplus of $5,337,752 and no outstanding bank debt.


Activity Update

Cobalt's initial areas of operational focus include the Peace River Arch and
East Central Alberta. The Company anticipates activity during the remainder of
the year to be directed primarily towards the Peace River Arch. To date, Cobalt
has assembled 5,760 acres (9 sections) of undeveloped land in the Peace River
Arch at 55-100% operated working interest through Crown land sales and farm-in
agreements. Cobalt is currently conducting seismic evaluations, pursuing
additional undeveloped lands and expects to operate the drilling of 2 (1.1 net)
exploration wells targeting liquids rich natural gas reserves prior to year end.


Subsequent to the second quarter, Cobalt acquired 2,560 acres (4 sections) of
undeveloped land in its East Central Alberta core area at 100% working interest.
The Company plans to operate the drilling of 2 (2.0 net) exploration wells prior
to year end, targeting natural gas at shallow drilling depths.


Acquisitions are also part of the Cobalt's growth strategy and the Company is
continually evaluating property or corporate acquisition opportunities which are
well-suited to its business plan.


Outlook

Since inception in late 2006, Cobalt has been committed to position itself as a
gas weighted company anticipating a rebound in natural gas prices over the
coming one to two years. The Company remains bullish in the mid to long term
outlook for natural gas prices. Our view is that the longer term demand for
energy in North America will reduce the current levels of natural gas storage.
This in turn will place pressure for increased natural gas pricing and
strengthening of the energy sector markets. Wildcards such as weather and the
pending hurricane season in the Gulf of Mexico are considered catalysts to
possibly accelerate the natural gas demand cycle.


Cobalt currently has a competitive advantage in conducting its business over the
next year. While many competitors are dealing with stressed balance sheets and
tight equity/debt markets to execute their business plans, Cobalt has recently
completed its IPO and enters the industry with fresh capital in a lower service
cost environment.


The Company's focus for the remainder of 2007 and into early 2008 is to fulfill
its flow-through obligation of $5.3 million by drilling a portion of our current
exploration inventory and by conducting seismic programs in our core areas. For
the second half of 2007, Cobalt plans capital expenditures of approximately $3
million. We expect to drill 4 (3.1 net) wells prior to year end, add to our
currently established undeveloped land position in multi-zone regions of
Alberta, and commence production in the Peace River Arch and in East Central
Alberta in late 2007 or early 2008.


Reader Advisory - This news release contains certain forward-looking statements,
which include assumptions with respect to future capital expenditures. The
reader is cautioned that assumptions used in the preparation of such information
may prove to be incorrect. All such forward looking statements involve
substantial known and unknown risks and uncertainties, certain of which are
beyond the Company's control. Such risks and uncertainties include, without
limitation, risks associated with oil and gas exploration, development,
exploitation, production, marketing and transportation, loss of markets,
volatility of commodity prices, currency fluctuations, imprecision of reserve
estimates, environmental risks, competition from other producers, inability to
retain drilling rigs and other services, delays resulting from or inability to
obtain required regulatory approvals and ability to access sufficient capital
from internal and external sources, the impact of general economic conditions in
Canada, the United States and overseas, industry conditions, changes in laws and
regulations (including the adoption of new environmental laws and regulations)
and changes in how they are interpreted and enforced, increased competition, the
lack of availability of qualified personnel or management, fluctuations in
foreign exchange or interest rates, stock market volatility and market
valuations of companies with respect to announced transactions and the final
valuations thereof, and obtaining required approvals of regulatory authorities.
The Company's actual results, performance or achievements could differ
materially from those expressed in, or implied by, these forward-looking
statements and, accordingly, no assurances can be given that any of the events
anticipated by the forward-looking statements will transpire or occur, or if any
of them do so, what benefits, including the amount of proceeds, that the Company
will derive therefrom. Readers are cautioned that the foregoing list of factors
is not exhaustive. All subsequent forward-looking statements, whether written or
oral, attributable to the Company or persons acting on its behalf are expressly
qualified in their entirety by these cautionary statements. Furthermore, the
forward-looking statements contained in this news release are made as at the
date of this news release and the Company does not undertake any obligation to
update publicly or to revise any of the included forward-looking statements,
whether as a result of new information, future events or otherwise, except as
may be required by applicable securities laws."