Redcliffe Announces Q3 2008 Financial Results

THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OR TO U.S. PERSONS.

Redcliffe Exploration Inc. (TSX VENTURE:RXP.A) (TSX VENTURE:RXP.B) ("Redcliffe"
or the "Company") is pleased to announce that it has filed its unaudited interim
financial statements and related Management's Discussion and Analysis as of
September 30, 2008 and for the three and nine months then ended with Canadian
securities regulatory authorities. These filings are available for review at
www.sedar.com.


Q3 2008 Highlights:

- Production increased 84% to an average of 828 boe/d for Q3 2008, compared to
451 boe/d for Q3 2007. The Company is currently producing approximately 1,100
boe/d, with potential production of 300 boe/d currently being tied-in.


- Petroleum and natural gas sales increased 259% to $5,411,000, compared to
$1,508,000 in Q3 2007. Average prices realized for Q3 2008 increased 95% to
$71.00/boe, compared to $36.34/boe for Q3 2007.


- Operating netback increased 107% to $39.22/boe for Q3 2008, compared to
$18.97/boe for Q3 2007.


- Funds from operations increased 568% to $2,011,000, compared to $301,000 for
Q3 2007.


- Net income increased to $1,856,000 for Q3 2008, compared to a net loss of
$1,131,000 for Q3 2007.


- Net capital expenditures totaled $4,474,000 for Q3 2008. Redcliffe drilled 2
(1.03 net) wells during the quarter, resulting in 2 (1.03 net) gas wells, for an
overall success rate of 100%.


- Subsequently completed a flow-through equity financing on October 30, 2008 at
$0.50 per Class A share for gross proceeds of $5 million.




                                          Three months          Nine months 
                                    ended September 30   ended September 30
                                   -----------------------------------------
Financial                              2008       2007      2008       2007
----------------------------------------------------------------------------
($ thousands, except per 
 share amounts)

Petroleum and natural gas sales       5,411      1,508    16,693      4,270
Funds from operations (1)             2,011        301     7,021      1,038
 Per basic and diluted share           0.02       0.01      0.09       0.03
Cash provided by operating activities 1,368        879     5,923      1,452
 Per basic and diluted share           0.02       0.02      0.08       0.04
Net income (loss) and other 
 comprehensive income (loss)          1,856     (1,131)      632        197
 Per basic and diluted share           0.02      (0.03)     0.01       0.01
Capital expenditures, net             4,474      5,566    13,096     11,234
Weighted-average shares (thousands) 
 Basic                               80,484     42,658    75,549     35,257
 Diluted                             80,484     42,658    75,872     35,257


Capital Structure                   September 30, 2008    December 31, 2007
----------------------------------------------------------------------------
($ thousands, except share amounts)

Working capital deficiency (2)                   3,974                9,144
Bank debt                                        9,503                4,225
Net debt                                        13,477               13,369
Bank facility                                   14,000                9,200
Total assets                                    64,255               56,922
Shares outstanding (thousands)  
 Class A                                        65,609               54,406
 Class B                                         1,494                1,494


                                          Three months          Nine months 
                                    ended September 30   ended September 30
                                   -----------------------------------------
Operations                             2008       2007      2008       2007
----------------------------------------------------------------------------

Daily production
 Crude oil and condensate (bbl/d)       224         24       176         10
 Natural gas liquids (bbl/d)             47         66       109         69
 Natural gas (mcf/d)                  3,345      2,163     3,739      1,753
 Oil equivalent (boe/d @ 6:1)           828        451       908        371
 Per million diluted shares           10.29      10.57     11.97      10.52
Average prices (3)
 Crude oil and condensate ($/bbl)    115.45      77.11    115.95      75.37
 Natural gas liquids ($/bbl)          49.79      39.30     55.04      43.36
 Natural gas ($/mcf)                   8.95       5.51      9.17       6.80
 Oil equivalent ($/boe)               71.00      36.34     67.08      42.19
Netback
 Operating netback ($/boe) (4)        39.22      18.97     38.79      24.56
 Realized loss on financial 
  instruments ($/boe)                 (3.36)         -     (1.99)         - 
 General and administrative ($/boe)   (7.68)     (7.88)    (6.97)    (10.15)
 Interest ($/boe)                     (1.78)     (3.84)    (1.61)     (4.16)
 Funds from operations ($/boe)        26.40       7.25     28.22      10.25
Drilling activity
 Gross wells                           2.00       2.00      5.00       7.00
 Net wells                             1.03       0.63      3.53       3.65
 Success rate, net wells                100%       100%      100%        68%
----------------------------------------------------------------------------
(1) Funds from operations is calculated as cash provided by operating 
    activities and adding changes in non-cash working capital. Funds from
    operations is used to analyze the Company's operating performance and
    leverage. Funds from operations does not have a standardized measure
    prescribed by GAAP and therefore may not be comparable with 
    calculations of similar measures for other companies.

(2) Working capital deficiency includes only accounts receivable, prepaid
    expenses and deposits, less accounts payable and accrued liabilities.

(3) Average prices are before the deduction of transportation costs; oil
    equivalent includes sulphur sales.

(4) Operating netback equals petroleum and natural gas sales less 
    royalties, operating expenses and transportation costs, calculated on 
    a boe basis. Operating netback does not have a standardized measure
    prescribed by GAAP and therefore may not be comparable with the 
    calculation of similar measures for other companies.



Outlook:

Redcliffe's 2008 focus has been to increase production through the tie-in of
significant behind-pipe production, to increase production and reserves from
additional drilling activities in our core areas, and to significantly expand
our land position and high-impact drilling opportunities for 2009 and beyond.


The Company is currently producing approximately 1,100 boe/d. Production has
increased from Q3 2008 from the Wapiti 7-3 light oil well as a result of
receiving GPP status, although production of this well is constrained based on
its gas rate and related plant capacity. The Company expects to complete the
tie-in of two recently completed Gold Creek gas wells, with production from such
wells expected to commence in December 2008 for a net potential addition of
approximately 300 boe/d to the Company. Approximately 250 boe/d of the Company's
Gold Creek production remains shut-in as a result of continued facility
constraints and high hydrocarbon liquid handling issues in the area. The Company
has been able to steadily increase production from such affected Gold Creek
wells since earlier this year; however, the remaining shut-in production is not
expected to come on-stream until the remaining operational and technical issues
are resolved. This has also postponed the drilling of a number of lower risk
wells in the Gold Creek area until 2009. The Company and the other working
interest partners continue to work diligently to address these issues and are
exploring a number of near and longer-term alternatives.


Redcliffe has continued to enjoy excellent drilling success in 2008 and we
currently plan to drill up to four wells to the end of Q1 2009. Nevertheless, as
a result of the current global economic downturn and credit crisis, the Company
will monitor its capital budget in relation to available funding and changes in
commodity prices, and will adjust capital expenditures accordingly.


Our 2008 objective of significantly expanding our land position and high-impact
drilling opportunities for 2009 and beyond continues to meet with excellent
success. In particular, the raising of a US$6 million land fund during the
quarter has enabled us to assemble an enviable undeveloped land position in the
dynamic Gold Creek/Wapiti areas of the Peace River Arch, while maintaining
technical and operational control over these lands in regards to all drilling
and operational issues. As a result, the Company now controls approximately 121
(78 net) sections or approximately 77,500 (50,100 net) acres of undeveloped
land, which includes the Company's share of unearned lands held through the land
fund (11,400 net acres). For the remainder of 2008, we will continue to build
our land base and drilling inventory.


The past several months have been a trying time for our industry and we
anticipate a continued difficult environment for junior oil and gas companies
for the foreseeable future caused by lower oil prices and world-wide
recessionary and liquidity issues. Nevertheless, we will continue to focus on
creating value in these difficult times, and with our strong management and
technical teams, our excellent land base, and our inventory of high-impact
drilling opportunities, we remain confident and optimistic about our future.
Recent royalty program modifications by the Alberta government have
significantly improved the economics of our drilling programs for 2009 and
beyond, which will also assist in our competition for capital resources to
finance our investment programs.


Reader Advisories

Forward-Looking Statements: This news release contains certain forward-looking
statements, including management's assessment of future plans and operations,
and capital expenditures and the timing thereof, that 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, processing 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 there from. Readers are cautioned that the foregoing list of factors
is not exhaustive. Additional information on these and other factors that could
affect the Company's operations and financial results are included in reports on
file with Canadian securities regulatory authorities and may be accessed through
the SEDAR website (www.sedar.com). 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.


BOE may be misleading, particularly if used in isolation. A BOE conversion of 6
Mcf: 1 bbl is based on an energy equivalency conversion method primarily
applicable at the burner tip and does not represent a value equivalency at the
wellhead.