Coastal Energy Announces 2010 Year End Financial Results

   Coastal Energy Company (the "Company" or "Coastal Energy") (TSX-V: CEN) (AIM: CEO), an independent exploration and production company with assets in Thailand, announces the financial results for the year ended December 31, 2010. The functional and reporting currency of the Company is the United States dollar.

Fourth Quarter 2010 Highlights

• Total Company production averaged 7,578 boepd in the fourth quarter; offshore production was impacted by 23 days of downtime (15 related to weather and 8 for processing facilities upgrades).
• The Company drilled three exploration wells at Songkhla A and each well discovered new reservoirs in the Lower Oligocene and Eocene intervals. These three new fault blocks are estimated by the Company to collectively contain approximately 80 million barrels of oil in place. The wells have since been tied into production facilities. Further appraisal and development work around these three discoveries is planned for 2011.
• The Company reported EBITDAX of $2.6 million ($0.02 per basic share) for Q410. The decline from Q310 is attributable to lower production and lifting volumes due to downtime on the Company's offshore operations.

Full Year 2010 Highlights

• Total Company production averaged 9,670 boepd for the full year of 2010, 31% above 2009 levels.
• A total of 2.8 million barrels of oil and 4.3 bcf of gas net to the Company were produced during the year. The average prices realized were $70.47 / barrel for oil and $7.07 / mcf for gas
• The Company brought its Bua Ban field onstream in July.
• The Company's full year 2010 EBITDAX was $112.7 million, 197% above 2009 EBITDAX of $37.9 million.
• The Company released the results of its third-party reserve evaluation report prepared by Huddleston & Co. dated March 28, 2011 (effective date December 31, 2010)
• As of the date of this release, the Company has cash and cash equivalents of approximately $35MM.

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                                                          After-Tax
                                                          NPV 2010
                                                            using
            As of    As of                                March 31,
          December December After-Tax After-Tax             2011
          31, 2010 31, 2009  NPV 2010  NPV 2009           Pricing
           (mmboe)  (mmboe)  (US$MM)   (US$MM)  % Change   (US$MM)  % Change
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Proven
 Offshore   14.5     15.2     $413.5    $345.2   19.8 %    $498.2     44.3%
 Onshore     8.0      8.0     114.0     107.4     6.1 %     114.0     6.1%
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  Total     22.5     23.2     527.5     452.6    16.5 %     612.2     35.3%
   1P

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Proven +
 Probable
 Offshore   27.1     32.9     $583.6    $577.1    1.1 %    $716.2     24.1%
 Onshore    23.9     22.1     207.0     203.5     1.7 %     207.0     1.7%
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  Total     51.0     55.0     790.6     780.6     1.3 %     923.2     18.3%
   2P
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Note: Reserve figures are shown as net working interest before royalties (Thailand royalty regime is discussed in the MD&A of the Company's Annual Report dated December 31, 2010). After-tax NPV figures are defined as future net revenues discounted at 10%. Reserve numbers taken from the Company's competent person's report prepared by Huddleston & Co. dated as of December 31, 2010 (prepared in accordance with NI 51-101 and the COGE Handbook) which may be found on the Company's website at www.coastalenergy.com.

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

"2010 was a record year for Coastal Energy. We had record production volumes and cash flow. The Company successfully completed the first phase of development at the Bua Ban field and drilled three successful exploration wells at Songkhla. We are pleased with the results and expect to build on this foundation with further success in 2011.

"The slight reduction in offshore reserves is attributable to a write down at the Bua Ban field following development drilling in Q310. Several of the wells encountered thinner pay zones than were used previously in calculating the reserve estimates. However, we are pleased that the exploration drilling at Songkhla in Q410 added enough reserves to almost fully offset the decline in Bua Ban reserves. We plan further appraisal drilling at Songkhla later in 2011 to further refine our oil in place estimates and recovery factors for these reservoirs, which could serve to increase reserve estimates.

"2011 is off to a terrific start. We have drilled successful exploration wells at Bua Ban North A and have already discovered over 50 million barrels of oil in place (per Company estimates) in the first three and a half months of the year. Coastal has also successfully fractured two wells at Bua Ban, which we continue to evaluate. We are evaluating a development plan for horizontal wells and multi-stage fracs in both the Eocene and Lower Oligocene reservoirs at Bua Ban to increase production rates and ultimate recoveries.

"We have a busy year ahead of us with the remainder of Bua Ban North exploration drilling, development work on the recent discovery at Bua Ban North, Southern Bua Ban appraisal and exploration and further appraisal and development drilling at Songkhla."

The following financial statements for the Company are abbreviated versions. The Company's complete financial statements for the three and twelve months ended December 31, 2010 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.

                                                         2010          2009
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                                                            $             $
Revenues
  Oil and natural gas                                 193,608        86,348
  Royalties                                           (16,401)       (5,878)
  Loss on derivative risk management contracts
   (Note 13)                                          (18,247)       (2,077)
  Interest income                                           5            27
  Other income                                             99           110
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                                                      159,064        78,530
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Expenses and other
  Production                                           53,368        33,477
  General and administrative                           20,253        19,576
  Foreign exchange loss                                 4,600         1,941
  Interest                                              2,007         3,839
  Debt financing fees (Note 13)                           522         1,454
  Depletion, depreciation and accretion                56,599        23,695
  Impairment (Note 9)                                  10,706         2,366
  Loss on sale of assets                                    -           148
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                                                      148,055        86,496
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Net income (loss) before taxes, earnings from
 significantly influenced investee and non-
 controlling interest                                  11,009        (7,966)

Income taxes (Note 18)                                 15,947           738
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Net loss before earnings from significantly
 influenced investee and non-controlling
 interests                                             (4,938)       (8,704)

Earnings from significantly influenced investee
 (Note 8)                                              10,959         8,462
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Net income (loss) before non-controlling
 interests                                              6,021          (242)

Non-controlling interest (Note 4)                      (1,167)          127
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Net income (loss) and comprehensive income
 (loss)                                                 4,854          (115)
Deficit, beginning of year                            (16,702)      (16,587)
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Deficit, end of year                                  (11,848)      (16,702)
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Basic and diluted earnings per share (Note 15)           0.04          0.00
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                                                         As at December 31,
                                                         2010          2009
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                                                            $             $
Assets
Current assets
  Cash                                                  3,884        21,229
  Restricted cash (Note 5)                             16,369         3,829
  Accounts receivable (Note 6)                         10,299         6,111
  Derivative asset (Note 13)                              135            66
  Inventory (Note 7)                                   12,846         5,310
  Prepaids and other current assets                       606           526
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                                                       44,139        37,071

Investment in and advances to Apico LLC (Note 8)       50,288        55,225
Property, plant and equipment (Note 9)                318,374       233,014
Deposits and other assets                                 289           299
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Total Assets                                          413,090       325,609
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Liabilities
Current liabilities
  Accounts payable and accrued liabilities (Note
   10)                                                 53,519        31,325
  Current portion of derivative liabilities
   (Note 13)                                           10,141             -
  Deferred income (Note 11)                                 -        23,060
  Income taxes payable (Note 18)                           31            38
  Amounts due to shareholder (Note 12)                      -         5,164
  Current portion of long-term debt (Note 13)          36,262        10,266
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                                                       99,953        69,853

Long-term debt (Note 13)                               35,081        24,284
Non-current portion of derivative liabilities
 (Note 13)                                              6,609             -
Asset retirement obligations (Note 14)                 12,277         2,809
Future income tax liability (Note 18)                  47,185        27,695
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Total Liabilities                                     201,105       124,641
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Commitments and contingencies (Note 19)

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Non-controlling interest (Note 4)                       6,559         5,617
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Shareholders' equity
Share capital (Note 15)                               201,303       198,121
Contributed surplus (Note 15)                          15,892        13,779
Warrants (Note 15)                                         79           153
Retained deficit                                      (11,848)      (16,702)
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                                                      205,426       195,351
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                                                      413,090       325,609
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                                                         2010          2009
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                                                            $             $
Operating activities
  Net income (loss) for the year                        4,854          (115)
  Distributions from significantly influenced
   investee (note 8)                                   15,896         8,129
  Items not involving cash:
    Depletion, depreciation and accretion              56,599        23,695
    Impairment                                         10,706         1,765
    Future income taxes (note 19)                      15,954           700
    Unrealized foreign exchange loss                    2,890           909
    Income (loss) applicable to non-controlling
     interest                                           1,167          (127)
    Stock based compensation                            7,827         8,021
    Amortisation of debt financing fees                   132             -
    Issuance of warrants with notes payable                 -           294
    Share of earnings of significantly
     influenced investee, net of taxes                (10,959)       (8,462)
    Unrealized loss on derivative instrument           16,681         1,950
    Loss on sale of assets                                  -           148
  Change in non-cash working capital (Note 20)        (26,771)       17,095
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  Cash provided by operating activities of
   continuing operations                               94,976        54,002
Investing activities
  Investment in and advances to Apico LLC                   -        (4,516)
  Increase in restricted cash                         (12,540)          317
  Purchase of property, plant and equipment          (133,375)      (77,671)
  (Payments to) contributions from non-
   controlling interest partner                          (225)        5,744
  Other                                                                  (2)
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Cash used in investing activities                    (146,140)      (76,128)
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Financing activities
  Issuance of shares for cash                           2,409        52,306
  Transaction costs associated with issuance of
   shares                                                   -        (2,984)
  Borrowings under long-term debt                      73,725         1,620
  Credit facility transaction costs                    (2,514)            -
  Repayments under long-term debt                     (34,550)      (11,070)
  Borrowings under notes payable                            -        15,000
  Repayments under notes payable                            -       (15,000)
  Borrowings under amounts due to shareholder               -         1,000
  Repayments under amounts due to shareholder          (5,164)       (3,000)
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Cash provided by financing activities                  33,906        37,872
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Net effect of foreign exchange on cash held in
 foreign currencies                                       (87)         (951)
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Change in cash                                        (17,345)       14,795
Cash, beginning of year                                21,229         6,434
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Cash, end of year                                       3,884        21,229
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Supplemental cash flow information (Note 20)

Randy Bartley, President and Chief Executive Officer of the Company and a member of the Society of Petroleum Engineering and Jerry Moon, Vice President, Technical & Business Development, a member of the American Association of Petroleum Geologists, a Licensed Professional Geoscientist and a Certified Petroleum Geologist in the state of Texas, have reviewed the contents of this announcement.

Additional information, including the Company's complete competent person's report may be found on the Company's website at www.CoastalEnergy.com or 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.

These securities have not been registered under United States Securities Act of 1933 (the "US Securities Act") or the securities laws of any state and may not be offered or sold in the United States or to US persons (as defined in Regulation S under the US Securities Act) unless an exemption from registration is available.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

This news release is not for dissemination in the United States or through United States newswire services

Enquiries: Coastal Energy Company Email: Email Contact [phone] Strand Hanson Limited (Nominated Adviser) Rory Murphy Paul Cocker [phone] Macquarie Capital (Europe) Limited (Broker) + Ben Colegrave Paul Connolly 44 (0) 20 3037 2000 FirstEnergy Capital LLP (Broker) Hugh Sanderson Travis Inlow [phone] Buchanan Communications Tim Thompson Chris McMahon Ben Romney [phone]