Colonia Energy Corp Announces Closing of Bought Deal Financing

NOT FOR DISSEMINATION OR DISTRIBUTION IN THE UNITED STATES OR TO UNITED STATES
NEWS WIRE SERVICES.


Colonia Energy Corp. ("Colonia" or the "Company") (TSX VENTURE:CLA) is pleased
to announce that it has completed its previously announced bought deal financing
for gross proceeds of $35 million. 


Pursuant to the bought deal financing, Colonia, through a syndicate of
underwriters co-led by GMP Securities L.P. and Peters & Co. Limited and
including Genuity Capital Markets, Macquarie Capital Markets Canada Ltd., Acumen
Capital Finance Partners Limited, CIBC World Markets Inc., Dundee Securities
Corporation and Paradigm Capital Inc. (collectively the "Underwriters") issued
175,000,000 subscription receipts ("Subscription Receipts") at a price of $0.20
per Subscription Receipt. The gross proceeds of the financing (the "Escrowed
Funds") have been deposited with Olympia Trust Company as escrow agent pending
the completion by Colonia of its previously announced acquisition (the "Private
Company Acquisition") of Duce Oil Ltd. ("Duce"). Upon closing of the Private
Company Acquisition, each holder of a Subscription Receipt shall receive one
common share of Colonia ("Common Share") without any further action or payment
of any additional funds and the Escrowed Funds shall be released to Colonia. If
the Private Company Acquisition is not completed by January 20, 2010, holders of
Subscription Receipts shall be refunded their pro rata portion of the Escrowed
Funds and the Subscription Receipts shall be cancelled. The Subscription
Receipts and any Common Shares issuable pursuant to the Subscription Receipts
will be subject to a four-month hold period expiring April 10, 2010. The
Underwriters received a cash fee equal to 6% of the gross proceeds raised under
the financing.


In addition, Colonia has, through an arrangement with Duce, closed a separate
non-brokered private placement of subscription receipts of Duce for gross
proceeds of $2 million. Pursuant to the arrangement, Duce has issued 10,000,000
subscription receipts ("Duce Receipts") at a price of $0.20 per subscription
receipt to facilitate a subscription that could not be made pursuant to the
Colonia bought deal financing. The Duce Receipts have the same conversion
conditions as the Subscription Receipts such that, upon completion of the
Private Company Acquisition, the holder will be entitled to receive 10,000,000
Common Shares of Colonia and the subscription funds for the Duce Receipts will
then be released to Colonia. The issuance and listing of the Common Shares
issuable pursuant to the Duce Receipts are subject to approval from the TSX
Venture Exchange (the "Exchange") and such Common Shares will also be subject to
a four-month hold period expiring April 10, 2010. 


Note Regarding Forward Looking Statements

This document contains forward-looking statements. More particularly, this
document contains statements concerning the release from escrow of proceeds
realized from the financings described above and closing of the Private Company
Acquisition.


Although Colonia believes that the expectations and assumptions on which the
forward-looking statements are based are reasonable, undue reliance should not
be placed on the forward-looking statements because Colonia can give no
assurance that they will prove to be correct. Since forward-looking statements
address future events and conditions, by their very nature they involve inherent
risks and uncertainties. Actual results could differ materially from those
currently anticipated due to a number of factors and risks. These include, but
are not limited to, risks that required regulatory and third party approvals and
consents are not obtained on terms satisfactory to the parties.


The forward-looking statements contained in this press release are made as of
the date hereof and Colonia undertakes no obligation to update publicly or
revise any forward-looking statements or information, whether as a result of new
information, future events or otherwise, unless so required by applicable
securities laws.