Insignia Energy Ltd.: Third Quarter Interim Report

Insignia Energy Ltd. (TSX:ISN) is pleased to announce its financial and
operating results for the three months and nine months ended September 30, 2008
as follows:




Corporate Highlights
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                               Three months ended        Nine months ended
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                          September     June  September September September
                                 30,      30,        30,       30,       30,
                               2008     2008       2007      2008      2007
                                  $        $          $         $         $
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Financial
($ thousands, except per
 share amounts)
Oil and natural gas sales     3,831    1,004        173     5,643       730
Funds from operations(1)      1,488      430         78     2,209       169
 Per share - Basic and
  diluted(1)                   0.16     0.10       0.02      0.38      0.04
Net loss                     (1,425)      (5)      (184)   (1,584)       (2)
 Per share - Basic and
  diluted                     (0.16)   (0.00)     (0.05)    (0.27)     0.00
Working capital              30,246   15,756     16,780    30,246    16,780
Future proceeds from equity
 line(2)                     25,000        -          -    25,000         -
Total capital resources
 available(3)                55,246   15,756     16,780    55,246    16,780
Property and equipment       49,095    4,419      4,143    49,095     4,143
Total assets                 87,384   22,230     21,785    87,384    21,785
Weighted average common
 shares outstanding
 (thousands):
  Basic and diluted(4)        9,038    4,112      4,112     5,781     4,030
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Operating
(boe conversion - 6:1
 basis)
Average daily production
 Natural gas (mcf/d)          3,390    1,129        351     1,873       388
 Oil and NGL (bbls/d)           168        -          -        56         -
 Total (boe/d)                  733      188         59       368        65
Product prices
 Natural gas ($/mcf)           7.22     9.77       5.36      7.92      6.89
 Oil and NGL ($/bbl)         101.52        -          -    101.52         -
 Total ($/boe)                56.81    58.63      32.13     55.88     41.34
Operating netback ($/boe)(1)  27.35    33.91      19.33     28.38     22.77
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(1) Funds from operations, funds from operations per share and operating
    netback are not defined by GAAP in Canada and are referred to as
    non-GAAP measures. Funds from operations is cash provided by operating
    activities before changes in non-cash working capital and before
    abandonment and reclamation costs. Funds from operations per share is
    calculated by dividing funds from operations by the weighted average
    number of shares outstanding, consistent with the calculation of net
    loss per share. Operating netback per boe is calculated as total oil
    and natural gas revenue less royalties, operating costs and
    transportation costs calculated on a boe basis.
(2) Insignia has a $25 million unused equity line whereby Tricap Partners
    Ltd. are committed, prior to July 31, 2009, to subscribe for an
    additional 3,676,470 common shares of the Company at a price of $6.80
    per share.
(3) Total capital resources available includes working capital plus future
    proceeds from the equity line with Tricap Partners Ltd.
(4) Excludes shares to be issued pursuant to the Tricap Partners Ltd.
    equity line.



MESSAGE TO SHAREHOLDERS

Insignia Energy Ltd. ("Insignia or the Company") is pleased to report to its
shareholders the financial and operating results for the three and nine months
ended September 30, 2008. This is the first reporting quarter since the reverse
take-over (the "RTO") of Flagship Energy Inc. which closed on July 31, 2008. the
RTO was concluded through a Plan of Arrangement (the "Arrangement") whereby,
among other things, Insignia (formerly Flagship Energy Inc.) acquired
substantially all of the assets and liabilities of Insignia Energy Inc., a
private Alberta based company.


As a result of the timing of the closing of the Arrangement, this report, for
the quarter ended September 30, 2008, reflects only a partial quarter, namely 61
days of financial and operating results of Insignia Energy Ltd. and a full
quarter of the financial and operating results of Insignia Energy Inc.
Similarly, the nine month data again reflect 61 days of Insignia Energy Ltd. and
the full nine month period of Insignia Energy Inc.


Reflecting this partial quarter, production averaged 733 boe/d and funds from
operations totalled $1.5 million for the three months ended September 30, 2008.
in addition, Insignia ended the third quarter with a strong balance sheet
consisting of $30.2 million of positive working capital with no debt. Further,
and as highlighted in Note 6 to our Financial Statements, Insignia has a $25
million unused equity line whereby Tricap Partners Ltd. are committed, prior to
July 31, 2009, to subscribe for an additional 3,676,470 shares of Insignia at a
price of $6.80 per share.


THIRD QUARTER 2008 HIGHLIGHTS

- Completed the Arrangement whereby Insignia (formerly Flagship Energy Inc.)
acquired substantially all of the assets and liabilities of Insignia Energy Inc.
and the Company was recapitalized with significant equity investment from Tricap
Partners Ltd. the transaction closed on July 31, 2008.


- On August 8, 2008, Insignia began trading on the TSX Venture Exchange under
the symbol "ISN". Subsequent to the third quarter, Insignia moved its listing to
the Toronto Stock Exchange (TSX) and began trading on the TSX on October 30,
2008 under the symbol "ISN".


- In September, the operator of the Crossfire Nisku well located at 09-01-50-6
W5M (Insignia 15% working interest) placed the well on production having been
granted Good Production Practice (GPP) status from the Energy Resources
Conservation Board (ERCB). Initial rates from the well have been positive,
yielding approximately 1,850 bbls/d of light oil and 1.3 mmcf/d of raw gas or
approximately 2,000 boe/d gross (300 boe/d net).


- The Company exited the quarter at a production rate of 1,000 boe/d.

- The Company has, inclusive of the Tricap Partners Ltd. equity line, in excess
of $55 million of capital resources, which on a per share basis, after giving
consideration to the shares to be issued to Tricap Partners Ltd. pursuant to the
equity line, represents approximately $3.39 per share.


OUTLOOK

In the past few months we have all witnessed unprecedented volatility in the
world markets which has, in turn, created much uncertainty. While no one knows
how long this current uncertainty will last, we know that our approach to our
business hasn't changed, nor has our focus or determination to build value for
Insignia shareholders. Our management team has collectively worked through a
number of down cycles, and we know that it is these times of uncertainty that
have created the best opportunities and wealth generation for our industry.
Further, we also know that our business is centered on a non renewable resource,
oil and gas, and this resource will continue to be in great demand for many
years to come. Although the short term is highly unpredictable, the long term
fundamentals in the oil and gas industry are extremely positive and it is that
longer term approach that we intend to take in the building of Insignia.


Insignia is well positioned to not only weather this economic downturn but is
also well positioned to capitalize on tremendous opportunities that we
anticipate will be presented to us in the coming months. Although our single
biggest asset is our $55 million in positive working capital (includes the $25
million equity line), we also have a diversified portfolio of medium to low risk
drilling and completion opportunities including the future advancement of our
high impact Crossfire property, a large undeveloped land base of over 145,000
net undeveloped acres, significant tax pools in excess of $70 million and
lastly, an experienced team and aligned Board of Directors.


In the coming months, we intend to advance the delineation of the highest return
projects within our portfolio including drilling, completion and facility
activity on our Beaverhill Lake, Retlaw, Sedalia, La Glace, Redwater, Nig and
Crossfire properties. at the same time, we intend to identify and aggressively
pursue accretive corporate acquisition opportunities and, to a lesser extent,
asset acquisition opportunities. And, finally, we intend to more actively
participate at future Crown land sales acquiring lands in the deep basin
corridor of Western Alberta and NE British Columbia at a time when the industry
is capital constrained and pulling back on land sale activity.


In the fourth quarter, we plan to spend between $5.0 to $7.0 million on capital
expenditures with over half of this amount being allocated to land, facilities
and seismic. Assuming the Crossfire 9-1 well continues to produce under Good
Production Practice ("GPP"), we feel comfortable that we will be on target to
meet our previously announced 2008 exit rate of 1,000 to 1,100 boe/d net to
Insignia.


Lastly, we wish to thank all shareholders for their overwhelming support in the
approval of our recent Plan of Arrangement and generally your support as we
navigate through these uncertain times.


Regards,

Jeff Newcommon Brenda Hughes President & CEO Interim CFO and Controller

The discussion of our oil and natural gas activities with respect to oil and gas
volumes, and related performance measures is presented on a working-interest,
before royalties basis. for the purpose of calculating unit information, natural
gas is converted to a barrel of oil equivalent ("boe") using six thousand cubic
feet of natural gas equal to one barrel of oil. Readers are cautioned that boe's
may be misleading, particularly if used in isolation. a conversion ratio of six
thousand cubic feet of natural gas to one barrel of oil is based on an energy
equivalency conversion method primarily applicable at the burner tip and does
not represent a value equivalency at the wellhead. in this press release: boe/d
means boe per day; mcf/d means thousand cubic feet per day, bbl means barrel and
mmcf means million cubic feet.


Investors are further cautioned that the preparations of financial statements in
accordance with Canadian generally accepted accounting principles ("Canadian
GAAP") requires management to make estimates and assumptions that affect the
reported amounts of our assets and liabilities and the disclosure of contingent
assets and liabilities at the date of the financial statements and our revenues
and expenses during the reporting period. Our management reviews these
estimates, including those related to accruals, environmental and asset
retirement obligations, income taxes, and the determination of proved reserves
on an ongoing basis. Changes in facts and circumstances may result in revised
estimates and actual results may differ from these estimates.


Certain financial measures referenced to in this news release are not prescribed
by Canadian GAAP. These non-GAAP financial measures do not have any standardized
meaning and therefore are unlikely to be comparable to similar measures
presented by other companies. We include these measures because management
utilizes them to analyze operating performance. the additional information
should not be considered in isolation or as a substitute for measures of
performance prepared in accordance with the Canadian GAAP. We use funds from
operations which is cash provided by operating activities before changes in
non-cash working capital and before abandonment and reclamation costs. Funds
from operations per share is calculated by dividing funds from operations by the
weighted average number of shares outstanding, consistent with the calculation
of net loss per share. Funds from operations netback per boe is calculated as
funds from operations divided by our total boe produced. We also use operating
netback per boe. This is calculated as total oil and natural gas revenue less
royalties, operating costs and transportation costs calculated on a boe basis.


Forward Looking Statements

Statements throughout this Press Release that are not historical facts may be
considered to be "forward looking statements". These forward looking statements
sometimes include words to the effect that management believes or expects a
stated condition or result. All estimates and statements that describe the
Company's objectives, goals, or future plans, including management's assessment
of future plans and operations, anticipated commodity prices and their impact,
timing of expenditures, budgeted capital expenditures and the method of funding
thereof, timing of drilling, completion and tie-in of wells, expected royalty
rates and changes to the Alberta royalty regime and the possible effect thereof
on the Company and its allocation of capital, expected royalty rates, operating
costs and general and administrative expenses and the expected levels of
activities may constitute forward-looking statements under applicable securities
laws and necessarily involve risks including, without limitation, risks
associated with oil and gas exploration, development, exploitation, production,
marketing and transportation, volatility of commodity prices, imprecision of
reserve estimates, environmental risks, competition from other producers,
incorrect assessment of the value of acquisitions, failure to complete and/or
realize the anticipated benefits of acquisitions, delays resulting from or
inability to obtain required regulatory approvals and ability to access
sufficient capital from internal and external sources and changes in the
regulatory and taxation environment. as a consequence, the Company's actual
results may differ materially from those expressed in, or implied by, the
forward-looking statements. Forward-looking statements or information are based
on a number of factors and assumptions which have been used to develop such
statements and information but which may prove to be incorrect.

Although the Company believes that the expectations reflected in such
forward-looking statements or information are reasonable, undue reliance should
not be placed on forward-looking statements because the Company can give no
assurance that such expectations will prove to be correct. in addition to other
factors and assumptions which may be identified in this document, assumptions
have been made regarding, among other things: the ability of the Company to
obtain equipment and services in a timely and cost efficient manner; drilling
results; the ability of the operator of the projects which the Company has an
interest in to operate the field in a safe, efficient and effective manor; field
production rates and decline rates; the ability to replace and expand oil and
natural gas reserves through development of exploration; future oil and natural
gas prices; interest rates; the regulatory framework regarding royalties, and
the ability of the Company to successfully market its oil and natural gas
products. 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 elsewhere herein and
in reports on file with Canadian securities regulatory authorities and may be
accessed through the SEDAR website (www.sedar.com), or at the Company's website
(www.insigniaenergy.ca). Furthermore, the forward-looking statements contained
in this Press Release are made as at the date of this Press 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.


Insignia is a publicly listed junior oil and gas exploration and development
company based in Calgary, Alberta. Insignia's shares trade on the TSX under the
symbol "ISN".


Copies of the interim financial statements and Management's Discussion and
Analysis in respect thereof for the nine months ended September 30, 2008 is
being filed today with Canadian securities regulators and will be available on
SEDAR and can be accessed at www.sedar.com or by visiting Insignia's website at
www.insigniaenergy.ca.