Bronco Energy Ltd.

TSX: BCF

CALGARY, ALBERTA--(Marketwire - May 12, 2009) - Bronco Energy Ltd. ("Bronco" or the "Company") (TSX:BCF) announces its first quarter 2009 results and operations update noting the following highlights:

- Bronco has received conditional approval from the TSX for a $24 million convertible debenture financing. It is expected to close shortly and will strengthen Bronco's balance sheet.

- Continued focused efforts to increase operating netbacks through improved bitumen marketing. Improved operations and efficiencies are resulting in lower operating costs.

- Our Q1 2009 average net production was 1,007 boepd (including 798 bopd of raw bitumen and gas of 1,254 mcfpd). Net production since the end of Q1 2009 has average 1,295 boepd (including 912 bopd of raw bitumen and gas of 2,290 mcfpd). Since the Free Water Knock Out was returned to full operation in January 2009, a facility uptime rate of 100% has been achieved. Continued facility uptime combined with ongoing well optimization efforts, are expected to result in continued near term growth in production.

Bronco has filed its Financial Statements and related Management Discussion and Analysis for the first quarter ended March 31, 2009. Electronic copies of the above documents may be obtained from SEDAR at www.sedar.com or from Bronco's website at www.broncoenergy.ca/financial-report... .

Operations

As a result of an evaluation of the economics under its crude pipeline shipping contract compared to shipping bitumen by truck, Bronco began delivering 100% of its bitumen production near the beginning of April 2009 to three alternate delivery points. This change eliminates the Company's dependence on the single third party pipeline shipper it had been selling blended bitumen to, and is having a positive impact on operating netbacks.

Recent increases in the WTI forward curve along with improving heavy oil differentials, have had a positive impact on our realized commodity prices. Management remains optimistic that anticipated improvements in production volumes, heavy oil prices and newly introduced cost control and marketing initiatives will result in positive operating netbacks by the end of Q2 2009.

Bronco Drilling's Rig #1 has been working for a third party since January 3, 2009 and had a total of 88 operating days in the first quarter of 2009, with an expected additional 30 to 40 operating days in the second quarter under the current contract.

"The net proceeds from our $24 million debenture financing (expected to close in the next few days), will leave us with a healthy balance sheet. It will also provide sufficient capital to fund our 2009 capital expenditure plans, including bringing on production from the last ten of our 68 wells and upgrading the battery to reduce operating costs", said Peter Pelensky, CEO of Bronco.

First Quarter 2009 Financial Results

The table below provides selected consolidated financial information for the three months ended March 31, 2009 and 2008:

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                                                Three Months Ended March 31,
Selected Financial Information                         2009            2008
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Petroleum & natural gas revenue               $   3,654,106   $           -
Royalties                                          (215,668)              -
Operating expense - petroleum and natural gas    (4,588,419)              -
Transportation costs                               (966,695)              -
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Operating netback (loss)                      $  (2,116,676)  $           -
Drilling services sales                           1,510,620       1,211,525
Operating expense - drilling                       (851,107)       (578,050)
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Operating income (loss)                       $  (1,457,163)  $     633,475
Interest income                                       2,102         103,147
General and administrative - cash charge         (1,526,300)       (986,355)
Cash financial charges                             (191,922)       (371,134)
Cash taxes                                                -               -
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Funds (loss) from operations                  $  (3,173,283)  $    (620,867)
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Net loss                                      $  (6,172,576)  $  (1,748,531)
Basic and diluted loss per share              $       (0.16)  $       (0.05)
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Total assets                                  $ 168,039,955   $ 147,988,855
Working capital (deficit)                     $ (21,938,667)  $ (33,927,983)
Bank debt                                     $  10,000,000   $  10,000,000
Asset retirement obligation                   $   4,106,304   $   2,981,475
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Capital expenditures                          $   1,870,035   $  36,367,415
Wells drilled - gross (net)                        0.0 (0.0)     12.0 (11.4)
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Operating days - drilling                                88             121
Utilization rate - drilling                              50%             66%
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Common shares outstanding                        38,163,558      32,489,706
Weighted average common shares outstanding       38,163,558      32,029,684
Stock options outstanding                         2,301,323       3,147,255
Exercisable vested stock options outstanding      1,995,154       1,697,924
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Operational
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Average Daily Net Production
Blended Heavy Oil (bopd)                              1,107               -
Diluent purchased (bopd)                               (309)              -
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Bitumen produced and sold (bopd)                        798               -
Natural gas (Mcfpd)                                   1,254               -
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Combined (boepd)                                      1,007               -
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Netbacks
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Natural gas ($/Mcf)                                    4.79               -
Heavy Oil ($/bbl)                                     31.25               -
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Gross revenues combined ($/boe)                       40.31               -
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Production revenue ($/boe) (1)                        12.12               -
Royalties ($/boe)                                     (2.38)              -
Operating expenses ($/boe)                           (33.09)              -
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Operating netback ($/boe)                            (23.35)              -
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(1) Production revenue is calculated by deducting the related diluent and
    transportation costs from revenues. "Production revenue" is a measure
    utilized by the Company to evaluate operating performance of our
    petroleum and natural gas assets and is defined as petroleum and natural
    gas revenues (gross of royalties) less transportation costs and diluent
    purchased. Production revenue does not have a standardized meaning under
    GAAP and may not be comparable with similar measures of other entities.
    A reconciliation of production revenue to petroleum and natural gas
    revenues follows.



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                                                Three Months Ended March 31,
                                                     2009              2008
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Production revenue                            $ 1,097,944        $        -
Diluent purchased                               1,589,467                 -
Transportation costs                              966,695                 -
Royalties                                        (215,668)                -
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Petroleum & natural gas, net of royalties     $ 3,438,438        $        -
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Disclosure provided in respect of barrels of oil equivalent per day ("boepd") may be misleading, particularly if used in isolation. A boepd conversion ratio of six thousand cubic feet of gas per day ("mcfpd") to one barrel of oil per day ("bopd") is used and is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Forward-Looking Information

Certain statements contained in this document constitute forward-looking statements (the "forward-looking statements"). These statements relate to future events or our future performance. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "budget", "plan", "guidance", "continue", "estimate", "expect", "forecast", "may", "will", "project", "potential", "target", "intend", "could", "might", "should", "believe" and similar expressions. In particular, forward-looking statements herein include, but are not limited to, statements with respect to: timing of re-completion and tie-in of wells; well and facility performance, completion timing and method of funding thereof; productive capacity of wells, anticipated or expected production rates; completion and facilities costs; our ability to lower our cost structure; our growth expectations; timing of development of developed non-producing and undeveloped reserves; the performance characteristics of our oil and natural gas properties; oil and natural gas production levels; the size and quantity of the oil and natural gas reserves; projections of market prices and costs; supply and demand for oil and natural gas and commodity prices; expectations regarding the ability to raise capital and to continually add to reserves through acquisitions, exploration and development; treatment under governmental regulatory regimes and tax laws; our tax horizon; expected levels of royalty rates, operating costs, general administrative costs, costs of services and other costs and expenses; and realization of the anticipated benefits of acquisitions and dispositions. Statements relating to "reserves" or "resources" are deemed to be forward-looking statements, as they involve the implied assessment that, based on certain estimates and assumptions, the resources and reserves described can be profitably produced in the future. Although we believe that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, level of activity, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking statements and information.

With respect to the forward-looking statements, we have made assumptions regarding, among other things: our ability to obtain financing on acceptable terms as required; future performance of our wells and facilities, including the battery; future performance of our drilling rigs and our ability to obtain additional equipment in a timely manner, if and as required; the impact of increasing competition for transportation capacity and supplies; future oil and natural gas production levels from our current and new wells; our ability to market our oil successfully; future capital expenditure levels; future prices and differentials between light, medium and heavy oil prices; and our ability to monetize our other non-core assets; our ability to maintain or increase our credit facility and our ability to obtain financing on acceptable terms as required.

Some of the risks and other factors could cause results to differ materially from those expressed in the forward-looking statements include, but are not limited to: general economic conditions in Canada, the United States and globally; industry conditions, including fluctuations in the prices of oil and natural gas; governmental regulation of the oil and gas industry, including environmental regulation; geological, technical, drilling and processing problems and other difficulties in producing reserves; unanticipated operating events or performance which can reduce production or cause production to be shut in or delayed; failure of our oil processing battery to operate at the expected capacity; failure to install pipeline facilities as and when expected; failure to obtain industry partner and other third party consents and approvals, when required; competition for and/or inability to retain drilling rigs and other services; the availability of capital; the availability of capital on acceptable terms; an adverse revision to the borrowing base under our credit facility; the need to obtain required approvals from regulatory authorities; stock market volatility; volatility in market prices for oil and natural gas; market demand for our non-core assets; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions of reserves, undeveloped lands, skilled personnel and supplies; incorrect assessments of the value of acquisitions; geological, technical, drilling, processing and transportation problems; changes in tax laws and incentive programs relating to the oil and gas industry; failure to realize the anticipated benefits of acquisitions and dispositions; and the other factors described in our public filings (including our annual information form and management's discussion and analysis) available at www.sedar.com. Readers are cautioned that this list of risk factors should not be construed as exhaustive.

The forward-looking statements contained in this document are expressly qualified by this cautionary statement. We undertake no duty to update any of the forward-looking statements to conform such statement to actual results or to changes in our expectations except as otherwise required by applicable securities legislation.