Canadian Energy Exploration Inc. Third Quarter 2011 Highlights and Update

Canadian Energy Exploration Inc. ("Canadian Energy" or the "Company") (TSX VENTURE:XPL) announces financial and operating results for the third quarter ended September 30, 2011 and an update of current activities. The unaudited condensed interim consolidated financial statements for the three and nine months ended September 30, 2011, together with the notes thereto; and management's discussion and analysis of financial condition and results of operations as at and for the for the three and nine months ended September 30, 2011 can be accessed electronically on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.

Third Quarter and Nine Months Ending September 30, 2011 Highlights


--  During the nine months ended September 30, 2011, cash used in investing
    activities increased from $201,208 to $5,459,248 during the same period
    2010. 
    
    
--  Average production during the third quarter 2011 was lower at 7.8 versus
    14.8 Boe per day; inclusive of an average NGL production during the
    third quarter 2011 of 0.4 Boe per day for the same period in 2010. 
    
    
--  Petroleum and natural gas sales gross revenue was $28,742, and net loss
    was $417,619 for the three months ended September 30, 2011.

Operational Update


--  On the Company's Hardy Southeast Saskatchewan prospect, the Company has
    earned or has under option 53.50 sections (approx. 13,857 hectares) and
    has acquired at Crown sales another six sections (approx. 1,554
    hectares.) The Company has expended a total of $6,799,596 exploring the
    lands to-date, including $5,528,123 for the nine months ended September
    30, 2011. 
    
    
--  The Company has drilled and evaluated four wells (three Devonian-depth
    wells and one Mississippian-depth well.) Nine separate formations were
    evaluated and three wells warranted equipping and production testing. 
    
    
--  Currently two wells remain on production testing in the Bakken formation
    and the Company intends to license one new horizontal drilling location,
    while seeking a joint venture partner for that operation. The Company
    received permission from the Saskatchewan regulatory bodies to convert
    its vertical wells in the Hardy area to horizontal well licenses. The
    Company has obtained a horizontal survey to change its vertical well at
    Hardy 12-4-5-21W2 to CEEI HARDY HZ 4B12-4-4B5-33-4-21W2 and intends to
    apply for a license to drill same for Bakken. It is the Company's
    intention to seek a joint venture farmin partner for the drilling of the
    well expected to cost $2.75 million (drilled, completed and equipped).
    The Company has also licensed an additional Ratcliffe well at 13-36-5-
    21W2 on lands due to expire in March 2016. 
    
    
--  The 2011 drilling program has not had economic results but the Company
    is encouraged enough to continue testing and evaluation, believing a
    horizontal wellbore is required to unlock ultimate potential. Our
    activity has extended the expiry of lands with all petroleum and natural
    gas rights held to the end of March 2012 on 12.75 sections (approx.
    3,302 hectares). The Company has applied for continuation of another
    40.75 sections (approx. 10,554 hectares) to the end of March 2012. 
    
    
--  Third parties have licensed seven wells on offsetting lands along what
    the Company interprets as similar structural trends identified on 3D
    seismic, under license to the Company. They have drilled and are
    producing four horizontal Bakken wells but well information has not been
    completely released to the public.  
    
    
--  As at September 30, 2011 the Company has $4,254,890 uncommitted cash on
    hand and expects to fund additional capital requirements by joint
    ventures, reducing Company participation to conserve capital and reduce
    risk. 
    
    
--  The Company intends to license a re-entry of a vertical well on a new
    focus property in Pembina Alberta in anticipation of re-entering this
    wellbore and completing a potential light oil bearing zone. This
    activity could begin in Q4 2011 and would be conducted 100% by the
    Company. 
    
    
--  The Company continues to look at all opportunities available to it
    including, but not limited to, high potential resource plays using low-
    cost wellbore re-entries. Further, should the potential of such resource
    plays be established, the Company intends to pursue additional financing
    to develop these plays. The Company is currently restricted by the rules
    of the TSX Venture Exchange in raising additional financing below $0.05,
    and as such the Company is also looking at mergers or corporate
    acquisitions. With approximately $4,000,000 cash on hand, the Company
    has taken steps to reduce its expenses and conserve capital.

In this Press Release the calculation of barrels of oil equivalent (Boe) is calculated at a conversion rate of six thousand cubic feet (Mcf) of natural gas for one barrel (Bbl) of oil based on an energy equivalency conversion method. Boe's may be misleading particularly if used in isolation. A Boe conversion ratio of 6 Mcf: 1Bbl is based on an energy equivalency conversion method primarily applicable to the burner tip and does not represent a value equivalency at the wellhead.

Forward-Looking Statements:

This press release contains certain statements which constitute forward-looking statements or information ("forward-looking statements"), including statements regarding Canadian Energy's business, such as the review of strategic alternatives and licencing and drilling new wells, seeking a joint venture partner(s), which by their nature are forward-looking statements and which are subject to numerous risks and uncertainties, some of which are beyond Canadian Energy's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, operational risks in exploration and development, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and the ability to access sufficient capital from internal and external sources. Although Canadian Energy believes that the expectations in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking information. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. The forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Canadian Energy does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

About Canadian Energy Exploration Inc.

Canadian Energy Exploration Inc. is a junior oil and gas company engaged in the exploration for and development and production of natural gas and oil reserves. Canadian Energy has 135,497,209 common shares outstanding and an aggregate of 16,292,937 unexercised warrants.

The Company's common shares are listed to trade on the TSX Venture Exchange under the symbol "XPL".

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contacts: Canadian Energy Exploration Inc. Larry Buzan President and Chief Executive Officer (403) 229-2800buzan@cdnenergy.com

Canadian Energy Exploration Inc. (TSXV:XPL)
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