Quetzal Elects Not to Spin Out Guatemalan Assets, Updates Ops

Quetzal has elected to not proceed with the previously announced plan of arrangement to spin out its Guatemalan assets to its shareholders through the creation of a separate publicly traded company. The board of directors will review several strategic alternatives to maximize shareholder value of its Guatemalan assets. In addition, the Company has withdrawn its request to approve Quetzal's stock option plan due to a lack of shareholder support. The board of directors will examine compensation alternatives that will enable the Company to continue to attract, retain and motivate highly talented employees.

Guatemala Update

A work-over was conducted on Atzam #2 and the well is producing approximately 40 barrels of 32 degree API oil and 420 barrels of water per day. The oil is trucked to Guatemala City and sold to end users who blend the oil with refined products and use the blend to fire furnaces or power diesel engines. The Company has recently sold loads of oil at prices in excess of WTI plus 20 dollars per barrel. The water is transported by pipeline and injected into the Atzam #1 water disposal well at minimum cost.