EI Eurogas International Inc

Eurogas International Inc. (CNSX:EI) ("Eurogas International" or the
"Corporation") today announced its financial results for the three and nine
months ended September 30, 2012. The Corporation's unaudited condensed interim
financial statements, along with the accompanying management's discussion and
analysis have been filed on the System for Electronic Document Analysis and
Retrieval ("SEDAR") and may be viewed by interested parties under the
Corporation's profile at www.sedar.com or the Corporation's website at
www.eurogasinternational.com.


Eurogas International is conducting exploration and evaluation programs for oil
and natural gas in the shallow Mediterranean waters offshore Tunisia, where it
holds a 45% working interest in the Sfax Permit. The Corporation has entered
into a joint operating agreement with Atlas Petroleum Exploration Worldwide Ltd.
("APEX"), a production sharing agreement with the Tunisian state oil company,
and an exploration permit with the Tunisian government. Pursuant to these
arrangements, the Corporation and APEX agreed to undertake exploration,
evaluation and production operations on the Sfax Permit. APEX is the operating
partner in the joint venture arrangement.


DECLARATION OF FORCE MAJEURE

As a result of political uncertainty and civil unrest in Tunisia, in January
2011, the Corporation announced that, together with APEX, it had declared a
condition of Force Majeure with respect to the Sfax Permit and Ras El Besh
development concession. The Corporation believes that the declaration of Force
Majeure allowed the Corporation and APEX to suspend their activities, while the
conditions resulting in the Force Majeure continued.


FINANCIAL RESULTS

During the three and nine months ended September 30, 2012, the Corporation
incurred a net loss of $0.5 million and $1.6 million respectively, representing
a loss of approximately $0.02 per share and $0.05 per share, respectively. This
compares with a net loss of $0.5 million and $1.7 million for the three and nine
months ended September 30, 2011, respectively, representing a loss of $0.02 per
share and $0.05 per share, respectively. The decrease in the net loss reflects a
decrease in corporate activities as a result of the Force Majeure.


COMMITMENTS

On July 7, 2011, the Corporation received approval from the Tunisian government
to extend the term of the Sfax Permit to December 8, 2012. The joint venture
partners are committed to drilling an exploration well, with depth to a
specified geological zone, during the extension period. The actual cost for an
exploration well will depend on the selection of the prospect and the location
within the Sfax Permit. Based on current information, the Corporation estimates
that its share of the cost to meet this commitment ranges between US$6 million
and US$9 million.


The Corporation, on behalf of the joint venture partners, has completed the
reprocessing of approximately 1,280 km2 of 3-D seismic surveys and select 2-D
seismic lines over the Sfax Permit. The reprocessed seismic data was
subsequently combined in order to allow a balanced interpretation over the
entire Sfax Permit. The joint venture partners have identified three separate
potential drilling locations which they consider prospective for containing oil
reserves, each of which would, if drilled, meet the joint venture's current
drilling commitment pursuant to the Sfax Permit.


In anticipation of commencing its drilling program, during the third quarter of
2012, APEX began a procurement process to identify a suitable offshore drilling
rig. In September 2012, APEX determined that it would not be able to secure the
appropriate drilling rig in sufficient time to meet the joint venture's current
drilling commitment and, as a result, the joint venture partners filed an
application with the Tunisian Director General of Energy for a renewal of the
Sfax Permit for an additional three-year period. In addition, the joint venture
partners requested an extension of the drilling commitment period to coincide
with the renewal period. As of the date hereof, there can be no certainty that
the Tunisian authorities will grant the three-year renewal to the Sfax Permit,
or concede on the deferral of the drilling commitment. In any event, the
drilling of an exploration well will only be undertaken if the conditions which
resulted in the declaration of Force Majeure in January 2011, are alleviated.


During the third quarter of 2012, the Corporation received a commitment from its
parent, Dundee Corporation, to provide the necessary financial resources to the
Corporation to enable it to complete its drilling obligation pursuant to the
terms of the Sfax Permit, subject to certain conditions, including obtaining the
consent of the Tunisian authorities to an extension of the term of the Sfax
Permit.


In the event that its drilling commitment is not completed, a compensatory
payment of up to US$12 million will be payable to the Tunisian government by the
joint venture partners, less any amounts previously incurred by the joint
venture partners in respect of the completion of the Corporation's obligations
pursuant to the Sfax Permit. The Corporation continues to consider alternative
financing options including farmout arrangements, possible debt or equity
issuance, or the monetization of certain assets. There can be no assurance that
the Corporation will be successful in any of these initiatives.


FORWARD LOOKING STATEMENTS

Certain information set forth in this document, including management's
assessment of the Corporation's future plans and operations, contains
forward-looking statements. Forward-looking statements are statements that are
predictive in nature, depend upon or refer to future events or conditions or
include words such as "expects", "anticipates", "intends", "plans", "believes",
"estimates" or similar expressions. By their nature, forward-looking statements
are subject to numerous risks and uncertainties, some of which are beyond the
Corporation's control, including risks of not being able to obtain or renew
permits and licenses, the inability to access sufficient capital from internal
and external sources, risks associated with foreign operations, the impact of
general economic conditions, currency fluctuations, exploration and development
risks, reliance on key personnel and management, risks relating to the
abandonment of operations, environmental risks, and competition from other
industry participants. Readers are cautioned that the assumptions used in the
preparation of such information, although considered reasonable at the time of
preparation, may prove to be imprecise and, as such, undue reliance should not
be placed on forward-looking statements. The Corporation's actual results,
performance or achievement could differ materially from those expressed in, or
implied by, these forward-looking statements and, accordingly, no assurance can
be given that any of the events anticipated by the forward-looking statements
will transpire or occur, or if any of them do so, what benefits the Corporation
will derive from them. The Corporation disclaims any intention or obligation to
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by law. 


ABOUT THE CORPORATION 

Eurogas International Inc. is an independent oil and gas exploration company
listed on the Canadian National Stock Exchange under the symbol EI. 


All documentation in respect of the Corporation may be viewed under the
Corporation's profile on SEDAR (www.sedar.com) or under the Corporation's
website at www.eurogasinternational.com. For more information about Eurogas
International, please visit the Listings Disclosure Hall at www.cnsx.ca.

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