PSTRQ PostRock Energy Corporation (CE)

PostRock Energy Corporation (Nasdaq:PSTR) ("PostRock" or the "Company") today announced that the United States District Court for the District of Kansas had preliminarily certified a class and approved a settlement of all claims against the Company by its Kansas royalty owners. Following a 21 day period during which members of the Class may opt out, a final hearing has been scheduled for December 30. In the settlement, a total of $7.5 million will be paid to the royalty owners: $3 million in January 2012 and $4.5 million in January 2013. As part of the settlement, all ambiguity in the calculation of prospective as well as prior royalties in the Company's lease agreements will be eliminated. A similar settlement with the Company's Oklahoma royalty owners became final in June.

Terry Carter, the Company's Chief Executive Officer, said, "With this settlement, all legacy disputes with our royalty owners in Oklahoma and Kansas will have been resolved. This is the last material litigation or dispute related to PostRock's predecessor entities and management. The closing of this unfortunate chapter in the Company's history frees us to entirely focus our energy and resources on enhancing field operations, ongoing development opportunities, profitability and, potentially, consolidation in the Cherokee Basin.

"Additionally, we've continued to make progress in improving cost efficiencies and development results. We expect recent changes made to our field gathering systems and well operating practices will reduce compression expenses by at least $700,000 per year, representing an 8% reduction in overall compression costs. Also, improvements in drilling and completion processes have resulted in improved returns that will enable us to extend field development, even in the current price environment."

PostRock Energy Corporation is engaged in the acquisition, development, production and transportation of oil and natural gas, primarily in the Cherokee Basin of Kansas and Oklahoma. The Company owns and operates over 3,000 wells and nearly 2,200 miles of gas gathering lines in the Basin. It also owns a 1,120 mile interstate pipeline, which transports natural gas from northern Oklahoma and western Kansas to Wichita and Kansas City.

The PostRock Energy Corp. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=7221

CONTACT: North Whipple
         Director, Finance & Investor Relations
         (405) 702-7423