Nexstar Energy to Drill New Light Oil Resource Play

CALGARY, ALBERTA–(EMWNews – July 17, 2008) –

NOT FOR DISSEMINATION IN THE UNITED STATES OR TO US PERSONS.

Nexstar Energy Ltd. (“Nexstar Energy” or the “Company”) (TSX VENTURE:NXE.A) (TSX VENTURE:NXE.B) is pleased to provide the following update:

West Central Alberta – New Light Oil Resource Play Identified

The Company has recently secured several farmin and option agreements encompassing over 7000 gross acres on a new light oil prospect in west central Alberta and has committed to the drilling of two earning wells. Several existing abandoned wells on the farmin lands indicate bypassed oil pay which management believes may have resource potential of up to 500,000 barrels of oil equivalent recoverable per section. The first earning well will involve the vertical twinning of an abandoned well which exhibits untested bypassed potential in three horizons including the main target zone. If successful as a vertical well, follow-up horizontal wells are planned to exploit the resource potential of these lands. The second earning well will involve the twinning of an existing well with potential bypassed pay, followed by a minimum 1000 meter horizontal section to evaluate the target formation. Horizontal wells will be completed using multi-stage frac technology which has been successfully utilized on similar resource plays in western Canada. If this initial horizontal well is successful, management has identified up to 15 additional light oil drilling locations on the farmin and option lands for further development. The gross cost for the drilling, completion, multi-stage fracturing and equipping of each horizontal well is estimated at $2.4 million. The Company has initiated surface acquisition activities for the drilling of the earning wells and subject to surface access, drilling operations are expected to commence in September 2008. Nexstar Energy plans to participate for up to 50% in this project and will be required to secure new financing for its participation in these wells. As there is no assurance that the Company will be able to secure new financing, the Company plans to obtain joint venture participants capable of funding the entire project, if required.

Pembina Area, Alberta – Oil and Gas Well Tie-Ins

Field operations are expected to commence in August to tie-in two existing wells (net .90) which management expects to provide up to 50 boepd net to the Company. A third well (.60 net) in the area, which was previously thought to have encountered poor reservoir quality has recently shown significant wellhead pressure and is currently being re-tested for production potential. Subject to the test results, this well could be tied in to existing Company infrastructure in the third quarter. Also in the Pembina region, Nexstar Energy recently finalized the installation of wellsite compression on its 100% working interest 04-19-47-3 W5M natural gas well with good initial results. The well has produced intermittently at rates of up to 450 mcfd but with increased water production. As a result of the recent downtime experienced with this well and increased water production, the well is currently shut-in pending the possible installation of artificial lift to deal with increased water production.

Whitecourt Area, Alberta – Deep Drilling Targets Identified on 3-D

In mid-April, the Company submitted a pre-licence application to the Energy Resources Conservation Board (“ERCB”) for the drilling of a planned test well in the South Whitecourt area. This exploratory prospect (33% working interest) resulted from an airborne survey utilizing stress-field detection technology (“SFD”) and was subsequently confirmed utilizing conventional 3-D seismic. The proposed exploratory well will target a seismically defined Swan Hills collapse-feature in an area of dolomite reservoir development. The Swan Hills formation, if hydrocarbon-bearing, is expected to contain sour natural gas with the secondary Gilwood formation targeting light oil at a planned total depth of 3100 metres. This exploratory well is expected to qualify for depth-related royalty benefits under the proposed new Alberta royalty program, effective January 1, 2009. The Company is presently awaiting ERCB response for the pre-licence application and will provide updates as appropriate. At Goodwin, in the Whitecourt area, Nexstar Energy has recently entered into a farmout agreement with a third party group for the drilling, completion and equipping of a shallow exploratory well (.25 net before farmout, .10 net after farmout). This non-operated well will be drilled at no cost to the Company and will test the potential of several shallow sandstone reservoirs with indicated bypassed natural gas pay. Drilling operations are expected to commence in mid-August and if successful, the well will be tied-in to an existing pipeline system adjacent to the farmout lands.

Puskwa Area, Alberta – Prospective Lands Acquired

Within the last year, Nexstar Energy has acquired an interest in four sections of exploratory lands in this rapidly developing Beaverhill Lake light oil and Montney natural gas prone area. The Company presently holds an average 21% working interest in 2560 gross acres (544 net acres) of exploratory lands, some of which have recently been offset with competitor drilled and cased potential oil and gas wells. The Company plans to assess the competitor well results and will either participate in the development of these lands, sell or farmout its interest in the region once additional information is obtained.

Financial Update – Class A Shares Issued

Nexstar Energy also announces that pursuant to its news release issued June 2, 2008, the Company has issued approximately 2.7 million Class A Shares of Nexstar Energy at a deemed price of $0.15 per share in satisfaction of a portion of its outstanding debts and intends to continue to settle a portion of its remaining outstanding debts with trade creditors through the issuance of additional Class A Shares of Nexstar Energy. Any settlements will be subject to final TSX Venture Exchange approval and the Class A Shares issued will be subject to a four month hold period in accordance with applicable securities laws.

Nexstar Energy is a junior oil and gas company that is focused on drilling multi-zone crude oil and natural gas prospects in western Canada, complemented by strategic acquisitions.

For further information, please go to Nexstar Energy’s website and view our updated July 2008 presentation.

This document contains forward-looking information that is based on expectations and estimates as of the date of this document. This forward-looking information is information that is subject to known and unknown risks and other factors that may cause future actions, conditions or events to differ materially from the anticipated actions, conditions or events expressed or implied by such forward-looking information. Forward-looking information is information that does not relate strictly to historical or current facts, and can be identified by the use of the future tense or other forward-looking words such as “proposed”, “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate”, “should”, “may”, “objective”, “projection”, “forecast”, “continue”, “strategy”, “position” or the negative of those terms or other variations of them or comparable terminology. Examples of such forward-looking information in this document include but are not limited to the following, each of which is subject to significant risks and uncertainties and is based on a number of assumptions which may prove to be incorrect. The Company will be required to secure financing in order to participate in the projects referenced in this document and there is no assurance that the Company will be able to secure such financing. This forward-looking information represents the Company’s views as of the date of this document and such information should not be relied upon as representing the Company’s views as of any date subsequent to the date of this document. The Company has attempted to identify important factors that could cause actual results, performance or achievements to vary from those current expectations or estimates expressed or implied by the forward-looking information. However, there may be other factors that cause results, performance or achievements not to be as expected or estimated and that could cause actual results, performance or achievements to differ materially from current expectations. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those expected or estimated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. These factors are not intended to represent a complete list of factors that could affect the Company. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

12,621,342 Class A Shares

1,080,000 Class B Shares

ADVISORY: The TSX Venture Exchange has neither approved nor disapproved the contents of this news release. The TSXV does not accept responsibility for the adequacy or accuracy of this release.