19/05/2011 - To Corporate Governance Policies

Pacific Rubiales Energy Corp. ("Pacific Rubiales" or the "Company") and its Board of Directors recognize the importance of sound corporate governance practices. In 2010 and into 2011, the Company, through its Corporate Governance and Nominating Committee, undertook a review of its corporate governance policies and practices. During and following such review, the Corporate Governance and Nominating Committee recommended to the Board of Directors certain enhancements to the Company's corporate governance policies and practices, all of which were adopted by the Board of Directors, including the following:

(i) appointing a Lead Independent Director (implemented in 2010);

(ii) adding three additional independent directors to the Board of Directors (implemented in 2010);

(iii) formalizing in camera meetings of independent directors (implemented in 2010);

(iv) adopting a skills matrix for directors (implemented in 2011);

(v) adopting minimum shareholding requirements for directors (implemented in 2010);

(vi) enhancing the formal assessment process for directors (enhanced in 2011);

(vii) adopting a formal director education program (implemented in 2011) (collectively, the "New Corporate Governance Initiatives").

Pacific Rubiales is committed to the improvement of its corporate governance practices. The Company and the Board of Directors recognize the importance of corporate governance to the effective management of the Company and to the protection of its employees and shareholders. The Company's approach to significant issues of corporate governance is designed with a view to ensuring that the business and affairs of the Company are effectively managed so as to enhance shareholder value.

In furtherance of the Company's commitment to continually increase the level of its corporate governance structure to achieve best practices, the Board of Directors has given consideration to various corporate policies and practices and, in addition to the new Corporate Governance Initiatives, has undertaken to accomplish the following changes:

For the 2012 proxy season, Pacific Rubiales will amend its stock option plan dated March 28, 2008 (the "Stock Option Plan") to:

(i) provide for limited non-employee director participation in option grants up to a value of $100,000 per non-employee director per year;

(ii) provide that the aggregate number of common shares in the capital of the Company issuable to non-employee directors under the Stock Option Plan, together with all other treasury-based equity compensation plans, if any, shall not at any time exceed 1% of the issued and outstanding common shares (calculated on a non-diluted basis); and

(iii) to include in the Stock Option Plan's amending provision a requirement to obtain shareholder approval for any increase to these limits. The Company recognizes that options are an important element of non-employee director

compensation and, in the absence of shareholder approval, must be available in this limited manner in order to align director interests to that of the shareholders of the Company.

The Company is confident that the adoption of the New Corporate Governance Initiatives and the proposed amendments to the Stock Option Plan set out above are in line with best practices for the Canadian market. The Company is committed to, and supports, on-going review of its processes, policies and practices in order to ensure it is maintaining good stewardship of investor interests.

The Company's corporate governance practices have been and continue to be in compliance with applicable Canadian requirements. The Company continues to monitor developments in Canada and abroad with a view to further revising its governance policies and practices, as appropriate.

For more information on the Company's corporate governance practices, please visitwww.pacificrubiales.com.