On February 28, 2013, PetroQuest Energy, Inc. (the "Company") announced a net loss available to common stockholders for the quarter ended December 31, 2012 of $25,451,000, or $0.41 per share, compared to fourth quarter 2011 net income available to common stockholders of $2,830,000, or $0.04 per share. For the year ended December 31, 2012, the Company reported a net loss available to common shareholders of $137,218,000, or $2.20 per share, compared to net income available to common shareholders of $5,409,000, or $0.08 per share, for the year ended December 31, 2011. Net loss for the three and twelve months ended December 31, 2012 included ceiling test writedowns totaling $28,113,000 and $137,100,000, respectively.

Discretionary cash flow for the fourth quarter of 2012 was $20,393,000 as compared to $20,176,000 for the comparable 2011 period. Net cash flow provided by operating activities totaled $20,915,000 and $26,777,000 during the fourth quarters of 2012 and 2011, respectively. For the year ended December 31, 2012, discretionary cash flow was $77,448,000 compared to $93,395,000 for 2011. Net cash flow provided by operating activities totaled $88,591,000 and $117,890,000 during the years ended December 31, 2012 and 2011, respectively. See the attached schedule for a reconciliation of net cash flow provided by operating activities to discretionary cash flow.

Oil and gas sales during the fourth quarter of 2012 were $38,147,000 as compared to $38,040,000 in the fourth quarter of 2011. For the year ended December 31, 2012, oil and gas sales decreased 12% to $141,433,000 as compared to $160,486,000 for the year ended December 31, 2011. Production for the fourth quarter and year ended December 31, 2012 was higher by 11% and 13%, respectively, than production for the comparable periods of 2011. Stated on an Mcfe basis, unit prices received during the fourth quarter and the year ended December 31, 2012 were lower by 9% and 22%, respectively, as compared to the prices received during the comparable 2011 periods.

Lease operating expenses for the fourth quarter of 2012 were $1.18 per Mcfe as compared to $1.06 per Mcfe in the fourth quarter of 2011. For the year ended December 31, 2012, lease operating expenses totaled $1.15 per Mcfe as compared to $1.28 per Mcfe in 2011. For the year ended December 31, 2012, per unit lease operating expenses decreased primarily due to the overall increase in produced volumes.

Depreciation, depletion and amortization ("DD&A") on oil and gas properties for the fourth quarter of 2012 was $1.61 per Mcfe as compared to $1.81 per Mcfe in the fourth quarter of 2011. For the year ended December 31, 2012, DD&A on oil and gas properties decreased to $1.75 per Mcfe from $1.89 per Mcfe for the comparable period of 2011. The decrease in DD&A for the year ended December 31, 2012 was primarily the result of the non-cash ceiling test write-downs recorded throughout 2012.

Interest expense for the fourth quarter of 2012 increased to $2,787,000, as compared to $2,400,000 in the fourth quarter of 2011. For the year ended December 31, 2012, interest expense was $9,808,000, compared to $9,648,000 for 2011.

Fourth quarter of 2012 general and administrative expenses were $1,352,000 lower than the comparable 2011 period. Fourth quarter 2011 costs included higher incentive compensation expenses than the 2012 period. For the year ended December 31, 2012, general and administrative expenses were $2,521,000 higher than 2011. The increase in general and administrative expenses for the year ended 2012 was primarily due to higher non-cash share-based compensation costs totaling $6,910,000 in 2012 versus $4,833,000 in 2011.

Production taxes for the fourth quarter of 2012 totaled $773,000, as compared to $1,030,000 in the fourth quarter of 2011. For the year ended December 31, 2012, production taxes were $885,000, as compared to $3,100,000 for the comparable period of 2011. Production taxes for the year ended December 31, 2012 decreased due to a receivable of $2,717,000 recorded in June 2012 related to severance tax refunds expected to be received over the next three years.

                                     Three Months Ended December 31,             Year Ended December 31,
                                         2012                 2011               2012               2011
Production:
Oil (Bbls)                                  140,632             126,639            520,590            572,096
Gas (Mcf)                                 6,902,878           6,615,872         27,466,228         24,462,933
Ngl (Mcfe)                                1,116,205             629,523          3,366,774          2,287,846
Total Production (Mcfe)                   8,862,875           8,005,229         33,956,542         30,183,355
Total Daily Production (Mmcfe)                 96.3                87.0               92.8               82.7
Sales:
Total oil sales                    $     15,008,184       $  13,660,565      $  56,635,786      $  60,064,426
Total gas sales                          17,213,657          18,182,671         63,535,262         78,664,373
Total ngl sales                           5,925,721           6,196,692         21,262,236         21,756,917

Total oil and gas sales            $     38,147,562       $  38,039,928      $ 141,433,284      $ 160,485,716

Average sales prices:
Oil (per Bbl)                      $         106.72       $      107.87      $      108.79      $      104.99
Gas (per Mcf)                                  2.49                2.75               2.31               3.22
Ngl (per Mcfe)                                 5.31                9.84               6.32               9.51
Per Mcfe                                       4.30                4.75               4.17               5.32

The above sales and average sales prices include increases (reductions) to revenue related to the settlement of gas hedges of $(21,000) and $1,745,000 and oil hedges of $676,000 and $19,000 and ngl hedges of $178,000 and $0 for the quarters ended December 31, 2012, and 2011, respectively. The above sales and average sales prices include increases (reductions) to revenue related to the settlement of gas hedges of $6,846,000 and $2,609,000 and oil hedges of $1,529,000 and $(192,000) and ngl hedges of $722,000 and $0 for the years ended December 31, 2012 and 2011, respectively.

                                                              Guidance for
      Description                                           1st Quarter 2013
      Production volumes (MMcfe/d)                              87 - 92
      Percent Gas                                                 80%
      Percent Oil                                                  9%
      Percent NGL                                                 11%
      Expenses:
      Lease operating expenses (per Mcfe)                    $1.15 - $1.25
      Production taxes (per Mcfe)                            $0.10 - $0.15
      Depreciation, depletion and amortization (per Mcfe)    $1.50 - $1.60
      General and administrative (in millions)*               $5.5 - $6.0
      Interest expense (in millions)                          $2.6 - $2.9

* Includes non-cash stock compensation estimate of $1.4 million

The following initiates guidance for 2013:

                                                             Guidance for
       Description                                               2013
       Production volumes (MMcfe/d)                             90 - 95
       Percent Gas                                                80%
       Percent Oil                                                8%
       Percent NGL                                                12%
       Expenses:
       Lease operating expenses (per Mcfe)                   $1.15 - $1.25
       Production taxes (per Mcfe)                           $0.10 - $0.15
       Depreciation, depletion and amortization (per Mcfe)   $1.50 - $1.60
       General and administrative (in millions)*               $21 - $23
       Interest expense (in millions)                          $10 - $12
       2013 Capital Expenditures (in millions)                $80 - $100

* Includes non-cash stock compensation estimate of $4.5 million

In the Woodford, the Company recently completed eight wells in the liquids rich area of its leasehold position. Six of these wells have established maximum 24 hour gross rates and two wells remain in the initial production stage. The six well group had an average lateral length of 5,360 feet and achieved a maximum 24 hour gross daily rate of 3,738 Mcf of gas and 201 barrels of natural gas liquids. The Company continues to realize cost savings in the trend due to increased drilling efficiencies and lower service costs. The Company estimates that its cost to drill and complete these recent wells was approximately 10%-15% lower than its 2012 average Woodford well cost. The Company is continuing to achieve ongoing cost savings. In addition, the Company recently closed an additional acreage acquisition in the liquids rich portion of the trend bringing the total acreage acquired since November of 2012 to approximately 7,000 acres. The Company estimates that its total JV Woodford acreage position is in excess of 60,000 acres.

Hedging Update

The Company recently initiated the following commodity hedging transactions:



                                  Instrument
              Production Period      Type         Daily Volumes      Price
              Gas:
              Mar 13-Dec 13              Swap        5,000 MMbtu     $ 3.50
              2014                       Swap       10,000 MMbtu     $ 4.08

After executing the above transactions, the Company has approximately 3.7 Bcf of gas hedged for 2014. In addition, the Company has approximately 84,000 barrels of oil and 10.3 Bcf of gas hedged for 2013. Based on the mid-point of 2013 production guidance, the Company estimates it has hedged 38% of its 2013 estimated gas production at an average price of $3.48/Mcf.

About the Company

PetroQuest Energy, Inc. is an independent energy company engaged in the exploration, development, acquisition and production of oil and natural gas reserves in the Arkoma Basin, Wyoming, Texas, South Louisiana and the shallow waters of the Gulf of Mexico. PetroQuest's common stock trades on the New York Stock Exchange under the ticker PQ.

Forward-Looking Statements

This news release contains "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Among those risks, trends and uncertainties are our ability to find oil and natural gas reserves that are economically recoverable, the volatility of oil and natural gas prices and significantly depressed natural gas prices since the middle of 2008, the uncertain economic conditions in the United States and globally, the declines in the values of our properties that have resulted in and may in the future result in additional ceiling test write-downs, our ability to replace reserves and sustain production, our estimate of the sufficiency of our existing capital sources, our ability to raise additional capital to fund cash requirements for future operations, the uncertainties involved in prospect development and property acquisitions or dispositions and in projecting future rates of production or future reserves, the timing of development expenditures and drilling of wells, hurricanes and other natural disasters, changes in laws and regulations as they relate to our operations, including our fracing operations in shale plays or our operations in the Gulf of Mexico, and the operating hazards attendant to the oil and gas business. In particular, careful consideration should be given to cautionary statements made in the various reports PetroQuest has filed with the Securities and Exchange Commission. PetroQuest undertakes no duty to update or revise these forward-looking statements.

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