Calvalley Petroleum Inc. Update

CALGARY, July 23, 2012 /CNW/ - Calvalley Petroleum Inc. (TSX: CVI.A) announces the decision not to exercise its option to acquire an additional working interest in Block 9, Republic of Yemen and announces the decision by the TSX to defer consideration of the Shareholder Rights Plan

Calvalley Petroleum Inc. ("Calvalley" or the "Company") announces that it has decided not to exercise its option under the Joint Operating Agreement to acquire an additional working interest in Block 9, Republic of Yemen. As disclosed in a press release of July 6, 2012, Calvalley received a notice from one of its partners setting forth the provisions under which such partner intends to dispose of its 25% working interest in Block 9 to a third party. Pursuant to the provisions of the Joint Operating Agreement governing Block 9, the existing partners had the option to match the offer of such third party and acquire either all or, jointly with the other partners, their proportionate share of the working interest to be assigned. The decision not to exercise the option was made by the Board of Directors of the Company following consideration of all relevant factors.

Calvalley also announces today that it has been notified by the Toronto Stock Exchange (the "TSX") that the TSX will, in accordance with its practice in connection with similar rights plans, defer consideration of the acceptance of Calvalley's previously-announced Shareholder Rights Plan. A condition of the acceptance by the TSX is that shareholder approval is obtained for the Shareholder Rights Plan on or before January 11, 2013. Shareholders should note that the Shareholder Rights Plan remains in effect while the TSX defers its review. A copy of the Shareholder Rights Plan is available at www.sedar.com.


About Calvalley Petroleum Inc.

Calvalley Petroleum Inc. is an international oil and gas company, with offices in Calgary, Alberta, Canada, that operates its 50% working interest in Block 9 of the Masila Basin, in The Republic of Yemen and its 100% working interest in the Gimbi and Metema Blocks of the Blue Nile Basin, in The Republic of Ethiopia.


Certain information contained herein may constitute forward-looking statements under applicable securities laws. Such statements are subject to known or unknown risks and uncertainties that may cause actual results to differ materially from those anticipated or implied in the forward-looking statements. Investors are encouraged to review the principal risks associated with the Corporation's operations set out in the Corporation's Annual Information Form for the year-ended December 31, 2011, a copy of which is filed on SEDAR at www.sedar.com. Forward-looking statements are based upon management's assumptions, expectations and estimates at the time that such statements are made. The Corporation does not update forward-looking statements should circumstances change or management's assumptions, expectations or estimates change, except as required by law.

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Calvalley Petroleum Inc.
investorrelations@calvalleypetroleum.com
+1 (403) 297-0490
Edmund Shimoon, Chairman and CEO
Gerry Elms, CFO