March 22, 2004

NEWS RELEASE
 
 Proposed Private Placement to raise $1,500,000
 
Loon Energy Inc. (“Loon”) (TSX-V:LEY) announces that it plans to raise up to $1,500,000 by issuing up to 10,000,000 of its common shares at an issue price of $0.15 per common share by way of private placement.  The private placement, which will be subject to regulatory approval, is expected to close by mid-April.  The proceeds of the issue will be used to further the exploration and development efforts of the Company in south-central Europe and for general corporate purposes.
 
In addition, Loon announces its intention, subject to regulatory and, if required, shareholder approval, to issue up to 800,000 additional options to purchase Loon common shares at an option price of $0.15 per share.
 
Loon’s activities in south-central Europe focus on Slovenia.  Slovenia is bounded by Croatia (south), Hungary (east), Austria (north) and Italy (west).  The project area is located in eastern Slovenia near to the borders with Hungary and Croatia approximately 210 kilometres south of Vienna, Austria and 180 kilometres northeast of Ljubljana, the capital of Slovenia. Slovenia will be joining the European Union (the “EU”) in May of this year.
 
Loon is an oil and gas exploration and production company with approximately 40 boepd of production in Canada and exploration and development projects in south-central Europe and other areas.