EXHIBIT 99.1

          Recent Events - Questions and Answers, dated October 13, 2004



Prospect Energy Corporation (the "Company") desires to provide further
information with respect to the recent acquisition of Gas Solutions, Ltd. ("Gas
Solutions"). The Company has furnished this document to the SEC in compliance
with Regulation FD.

Q: What was the final structure of the acquisition of Gas Solutions?

As previously announced, the Company provided financing of approximately
$30,000,000 in connection with the acquisition of Gas Solutions. The Company
structured this investment in the form of an investment through a holding
company whereby the Company indirectly holds a mezzanine investment in Gas
Solutions and 100% of the equity of the holding company. The Company decided
upon this investment structure to seek to optimize its return on investment and
to provide the greatest flexibility in the future to arrange for investment by
the management team in Gas Solutions.

Q: Does the Company expect to maintain the finalized capital structure going
forward?

In the future, the Company expects to consider opportunities for divesting a
portion of its investment in Gas Solutions. Either as a result of an increase in
the Company's capitalization or as a result of a sale of all or part of a sale
of all or part of its investment in Gas Solutions, the Company expects that Gas
Solutions will become a smaller percentage of its portfolio. While the Company
currently has no plans to sell any portion of investment in Gas Solutions, it
can offer no assurance that it will remain the holder of all of the
capitalization of Gas Solutions in the future. The Company will continue to
examine opportunities in this regard.

Q: Does the Company expect the acquisition of Gas Solutions to serve as a model
for future investments?

The Company elected to finance the acquisition of all of the debt and equity
securities of Gas Solutions because it perceived this to be an excellent
opportunity to invest in the energy industry. The Company believes that this
investment was consistent with the investment strategy set forth in the
prospectus issued by the Company in connection with its initial public offering
of common stock. In the future, the Company intends to continue to make
investments in senior and mezzanine debt securities of companies in the energy
related industry, and may acquire equity interests in such target companies on
an opportunistic basis. The Company does not expect to revise this investment
strategy going forward.



About Prospect Energy Corporation

Prospect Energy Corporation is a financial services company that lends to and
invests in energy related businesses. Prospect Energy's investment objective is
to generate both current income and long-term capital through debt and equity
investments.




Contact:
Prospect Energy Corporation
(212) 448 - 0702
www.prospectenergy.com



Forward-Looking Statement

This written communication contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements involve risks and uncertainties, including, but not limited to,
statements as to our future operating results; our business prospects and the
prospects of our portfolio companies; the impact of investments that we expect
to make; the dependence of our future success on the general economy and its
impact on the industries in which we invest; the ability of our portfolio
companies to achieve their objectives; our expected financings and investments;
the adequacy of our cash resources and working capital; and the timing of cash
flows, if any, from the operations of our portfolio companies.

We may use words such as "anticipates," "believes," "expects," "intends",
"will", "should," "may" and similar expressions to identify forward-looking
statements. Such statements are based on currently available operating,
financial and competitive information and are subject to various risks and
uncertainties that could cause actual results to differ materially from our
historical experience and our present expectations. Undue reliance should not be
placed on such forward-looking statements as such statements speak only as of
the date on which they are made. We do not undertake to update our
forward-looking statements unless required by law.