Shoreline Energy Corp. Announces First Quarter Results, Record Revenue, $34 Million Increase to Reserve Value and Current Production Exceeding 2200 BOED

CALGARY, ALBERTA–(Marketwired – May 15, 2013) – Shoreline Energy Corp. (“Shoreline” or the “Company”) is pleased to announce financial and operating results from the first quarter of 2013. The Company generated record revenue of $6.5 million during the quarter as a direct result of wells drilled during Shoreline’s successful 2012 drilling program and through recent acquisitions. During the quarter, total proved plus probable reserve value increased to over $141 million upon the Company’s fourth and fifth acquisitions in the highly prolific Niobrara and Codell light oil play in Colorado. At present, the Company is producing at record levels, which based on field estimates is over 2,200 BOED, increasing its light oil and natural gas liquids weighting to approximately 35%. Cash flow and production for the Company is expected to increase materially in subsequent quarters as the effect of US acquisitions and successful Canadian drilling program are realized. A complete copy of the Company’s financial statements along with management’s discussion and analysis may be obtained at www.sedar.com or on the Company’s website at www.shorelineenergy.ca.

• Sales volumes averaged 1,663 barrels of oil equivalent per day (BOED) an increase of 14% from the fourth quarter of 2012.
• Oil and NGL production as a percentage of total production was 35%, an increase from 23% for the first quarter of 2012.
• Total Proved and 2P reserves increased by 18% and 19% respectively, with 2P net present value (10% discount) of $141 million, 24% above December 31, 2012 value, as determined by independent engineering consultants.
• Realized average natural gas pricing of $3.66/Mcf, 68% above first quarter 2012 prices of $2.18/Mcf.
• The Company drilled 1 gross (1 net) well during the first quarter of 2013 and brought on production 1 gross (1 net) horizontal oil well.
• Capital expenditures for the first quarter of 2013 totaled $26.8 million.

• The Company closed a private placement financing for net proceeds of $4.2 million and short term debt financing for net proceeds of $4.3 million.
• Funds from operations were $1.8 million compared to $0.8 million for the first quarter of 2012.

• The Company acquired additional working interest lands in the Wattenberg Field of Weld County Colorado for a total purchase price of $23.2 million in the first quarter. Consideration was made up of cash, shares and a note payable.
• The Company divested of non-core assets for net sale proceeds of $2.1 million.

• On May 15^th, 2013 the Company paid a dividend of $0.12 per share, its seventh consecutive quarterly dividend, bringing the total dividends paid to date of $1.08 per share.
• Subsequent to March 31, 2013, the Company closed a private placement flow through share offering for gross proceeds of $3.0 million.
• Montney development well (100% working interest) placed on production in mid-April, bringing production to over 2,200 BOED, an increase of 32% over the Q1 2013 average.
• On May 15^th, the Company divested of non-core asset for net sale proceeds of $0.966 million.

1. These terms are not IFRS measures and do not have standardized meanings prescribed by IFRS. Management believes that in addition to net income (loss), funds from operation and operating netback are useful supplemental measures as they demonstrate the Company’s ability to generate the cash necessary to fund future growth through capital investment, fund dividend payments and/or repay debt in future periods. Investors are cautioned, however, that these measures should not be construed as an alternative to net income (loss) determined in accordance with IFRS as an indication of the Company’s performance.
2. Only includes the effect of dilutive outstanding options and warrants on income per share for the three month period ended March 31, 2013
3. Boe means barrels of oil equivalent. Boe may be misleading, particularly is used in isolation. A boe conversion rate of 1 BOE: 6 mcf is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Investor Information

Shoreline is a Calgary, Alberta based corporation engaged in the exploration, development and production of petroleum and natural gas. Shoreline offers investors a combination of value growth via lower risk development of additional oil reserves and production on its current lands and pays a quarterly dividend. Shoreline has 8,255,600 common shares outstanding. The Company’s common shares are currently listed on the TSX under the trading symbol “SEQ” and its debentures under the trading symbol “SEQ.DB”. Additional information regarding Shoreline is available under the Company’s profile at www.sedar.com or at the Corporation’s website, www.shorelineenergy.ca.

Forward-Looking and Cautionary Statements

This news release contains forward-looking statements relating to the Corporation’s plans and other aspects of the Corporation’s anticipated future operations, strategies, financial and operating results and business opportunities. These forward-looking statements may include opinions, assumptions, estimates, management’s assessment of value, reserves, future plans and operations.

Forward-looking statements typically use words such as “will,” “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “project,” “should,” “plan,” and similar expressions suggesting future outcomes, and include statements that actions, events or conditions “may,” “would,” “could,” or “will” be taken or occur in the future. The forward-looking statements are based on various assumptions including expectations regarding the success of current or future drill wells; the outlook for petroleum and natural gas prices; estimated amounts and timing of capital expenditures; estimates of future production; assumptions concerning the timing of regulatory approvals; the state of the economy and the exploration and production business; results of operations; business prospects and opportunities; future exchange and interest rates; the Corporation’s ability to obtain equipment in a timely manner to carry out development activities; and the ability of the Corporation to access capital and credit. While the Corporation considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Forward-looking statements are subject to a wide range of assumptions, known and unknown risks and uncertainties and other factors that contribute to the possibility that the predicted outcome will not occur, including, without limitation: risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation; loss of markets; volatility of commodities prices; currency fluctuations; imprecision of reserves estimates; environmental risks; competition from other producers; inability to retain drilling rigs and other services; incorrect assessment of the value of acquisitions; failure to realize the anticipated benefits of acquisitions; general economic conditions; delays resulting from or inability to obtain required regulatory approvals and to satisfy various closing conditions; and ability to access sufficient capital from internal and external sources. Readers are cautioned that the foregoing list of factors is not exhaustive.

Although Shoreline believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements and you should not rely unduly on forward-looking statements. The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by applicable law, Shoreline does not undertake any obligation to publicly update or revise any forward-looking statements.

Note Regarding BOEs

The term barrel of oil equivalent (“boe”) may be misleading, particularly if used in isolation. A conversion ratio for gas of 6 mcf:1 boe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is sign ificantl gy equivalency conversion ratio of 6:1, utilizing a conversion on a 6:1 basis is misleading as an indication of value.