Edge Resources Inc. Announces Record Quarterly Results Debt Restructuring, and Production and Reserve Update

CALGARY, ALBERTA–(Marketwired – Sept. 3, 2013) – Edge Resources Inc. (TSX VENTURE:EDE)(AIM:EDG) (“Edge” or the “Company”) reports record financial and operating results for the three month period ending June 30, 2013. Edge is also pleased to announce that it has lowered the interest rate on its loan with a subordinated lender and extended the due date of that loan until 2017. Additionally, the Company has achieved record operating and financial results during the last quarter due to lower corporate and operating costs and improved revenue.

Production testing at the Company’s vertical oil well drilled at the end of March 2013 is continuing, posting very strong results. The well is producing at a restricted rate of over 100 bopd – up to 114 bopd – with water cuts below 50%, and dropping. The Company is thrilled with these results; and hence, has intentions to drill the first 25 of up to 100 wells in Eye Hill, Saskatchewan, where it has 100% ownership of the mineral rights and extensive 3D seismic coverage over the entire property.

The Company also updated its NI51-101 Reserves Report, effective March 31, 2013. In Eye Hill (formerly known as Primate), Saskatchewan, the Company’s core area, the Company increased Proved Reserve Value¹ by 225% to $24.1 million and increased Proved+Probable Reserve Value¹ by 173% to $60.1 million. On a Corporate basis, the Company’s Total Proved Reserve Value¹ increased 30% to $40.2 million and Total Proved+Probable Reserve Value¹ increased 37% to $89.4 million.

Detailed operating and financial results are presented in Edge’s unaudited consolidated quarterly financial statements and related Management Discussion & Analysis (“MD&A”), which can be accessed on the Company’s website (www.edgeres.com) and on SEDAR (www.sedar.com).

Financial and Operational Summary:

Summary:

• The Company continued production testing of its vertical well in Eye Hill. The Company is extremely pleased with the results as production has reached 114 bopd and water cuts have continually dropped. Water production is currently estimated at less than 50% of total fluid, which is well below the average for the area and well below the Company’s original expectations. The Company feels it is being conservative with this production test and is currently restricting the flow rate to maximize reservoir life and long-term productivity of the well. Because of the low water cuts and very high deliverability, the Company feels confident that this newly discovered reservoir is highly unique.
• Effective August 29, 2013, the Company consolidated, improved and extended the $8 million in loans previously held by its subordinated lender, which will drastically reduce the Company’s working capital deficit (not reflected in this quarter’s results). The move was made to reduce the Company’s reliance on its revolving facility, as the Canadian lending environment for junior oil and gas firms is expected to continue tightening. The two previous loans were consolidated into a single loan and the annual interest rate was lowered to 10%, simple interest. Neither the interest nor the principal are payable until the end of the term. The Company has the option to pay out the loan, or a portion thereof, at any time, without penalty. Three were no fees associated with restructuring the loans or for initiating the original loans. The lender is also a substantial, long-standing shareholder of the Company and this restructuring indicates his liberal support, flexibility and willingness to see the Company proliferate through the successful drilling of the remainder of the heavy oil locations in Eye Hill, Saskatchewan.
• The Company achieved record quarterly revenue of $2.3 million for the three months ended June 30, 3013. The Company also set another quarterly record, Cash Generated from Operations, at $1.03 million. Netbacks on oil production improved by 120% to $37.46/bbl compared to the previous quarter, reflecting significantly improved operating costs and stronger revenues per barrel. Operating cost improvements were also made on natural gas properties, where operating costs decreased 21% compared to the previous quarter. Natural gas netbacks showed drastic improvement from $0.00/mcf to $0.92/mcf quarter-over-quarter.

About Edge Resources Inc.

Edge Resources is focused on developing a balanced portfolio of oil and natural gas assets from properties in Alberta and Saskatchewan, Canada. Management has consistently focused on:

1. Shallow, conventional programs that typically offer reduced capital, operational and geological risks
2. Very high or 100% working interests and fully operated assets
3. Pools and horizons with exceptionally high reserves in place

The management team’s very high drilling success rate is based on the safe, efficient deployment of capital and a proven ability to efficiently execute in shallow formations, which gives Edge Resources a sustainable, low-cost, competitive advantage.

1. Proved Reserve Value and Proved+Probable Reserve Value do not include abandonment, reclamation and tax pool effects, which are included at a corporate level. When included, the corporate level Total Proved+Probable Reserve Value decreases from $89.4 million to $87.4 million. All values are net working interest, before tax and royalties, calculated at a 10% discount rate. The NI51-101 Reserve Report is conducted annually by a qualified independent engineering and reserve estimation firm, as per Canadian standard requirements for public oil and gas disclosure.

This release includes certain statements that may be deemed “forward-looking statements”. All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Company, Investors should review the Company’s registered filings which are available at www.sedar.com.

Barrel (“bbl”) of oil equivalent (“boe”) amounts may be misleading particularly if used in isolation. All boe conversions in this report are calculated using a conversion of six thousand cubic feet of natural gas to one equivalent barrel of oil (6 mcf=1 bbl) and is based on an energy conversion method primarily applicable at the burner tip and does not represent a value equivalency at the well head. Barrels of oil per day (“bopd’) is estimated daily oil production.

This news release shall not constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws.

Trading in the securities of Edge Resources Inc. should be considered highly speculative. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.