Shoreline Energy Corp. Announces Financial and Operating Results for the Quarter and Year-Ended December 31, 2014

CALGARY, ALBERTA--(Marketwired - Mar 31, 2015) - Shoreline Energy Corp. (SEQ.TO) ("Shoreline" or the "Company") reports its 2014 year end oil and gas reserves, as well as 2014 year-end financial and operating results. A complete copy of the Company's annual information form, 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.

Fourth Quarter 2014 Financial and Operating Highlights

• In the fourth quarter of 2014, the Company completed the sale of all of its US Wattenburg assets for gross proceeds of $12.5 million US Dollars.

• A settlement agreement was reached on the royalty obligation that reduced the obligation from the carrying value of $9.6 million to $5.5 million. A gain on the settlement of debt of $4.1 million was recorded.

• From the proceeds of asset sales in the fourth quarter of 2014, the Company fully repaid all of its secured loans including repayment and retirement of its royalty obligation. The Company no longer has any secured debt facilities.

• Revenues from continuing operations for the fourth quarter of 2014 were $1.5 million, a decrease of $2.5 million from the third quarter of 2014 as the result of lower average daily production after asset sales and lower commodity prices.

• Sales volumes from continuing operations averaged 520 barrels of oil equivalent per day (boe/d) for the fourth quarter of 2014, compared to 1,033 boe/d the third quarter of 2014. The decrease is the result of the Canadian property dispositions that closed during the third quarter of 2014.

• The Company recorded a net loss of $33.4 million from continued and discontinued operations combined, representing a net loss per share of $3.69.

• Net funds flow from continuing operations resulted in a use of $1.3 million for the fourth quarter of 2014, in comparison to the third quarter of 2014, which resulted in a use of $2.4 million. The higher loss for the third quarter is primarily as a result of a flow through share obligation of $2.2 million recorded. In the fourth quarter of 2014 there was a reversal of the flow through share obligation of $0.2 million as a result of eligible seismic expenditures made.

• Capital expenditures for the fourth quarter of 2014 totaled $0.7 million compared to $0.1 million in the third quarter of 2014 and related mainly to seismic shot in the Company's Hines Creek area lands.

Reserve Highlights

• Total Proved plus Probable (2P) reserve value of $21.7 million (discounted at 10%), representing 2,697 mmBOE.

• Total Proved (1P) reserve value of $16.0 million (discounted at 10%), representing 1,939 mmBOE.

• Proved Developed Producing reserve value of $10.4 million (discounted at 10%), representing 1,270 mmBOE.

Corporate Update

For the first quarter of 2015, the Company produced an average of 641 Boe/d based on field estimates, with an 84% natural gas weighting. Effective March 29, 2015, a production facility operated by a third party was shut in due to continued low commodity prices, this will result in a reduction of 77 Boe/d to Shoreline's production while commodity prices remain weak.

Going Concern Risk

The Company's ability to continue as a going concern is dependent upon the continued support of the Company's debenture holders as well as the Company's ability to obtain other financing to fund its existing obligations, operating, financing and investing activities. If the Company cannot negotiate a shares-for-debt settlement with its debenture holders and acceptable settlement terms with its other creditors, the Company may need to enter into credit protection to restructure its financial position.

After selling a significant portion of its producing assets, Shoreline's environment licensee liability rating (LLR) dropped below 1.0, which under normal circumstances, would require the Company to post a deposit with the Alberta Energy Regulator for future abandonment and reclamation expenses. Shoreline has instead submitted an extensive application and work plan under the LLR management program in December 2014 and was subsequently accepted into the program on March 25th, 2015. This program will defer any deposits until September 30th 2015.

Reserves Information

The following table summarizes the Company's reserves as at December 31, 2014 as evaluated by GLJ Petroleum Consultants conducted pursuant to NI-51-101 and COGEH reserves definitions.

Summary of Oil and Gas Reserves

	Light and Medium Crude Oil		Heavy Crude Oil		Natural Gas (Excluding Natural Gas Liquids)			Natural Gas Liquids		Total Oil Equivalent
	Gross(1) (Mbbl)	Net(2) (Mbbl)	Gross(1) (Mbbl)	Net2) (Mbbl)	Gross(1) (MMcf)	Net(2) (MMcf)		Gross(1) (Mbbl)	Net(2) (Mbbl)	Gross(1) (Mbbl)	Net(2) (Mbbl)
Proved
Developed Producing	173	161	5	4	6,246	5,535		52	34	1,270	1,122
Developed Non-producing	129	110	0	0	3,137	2,708		17	12	669	572
Undeveloped	0	0	0	0	0	0		0	0	0	0
Total Proved	301	270	5	4	9,384	8,244		69	45	1,939	1,694
Total Probable	151	128	0	0	3,502	3,041		23	15	758	650
Total Proved + Probable	453	398	5	5	12,885	11,285		92	61	2,697	2,344

(1)	Gross refers to Company's working interest excluding royalty interests and before royalty charges
(2)	Net refers to the Companies working interest and royalty interests after royalties charges
(3)	Tables may not add due to rounding

Net Present Value of Future Net Revenue Before Income Taxes (Forecast Case)

	Net Present Value of Future Net Revenue Before Income Taxes Discounted at (%/year)					Unit Value(2) Before Income Tax Discounted at 10% per year
	0 (M$)	5 (M$)	10 (M$)	15 (M$)	20 (M$)	$/Boe	$/Mcfe
Proved
Developed Producing	17,261	12,985	10,404	8,699	7,495	$9.27	$1.55
Developed Non-producing	9,759	7,272	5,650	4,534	3,730	$9.87	$1.64
Undeveloped	0	0	0	0	0	0	0
Total Proved	27,020	20,257	16,054	13,232	11,225	$9.48	$1.58
Total Probable	12,961	8,060	5,616	4,205	3,303	$8.64	$1.44
Total Proved + Probable	39,981	28,317	21,669	17,437	14,528	$9.24	$1.54

(1)	All values are in Canadian dollars
(2)	Unit values are calculated by dividing net present value at 10% by Company Net volumes
(3)	Tables may not add due to rounding

Financial Tables From Continuing Operations

		Three months ended
		December 31,		September 30,
		2014		2014		Change
Capital expenditures (excluding acquisitions)		748		67		1,016	%
Total assets		40,154		75,130		(47	)%
Working capital (deficiency)		(20,834	)	(37,597	)	(45	)%
Shareholders' equity		8,545		8,545		0	%
Weighted average common shares outstanding
	Basic and diluted(2)	9,041		9,041		0	%
Operating
Production
Oil & NGL's (bbls/d)		96		238		(60	)%
Gas (mcf/d)		2,542		4,769		(47	)%
Total (boe/d) (3)		520		1,033		(50	)%
Average realized prices
Oil & NGL's ($/bbl)		67.37		88.31		(24	)%
Gas ($/mcf)		3.64		4.36		(17	)%
	Petroleum and natural gas sales	31.03		42.05		(26	)%
	Realized gain (loss) on financial instrument	-		(1.28	)	(100	)%
	Royalties	(0.53	)	(5.08	)	(90	)%
	Operating expenses	(41.47	)	(14.68	)	182	%
	Transportation expenses	(1.67	)	(0.99	)	69	%
Operating netback		(12.64	)	20.02		(163	)%
Drilling activity
Gross wells		0		0		NA
Net interest wells		0		0		NA
(1) See "Non-GAAP Terms".
(2) The effect of outstanding options and warrants on loss per share for the three month periods ended December 31, 2014 and September 30, 2014 is anti-dilutive.

About Shoreline Energy Corp.

Shoreline is a Calgary, Alberta based corporation engaged in the exploration, development and production of petroleum and natural gas. The Common Shares are currently listed on the TSX under the trading symbol "SEQ" and the 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 Company's website, www.shorelineenergy.ca.

Forward Looking and Cautionary Statements

This news release contains forward-looking statements relating to the Company's plans and other aspects of the Company'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 Company's ability to obtain equipment in a timely manner to carry out development activities; and the ability of the Company to access capital and credit. While the Company 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.

Non-GAAP Financial Measures

This press release contains references to measures used in the oil and natural gas industry such as "netback" and "net debt". These measures do not have any standardized meanings within International Financial Reporting Standards ("IFRS") and, therefore, reported amounts may not be comparable to similarly titled measures reported by other companies. These measures have been described and presented in this press release in order to provide shareholders and potential investors with additional information regarding Shoreline's liquidity and its ability to generate funds to finance its operations.

Netback, as used in this press release, denotes net earnings plus non-cash items, including future income taxes expense (less any recovery), depletion, depreciation and accretion expense and non-cash stock-based compensation expense. Shoreline uses net debt as a measure to assess its financial position. Net debt includes current liabilities (including Shoreline's credit facility and excluding the current portion of decommissioning obligations) less current assets (excluding property, plant and equipment, held for sale and risk management contracts).

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 significantly equivalency conversion ratio of 6:1, utilizing a conversion on a 6:1 basis is misleading as an indication of value.