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CALGARY, ALBERTA–(Marketwired – Oct. 1, 2015) –


Manitok Energy Inc. (the “Corporation” or “Manitok“) (TSX VENTURE:MEI) wishes to provide this update to inform its shareholders of the proactive steps that the Corporation is taking to withstand the current commodity market conditions.

The significant, unforeseen drop in energy prices has reduced the value of the Corporation’s oil and natural gas reserves, impacting the Corporation’s credit facilities, as noted in the Corporation’s financial results for the second quarter of 2015 released on August 31, 2015. Management is identifying and pursuing alternative debt arrangements, joint venture arrangements, property acquisitions or divestitures, corporate mergers and acquisitions and other recapitalization opportunities and is taking steps to manage its spending and leverage including the implementation of cost reduction and capital management initiatives to satisfy the credit facility repayment requirements.

In addition, management is continuing to work towards resolving the issues at the third party gas processing facility in the Carseland area in order to enable both restricted and behind pipe production to flow to sales. As previously noted in the Corporation’s press release dated August 31, 2015, the Corporation has approximately 1,200 to 1,300 boe/d either tied-in and restricted or awaiting tie-in in the Carseland area. The Corporation is not able to produce at full capacity due to the third party gas processing facility not being designed to process the high condensate rich natural gas. The resolution of this problem would enable the Corporation to accelerate development of the Carseland area where the Corporation has been successful drilling 6 wells to date and has identified over 50 lower Mannville drilling locations with 25 targeting the Lithic Glauconitic (“LG“) zone.

The Corporation is also advancing its Cardium F pool enhanced oil recovery plan (“EORP“) in order to increase the anticipated recovery factor from the current 9% to 10% to between 20% to 24%. The EORP would also provide the Corporation with good production practice status on the Cardium F pool, which would lift the existing production limitations on wells in the reservoir. Advancing the EORP provides the Corporation with a lower cost and risk option to increase its reserves relative to drilling.

Manitok has also identified several recompletion opportunities in suspended wellbores in the Wayne and Stolberg areas, which would provide additional production and reserves at a lower cost relative to drilling. The Corporation anticipates executing these recompletions in the fourth quarter of 2015.

The Corporation is well hedged to the end of 2017. In the second half of 2015, Manitok has hedged 2,000 bbls/d of crude oil at an average price of $89.00/bbl CAD WTI and 16,000 GJs/d of natural gas at an average price of $3.83/GJ, less a deferred premium of $0.35/GJ.

The Corporation has hedged 2,000 bbls/d of crude oil for the entire calendar year of 2016; 1,000 bbls/d is at $79.95/bbl CAD WTI through a swap and 1,000 bbls/d is through option collar transactions with a floor of $68.68/bbl and a ceiling of $86.18/bbl CAD WTI net of the deferred premium. The Corporation has hedged 1,500 bbls/d of crude oil for the entire calendar year 2017; 500 bbls/d is at $79.75/bbl CAD WTI through a swap and 1,000 bbls/d is through option collar transactions with a floor of $68.68/bbl and ceiling of $86.18/bbl CAD WTI net of the deferred premium.

Over the past two years, the Corporation has focused on building a new core area outside of the foothills area in southeast Alberta. In doing so, the Corporation has accumulated over 250,000 acres in the greater Entice and Wayne areas. In this area, the Corporation is focused on the lower Mannville oil development and, in particular, the LG and Basil Quartz formations. Manitok has identified 300 potential drilling locations on these lands and 150 locations are in the LG zone. The Corporation believes the LG play has good economics at a crude oil price of US$50.00/bbl WTI.

About Manitok

Manitok is a public oil and gas exploration and development Corporation focusing on conventional oil and gas reservoirs in the Canadian foothills and southeast Alberta. The Corporation will utilize its experience to develop the untapped conventional oil and liquids-rich natural gas pools in both the foothills and southeast Alberta areas of the Western Canadian Sedimentary Basin.