Rock Energy Inc. Announces Year End 2015 Reserves Replacing Over 400% of Its Production During the Year, and Growing Total Proven Plus Probable Reserves by 37%

Rock Energy Inc. (RE.TO) (“Rock” or the “Company”) is pleased to report a corporate reserves update effective December 31, 2015. This is a reserves update to the report provided on December 14, 2015 that had an effective date of November 30, 2015. The new report incorporates production for the month of December, the drilling of three (3.0 net) wells at Laporte, and the GLJ Petroleum Consultants (“GLJ”) price forecast dated January 1, 2016. GLJ’s new price forecast has a 2016 WTI price of $44.00 US/bbl compared to the previous forecast of WTI = $50.00 US/bbl. The Company’s net asset value has not been materially impacted by this reduction in forecasted prices.

This reserves update was undertaken by Rock’s independent reserve evaluator, GLJ. The report on such reserves (the “GLJ Report”) was prepared in accordance with definition, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities (“NI 51-101”). The information set forth below summarizes the oil, liquids and natural gas reserves and the net present value of future net revenues from those reserves using forecast prices and costs. Unless stated otherwise, all reserve volumes referred to in this document are “gross” reserves which are the Company’s interest share of reserves (operated and non-operated) before deduction of royalties and without including any royalty interests. In addition to the detailed information disclosed in this press release, more information will be included in Rock’s Annual Information Form for the year ended December 31, 2015, which will be filed on SEDAR at www.sedar.com on or before March 31, 2016.

The key results of the report can be summarized as follows:

• Increased its Total Proven plus Probable reserves by 37% from 12.5 million boe at 2014 year-end to 17.1 million boe (98% heavy and light oil and natural gas liquids). This increase in reserves was accomplished due to the success of the Laporte/Mantario Polymer Flood project as well as the continued success of the Onward Viking resource play development;
• Replaced over 400% of its production during the period on a Total Proved plus Probable basis;
• Generated a corporate reserve value for the Total Proved plus Probable of $218.6 million (BTAX NPV discounted at 10%) despite the 41% reduction in the price forecast (2016 WTI was reduced from $75.00 US/bbl to $44.00 US/bbl);
• Increased the Reserve Life Index (“RLI”) to 14.1 years on its Total Proven plus Probable reserves (assuming forecasted Q1/2016 average production of 3,320 boepd);
• Focused the Company into three assets, two of which the Company has discovered and developed, representing 99% of the value of the Company; and
• Generated corporate Finding, Development and Acquisition Costs including revisions of $17.04/boe for Total Proven plus Probable reserves.

Corporate Net Asset Value

Based on Rock’s updated reserve value, management estimates that the corporate net asset value of the Company is $3.67/share (basic) as detailed below:

The estimates of reserves and future net revenue for individual properties may not reflect the same confidence level as estimates of reserves and future net revenue for all properties, due to the effect of aggregation.

Laporte/Mantario

In addition to the progress we reported in the December 14, 2015 press release we were able further increase the pool size at Laporte by the drilling of two (2.0 net) infill wells and one (1.0 net) step out well in December, further verifying the seismic interpretation. The pool now has a total of 44.1 million barrels of OOIP and GLJ has recognized a Total Proved plus Probable pool recovery factor of 25%. During 2015 Rock was able to add reserves at Laporte at a cost of $3.57/boe (FD&A including revisions) generating a recycle ratio of 5.5.

Onward Viking

During 2015 Rock was able to add reserves light oil reserves at Onward at a cost of $26.00/boe (FD&A including revisions) generating a recycle ratio of 1.5.

RESERVES DATA

More detailed information in respect of reserves and net present value which is contained in the GLJ Report is set forth below.

Disclosure of Reserves Data

The reserves data set forth below (the “Reserves Data“) is based upon an evaluation by GLJ with an effective date of December 31, 2015 contained in the GLJ Report. The Reserves Data summarizes the oil, liquids and natural gas reserves of the Corporation and the net present values of future net revenue for these reserves using forecast prices and costs. The GLJ Report has been prepared in accordance with the standards contained in the COGE Handbook and the reserve definitions contained in NI 51-101. The Company engaged GLJ to provide an evaluation of proved and proved plus probable reserves and no attempt was made to evaluate possible reserves. All of Rock’s reserves are in Canada and, specifically, in the provinces of Alberta, British Columbia and Saskatchewan.

We have adopted the standard of 6 Mcf:1boe when converting natural gas to boes. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf per barrel 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 different than the energy equivalency of the 6:1 conversion ratio, utilizing the 6:1 conversion ratio may be misleading as an indication of value.

All evaluations and reviews of future net cash flow are stated prior to any provision for interest costs or general and administrative costs and after the deduction of estimated future capital expenditures for wells to which reserves have been assigned. It should not be assumed that the estimated future net cash flow shown below is representative of the fair market value of the Corporation’s properties. There is no assurance that such price and cost assumptions will be attained and variances could be material. The recovery and reserve estimates of crude oil, natural gas liquids (“NGLs) and natural gas reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual crude oil, NGLs and natural gas reserves may be greater than or less than the estimates provided herein.

Future Development Costs

The following table sets forth development costs deducted in the estimation of the corporation’s future net revenue attributable to the reserve categories noted below.

Forecast Prices and Costs

The forecast cost and price assumptions assume increases in wellhead selling prices and take into account inflation with respect to future operating and capital costs. Crude oil and natural gas benchmark reference pricing, as at January 1, 2016, inflation and exchange rates utilized by GLJ in the GLJ Report, which were GLJ’s then current forecasts at the date of the GLJ Report, were as follows:

Table Notes:

A) The aggregate of the exploration and development costs incurred in the most recent financial year and the change during that year in estimated future development costs generally will not reflect total finding and development costs related to reserve additions for that year.

For further information please visit Rock’s website at www.rockenergy.ca.