Mr. Barry Hildred reports

AQUILA RESOURCES FILES Q2 2014 RESULTS

Aquila Resources Inc. has released its second-quarter results for the period ended June 30, 2014. Aquila's management's discussion and analysis and financial statements for the quarter are available on the company's website and on SEDAR.

Aquila's focus in second-quarter 2014 was on completing a series of trade-off studies to determine the optimal mine plan for Back Forty and finalizing a new preliminary economic assessment for the project.

Postsecond-quarter 2014 highlights

In July, 2014, Aquila announced strong results from its new PEA on Back Forty (refer to the news release dated July 23, 2014, for full details and disclosures). Key highlights include:

• A pretax net present value of $247.2-million at 6 per cent, 34.9-per-cent internal rate of return and 1.6-year payback period;
• Potential for a diverse earnings stream with total payable production of the mine expected to be 532,000 ounces of gold, 704 million pounds of zinc, 63 million pounds of copper, 4,645,000 ounces of silver and 11 million pounds of lead;
• Opportunity for a low-capital-expenditure, high-grade initial phase operation that has the potential to maximize capital return in the early years of production.

Outlook

Subject to market conditions and available capital, Aquila's focus in 2014 remains on:

• Evaluating a small exploration program on previously identified near-mine targets in third-quarter 2014;
• Ramping up activities related to its permit application for Back Forty with the Michigan Department of Environmental Quality in second-half 2014.

About the Back Forty project

The Back Forty project is a high-grade polymetallic deposit located in the Penokean volcanic belt in the Great Lakes region. A 2013 updated resource estimate (refer to the news release dated Feb. 4, 2013, for full details and disclosures) delineated a measured and indicated resource of 15.1 million tonnes and an inferred resource of 2.3 million tonnes. The updated measured and indicated resource estimate contains 987,236 ounces of gold, 11.91 million ounces of silver, 1.02 billion pounds of zinc, 74.3 million pounds of lead and 110.4 million pounds of copper. An additional 155,885 ounces of gold, 1.99 million ounces of silver, 113.3 million pounds of zinc, 17.2 million pounds of lead and 18.6 million pounds of copper are included in the inferred category. The 2014 preliminary economic assessment (refer to the news release dated July 23, 2014, for full details and disclosures), based on the 2013 resource estimate, provided encouraging project economics, including a $247.2-million pretax net present value at a discount rate of 6 per cent and a pretax internal rate of return of 34.9 per cent. Results from the 2012 drilling program demonstrate potential for continued resource expansion at Back Forty.

We seek Safe Harbor.