Mr. Barry Hildred reports

AQUILA RESOURCES FILES Q3 2015 FINANCIAL RESULTS AND PROVIDES CORPORATE UPDATE

Aquila Resources Inc. has filed its third quarter financial results for the period ended Sept. 30, 2015. All amounts are reported in U.S. dollars, unless indicated.

Third quarter 2015 corporate highlights:

• Received a payment totalling $1.35-million from Orion Mine Finance, stemming from the financing agreement closed in March, 2015;
• Advanced the mine permit application for the company's Back Forty project, in collaboration with Foth Infrastructure and Environment, an engineering firm based in Green Bay, Wis.; subsequent to quarter-end, the company submitted its mine permit application with the Michigan Department of Environmental Equality (MDEQ);
• Commissioned the University of Minnesota to complete a study examining the economic impact and benefits that development of Back Forty will have on Michigan's Upper Peninsula and Menominee county in particular;
• Identified near-mine exploration targets and prepared drill hole locations in advance of a fourth quarter drilling program consisting of up to 1,000 metres; the drill program includes step-out drilling to add to the underground resource; the Back Forty project is a volcanogenic massive sulphide (VMS) deposit located along the mineral-rich Penokean volcanic belt in Michigan's Upper Peninsula; VMS deposits often appear in clusters;
• Engaged SGS Lakefield to begin a comprehensive metallurgical test work program that included additional metallurgical drilling on site; the metallurgical test work program will also be used in the development of the feasibility study for Back Forty;
• Launched a concentrate marketing study that will be used for metallurgical design work, as well as with the development of the company's feasibility study for Back Forty;
• At Sept. 30, 2015, Aquila had cash of $1.2-million and a working capital deficit of $1-million; these compare with cash of $461,175 and a working capital deficit of $1.4-million at Dec. 31, 2014; the increase in cash and improvement in working capital is a direct result of the $20.75-million multilevel financing agreement that the company completed with Orion Mine Finance in March, 2015; as at Sept. 30, 2015, Aquila had received $11.35-million from Orion, the balance of which will be paid upon the successful completion of specific milestones, including the submission of an administratively complete mine permit application.

Highlights subsequent to quarter-end

• Received a cash advance totalling $1.5-million from Orion;
• Initiated plans to begin development of a feasibility study, including the engagement of expert consultants that will assist in the study's preparation; Aquila expects that the feasibility study, which will update Back Forty's economics, will be completed in the second half of 2016.

Outlook

"Our third quarter was among our busiest ever," said Barry Hildred, chief executive officer of Aquila Resources. "While our primary efforts focused on completing our mine permit application that was recently submitted to the MDEQ, we also commenced two drill programs: one to support metallurgical test work and one designed to increase the long-term potential of the resource."

Mr. Hildred added: "In the future, we will continue to support our permitting activities through community outreach and town hall sessions, where we will present information about Back Forty and its economic benefits, including job creation, to Michigan's Upper Peninsula. We will also share details on how our mine development plan is fully compliant with all of Michigan's environmental regulations for air, water, wetland and archeological resource."

Aquila's management discussion and analysis and financial statements for the third quarter of 2015 are available on the company's website and on SEDAR.

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