Mr. Tony van Winkoop reports

ARSENAL ENERGY INC. ANNOUNCES CLOSING OF BOUGHT DEAL PRIVATE PLACEMENT OFFERING

Arsenal Energy Inc. has closed its previously announced bought-deal private-placement offering. Together, with the exercise of the underwriters' option granted in connection with the offering, the company issued 778,460 common shares at a price of $3.15 per common share and 585,700 common shares issued on a flow-through basis, pursuant to the Income Tax Act (Canada), in respect of Canadian exploration expenses (CEE), at a price of $3.70 per CEE flow-through share, for total gross proceeds of $4,619,239.

The offering was led by PI Financial Corp., as lead underwriter, on behalf of a syndicate of underwriters, including Acumen Capital Finance Partners Ltd., National Bank Financial Inc., Industrial Alliance Securities Inc. and Paradigm Capital Inc.

Arsenal intends to use the proceeds of the common share portion of the offering to position the company to take advantage of property dispositions by competitors in its core areas and pay down existing indebtedness and will use the proceeds of the CEE flow-through share portion of the offering to incur eligible Canadian exploration expenses on its core properties and renounce such expenses to subscribers of CEE flow-through shares for the 2015 tax year.

The common shares and CEE flow-through shares issued pursuant to the offering are subject to a statutory hold period under applicable securities legislation until Nov. 15, 2015.

We seek Safe Harbor.