Mr. Brad Gabel reports

CANAMAX ANNOUNCES STRATEGIC MONTNEY OIL FOCUSED ACQUISITION FURTHER CONSOLIDATING ITS GREATER GRIMSHAW AREA

Canamax Energy Ltd. has entered into a binding purchase and sale agreement with an intermediate oil and gas company to acquire certain assets in Alberta for cash consideration of $24.0-million, subject to customary closing adjustments. The acquisition is expected to close on or before July 31, 2015. The assets to be acquired consist primarily of two producing properties located in northwest Alberta within the company's Greater Grimshaw area (previously referenced as the company's Flood area). The acquisition is expected to add low decline production of approximately 750 barrels of oil equivalent per day (boe/d) (54 per cent oil and natural gas liquids (NGL)) at the closing date and includes 110 (64 net) sections of land. The Grande Prairie and Grimshaw properties each have contiguous, substantially 100-per-cent-owned acreage and facilities with significant development potential for Montney oil. Canamax has initially identified approximately 50 Montney oil horizontal drilling locations on these two new properties, which include 11 drilling locations already booked as part of the Dec. 31, 2014, independent reserve report on the assets to be acquired. The acquisition will be financed through a combination of equity and debt financing.

Acquisition

The Grimshaw and Grande Prairie assets (the Greater Grimshaw assets) provide a strategic fit with Canamax's existing core property at Flood. The Grimshaw property is directly south of Flood and encompasses 17, 100-per-cent-owned sections with a gathering system and centralized battery facilities in place and production from the same Montney fairway as the Flood property. As part of the acquisition, Canamax will acquire approximately 25 square kilometres of proprietary 3-D seismic over the prospective portions of Grimshaw.

The Grande Prairie assets to be acquired are just north of the city of Grande Prairie and encompass approximately 20 net sections (at 90-per-cent average working interest). The production, facilities and prospective sections in this area have a 100-per-cent ownership interest. Production from Grande Prairie consists of oil, natural gas and NGLs from the Montney and Dunvegan formations.

At Canamax's existing Flood property, the company currently has 59 net sections of primarily contiguous 100-per-cent-owned acreage with 100-per-cent ownership of the area facilities and producing wells. Current production at Flood is approximately 350 boe/d (85 per cent oil) and the company plans to drill six vertical Montney wells in the area during third quarter 2015. An additional 140 potential drilling locations (vertical and horizontal wells) have been identified in the upper and lower Montney reservoirs on the Flood property.

Canamax estimates that on closing of the acquisition, the company should have aggregate production of approximately 1,800 boe/d (which includes 150 boe/d of currently shut-in production at Canamax's Brazeau River property). With full ownership of the pipeline infrastructure and emulsion handling/disposal facilities in the Greater Grimshaw areas (that are currently owned or are to be acquired by the company), Canamax should be well positioned to further build out and exploit this highly prospective region.

The acquisition of the Greater Grimshaw assets is summarized as follows.

Total purchase price (1):  $24.0-million

Actual production -- Q1 2015:  727 boe/d

Estimated production (at closing date) (2):  750 boe/d (54 per cent oil and NGLs)

Estimated annual decline rate on base production:  12 per cent

Land:  70,500 (41,200 net) acres

Proved developed producing reserves (3):  1.6 million barrels of oil equivalent (MMboe) (65 per cent oil and NGL)

Proved reserves (3):  1.9 MMboe (70 per cent oil and NGL)

Proved plus probable reserves (3):  4.3 MMboe (55 per cent oil and NGL)

Proved plus probable reserve life index (3):  15.5 years

Proved developed producing reserves -- NPV10 (3) (4):  $25.8-million

Proved reserves -- NPV10 (3) (4):  $27.9-million

Proved plus probable reserves -- NPV10 (3) (4):  $40.9-million

The associated metrics based on the $24.0-million acquisition cost are as follows:

Estimated production (at closing):  $32,000 per flowing boe/d

Proved reserves:  $12.70/boe (5)

Proved plus probable reserves:  $5.62/boe (5)

Notes:

1. Subject to certain closing adjustments.
2. Estimated production at closing date, includes Q1 2015 production rates reduced to incorporate production declines, plus the activation of previously shut-in production.
3. The reserves information provided is based on a reserves evaluation prepared by Insite Petroleum Consultants, an independent qualified reserves evaluator, as at Dec. 31, 2014, for the properties to be acquired in accordance with the standards contained in the COGE Handbook and National Instrument 51-101. The reserves information used a price forecast schedule prepared by Insite and effective as at Dec. 31, 2014.
4. NPV10 means net present value of future net revenue discounted at 10 per cent before income tax. It should not be assumed that the NPV10 reserve values represent the fair market values of the reserves.
5. The acquisition cost per boe for proved reserves and proved plus probable reserves excludes the related future development costs estimated at Dec. 31, 2014.

On a combined basis, after the closing of the acquisition, Canamax anticipates that its corporate profile will be as follows:

Estimated production (at closing date) (1):  1,800 boe/d (54 per cent oil and NGLs)

Land:  165,000 (111,000 net) acres

Proved developed producing reserves (2):  3.2 MMboe (61 per cent oil and NGL)

Proved reserves (2):  5.1 MMboe (67 per cent oil and NGL)

Proved plus probable reserves (2):  9.6 MMboe (62 per cent oil and NGL)

Proved developed producing reserves -- NPV10 (2) (3):  $52.2-million

Proved reserves -- NPV10 (2) (3):  $66.2-million

Proved plus probable reserves -- NPV10 (2) (3):  $107.9-million

Notes:

1. The aggregate estimated production includes 150 boe/d of currently shut-in Canamax production at Brazeau River.
2. Based on the Canamax reserves information as at Dec. 31, 2014, that has been previously disclosed (where the supporting reserves information was prepared by an independent qualified reserves evaluator, GLJ Petroleum Consultants Ltd., in accordance with the standards contained in the COGE Handbook and National Instrument 51-101) plus the acquisition reserves information as at Dec. 31, 2014, as outlined above. The Canamax reserves information used a price forecast schedule prepared by GLJ effective as at Dec. 31, 2014. The acquisition reserves were evaluated by Insite using a price schedule prepared by Insite and effective as at Dec. 31, 2014. Readers should be cautioned that the price forecasts of each of GLJ and Insite are different and as a result, the values reflected in these rows utilize different price estimates.
3. NPV10 means net present value of future net revenue discounted at 10 per cent before income tax. It should not be assumed that the NPV10 reserve values represent the fair market values of the reserves.

"This acquisition further consolidates our position as a leading Montney oil producer in the Greater Grimshaw area," commented Brad Gabel, the company's president and chief executive officer. "The contiguous land base at Greater Grimshaw, combined with 100-per-cent ownership interests in the key acreage and facilities in those areas should provide Canamax with significant running room to develop these assets and accelerate the company's growth rate."

The acquisition is subject to customary closing conditions, Canamax obtaining sufficient external financing, and the receipt of the approval of the TSX Venture Exchange.

Financial adviser

GMP Securities LP acted as exclusive financial adviser to Canamax with respect to the acquisition.

Financing

To assist in financing the acquisition, Canamax has entered into an agreement, on a commercially reasonable efforts agency basis, with a syndicate of investment dealers co-led by GMP Securities LP and Clarus Securities Inc. for a private placement financing of subscription receipts of the company at 60 cents per subscription receipt for minimum gross proceeds of $15-million. The company has granted the agents an option to increase the size of the financing by up to 15 per cent for maximum gross proceeds of $17.25-million. All net proceeds from the financing will be allocated to the acquisition. The financing is expected to close on or about June 30, 2015.

The subscription receipts will be issued pursuant to a subscription receipt agreement. Each subscription receipt will entitle the holder to receive one common share in the capital of the company, without any further action or payment on the part of the holder, upon receipt of all approvals required to complete the acquisition and all conditions to the closing of the acquisition, other than the payment of the purchase price therefor, being satisfied and the earlier of: (i) four months and a day following the closing of the financing; and (ii) the date upon which a receipt is issued in respect of a final prospectus qualifying the issuance of the common shares underlying the subscription receipts.

The company has agreed to use commercially reasonable efforts to obtain such receipt no later than 30 days following the closing of the acquisition. The proceeds raised from the financing shall be held in escrow pending the satisfaction of the escrow release conditions. If the acquisition is not completed by the company on or before Aug. 1, 2015, then the gross proceeds from the subscription receipts will be returned to subscribers, together with their pro rata portion of any accrued interest less any applicable withholding taxes.

As a backstop for the financing required for the acquisition, Canamax has established a standby bridge loan facility with an arm's-length lender which provides lending capability of up to $20.0-million, if required. The standby bridge facility with the arm's-length lender required an upfront fee of 5.25 per cent on $20.0-million (payable as to 1 per cent in cash and 4.25 per cent in common shares). Canamax made the common share payment by issuing the lender 1,532,000 common shares pursuant to a prospectus exemption in accordance with the terms of the credit agreement governing the standby facility. Such shares will be subject to a four-month hold period. If Canamax draws on the facility to finance a portion of the acquisition, an additional fee of 4.25 per cent of the funds drawn will be payable to the lender in the form of common shares. Drawn funds on the bridge facility will carry a maximum term of 14 months and carry an annual interest rate of 9.5 per cent for the first 12 months and 12 per cent per annum thereafter. There will be no early payout penalty as long as the drawn amounts are outstanding for at least three months. Prior to any financing being available from this facility, Canamax must raise a minimum of $10-million in equity financing.

The financing is subject to the receipt of necessary regulatory approvals including approval by the TSX Venture Exchange and the satisfaction of certain other conditions.

We seek Safe Harbor.