Mr. Chris Bloomer reports

CONNACHER ANNOUNCES THIRD QUARTER 2013 RESULTS

Connacher Oil and Gas Ltd. has released its financial and operating results for the third quarter ending Sept. 30, 2013. Selected financial and operational information is outlined below and should be read in conjunction with the company's unaudited financial statements, and the related management's discussion and analysis, which are available at the company's website or SEDAR.

Q3 2013 highlights:

• Earnings before interest, taxes, depreciation and amortization of $36.8-million, a 54-per-cent increase from second quarter 2013 ($24-million);
• Bitumen production averaged 11,788 barrels per day;
• Bitumen netback of $46.57/bbl, a 46-per-cent increase from Q2 2013 ($31.79/bbl);
• Funds flow from continuing operations of $16.4-million;
• Reduced diluent blend ratio (DBR) to 18 per cent from 20 per cent in Q2 2013;
• Diluted bitumen sales by rail increased to 90 per cent of total sales from 80 per cent in Q2 2013;
• Commenced steaming new SAGD well pairs at Pod One;
• Converted infill wells from steam injection to production;
• Capital expenditures of $35-million.

                              Q3 2013 FINANCIAL AND OPERATIONAL SUMMARY
                           (In thousands, except per share and where noted)

                                                Three months ended Sept. 30, Nine months ended Sept. 30,
                                                           2013         2012            2013        2012

Revenue, net of royalties (continuing operations)      $122,719     $100,829        $334,652    $289,987
EBITDA (continuing operations)                           36,775       10,118          71,860      29,488
Funds flow (continuing operations)                       16,410      (10,432)         12,577     (33,090)
Net earnings (loss) (continuing operations)              (2,357)     (25,379)        (81,040)    (68,645)
Net earnings (loss) (discontinued operations)                 -       13,697               -      (8,657)
Net earnings (loss)                                      (2,357)     (11,682)        (81,040)    (77,302)
Per share, basic and diluted                                  -        (0.03)          (0.18)      (0.17)
Capital expenditures -- continuing operations            35,305        4,968          83,992      25,706
Average benchmark prices
WTI (US$/bbl)                                            105.83        92.22           98.14       96.22
Heavy oil differential ($/bbl)                           (18.15)      (21.65)         (23.26)     (22.06)
Western Canada Select ($/bbl)                             91.75        70.05           77.19       74.34
Daily production volumes -- continuing operations
Bitumen (bbl/d)                                          11,788       11,478          11,920      11,860
Dilbit sales                                             101.16        70.73           85.08       69.18
Diluent costs                                             (4.48)      (12.21)          (7.87)     (13.75)
Realized bitumen sales                                    96.68        58.52           77.21       55.43
Transportation and handling costs                        (24.79)      (20.40)         (22.21)     (14.15)
                                                          71.89        38.12           55.00       41.28
Royalties                                                 (5.65)       (2.15)          (3.62)      (2.49)
Net bitumen revenue                                       66.24        35.97           51.38       38.79
Production and operating expenses                        (19.67)      (20.35)         (20.25)     (18.40)
Bitumen netback -- per barrel                             46.57        15.62           31.13       20.39

At Sept. 30, 2013, the company's working capital surplus was $33-million, including $51-million of cash on hand. Based on current covenant calculations, the company is able to fully utilize the $95-million under the bank facility. The maximum available bank credit line at the end of Q3 2013 is $74-million, net of existing letters of credit.

Long-term debt, consisting solely of the company's outstanding second-lien senior notes due in 2018 and 2019, totalled $871-million. Under the note indenture for the company's notes, the company has a first-lien debt basket that permits the company to incur first-lien debt of up to $170-million (inclusive of commitments under the bank facility).

Total capital expenditures during the quarter were approximately $35-million ($77-million year-to-date 2013). Capital expenditures of $26-million were incurred in Q3 2013 to increase production and decrease operating costs, with the remaining $9-million for maintenance expenditures.

Bitumen production at Great Divide averaged 11,788 bbl/day in Q3 2013, up 2 per cent from Q2 2013.

Cash flow from operating activities (continuing operations) was $43-million in Q3 2013 compared with $21-million in Q2 2013. The increase was primarily driven by higher realized pricing and decreased diluent use.

Connacher incurred a net loss of $2.4-million, or nil per share, for Q3 2013, compared with a net loss in Q2 2013 of $32-million, or seven cents per share.

Operations update and outlook

Based upon field estimates, Great Divide production in the month of October, 2013, was 11,800 bbl/day.

Production on pad 102 is experiencing positive results from the infill wells, with Pod One average production in October of 6,200 bbl/d. The SOR for all of pad 102 has been less than three since the infills came on production. These results highlight Connacher's strategy to match reservoir performance with steam capacity. The four new SAGD well pairs at pad 104 are currently steaming and are expected to be converted to SAGD production in late fourth quarter 2013 to early first quarter 2014.

At Algar, October field estimates for production are 5,600 bbl/d, with rod pump conversions on pad 201 impacting production. SAGD-plus process trials will continue at Algar until the end of the year on 203-1, with testing focusing on optimizing commercial solvent injection rates. The company plans to initiate another test one of the new well pairs on pad 104 in Q3 2014.

The 2013 growth capital plan spend is nearing completion. In the third quarter, growth capital expenditures were $26-million and the company expects to spend approximately $5-million in the fourth quarter. The total growth capital spent in 2013 is approximately $68-million in line with the 2013 plan.

For 2014, the growth capital plan is being finalized and will be provided at a later date, as the company would like to continue to evaluate the performance of the new infill and SAGD wells. Connacher is able to undertake drilling and facilities projects throughout the year, and is not materially impacted by seasonal windows and therefore has the flexibility in the timing of capital expenditures.

In the third quarter the company moved approximately 90 per cent of its diluted bitumen (dilbit) to markets by rail outside Alberta. This is the highest proportion of sales by rail and provided strong bitumen netbacks. The company will continue to move dilbit by rail to markets that offer favourable pricing; however, the proportion moved by rail will vary due to market conditions.

We seek Safe Harbor.