Mr. John Rooney reports

NORTHERN BLIZZARD RESOURCES INC. ANNOUNCES REVISED 2015 CAPITAL PROGRAM AND GUIDANCE; MAINTAINS DIVIDEND

Northern Blizzard Resources Inc. has revised its capital program for 2015 in response to the significant decline in crude oil prices. The capital program for 2015 has been reduced by 40 per cent from $215-million to $130-million, which maintains the company's financial strength while supporting estimated 2015 production of 23,000 barrels of oil equivalent per day and the monthly dividend of eight cents per share.

Revised 2015 capital program

Northern Blizzard is committed to a sustainable long-term strategy that supports per-share growth and an attractive dividend. To achieve this goal in the current commodity price environment, the company has reduced its 2015 drilling program from 189 to 74 wells, which account for the majority of the change in the capital program. Capital spending for the first half of 2015 is budgeted to be less than $50-million and, when combined with the company's hedge program, will enable Northern Blizzard to enter the second half of 2015 in a strong financial position.

Northern Blizzard operates and controls approximately 99 per cent of its development program and thereby retains the ability to increase or decrease capital spending as circumstances dictate.

Hedging

Northern Blizzard has a hedging program that is designed to reduce revenue volatility caused by changes in commodity prices. The company has WTI hedges in place at an average price of $101 per barrel for approximately 55 per cent of estimated oil production for the first half of 2015 and approximately 28 per cent of estimated oil production for the third quarter of 2015. Northern Blizzard estimates the current mark-to-market value of its hedging program to be approximately $70-million. The hedging program contributes over $5 per barrel of oil equivalent to estimated 2015 funds from operations.

Sustainable dividend

Northern Blizzard currently pays a monthly dividend of eight cents per share. The dividend represents an important part of the company's corporate strategy, and the company expects to continue paying the dividend despite the challenging commodity price environment. Northern Blizzard has a stock dividend program, where shareholders can elect to receive common shares as payment for their dividends. Shareholders representing approximately 67 per cent of the company's outstanding shares currently participate in the SDP. This translates into a total payout ratio for 2015 of 77 per cent, including the SDP (111 per cent excluding the SDP). Shareholders holding more than 1,000 common shares have the choice of taking dividends in the form of cash or stock. More information regarding the stock dividend program can be found on the company's website.

Financial strength

Northern Blizzard has significant financial flexibility supported by a $530-million credit facility, of which approximately $470-million is undrawn. In addition, the majority of the company's debt is term debt of $276-million (U.S.) that is due in 2022.

Revised 2015 guidance

As noted herein, capital spending for 2015 has been revised to $130-million, $85-million less than the previous guidance of $215-million. As a result, the company's estimated 2015 production is now 23,000 boe per day as compared with prior guidance (midpoint) of 25,000 boe per day. Funds from operations (including hedging) for 2015 are expected to be $211-million.

Revised 2015 guidance and assumptions are as set out in the attached table.

                REVISED 2015 GUIDANCE
                                         Revised  Prior*
Production
Oil and NGL (bbl/d)                       21,900 23,800
Natural gas (Mcf/d)                        6,600  7,500
Total (boe/d)                             23,000 25,000
Pricing
WTI (U.S.$/bbl)                           $65.00 $80.00
Cdn$/U.S.$ exchange rate                   1.155  1.125
WCS ($/bbl)                                56.00  71.00
AECO ($/Mcf)                                4.00   4.00
Expenses
Average royalty rate (%)                      11     12
Operating ($/boe)                          19.70  18.60
Transportation ($/boe)                      2.15   2.15
Corporate costs ($/boe)                     6.50   6.00
Excluding hedging
Funds from operations ($ millions)           165    300
Funds from operations per boe ($/boe)      19.65  33.00
Including hedging
Funds from operations ($ millions)           211    311
Funds from operations per boe ($/boe)      25.15  34.00
Capital expenditures ($ millions)            130    215

* Represents the midpoint of the guidance range

We seek Safe Harbor.