Mr. Alexandre Gagnon reports

PETROLIA INC.: QUEBEC BUDGET 2015-1016

Petrolia Inc. is pleased with the willingness expressed by the government of Quebec in the Leitao budget to complete the assessment of the oil and gas potential of Gaspesie. This willingness, coupled with the new accelerated capital cost allowance for liquefied natural gas incentives, will enable the implementation of a liquefied natural gas supply chain from the producer to the Cote-Nord customer.

It is reminded that in 2012, the government of Quebec invested $10-million in the purchase of Petrolia shares, a decision that helped the company complete the Bourque 1 and 2 wells. This in turn enabled the company to make a wet natural gas discovery in the Bourque permits located near Murdochville in Gaspesie. The potential was evaluated by Sproule at more than one trillion cubic feet of volume initially in place of wet natural gas within the Bourque project. (April 10, 2013, press release.) At the time, these operations generated more than $1.2-million in economic spinoffs within the Murdochville area.

Petrolia also announced an agreement last November with Tugliq Energie to create a liquefied natural gas supply chain to bring the potential gas production from Gaspesie to Cote-Nord customers (Nov. 19, 2014, press release). Within the agreement, Petrolia committed to sell its future gas production at a fixed price that will also be stable over time to mining and industrial customers from Cote-Nord and Grand-Nord.

Finally, Petrolia would like to highlight that the development of the Bourque project is supported by the City of Murdochville.

"I am pleased that the government has acknowledged the hydrocarbon potential of Gaspesie. We believe that the elements announced in the budget will enable the link of Gaspesie with the Cote-Nord, thus building better prosperity for these two areas and all of Quebec while reducing greenhouse gas emissions," declared Petrolia president and chief executive officer, Alexandre Gagnon.

We seek Safe Harbor.