Mr. Dwayne LaMontagne reports

SAVANNA ENERGY SERVICES CORP. AGREES TO CANCEL NEW BUILD AUSTRALIAN CONTRACTS

In light of the significant uncertainty in respect of commodity pricing and activity levels for all of Savanna Energy Services Corp.'s services, Savanna and an Australian customer have mutually agreed to cancel construction of the four TDS drilling rigs previously contracted in fourth quarter 2014, resulting in the reduction of $34.5-million from Savanna's 2015 capital budget and a further $25-million from its 2016 capital commitments.

Savanna's estimated capital commitment for 2015 is updated as set out in the attached table.

             ESTIMATED CAPITAL COMMITMENT FOR 2015
               (stated in millions of dollars)

Estimated capital required to complete 2014 growth initiatives        $16.4
Estimated capital required to complete 2014 new field operating
facilities                                                             18.5
Maintenance capital for 2015                                           22.3
Proceeds on sale of field-operating facilities received to date in
2015                                                                  (11.5)
Net capital program spend                                              45.7

In addition, the company determined to consolidate a number of its field-operating facilities. The $16-million aggregate net book value of the land and buildings associated with these locations was classified as held for sale at Dec. 31, 2014. To date in 2015, total proceeds of $11.5-million were received for two of the properties, and the remaining locations continue to be actively marketed.

Savanna will continue to evaluate its 2015 capital program in light of further changes to anticipated activity levels as 2015 unfolds.

We seek Safe Harbor.