Epsilon Energy Ltd. Announces Redemption of Its 7.75% Convertible Unsecured Subordinated Debentures

HOUSTON, TEXAS--(Marketwired - Feb. 16, 2017) - Further to its news release dated January 30, 2017, Epsilon Energy Ltd. ("Epsilon" or the "Corporation") (TSX:EPS), announces that it has redeemed the remaining approximately $40 million principal amount of its 7.75% convertible unsecured subordinated debentures (the "Debentures") at a redemption price of approximately $1,038 per $1,000 principal amount of Debentures.

As previously disclosed, the holders of approximately $28 million principal amount of Debentures consented to the proposed amendments to the indenture for the Debentures to provide for the early payment of the cash amount payable in respect of the Debentures, including the principal amount together with any accrued and unpaid interest thereon less any tax required by law to be deducted (the "Full Maturity Amount") on February 16, 2017.

About Epsilon Energy Ltd.

Epsilon Energy Ltd. is a North American natural gas development, production and midstream company with a current focus on the Marcellus Shale of Pennsylvania.

Forward-Looking Statements

Certain statements contained in this news release constitute forward looking statements. The use of any of the words "anticipate", "continue", "estimate", "expect", 'may", "will", "project", "should", 'believe", and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements are based on reasonable assumption but no assurance can be given that these expectations will prove to be correct and the forward-looking statements included in this news release should not be unduly relied upon.

Special note for news distribution in the United States

The securities described in the news release have not been registered under the United Stated Securities Act of 1933, as amended, (the "1933 Act") or state securities laws. Any holder of these securities, by purchasing such securities, agrees for the benefit of Epsilon that such securities may not be offered, sold, or otherwise transferred only (A) to the Corporation or its affiliates; (B) outside the United States in accordance with applicable state laws and either (1) Rule 144(as) under the 1933 Act or (2) Rule 144 under the 1933 Act, if applicable.