Daylight Energy Ltd.

Daylight Energy Ltd.

March 15, 2011 18:09 ET

Daylight Energy Announces Third Party Processing Disruption at the K3 Gas Plant

CALGARY, ALBERTA--(Marketwire - March 15, 2011) - On March 10, 2011 Daylight Energy Ltd. (TSX:DAY) ("Daylight") was informed by SemCAMS, operator of the K3 Gas Plant and Gathering System, that a significant mechanical failure had occurred at the K3 Gas Plant. As a result of the mechanical failure, processing capacity at the K3 Gas Plant has been temporarily suspended in order to perform the necessary repair work. This suspension has resulted in a significant portion of Daylight's liquids rich natural gas production from its West Central and Wapiti Montney properties being temporarily shut in (approximately 8,500 boe per day net) until the repairs are completed and the facility is brought back on line. It is currently estimated that processing at the K3 Gas Plant will recommence on or about March 22, 2011. The impact of the suspension on average 2011 first quarter and annual production is estimated at 1,500 boe per day and 400 boe per day, respectively.

Daylight is a growing intermediate oil and natural gas producing company with a high quality suite of resource play assets in Western Canada. Our highly focused team utilizes our technical expertise in exploitation, development, and acquisitions to create long-term value for our shareholders. Our team has developed a multi-year inventory of repeatable, low risk exploitation resource play projects with substantial potential reserve additions on assets we currently own and control in the premier Pembina Cardium light oil fairway and in the premier Deep Basin area of Alberta and British Columbia.

Daylight has approximately 210 million common shares outstanding which trade on the TSX under the symbol DAY. Daylight Series C and D convertible debentures trade on the TSX under the symbols DAY.DB.C and DAY.DB.D, respectively.

Information Regarding Disclosure in This News Release

The term "boe" is utilized by Daylight in relation to reserves or production to combine the volumetric measures of natural gas, light oil, heavy oil, and NGLs to a common "barrel of oil equivalent" term of measurement. Natural gas volumes have been converted at the ratio of 6,000 cubic feet of natural gas to one boe and this conversion ratio is based upon an energy equivalent conversion method primarily applicable at the burner tip and does not represent value equivalence at the wellhead. Light oil, heavy oil, and NGLs have been converted at the ratio of one barrel of these liquids to one boe. Use of the terms boe and amounts per boe without reference to the underlying commodity may be misleading.

Forward-Looking Information and Statements

This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking statements or information. More particularly and without limitation, this press release contains forward-looking statements and information concerning anticipated timing to complete the repair work to the K3 gas plant and the impact on Daylight's 2011 first quarter and annual production.

The forward-looking statements and information in this press release are based on certain key expectations and assumptions made by Daylight. Although Daylight believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because Daylight can give no assurance that they will prove to be correct.

Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. Additional information on the factors that could affect the business, operations or financial results of Daylight are included in reports on file with applicable securities regulatory authorities, including but not limited to Daylight's Annual Information Form for the year ended December 31, 2010 and Management's Discussion and Analysis for the year ended December 31, 2010, each of which may be accessed on Daylight's SEDAR profile at or on our website at

The forward-looking statements contained in this press release are made as of the date hereof and Daylight undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

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