Greenfields Petroleum Corporation Announces Financial and Operating Results for the Three Months Ended March 31, 2015

HOUSTON, TEXAS--(Marketwired - May 29, 2015) -

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Greenfields Petroleum Corporation (the "Company" or "Greenfields") (TSX VENTURE:GNF)(TSX VENTURE:GNF.DB), an independent exploration and production company with producing assets in Azerbaijan, is pleased to announce its financial and operating results for the three months ended March 31, 2015. Selected financial and operational information is set forth below and should be read in conjunction with the Company's March 31, 2015 condensed consolidated financial statements and the related management's discussion and analysis ("MD&A"). The financial statements and MD&A are available for review at www.sedar.com or on the Company's website at www.greenfields-petroleum.com. Except as otherwise indicated, all dollar amounts referenced herein are expressed in United States dollars.

First Quarter 2015 Financial Results and Highlights

• For the first quarter 2015, the Company recorded revenues of $0.3 million and realized net loss of $1.4 million. For the first quarter 2015, the results represented a loss per share (basic and diluted) of $0.06. In comparison with the same period in 2014, the Company recorded revenues of $0.4 million and realized net income of $1.1 million. Also, for the same period in 2014, the Company realized income per share of $0.06.

• The Company's 33.33% share of Bahar Energy entitlement sales volumes averaged 275 bbl/d and 4,800 mcf/d or 1,075 boe/d in the first quarter 2015. In comparison to the average volumes for the same periods in 2014, bbl/d, mcf/d and boe/d volumes decreased 37%, 47%, and 44%, respectively.

• For the first quarter 2015, the Company, through its interest in Bahar Energy, realized an average oil price of $47.75. This price decreased in comparison with an average of $102.36 per barrel realized for the same period in 2014. The Company realized an average gas price of $3.96 per mcf for the same periods, which is a contractually constant fixed price.

• For the first quarter 2015, the Company's 33.33% share of Bahar Energy financial results realized net income of $0.2 million. These results compare to net income $3.2 million for the same period in 2014.

• On January 22, 2015, the Company completed a non-brokered private placement of 2,000,000 common shares ("Common Shares"), at a price of $0.90 per Common Share (approximately CAD$1.11 per Common Share based on the Bank of Canada noon exchange rate on January 22, 2015 of $1.00 USD = $1.2371 CAD), for aggregate gross proceeds of $1,800,000 (approximately CAD$2,226,780). The Common Shares were subject to a four-month hold period that expired on May 23, 2015.

• Pursuant to the terms of the investment and shareholders agreement with respect to Bahar Energy (the "Shareholders Agreement"), as at March 31, 2015, Greenfields Petroleum International Company Ltd. ("GPIC"), a wholly-owned subsidiary of the Company, had funded by way of loans to Bahar Energy, a total of $20.8 million of defaulted obligations (the "Default Amount") of the other shareholder of Bahar Energy, Baghlan Group Ltd. ("Baghlan"), including $2.3 million funded in February 2015.
  
  Baghlan has failed to fund its share of the costs of Bahar Energy in accordance with the Shareholders Agreement and its loan funding obligation to Bahar Energy since January 2014. The Shareholders Agreement provides that in the event of a default by a shareholder in a funding obligation, the other shareholder is required, by additional loan, to provide such funds to Bahar Energy. To the extent that Baghlan defaults on its future funding obligations, Greenfields anticipates that it may also fund such amounts by further loans to Bahar Energy.
  
  As a result of the loan by GPIC of the Default Amount to Bahar Energy, the Shareholders Agreement stipulates that:
  
  • all of Baghlan's loans to BEL have become "last in" loans and will not be repaid by BEL until all amounts outstanding under all of GPIC's loans to BEL, including the payment of the Default Amount, have been paid by BEL to GPIC in full, regardless of when such loans were made by Baghlan;
    
  • Baghlan is deemed to have assigned to GPIC a share of its dividends equal to the sum of: (i) the Default Amount; (ii) Greenfields' Cost of Funding (as defined in the Shareholders Agreement) of such Default Amount; and (iii) a default rate of 4% on such Default Amount computed from and including the date on which the Default Amount has been funded by GPIC to, but excluding, the date Baghlan remedies the default (the "Default Interest"); and
    
  • the right of any directors appointed by Baghlan to BEL to vote at a meeting of the board of directors of BEL is suspended until the Default Amount has been paid in full, together with the Default Interest.
    

Operating Highlights and Plans

• Work was completed during the first quarter 2015 on the acquisition of modern 3-D seismic over the Gum Deniz Oil Field. The total number of patches shot was 96 square kilometers. Processing of the data on an expedited basis (Fast Track Volume) was completed and provided to BEOC in early May. This volume will allow for early structural mapping and support BEOC's review of development well locations for possible drilling beginning in the first quarter 2016.

• The more detailed pre-stack time migration ("PSTM") processing of the 3-D data for Gum Deniz has commenced with PGS-Almaty in Kazakhstan after export of the data to the processor was approved by the Azerbaijan government authorities. The processing time is scheduled to take five months. The PSTM processed data will then be integrated with the well control to prepare a revised Gum Deniz reservoir model to improve well take-point selection for the drilling program.

• A Bahar Field Reservoir Study, awarded to ERA Consultants in February, was contracted for the preparation of a detailed reservoir model to be used in selecting re-development opportunities, both workovers and drilling in the Bahar Gas Field. The initial draft of the study was completed and a report issued for managements' review in early May. The next phase will be the integration with the recently acquired 50 line kilometers of 2-D seismic, currently being processed, after which the final report is expected in the third quarter 2015.

Select Financial and Operating Information for the Three Months Ended March 31, 2015

The selected information below is from the Greenfields' Management Discussion & Analysis. The Company's complete financial statements as of and for the three months ended March 31, 2015 and 2014, with the notes thereto and the related Management's Discussion & Analysis can be found either on Greenfields' website at www.Greenfields-Petroleum.com or on SEDAR at www.sedar.com. All amounts below are in thousands of United States dollars unless otherwise noted.

Greenfields Petroleum Corporation

	Three months ended March 31,
(US$000's,except as noted)	2015			2014
Financial
Revenues		337			427
Net Income (loss)		(1,352	)		1,101
Per share, basic and diluted	$	(0.06	)	$	0.06
Capital Items
Cash and cash equivalents		65			2,763
Total Assets		84,608			60,129
Working capital		735			1,773
Long term loan, convertible debt and Shareholders' equity		60,103			57,653

Bahar Energy Limited (Joint Venture)

	Total Joint Venture				Company's share
	Three months ended March 31,
(US$000's,except as noted)	2015		2014		2015		2014
Financial
Revenues		9,430		22,898		3,143		7,632
Net income		747		9,657		248		3,218
Operating
Average Entitlement Sales Volumes (1)
Oil and condensate (bbl/d)		826		1,304		275		435
Natural gas (mcf/d)		14,400		26.964		4,800		8,987
Barrel oil equivalent (boe/d)		3,226		5,798		1,075		1,933
Average Oil Price
Oil price ($/bbl)	$	47.75	$	102.36	$	47.75	$	102.36
Net realization price ($/bbl)	$	46.36	$	100.46	$	46.36	$	100.46
Brent oil price ($/bbl)	$	53.98	$	108.14	$	53.98	$	108.14
Natural gas price ($/mcf)	$	3.96	$	3.96	$	3.96	$	3.96
Capital Items
Total Assets		200,849		198,482		66,943		66,154
Total Liabilities		40,627		46,658		13,541		15,551
Net Assets		160,222		151,824		53,402		50,603

(1)	Daily volumes represent the Joint Venture's and Company's share of the Contractor Parties entitlement volumes net of 10% compensatory petroleum and the Azerbaijani government's share of profit petroleum.

About Greenfields Petroleum Corporation

Greenfields is a junior oil and natural gas company focused on the development and production of proven oil and gas reserves principally in the Republic of Azerbaijan. The Company plans to expand its oil and gas assets through further farm-ins, and acquisitions of Production Sharing Agreements from foreign governments containing previously discovered but under-developed international oil and gas fields, also known as "greenfields". More information about the Company may be obtained on the Greenfields website at www.greenfields-petroleum.com.

Forward-Looking Statements

This press release contains forward-looking statements. More particularly, this press release may include, but is not limited to, statements concerning: production, drilling and completion plans and the expected timing thereof, PSTM processing and operating plans. In addition, the use of any of the words "initial, "scheduled", "can", "will", "prior to", "estimate", "anticipate", "believe", "should", "forecast", "future", "continue", "may", "expect", and similar expressions are intended to identify forward-looking statements. The forward-looking statements contained herein are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the success of optimization and efficiency improvement projects, the availability of capital, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of existing wells, the performance of new wells, general economic conditions, availability of required equipment and services, weather conditions and prevailing commodity prices. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct.

Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties most of which are beyond the control of Greenfields. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results, performance or achievements could vary materially from those expressed or implied by the forward-looking information. These risks include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety, political and environmental risks), commodity price and exchange rate fluctuations, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Additional risk factors can be found under the heading "Risk Factors" in Greenfields' Annual Information Form and similar headings in Greenfields' Management's Discussion & Analysis which may be viewed on www.sedar.com.

The forward-looking statements contained in this press release are made as of the date hereof and Greenfields 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. The Company's forward-looking information is expressly qualified in its entirety by this cautionary statement.

Notes to Oil and Gas Disclosures

Barrels Oil Equivalent or "boe" may be misleading, particularly if used in isolation. All volumes disclosed in this press release use a 6mcf: 1boe, as such is typically used in oil and gas reporting and is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. The Company uses a 6mcf: 1boe ratio to calculate its share of entitlement sales from the Bahar Project for its financial reporting and reserves disclosure.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.