Shoreline Energy Corp. Acquires Royalty Interest in Prolific Light Oil Project in DJ Basin of Colorado

CALGARY, ALBERTA--(Marketwire - Nov. 20, 2012) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Shoreline Energy Corp. (the "Company" or "Shoreline") (SEQ.TO) is pleased to announce that the Company has executed agreements to acquire non-operating royalty interests in the prolific Wattenberg Colorado light oil project (the "Wattenberg Project") located in the Denver-Julesberg Basin ("DJ Basin") for approximately US$12.5 million from a private company based in the United Sates (collectively, the "Acquisition"). The Acquisition is anticipated to close on November 20, 2012, and will represent Shoreline's initial entry into the U.S.

The Acquisition will give Shoreline a variety of royalty interests ranging up to 1.45% on over 150 land tracts representing over 22,000 gross acres of land, predominantly located in Weld County Colorado, in the Wattenberg Project. The Wattenberg Project is currently an area of a large scale, low risk horizontal development well program, using multi-stage frac technology, led by Anadarko Petroleum Corp. and Noble Energy Inc. (the "Operators"), with participation of a number of other senior oil and gas producers. The Operators are forecasting to invest in excess of $2.5 billion in 2012, targeting light oil in the Niobrara and Codell Formations¹. The Operators also forecast an average of between 500 and 1200 barrels of oil equivalent ("BOE") per day per well and that horizontal wells in the Wattenburg field could recover as much as 300,000 to 600,000 BOE per well. Netbacks from Shoreline's royalty position is forecast to average between $75.00 and $80.00 per BOE for 2013 based on current forward strip commodity pricing. Shoreline estimates that based on the current development practices of the operators, that there are between 400 and 700 potential drilling locations on the acquired acreage².

Chief Executive Officer, Trevor Folk explained, "We acquired royalty interests in the Wattenberg Project for several reasons. First and foremost, this asset provides the highest return of any project we have evaluated whether in Canada or the U.S. Second, being in a non-operated royalty position allows Shoreline to harvest passive income from a world class oil project, a project which continues to see accelerated drilling and continual upward revisions in production and reserves per well, making these assets a perfect fit for Shoreline's mandate as a dividend paying, oil and gas production company. Third, with the vast majority of these wells producing very light sweet crude oil, we come closer to our goal of a balanced commodity portfolio of 50% liquids and 50% natural gas. With projected cash flows averaging $375,000 per month in 2013 and exiting 2013 at levels exceeding $750,000 per month, the acquisition increases discretionary cash which can be redeployed to create shareholder value through drilling of additional oil well in Canada, acquire additional assets, or increase our cash dividend."

The royalty package Shoreline has acquired includes royalty revenue related to 300 existing producing low rate vertical oil wells. Shoreline estimates that as of November 1, more than 20 horizontal wells were drilled on the subject royalty lands, with nearly 60 additional locations permitted and scheduled to be drilled by the Operators during the first 6 months of 2013.

Shoreline has financed the Acquisitions with a combination of existing cash on hand, debt and the issuance of 410,000 common shares of Shoreline at a deemed price of $3.65 per share. The Company may also conduct an equity private placement to repay a portion of the debt incurred through the Acquisitions. The Company expects to generate $4.6 million of cash flows from the Acquisitions in the first year, providing an internal rate of return ("IRR") of over 30%. Based on the anticipated drilling of additional wells in late 2013 and through 2014, Shoreline forecasts that cash flow from the royalties may exceed $11 million in 2014. Shoreline continues to evaluate additional royalty and working interest acquisition opportunities in the DJ Basin.

Mr. Folk concluded, "Shoreline is pleased to have been able to create two growing streams of cash flows - one from our producing wells and previously announced successful drilling program in the Peace River Arch area of Canada and one from our new position in Wattenberg. These two cash flow streams provide Shoreline with additional flexibility to evaluate future opportunities which provide potential for good risk-adjusted returns."

Shoreline will host a conference call on Wednesday November 28, 2012 at 9:30 a.m. (Mountain Time) to present its long term growth strategy, including the Wattenberg acquisition and potential future acquisitions.

About Shoreline Energy

Investor Information

Shoreline is a Calgary, Alberta based corporation engaged in the exploration, development and production of petroleum and natural gas. Shoreline offers investors a combination of value growth via lower risk development of additional oil reserves and production on its current lands and pays a quarterly dividend. Shoreline has 5,659,438 common shares outstanding and 170,000 convertible debentures outstanding. The Company's common shares are currently listed on the TSX under the trading symbol "SEQ" and its debentures under the trading symbol "SEQ.DB". Additional information regarding Shoreline is available under the Company's profile at www.sedar.com or at the Corporation's website, www.shorelineenergy.ca.

Forward Looking and Cautionary Statements

This news release contains forward-looking statements relating to the anticipated closing date of the Acquisitions, potential future equity offerings and debt repayment, future cash flows, future drilling plans and other aspects of the Corporation's anticipated future operations, strategies, financial and operating results and business opportunities. These forward-looking statements may include opinions, assumptions, estimates, management's assessment of value, reserves, future plans and operations.

Forward-looking statements typically use words such as "will," "anticipate," "believe," "estimate," "expect," "intend," "may," "project," "should," "plan," and similar expressions suggesting future outcomes, and include statements that actions, events or conditions "may," "would," "could," or "will" be taken or occur in the future. The forward-looking statements are based on various assumptions including expectations regarding the success of current or future drill wells; the outlook for petroleum and natural gas prices; estimated amounts and timing of capital expenditures; estimates of future production; assumptions concerning the timing of regulatory approvals; the state of the economy and the exploration and production business; results of operations; business prospects and opportunities; future exchange and interest rates; the Corporation's ability to obtain equipment in a timely manner to carry out development activities; and the ability of the Corporation to access capital and credit. While the Corporation considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Financial outlook information contained in this press release about the Corporation's prospective cash flows and financial position is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available. Readers are cautioned that any such financial outlook information contained herein should not be used for purposes other than for which it is disclosed herein.

Forward-looking statements are subject to a wide range of assumptions, known and unknown risks and uncertainties and other factors that contribute to the possibility that the predicted outcome will not occur, including, without limitation: risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation; loss of markets; volatility of commodities prices; currency fluctuations; imprecision of reserves estimates; environmental risks; competition from other producers; inability to retain drilling rigs and other services; incorrect assessment of the value of acquisitions; failure to realize the anticipated benefits of acquisitions; general economic conditions; delays resulting from or inability to obtain required regulatory approvals and to satisfy various closing conditions; and ability to access sufficient capital from internal and external sources. Readers are cautioned that the foregoing list of factors is not exhaustive.

Although Shoreline believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements and you should not rely unduly on forward-looking statements. The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by applicable law, Shoreline does not undertake any obligation to publicly update or revise any forward-looking statements.

Note Regarding BOEs

The term barrel of oil equivalent ("boe") may be misleading, particularly if used in isolation. A conversion ratio for gas of 6 mcf:1 boe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly equivalency conversion ratio of 6:1, utilizing a conversion on a 6:1 basis is misleading as an indication of value.

¹ Anadarko Petroleum Corporation, Noble Energy Inc., PDC Energy, EOG Resources corporate presentations.

² Well count based on published well spacing in development plans outlined by Anadarko Petroleum Corporation and Noble Energy Inc. in publicly available presentations.