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WesternZagros Resources Closes $14.3 Million Private Placement Financing

CALGARY, ALBERTA--(Marketwired - April 4, 2013) -


WesternZagros Resources Ltd. (TSX VENTURE:WZR) ("WesternZagros" or the "Company") is pleased to announce that it has closed its previously announced additional private placement (the "Private Placement") of common shares of the Company ("Common Shares"). Pursuant to the Private Placement, the Company sold, through a syndicate of agents, 11,431,422 Common Shares at a price of C$1.25 per share for gross proceeds of approximately C$14.3 million. The Common Shares issued under the Private Placement were issued pursuant to applicable exemptions from prospectus requirements and are subject to resale restrictions until August 5, 2013 in accordance with applicable securities laws.

Pursuant to the Private Placement, the Richard Chandler Corporation ("RCC") purchased 9,147,271 Common Shares and Crest Energy International Ltd. ("Crest") purchased 2,284,151 Common Shares. Following the Private Placement, RCC holds 71,817,271 Common Shares (approximately 15.1% of the outstanding Common Shares) and Crest holds 93,998,437 Common Shares (approximately 19.8% of the outstanding Common Shares).

Simon Hatfield, WesternZagros's Chief Executive Officer commented: "We are very pleased to close this additional private placement with Richard Chandler Corporation and Crest Energy International, especially at a premium to market. Securing strong support from our two largest shareholders validates their confidence in our business plan."

David Walker, RCC's Chief Executive Officer, said: "The Richard Chandler Corporation's participation in this private placement reflects our continued confidence in WesternZagros as a leader in the development of a dynamic oil and gas industry in Iraq's Kurdistan Region. With the support of our additional funding, WesternZagros is well positioned to undertake an active exploration and appraisal program during 2013."

The syndicate of agents was led by RBC Capital Markets and included FirstEnergy Capital Corp, Dundee Securities, Macquarie Capital Markets Canada Ltd. and Toll Cross Securities Inc. (collectively the "Agents"). In connection with the Private Placement, the Agents received a fee equal to approximately C$0.6 million of the gross proceeds of the Private Placement, resulting in net proceeds to the Company of approximately C$13.7 million.

The net proceeds from the Private Placement will be used to reduce the principal amount outstanding under the previously announced senior secured loan agreement with Crest.

Neither this news release nor any of the information contained in it shall form or constitute an offer or invitation to any person to sell or any solicitation of an offer to buy or subscribe for any securities in the United States or elsewhere, nor will it form the basis of any contract for the purchase of or subscription for any securities nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Common Shares being offered have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws, and accordingly are not being offered for sale and may not be offered, sold or delivered, directly or indirectly within the United States, its possessions and other areas subject to its jurisdiction or to, or for the account or for the benefit of a U.S. person, except pursuant to an exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws.

About WesternZagros Resources Ltd.

WesternZagros is an international natural resources company focused on acquiring properties and exploring for, developing and producing crude oil and natural gas in Iraq. WesternZagros, through its wholly-owned subsidiaries, holds a 40 percent working interest in two Production Sharing Contracts with the Kurdistan Regional Government in the Kurdistan Region of Iraq. WesternZagros's shares trade in Canada on the TSX Venture Exchange under the symbol "WZR".

About Richard Chandler Corporation

The Richard Chandler Corporation builds and operates businesses in energy and environment, consumer, financial services, and healthcare, with operations in Asia and the Pacific, Africa, the Americas, Europe, and the Middle East. The Corporation's vision of Building Great Companies and Great Nations reflects its belief in the power of business to drive national prosperity. In all its work, the Corporation places a special emphasis on good corporate governance as a crucial element of business sustainability and increasing stakeholder value.

This news release contains certain forward‐looking information relating, but not limited, to the use of proceeds from the Private Placement, Crest Loan and the issuance of Common Shares to Crest on March 18, 2013. Forward-looking information typically contains statements with words such as "anticipate", "plan", "estimate", "expect", "potential", "could", or similar words suggesting future outcomes. The Company cautions readers not to place undue reliance on forward‐looking information as by its nature, it is based on current expectations regarding future events that involve a number of assumptions, inherent risks and uncertainties, which could cause actual results to differ materially from those anticipated by WesternZagros. In addition, the forward‐looking information is made as of the date hereof, and the Company assumes no obligation to update or revise such to reflect new events or circumstances, except as required by law.

Forward‐looking information is not based on historical facts but rather on management's current expectations and assumptions regarding, among other things, timely receipt of all necessary stock exchange approvals, plans for and results of drilling activity and testing programs, future capital and other expenditures (including the amount, nature and sources of funding thereof), continued political stability, and timely receipt of any necessary government or regulatory approvals. Although the Company believes the expectations and assumptions reflected in such forward‐looking information are reasonable, they may prove to be incorrect. Forward‐looking information involves significant known and unknown risks and uncertainties. A number of factors could cause actual results to differ materially from those anticipated by WesternZagros including, but not limited to, risks associated with the oil and gas industry (e.g. operational risks in exploration; inherent uncertainties in interpreting geological data; changes in plans with respect to exploration or capital expenditures; interruptions in operations together with any associated insurance proceedings; the uncertainty of estimates and projections in relation to costs and expenses and health, safety and environmental risks), the risk of commodity price and foreign exchange rate fluctuations, the uncertainty associated with negotiating with foreign governments and risk associated with international activity. For further information on WesternZagros and the risks associated with its business, please see the Company's Annual Information Form dated March 26, 2012, which is available on SEDAR at www.sedar.com.