Delphi Energy Corp. Announces Close of $65 Million

**Not for distribution to United States News Services or Dissemination in the United States** 

CALGARY, Alberta, June 07, 2017 (GLOBE NEWSWIRE) -- Delphi Energy Corp. (“Delphi” or the “Company”) is pleased to announce that it has closed its previously announced financing comprised of the sale of (i) 27,559,055 common shares issued at a price of $1.27 per common share; and (ii) 30,000 senior secured Collateralized Exchange Listed™ (“CEL”) Notes, each with a principal amount of $1,000 and a 10% coupon, for gross proceeds of approximately $65.3 million.

A syndicate of agents, led by Raymond James Ltd. and co-led by AltaCorp Capital Inc., sold the common shares and Raymond James, as sole agent, sold the CEL Notes, all on a private placement basis. The common shares and CEL^TM Notes issued are subject to a statutory hold period of four months plus one day from the date of closing, in accordance with applicable securities legislation.  The majority of the financing was subscribed for by a single US-based institutional investor. Delphi is pleased to have a strategic investor who is constructive to Delphi’s accelerated development plan at its Bigstone Montney asset and is supportive of future consolidation opportunities in the area.

OUTLOOK

Funds from the financing will initially be used to repay bank debt leaving the Company with an undrawn $80 million credit facility.  The enhanced liquidity will support Delphi’s planned accelerated capital program and will allow the Company to continue its Bigstone consolidation efforts, following up on its previously announced acquisition of 22.5 net sections of Montney rights.

Delphi plans to add a third rig in the fall and double its planned drilling program for the remainder of 2017 through spring breakup in 2018, increasing the number of wells drilled from 10 to 20 wells. The Company drilled six wells in each of 2015 and 2016. The Company’s field operations remain active after an abbreviated spring break up, with five (3.1 net) wells in various stages of completion.

Although the full 2018 capital budget and guidance will not be finalized and approved until the fourth quarter of 2017, Delphi anticipates production in the fourth quarter of 2018 to increase by approximately 40 percent, from its current fourth quarter of 2017 expectation of 11,000 to 11,500 boe/d due to the expanded capital program.   Run-rate cash flow in the fourth quarter of 2018 is anticipated to be in the context of $100 million to $110 million (assuming commodity pricing similar to the Company’s 2017 guidance assumptions).Total debt to cash flow ratio is anticipated to remain at or below the Company’s target of 1.5 times through 2018.

This news release does not constitute an offer to sell or a solicitation of any offer to buy the securities in the United States. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended and will not be offered or sold in the United States absent an exemption from the registration requirements thereof.

About Delphi Energy Corp.

Delphi Energy Corp. is an industry-leading producer of liquids-rich natural gas.  The Company has achieved top decile results through the development of our high quality Montney property, uniquely positioned in the Deep Basin of Bigstone, in northwest Alberta. Delphi continues to outperform key industry players by improving operational efficiencies and growing our dominant Bigstone land position in this world-class play. Delphi is headquartered in Calgary, Alberta and trades on the Toronto Stock Exchange under the symbol DEE.

Forward-Looking Statements.  This news release contains forward-looking statements and forward-looking information within the meaning of applicable Canadian securities laws.  These statements relate to future events or the Company’s future performance and are based upon the Company’s internal assumptions and expectations.  All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “may”, “will”, “should”, “believe”, "intends”, “forecast”, “plans”, “guidance”, “budget” and similar expressions.

More particularly and without limitation, this release contains forward-looking statements and information relating to use of proceeds from the offering; impact of the offering on Delphi’s liquidity and the benefits therefrom; the expected increase to Delphi’s capital program; Delphi’s drilling plans; expectations of the impact of an accelerated growth plan; expected production; expected cash flow in the fourth quarter of 2018; and expected total debt to cash flow through 2018.

The forward-looking statements and information contained in this release are based on certain key expectations and assumptions made by Delphi.  The following are certain material assumptions on which the forward-looking statements and information contained in this release are based: the stability of the global and national economic environment, the stability of and commercial acceptability of tax, royalty and regulatory regimes applicable to Delphi, exploitation and development activities being consistent with management’s expectations, production levels of Delphi being consistent with management’s expectations, the absence of significant project delays, the stability of oil and gas prices, the absence of significant fluctuations in foreign exchange rates and interest rates, the stability of costs of oil and gas development and production in Western Canada, including operating costs, the timing and size of development plans and capital expenditures, availability of third party infrastructure for transportation, processing or marketing of oil and natural gas volumes, prices and availability of oilfield services and equipment being consistent with management’s expectations, the availability of, and competition for, among other things, pipeline capacity, skilled personnel and drilling and related services and equipment, results of development and exploitation activities that are consistent with management’s expectations, weather affecting Delphi’s ability to develop and produce as expected, contracted parties providing goods and services on the agreed timeframes, Delphi’s ability to manage environmental risks and hazards and the cost of complying with environmental regulations, the accuracy of operating cost estimates, the accurate estimation of oil and gas reserves, future exploitation, development and production results and Delphi’s ability to market oil and natural gas successfully to current and new customers. Additionally, estimates as to expected average annual production rates assume that no unexpected outages occur in the infrastructure that the Company relies on to produce its wells, that existing wells continue to meet production expectations and any future wells scheduled to come on in the coming year meet timing and production expectations.

Commodity prices used in the determination of forecast revenues are based upon general economic conditions, commodity supply and demand forecasts and publicly available price forecasts. The Company continually monitors its forecast assumptions to ensure the stakeholders are informed of material variances from previously communicated expectations.

Financial outlook information contained in this release about prospective results of operations, financial position or cash flows 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 such financial outlook information contained in this release should not be used for purposes other than for which it is disclosed.

Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent known and unknown risks and uncertainties.  Delphi’s actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits Delphi will derive therefrom. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those currently anticipated due to a number of factors and risks.  These include, but are not limited to, the risks associated with the oil and gas industry in general such as 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 estimates and projections relating to production rates, costs and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition from others for scarce resources, the ability to access sufficient capital from internal and external sources, changes in governmental regulation of the oil and gas industry and changes in tax, royalty and environmental legislation.  Additional information on these and other factors that could affect the Company’s operations or financial results are included in the Company’s most recent Annual Information Form and other reports on file with the applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). 

Readers are cautioned that the foregoing list of factors is not exhaustive.  Furthermore, the forward-looking statements contained in this release are made as of the date of this release for the purpose of providing the readers with the Company’s expectations for the coming year.  The forward-looking statements and information may not be appropriate for other purposes.  Delphi 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 forward-looking statements contained in this release are expressly qualified in their entirety by this cautionary statement.

Basis of Presentation.  For the purpose of reporting production information, reserves and calculating unit prices and costs, natural gas volumes have been converted to a barrel of oil equivalent (boe) using six thousand cubic feet equal to one barrel.  A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.  This conversion conforms to the Canadian Securities Administrators’ National Instrument 51-101 when boes are disclosed.  Boes may be misleading, particularly if used in isolation.