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Lynden Energy Reports Financial Results and Wolfberry Project Reserves

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VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 29, 2012) - Lynden Energy Corp. (TSX VENTURE:LVL) (the "Company") reports its fourth quarter 2012 results. Highlights for the year ended June 30, 2012 (the "Current Year"), compared to the year ended June 30, 2011 (the "Prior Year"), include:



-- Total production increased 328% to 199,676 boe (546 boe/d)
-- Gross revenues, net of royalties, increased 321% to $11,710,531



Production for the Current Year totaled 199,676 boe (546 boe/d). Production for the three months ended June 30, 2012 totaled 63,283 boe (695 boe/d), an increase of 22% over production in the three months ended March 31, 2012.

All of the production is attributable to the Wolfberry Project. The production mix, on a percent per boe basis, from the Wolfberry Project remains approximately 70% oil and 30% natural gas and associated products.

Financial Results for the year and 3 months ended June 30, 2012

This news release should be read in conjunction with the Company's consolidated financial statements for the year ended June 30, 2012 and the notes thereto, together with the MD&A for the corresponding period, which are available under the Company's profile on SEDAR at www.sedar.com. All monetary references in this news release are to U.S. dollars unless otherwise stated.

Results of Operations

The Company reported net earnings of $4,264,192 and total comprehensive income of $4,057,383 for the Current Year compared to a net loss of $859,377 and total comprehensive loss of $641,016 for the Prior Year. Significant components of the Current Year's net earnings were net revenue of $11,710,531 and depletion and depreciation of $4,749,929.

Petroleum and Natural Gas ("P&NG") Revenue

The Company reported gross P&NG revenues of $15,178,829 (Prior Year - $4,702,871) for the Current Year, all from its Wolfberry Project wells. In conjunction with the revenues, the Company reported royalties paid of $3,468,298 (Prior Year - $1,051,167) and paid production and operating expenses of $1,821,397 (Prior Year - $399,637) for the Current Year. The Company also incurred $4,749,929 (Prior Year - $1,218,982) of depletion and depreciation for the Current Year. Average realized prices for the Current Year, were $92 per barrel ("Bbl") of oil and $6.98 per thousand cubic feet ("Mcf") of natural gas, compared to $90 per Bbl of oil and $8.14 per Mcf of natural gas, for the Prior Year. The natural gas selling price is reflective of the thermal value of gas and associated products sold.

The Company also reported gross P&NG revenues of $4,418,972 for the three months ended June 30, 2012 compared to $4,229,831 for the three months ended March 31, 2012 ("Q3/2012"). In conjunction with the revenues, the Company reported royalties paid of $1,010,920 (Q3/2012 - $971,196) and paid production and operating expenses of $677,540 (Q3/2012 - $508,664) for the three months ended June 30, 2012. Average realized prices for the three months ended June 30, 2012 were $89 per Bbl of oil and $5.16 per Mcf of natural gas, compared to $99 per Bbl of oil and $7.00 per Mcf of natural gas, for Q3/2012.

Liquidity - Borrowing Base Increases

The Company has a $50 million reducing revolving line of credit with Texas Capital Bank. Effective June 30, 2012, the line of credit had a $16.0 million borrowing base of which $14.5 million was outstanding. Subsequent to June 30, 2012, the borrowing base was increased to $26.9 million.

The Company anticipates financing the majority of its Wolfberry Project capital expenditures through operating revenues and upward borrowing base revisions on the line of credit. The Company also anticipates that it will need to raise additional capital through the sale of equity, issuance of debt or the sale of assets. The availability of the additional capital on terms acceptable to the Company or at all is subject to a number of risks and uncertainties, many of which are beyond the Company's control.

The Company's working capital deficit has significantly increased over the past several quarters, however it is the Company's view that the value of its P&NG holdings is increasing at a rate significantly greater than the rate of increase of the working capital deficit. It is the Company's objective to sell portions of its proven acreage in order to manage its working capital position and to redeploy funds to its unproven acreage, where the Company believes it can achieve the best returns for shareholders.

Operations Highlights

The Wolfberry Project

The Company is currently carrying out a rapid oil and gas development program on its Wolfberry Project, where the Company now has 47 gross (19.82 net) wells tied-in and producing. During the three months ended June 30, 2012, a total of 4 gross (1.54 net) new wells were tied into production. At June 30, 2012, the Company had 6 gross (2.54 net) wells spud or drilled awaiting completion and/or tie-in.

The Company's current plans call for 46 gross (19.11 net) Wolfberry Project wells to spud from July 1, 2012 to June 30, 2013 (fiscal 2013) at an estimated cost to the Company of approximately $46 million. The Company's funding amount for the 19.11 net wells is equivalent to 21.84 wells. The gross cost of a Wolfberry well is currently approximately $2.1 million.

The Company's capital budget is subject to change depending upon a number of factors, including economic and industry conditions at the time of drilling, prevailing and anticipated prices for oil and gas, the availability of sufficient capital resources for drilling prospects, the Company's financial results and the availability of lease extensions and renewals on reasonable terms.

The Company anticipates significant increases in daily production volumes as development of the Wolfberry Project continues. The Company is targeting a December 31, 2012 net production exit rate, after royalties, of approximately 900 - 1,000 boe/day. This guidance is forward-looking information that is subject to a number of risks and uncertainties, many of which are beyond the Company's control.

Mitchell Ranch Project

The Company's Mitchell Ranch project covers approximately 103,400 acres of P&NG leases located primarily in Mitchell County, West Texas where the Company has a 50% working interest in approximately 67,400 acres, and a 1.25% overriding royalty interest on approximately 36,000 acres subject to a term assignment with a large, independent exploration and production company.

The Company currently has one (0.5 net) producing well, the Spade 17#1, where several rounds of completions have been carried out. During the Current Year, the Company received $303,258 of net revenue from sales from the Spade 17#1 well. The Mitchell Ranch Project is in the exploration and evaluation stage and as such, the net revenues have been credited to capitalized costs.

The Company had anticipated that two new wells would be spud, in the vicinity of the Spade 17#1, in the summer of 2012 to further test zones of interest near the Spade 17#1. As a result of significant new drilling activity in the general area around the Mitchell Ranch Project, the timing of the new vertical wells has been pushed out in order to best incorporate the results of other operators into the development plan on the Mitchell Ranch Project.

In addition, the Company is actively monitoring the multi-well vertical / horizontal drill program being undertaken on the term assignment acreage.

Wolfberry Project Reserves

The Company also reports that Cawley, Gillespie & Associates of Houston, Texas, the Company's independent petroleum engineer, estimates the Company's net Proved plus Probable (P2) reserves attributable to the Company's working interest at June 30, 2012 to be 5.97 million barrels of oil and 19.14 billion cubic feet of gas. Of this amount, Proved reserves were 4.99 million barrels of oil and 15.9 billion cubic feet of gas. The Net Present Value (using a 10% discount rate) of future revenue, before income tax, of the Proved plus Probable reserves as of June 30, 2012 is estimated by Cawley, Gillespie & Associates to be $85.69 million.

Relevant portions of the June 30, 2012 price forecast used in the reserves evaluation are as follows:



Year WTI Cushing Oil $/STB Henry Hub Gas $/MMBTU
---- --------------------- ---------------------
2012 86.39 2.99
2013 88.35 3.58
2014 87.63 3.94
2015 87.00 4.13
2016 86.68 4.29
2017 86.33 4.46
Thereafter Flat Flat
Cap 86.33 4.46



The Wolfberry play is a major low-permeability oil play in the Midland Basin, with targets generally located between 7,000 and 11,500 feet drilling depth. The primary objectives of the play are oil (and gas) production from the Spraberry and Wolfcamp formations, which are Permian in age and are informally grouped to form the 'Wolfberry' interval or zone. Over time, the play has evolved to include additional zones below the Wolfcamp. Typical Wolfberry wells involve completions, which can include 8 to 12 fracture stimulations, over a 2,500 to 3,000 foot gross interval.

In accordance with National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities, Lynden has filed the following documents as at June 30, 2012:



1. Form 51-101F1 - Statement of Reserves Data and Other Oil and Gas
Information;
2. Form 51-101F2 - Report on Reserves Data by Independent Qualified
Reserves Evaluator; and
3. Form 51-101F3 - Report of Management and Directors on Oil and Gas
Disclosure.



The filings can be accessed electronically under the Company's profile on the SEDAR website at www.sedar.com

About Lynden

Lynden Energy Corp. is in the business of acquiring, exploring and developing petroleum and natural gas rights and properties. The Company has various working interests in the Wolfberry Project and Mitchell Ranch Project, located in the Permian Basin in West Texas, USA and in the Paradox Basin Project, located in the State of Utah, USA.

ON BEHALF OF THE BOARD OF DIRECTORS

LYNDEN ENERGY CORP.

Colin Watt, President and CEO

NI 51-101 requires that we make the following disclosure: we use oil equivalents (boe) to express quantities of natural gas and crude oil in a common unit. A conversion ratio of 6 mcf of natural gas to 1 barrel of oil is used. Boe may be misleading, particularly if used in isolation. The conversion ratio is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

FORWARD-LOOKING STATEMENTS DISCLAIMER: This news release contains forward-looking statements. The reader is cautioned that assumptions used in the preparation of such statements, although considered accurate at the time of preparation, may prove incorrect, and the actual results may vary materially from the statements made herein. Expectations of spudding 46 gross (19.11 net) Wolfberry Project wells from July 1, 2012 to June 30, 2013 (fiscal 2013), and expected timelines relating to oil and gas operations are subject to the customary risks of the oil and gas industry, and are subject to the company having sufficient cash to fund the drilling and completion of these wells. Expectations of obtaining upward borrowing base revisions on the line of credit are subject to the customary risks of the oil and gas industry, and are subject to drilling and completing successful wells, and prevailing and anticipated prices for oil and gas. Achieving a December 31, 2012 net production exit rate, after royalties, of approximately 900 - 1,000 boe/day, is subject to the customary risks of the oil and gas industry and is subject to the Company drilling and completing successful wells. For a more detailed description of these risks, and others, see www.lyndenenergy.com/riskfactors.html.


FOR FURTHER INFORMATION PLEASE CONTACT:
Lynden Energy Corp.
(604) 629-2991
(604) 602-9311 (FAX)
www.lyndenenergy.com

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