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Blackbird Energy enters non-binding nomination

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Hydrocarbon Engineering,

Blackbird Energy Inc. (Blackbird or the company) is pleased to announce that it has entered into a non-binding letter of nomination (the nomination) with a premier midstream company (the midstream company) for the transportation and processing of natural gas and condensate produced from certain of Blackbird's Pipestone/Elmworth lands. Blackbird is also pleased to announce initial Pipestone/Elmworth production figures and team additions commensurate with Blackbird's growth plans.

The Nomination contemplates that the midstream company will transport Blackbird's natural gas and condensate produced from certain of its lands located both north and south of the Wapiti River to the midstream company's proposed gas plant (the plant) located south of the Wapiti River, where it will then be processed to market specification.

Blackbird and the midstream company have agreed that they will work in good faith towards executing a binding gas handling agreement (GHA) in the coming months. The GHA will be conditional on: (1) the midstream company sanctioning the construction of the plant, (2) the midstream company building a pipeline gathering and compression system from the plant to certain of Blackbird's lands both north and south of the Wapiti River, and (3) on Blackbird obtaining coinciding take-away service from the plant.

Blackbird's 12 February 2017 production was approximately 5.5 million ft3/d of natural gas plus 850 bpd of condensate/oil and 171 bpd of NGLs, which totals approximately 1938 bpd (53% liquids). On the last day prior to suspension of the 'ramp-up period', H2S levels were at approximately 5.5%, which is under Blackbird's contracted amount of 6%.

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