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2016-05-05

BLACKPEARL ANNOUNCES FIRST QUARTER 2016 FINANCIAL AND OPERATING RESULTS

ER 2016 FINANCIAL AND OPERATING RESULTS

CALGARY, ALBERTA – BlackPearl Resources Inc. ("BlackPearl" or the "Company")
(TSX: PXX) (NASDAQ Stockholm: PXXS) is pleased to announce its financial and
operating results for the three months ended March 31, 2016.

Highlights include:

-- Production averaged 9,166 barrels of oil equivalent (boe) per day, an 11%
increase compared to Q1 2015 volumes. The increase is attributable to the
production ramp-up on the Onion Lake thermal project.
-- Operating costs and transportation costs averaged $15.03/bbl, a 36%
decrease from Q1 2015.
-- During a period of exceptionally low oil prices we reduced our bank debt by
$2 million to $86 million at March 31, 2016.
-- Revenues for the quarter were $13 million and funds flow from operations
was $3.3 million.
-- The first phase of the Onion Lake thermal EOR project is currently
producing 5,300 barrels of oil per day – on target to reach its design
capacity of 6,000 barrels per day by mid-year.
-- The Blackrod SAGD pilot continues to provide very positive results – the
pilot has averaged over 550 barrels of oil per day at a steam oil ratio of
2.75 over the last 12 months.

John Festival, President of BlackPearl commented “The first quarter was a very
challenging period for the oil and gas sector. During the first quarter we saw
oil prices drop to levels we had not seen in over 12 years. Our objective
during the period was to limit spending, cut costs, maintain financial
liquidity and focus on our best projects. Production from our Onion Lake
thermal project steadily increased during the quarter. This long life, low
cost project is very beneficial in the current low price environment. Our
Blackrod and Onion Lake assets provide us with an excellent suite of thermal
assets with many years of development potential. Expansion of the Onion Lake
thermal project is the next large project we expect to tackle as oil prices
recover”.

Operations Review

In the current low oil price environment our objective has been to reduce
exploration and development activities, limit capital spending and focus on our
most cost effective projects. We did not undertake any new drilling activity
during the first quarter of 2016. Capital expenditures in the first quarter
were $2 million.

At Onion Lake, we are continuing to achieve a steady production ramp-up from
the first phase of our thermal EOR project. We initiated steam injection in
June of last year and achieved first oil in September. During the first quarter
of 2016 oil production from the project averaged over 4,200 bbl/d, with a steam
oil ratio of 3.5. In April, the project produced approximately 5,300 bbl/d with
a steam oil ratio of 2.9 and we are on target to reach our design capacity of
6,000 bbl/d by mid-year. We have commenced preliminary planning for the second
6,000 bbl/d phase on the project; however, we do not expect to incur any
significant expenditures on this phase until oil prices improve. The thermal
project in the Onion Lake area is our lowest cost production. During the first
quarter of 2016 operating and transportation costs were $15.17/bbl on the
thermal project, and we expect these costs to trend lower as our production
volumes increase.

At Blackrod, we did not undertake any new activities in 2016; however, our
existing SAGD pilot is continuing to perform exceptionally well. In March, oil
production averaged over 600 bbls/d, with a steam oil ratio of 2.7. The pilot
well’s production rate has averaged in excess of 550 bbl/d of oil for 12
consecutive months and has cumulatively produced over 300,000 barrels of oil.
We are planning to continue to operate the pilot as we are still acquiring
valuable technical and operational data. In 2012, we filed an application for
an 80,000 bbl/d commercial development of the Blackrod leases, including a full
environmental impact study. We have been advised that our application has met
all of the regulatory requirements and we are waiting on final approval. Having
an approved development application with a successful pilot project would be
very helpful in reviewing financing options for the project in the future.

At Mooney, during the first quarter of 2016 we elected to temporarily shut-in
the majority of the first phase of the ASP flood until oil prices improve. Due
to the polymer and other chemicals required for an ASP flood, Mooney is one of
our higher cost areas and we feel it is prudent to defer on-going development
of the area until we see a sustained increase in oil prices. Temporarily
shutting-in the ASP flood is not expected to affect the ultimate recovery of
the reserves in the area.

Production

Oil and gas production averaged 9,166 barrels of oil equivalent per day in the
first quarter of 2016, an 11% increase compared with the first quarter of 2015.
The increase reflects the successful ramp-up of production from our Onion Lake
thermal EOR project. Production has decreased in our non-thermal areas as a
result of limited new drilling activity, natural declines as well as the result
of the Company’s decision to temporarily shut-in oil production at Mooney and
on our conventional Onion Lake properties. Approximately 900 bbl/d are
currently shut-in at Mooney and 1,000 bbl/d at Onion Lake.We plan to put these
wells back on production when oil prices recover to a level where they can
contribute positive cash flow to our operations.

Average Daily Sales Volume

-----------------------------------------------------
Production by area (boe/d) Q1 2016 Q4 2015 Q1 2015
-----------------------------------------------------
Onion Lake - thermal 4,252 3,010 -
Onion Lake - conventional 2,232 2,914 3,959
Mooney 1,042 1,902 2,797
John Lake 861 955 1,011
Blackrod 584 562 406
Other 195 178 96
9,166 9,521 8,269
-----------------------------------------------------

Financial Results

Oil and gas revenues were $13.0 million in the first quarter of 2016, a
decrease of 41% from the first quarter of 2015. The decrease in revenues is
attributable to a 47% decrease in our average sales price partially offset by
an 11% increase in production volumes.

Our realized oil price (before the effects of risk management activities) in Q1
2016 was $16.77 per barrel compared to $32.05 per barrel in 2015. The decrease
in our realized wellhead price reflects significantly lower WTI reference oil
prices in Q1 2016 compared with Q1 2015 (US$33.45/bbl vs US$48.63/bbl),
partially offset by a weaker Canadian dollar relative to the US dollar ($0.727
vs $0.806) and slightly tighter heavy oil differentials (US$14.32/bbl vs
US$14.71).

During the first quarter we also realized a gain of $6.1 million from our oil
hedging program, which was the equivalent of adding $7.84 per barrel to our
wellhead price in the quarter. The following summarizes the hedging contracts
we currently have outstanding:

Subject of Volume Term Referen Strike Option
Contract ce Price Traded
--------------------------------------------------------------------------------
Oil 1,000 April 1, 2016 to CDN$ CDN$ Swap
bbls/d December 31, 2016 WCS 51.15/bbl
Oil 2,000 April 1, 2016 to CDN$ CDN$ Swap
bbls/d December 31, 2016 WCS 47.60/bbl
Oil 2,000 April 1, 2016 to US$ WTI US$ Sold Call
bbls/d December 31, 2016 65.00/bbl
Oil 1,000 January 1, 2017 to US$ WTI US$ Sold Call
bbls/d December 31, 2017 60.00/bbl
--------------------------------------------------------------------------------

Operating costs decreased significantly in the first quarter of 2016. In Q1
2016 operating and transportation costs were $11.7 million or $15.03/bbl
compared with $16.7 million or $23.58/bbl in Q1 2015. The decrease in operating
and transportation costs is attributable to our on-going efforts to reduce our
cost structure including generating a higher proportion of our production
volumes from the Onion Lake thermal project which has lower average operating
costs, as well as temporarily shutting-in some of our higher cost production,
which includes the Mooney ASP flood.

Reduced revenue, partially offset by lower royalties, transportation costs and
operating costs resulted in a 75% decrease in funds flow from operations in Q1
2016 to $3.3 million compared to $12.9 million for the same period in 2015.

Bank debt at March 31, 2016 was $86 million. The total credit facilities
available to the Company are currently $150 million. The lenders next review of
these facilities will be completed by May 31, 2016.

Financial and Operating Highlights

---------------------------------------------------------------------------
Three months ended
March 31
2016 2015
---------------------------------------------------------------------------
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Daily sales volumes(1)
Oil (bbl/d) 8,422 7,479
Bitumen (bbl/d) 584 406
-------------------------
-------------------------
Combined 9,026 7,885
Natural gas (mcf/d) 845 2,303
-------------------------
Combined (boe/d) 9,166 8,269
-------------------------
-------------------------

Product pricing ($)
Crude oil - per bbl 16.77 32.05
Natural gas - per mcf ...

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