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Tuscany Announces Q2 2013 Results

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CALGARY, ALBERTA -- (Marketwired) -- 08/29/13 -- Tuscany Energy Ltd. (TSX VENTURE: TUS) announces that it has filed on SEDAR its Interim Financial Statements and MD&A for the six months ended June 30, 2013.

Tuscany is pleased to report on the progress of its business plan to June 30, 2013.

During Q2 2013 Tuscany focused its efforts on completing the acquisition of Diaz Resources Ltd. and preparing for the development of its heavy oil properties in Saskatchewan. The acquisition of Diaz simplifies the Company's operations and increases management's flexibility to undertake planned development operations in Saskatchewan.

Subsequent to the period end Tuscany commenced this development with the drilling of 3 development heavy oil wells at Macklin and Evesham in Saskatchewan, which are now completed and on production.

The Acquisition of Diaz Resources Ltd.

On July 16, 2013, Tuscany completed the acquisition of Diaz and the consolidation of its shares on the basis of 1 new share for every 8 shares outstanding. Tuscany issued approximately 3.7 million post-consolidated common shares for the acquisition and as a result Tuscany has approximately 18.4 million common shares outstanding.

Tuscany anticipates that the acquisition will result in reduced overhead expenses per BOE and increase management's efficiency and control over the timing of drilling operations.

The following table is a summary of selected operating and financial information of Tuscany and Diaz, for the six months ended June 30, 2013 and the reserves and land holdings at December 31, 2013 and the net debt of Tuscany and Diaz at June 30, 2013.

Six months ended June 30, 2013 ------------------------------($ Thousands, unless otherwise indicated, unaudited) Tuscany Diaz Combined----------------------------------------------------------------------------Financial ($ thousands) Revenue, net of royalties 2,886 2,289 5,175 Cash flow from operations 621 51 672 Loss for the period (877) (1,267) (2,144) Capital expenditures 1,248 361 1,609 Net Debt (322) (4,352) (4,674)Operations Production Oil (Bopd) 264 157 421 Gas (Mcfd) 185 1,158 1,343---------------------------------------------------------------------------- BOEd (6 Mcf = 1 Bbl) 295 350 645----------------------------------------------------------------------------Reserves and Land (December 31, 2012) (i) Reserves (proved plus probable, forecast costs Gas (MMcf) 210 2,008 2,218 Oil (MBbl) 1,485 671 2,156 BOE (Thousands) 1,520 1,006 2,526 Net present value of future net revenue, before tax, of proved plus probable reserves, discounted at 10% ($ millions) 29.1 12.1 41.2---------------------------------------------------------------------------- Undeveloped land holdings (net acres) Alberta 9,800 52,640 62,440 Saskatchewan 10,700 12,360 23,060---------------------------------------------------------------------------- Total net acreage 20,500 65,000 85,500----------------------------------------------------------------------------(i) The reserve information and net present value is based on theindependent reserves reports of Tuscany and Diaz prepared by McDaniel &Associates Consultants effective December 31, 2012 in accordance withNational Instrument 51-101 and the COGE Handbook. It should not be assumedthat the estimate of the net present value of the future net revenueattributable to Tuscany and Diaz's reserves represents the fair market valueof the reserves. There can be no assurances that the assumptions containedin such estimate will be attained and variances could be material.



Operations

During the second quarter of 2013, Tuscany's results were positively influenced by increasing heavy oil price however, production modestly declined from Q1 2013. Low heavy oil prices in the first half of 2013 resulted in Tuscany:

-- restricting drilling related capital expenditures,-- focusing on increasing water handling capacity at its existing oil pools,-- maintaining production levels by adding high capacity pumps,-- displacing propane use for natural gas to reduce operating costs, and-- maintaining a strong balance sheet with limited debt leverage.



To view the Operations bar graphs, please visit the following link: http://media3.marketwire.com/docs/TUS829A.pdf.

During 2013, Tuscany completed an additional water disposal well at the Evesham field and installed larger pumps at Macklin. The additional water handling capacity allowed the Company to install larger pumps at both Macklin and Evesham subsequent to the end of the quarter. With the resulting increased fluid production Tuscany should ultimately see an increase in oil production at a reduced cost.

Financial

For the first six months of 2013, Tuscany's revenues decreased to $2.9 million compared with $4.1 million for the same period in 2012 and cash flow from operations decreased to $621,000 from $1.7 million in 2012. The decrease in revenue resulted primarily from the combined effect of a decline in heavy oil prices from $67.48 per barrel for the first six months of 2012 to $59.81 per barrel in the current year and a decline in production during the same period from 368 BOEd to 295 BOEd respectively.

To view the Financial bar graphs, please visit the following link: http://media3.marketwire.com/docs/TUS829B.pdf.

Operating costs during the first half of 2013 were $1.5 million or $28.80 per BOE compared with $1.5 million or $21.93 per BOE in 2012. Tuscany incurred $1.2 million in capital expenditures during the period compared with $3.1 million in 2012. Capital expenditures for the six month period ended June 30, 2013 consisted primarily of water disposal facilities and increased pumping capacity.

At June 30, 2013, Tuscany had net debt of $322,000 compared with positive working capital of $380,000 at the beginning of the year. The Company also had access to an unused credit facility of $8.5 million

Corporate Summary Three Months Ended Six months ended June 30 June 30($ Thousands, unless otherwise indicated, unaudited) 2013 2012 2013 2012----------------------------------------------------------------------------Financial Revenue, net of royalties $ 1,641 $ 1,889 $ 2,886 $ 4,127 Cash flow from operations 324 549 621 1,697 per share, diluted 0.00 0.00 0.01 0.01 Loss for the period (445) (559) (877) (473) per share, diluted (0.00) (0.00) (0.01) (0.00) Capital: expenditures 478 729 1,248 3,177 dispositions - - - (76)---------------------------------------------------------------------------- Net capital expenditures 478 729 1,248 3,101 Working capital (net debt) (322) 461 (322) 461 Total assets 22,824 25,626 22,824 25,626 Total shares outstanding at period end 119,499 122,919 119,499 122,919Operations Production Oil (Bopd) 255 357 264 356 Gas (Mcfd) 208 50 185 72---------------------------------------------------------------------------- BOEd (6 Mcf = 1 Bbl) 290 365 295 368 Product Prices Oil ($/Bbl) $ 69.34 $ 62.83 $ 59.81 $ 67.48 Gas ($/Mcf) $ 2.22 $ 2.20 $ 2.39 $ 2.21----------------------------------------------------------------------------



Please refer to Tuscany's website at www.tuscanyenergy.com for more information on the Company's Evesham and Macklin fields and other prospects in Alberta and Saskatchewan.

ADVISORY: Certain information regarding the Company in this News Release herein including, without limitation, management's assessment of future plans and operations the anticipated benefits from the acquisition of Diaz, drilling plans and the timing thereof, the effect of increased fluid production at Evesham, expected higher oil prices in Q3 2013 and impact thereof, expectation that total overhead costs will increase but the costs per boe should decline, method of financing continuing exploration and development timing of completion of new facilities and the effect thereof, reserve estimates and the net present value of the future net revenue attributable to such reserves, expected commodity prices, expected trend in management fees and plans to finance capital expenditures and to minimize use of debt to finance operations may be forward-looking statements. Words such as "may", "will", "should", "could", "anticipate", "believe", "expect", "intend", "plan", "potential", "continue" and similar expressions may be used to identify these forward-looking statements. These statements reflect management's beliefs at the date of the report and are based on information available to management at that time. Forward-looking statements involve significant risk and uncertainties.

A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements including, but not limited to, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources and the risk factors outlined under "Risk Factors" in the Company's Annual Information Form and elsewhere herein. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the Company's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com) and at the Company's website (www.tuscanyenergy.com). Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

Where amounts are expressed on a barrel of oil equivalent (boe) basis, natural gas volumes have been converted to barrels of oil at six thousand cubic feet (mcf) per barrel (bbl). Boe figures may be misleading, particularly if used in isolation. A boe conversion of six thousand cubic feet per barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. References to oil in this discussion include crude oil and natural gas liquids (NGLs).

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.



Contacts:
Tuscany Energy Ltd.
Robert W. Lamond
President & CEO
(403) 269-9889
(403) 269-9890 (FAX)

Tuscany Energy Ltd.
Donald K. Clark
Vice President Operations
(403) 269-9889
(403) 269-9890 (FAX)
www.tuscanyenergy.com



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