Parex Announces Fourth Quarter and Full Year 2013 Results

NOT FOR DISTRIBUTION OR FOR DISSEMINATION IN THE UNITED STATES

Parex Resources Inc. ("Parex" or the "Company") (TSX:PXT), a company focused on
Colombian oil exploration and production is pleased to report its operating and
financial results for the three months ("fourth quarter" or "Q4") and year ended
December 31, 2013. All financial amounts are in United States (US) dollars
unless otherwise stated.


2013 Financial and Operational Highlights:



--  Increased annual average oil production by 40 percent and, doubled
    proved plus probable ("2P") reserves. This annual growth was achieved
    with capital expenditures that were $36 million less than funds flow
    from operations; 
--  Replaced 2013 production by 3.75 times on a 2P basis; 
--  2P reserve growth per share of 108 percent on a debt adjusted basic
    share basis; 
--  2P reserve net present value of USD$832 million (CAD$915(1) million or
    $8.42 per basic share) after tax discounted at 10 percent compared to
    USD$449 million at 2012 year-end; 
--  Finding and developing and acquisition ("FD&A") costs for 2013 of
    USD$15.67 per barrel including changes in future development costs,
    generating a recycle ratio of 4.0 times; 
--  2P reserve life index ("RLI") increases to 5.1 years compared to 3.4
    years at 2012 year-end; 
--  Increased Colombia land holdings by 44 percent (582,836 gross acres) to
    1,905,878 gross acres (1,417,023 net) through farm-ins and acquisitions;
--  Participated in drilling 37 gross wells in Colombia resulting in 25 oil
    wells, 4 disposal wells, 3 untested and 5 dry and abandoned, for a
    success rate of 83 percent; 
--  Generated year end funds flow from operations of $270 million ($2.49 per
    share basic); and 
--  Increased cash balance from $32.0 million to $56.5 million, increased
    working capital by $36.6 million to $24.0 million and reduced bank debt
    by $0.6 million to $8.5 million. 



(1) At current spot rate of approximately 1.10 USD-CAD

Fourth Quarter 2013 Financial and Operational Highlights:



--  Achieved a record quarterly oil production of 17,287 barrels per day, an
    increase of 7 percent over the three months ending September 30, 2013; 
--  Realized sales price in Colombia averaged $101.64 per barrel of oil and
    an operating netback of $60.78 per bbl; 
--  Generated funds flow from operations of $75.8 million ($0.70 per share
    basic); 
--  The Company participated in drilling 9 gross wells in Colombia resulting
    in 5 oil wells, 1 disposal well, 2 untested and 1 dry and abandoned, for
    a success rate of 83 percent(2). 



(2) Oil wells: Adalia-3 (temporarily suspended), Akira-6 (temporarily
suspended), La Casona-2 (producing), Rumi-1(temporarily suspended), Tigana
Sur-1; Disposal well: Las Maracas-14; Untested: Adalia-2, Aruco-1; Dry &
Abandoned: La Guira-1.


Fourth Quarter and 2013 Financial Summary

For the Fourth quarter of 2013, sales volumes averaged 17,365 bopd (net working
interest before royalty) and the average realized sales price in Colombia was
$101.64 per barrel ("/bbl"), generating an operating netback of $60.78/bbl. In
Q1, 2014 the Company will increase oil blending operations which will help
narrow differentials closer to historic rates. 


Operating plus transportation unit costs were $29.13/bbl compared to $28.78/bbl
in the previous quarter. Fourth quarter production expenses were $9.94/bbl
comprising of $8.14/bbl in operated fields and $14.11/bbl in non-operated
fields.


Funds flow from operations in the Fourth Quarter of 2013 of $75.8 million ($0.70
per share basic) included a net decrease of 9,588 barrels of crude oil
inventory. For the year 2013, funds flow from operations was $270 million.


The Company's capital expenditures were $58.8 million in the Fourth Quarter.
Capital expenditures included $46.5 million for drilling and completions and
$12.5 million for facilities primarily at the Akira, Las Maracas and Tua fields.
For the 2013 year capital expenditures were $233.9 million.


Working capital surplus at period end was $24.0 million, including $56.5 million
in cash compared to a working capital surplus of $18.8 million in the previous
quarter. The Company had bank debt of $8.5 million on a current available
facility of $100 million. Net working capital, defined as working capital less
bank debt, increased by $37.2 million over December 31, 2012. 




                              Three Months ended,         Year ended,      
                                Dec. 31     Sep. 30     Dec. 31     Dec. 31
                                   2013        2013        2013        2012
Operational                                                                
Average daily production                                                   
  Oil (bbl/d)                    17,287      16,199      15,854      11,407
Average daily sales                                                        
  Oil (bbl/d)                    17,365      16,041      15,767      11,800
  Oil Inventory - end of                                                   
   period (barrels)             137,000     146,588     137,000     146,588
                                                                           
Operating netback ($/bbl)                                                  
    Reference Price - Brent      109.21      110.22      108.64      111.63
    Oil revenue                  101.64      106.41      104.20      109.18
    Royalties                   (11.73)     (13.75)     (13.46)      (8.31)
---------------------------------------------------------------------------
    Net revenue                   89.91       92.66       90.74      100.87
    Production expense           (9.94)     (10.06)      (9.95)      (8.40)
    Transportation expense      (19.19)     (18.72)     (18.09)     (19.06)
---------------------------------------------------------------------------
  Operating netback               60.78       63.88       62.70       73.41
                                                                           
Financial ($000s except per share amounts)(1)                              
Oil and natural gas revenue     166,959     157,043     636,577     523,514
                                                                           
Net income                       21,869    (27,965)      12,672      39,922
  Per share - basic                0.20      (0.26)        0.12        0.37
Adjusted Net income (2)          23,201    (23,940)      11,786      32,628
  Per share - basic                0.21      (0.22)        0.11        0.30
Funds flow from operations       75,818      68,241     269,923     241,569
  Per share - basic                0.70        0.63        2.49        2.23
                                                                           
Capital expenditure              58,817      49,962  233,872(3)     267,688
                                                                           
Total assets                    854,808     820,827     854,808     821,201
  Working capital (deficit)                                                
   surplus                       24,005      18,801      24,005    (12,640)
  Convertible debentures(4)      66,060      66,898      66,060      65,657
  Long-term debt (5)              8,530      18,500       8,530       9,100
                                                                           
Outstanding shares (end of                                                 
 period) (000s)                                                            
  Basic                         108,712     108,285     108,712     108,476
  Diluted(6)                    118,276     112,798     118,276     113,320
---------------------------------------------------------------------------
                                                                           
(1) The table above contains Non-GAAP measures. See "Non-GAAP Terms" for   
 further discussion.                                                       
(2) Net income has been adjusted for the International Financial Reporting 
 Standards ("IFRS") accounting effects of changes in the derivative        
 financial liability related to the convertible debenture. Management      
 considers adjusted net income a better measure of the Company's financial 
 performance.                                                              
(3) Includes the Cabrestero Block acquisition of 50% working interest for  
 approximately $12.5 million.                                              
(4) Face value of the convertible debenture is Cdn$85 million with a       
 conversion price of Cdn$10.15 per share.                                  
(5) Borrowing limit currently set at $100 million.                         
(6) Diluted shares as stated include the effects of common shares and in-  
 the-money stock options outstanding at the period-end. The December 31,   
 2013 closing stock price was Cdn$6.58 per share.                          



Parex' Audited Consolidated Financial Statements, as well as Parex' Management's
Discussion and Analysis ("MD&A") for years ended December 31, 2013 and 2012, are
available on Parex' website at www.parexresources.com and on SEDAR at
www.sedar.com.


2014 Outlook

For the months January and February 2014, oil production averaged 18,400 bopd.
Following first quarter appraisal and exploration drilling, we expect to review
our full year 2014 production guidance. Our current 2014 guidance is production
of 17,500-18,500 bopd with a $250-$280 million capital expenditure program fully
funded from funds flow from operations.


Operational Update

Parex currently has a catalyst rich 2014 drilling program of 37-45 wells. A
summary of the current drilling/testing program plus the immediately following
locations is provided below:




---------------------------------------------------------------------------
#            Prospect/Well          Block                   Timing / Status
1                   Rumi-1        El Eden          Facility Construction Q2
2                    Tua-6         LLA-34        Suspended for LTT Approval
3                  Aruco-1         LLA-34                           Testing
4                 Celtis-1         LLA-40                     Ready to Test
5                Ardisia-1         LLA-40                     Ready to Test
6                Akira-6/7     Cabrestero          Facility Construction Q2
7                  Akira-8     Cabrestero                     Ready to Test
8                 Tigana-2         LLA-34                     Ready to Test
9                 Tigana-3         LLA-34                          Drilling
10          Tigana Norte-1         LLA-34           Spud following Tigana-3
11              Arlequin-1        Cebucan            Spud following Akira-8
12               Begonia-1         LLA-40     Rig Mobilizing from Ardesia-1
13            Kananaskis-1         LLA-32                          Drilling
---------------------------------------------------------------------------



Tigana (Non-Operated, Block LLA-34, WI 45%): Tigana-1 and Tigana Sur-1 are
currently producing at a temporary facility restricted combined rate of
approximately 4,100 gross bopd. Tigana-2 is located approximately 400 meters
north-west of Tigana-1 and was drilled to evaluate the Mirador and Guadalupe
formations downdip of Tigana-1. Tigana-3 is drilling and will also evaluate the
Mirador and Guadalupe formations further downdip of Tigana-2, approximately 900
meters west of Tigana-1. Civil work is currently underway to build a new pad
approximately 900 meters south of the Tigana Sur 1 well to delineate the
southern portion of the Tigana structure with drilling expected late Q2 or Q3
2014.


Tua-6 (Non-Operated, Block LLA-34, W I 45%): The objective of the Tua-6 well was
to evaluate several zones in the Guadalupe Formation. Tua-6 is located
approximately 1,400 meters north-west from the Tua pad and was drilled as far
downdip as operationally possible. Log analysis indicates that the well did not
encounter an oil water interface and the oil column extends deeper than
previously tested. The well is currently suspended awaiting for long-term
testing approval and we expect to produce from the Lower Guadalupe Formation
which is the primary producing interval in the Akira field.


Aruco (Non-Operated, Block LLA-34, WI 45%): The Aruco-1 well was drilled to a
total depth of 10,705 feet and cased for testing. It was drilled from the same
pad as Tua-6. The Aruco-1 well is currently conducting testing operations. 


Akira (Operated, Cabrestero Block, WI 100%): As previously reported, the Akira-6
and Akira-7 wells were cased and will be completed to coincide with the
commissioning of the oil treatment plant during the second quarter of 2014. We
expect Cabrestero Block production to increase by approximately 2,000 bopd
during the second quarter of 2014 after the oil treatment plant is commissioned.



Rumi (Operated, El Eden Block WI 60%): The Rumi-1 exploration well requires the
commissioning of a production facility and we expect that when production
resumes during Q2 2014, it would be in the range of 300-500 bopd. 


Celtis & Ardisia (Operated, Block LLA-40, WI 50%): The Celtis-1 and Ardisia-1
wells were drilled from the same pad to total depths of 9,990 and 9,515 feet
respectively and cased for testing. After interpreting the well logs for
potential net pay and the likely structure size, the wells were cased and will
be tested later in 2014. 


El Porton Block Farm-in

Parex has signed a farm-in agreement for the Exploration Area of the El Porton
block in Llanos Basin of Colombia, located adjacent to the Company's El Eden
Block. Pursuant to the terms of the farm-in agreement, Parex will pay 80% of the
dry-hole cost of one exploration well to earn 50% working interest and
operatorship. The Block is approximately 109,000 gross acres and subject to an
initial base royalty of 8%. We expect to spud the Crypto-1 exploration well
during 2014.


Approval of Advance Notice By-Law 

Parex announces that its board of directors (the "Board") has approved certain
amendments to the Company's bylaws (the "By-laws"), including an increase to the
quorum at any meeting of shareholders from two persons present and holding or
representing not less than 5% of the shares entitled to be voted at the meeting
to two persons present and holding or representing not less than 25% of the
shares entitled to be voted at the meeting, and to remove the chairman's casting
vote where there is an equality of votes at a meeting of the Board or a meeting
of shareholders.


In addition, the By-laws were amended to include advance notice provisions,
which provisions fix a deadline by which shareholders must submit a notice of
director nominations to the Chief Financial Officer of Parex prior to any annual
or special meeting of shareholders where directors are to be elected, and sets
forth the information that a shareholder must include in the notice for an
effective nomination to occur. Specifically, the By-laws require advance notice
to the Company in circumstances where nominations of persons for election to the
Board are made by shareholders of the Company, other than pursuant to: (i) a
shareholder proposal made in accordance with the Business Corporations Act
(Alberta) (the "Act"); or (ii) a requisition of a meeting made in accordance
with the Act. No person will be eligible for election as a director of the
Company unless nominated in accordance with the provisions of the By-laws.


In the case of an annual meeting of shareholders, notice to the Chief Financial
Officer of Parex must be made not less than 30 nor more than 65 days prior to
the date of the annual general meeting of shareholders; provided, however, that
in the event that the annual general meeting of shareholders is to be held on a
date that is less than 50 days after the date on which the first public
announcement of the date of the annual meeting was made, notice may be made not
later than the close of business on the 10th day following such public
announcement. In the case of a special meeting (which is not also an annual
meeting) of shareholders called for the purpose of electing directors (whether
or not called for other purposes), notice to the Chief Financial Officer of the
Company must be made not later than the close of business on the 15th day
following the day on which the first public announcement of the date of the
special meeting of shareholders was made. 


The By-laws, as amended, are effective and in full force and effect as of the
date hereof. The amended By-laws will be put to shareholders of the Company for
ratification at the Company's annual and special meeting of shareholders to be
held on May 13, 2014 (the "Shareholders Meeting"). If the amended By-laws are
not confirmed at the Shareholders Meeting by ordinary resolution of
shareholders, the By-laws will terminate and be of no further force and effect
following the termination of the Shareholders Meeting. 


The full text of the amended By-laws will be available on Parex' profile at
www.sedar.com and are also available upon request to the Chief Financial Officer
of the Company at [e-mail]. 


Q4 Conference Call Information

Parex will host a conference call to discuss these results on Thursday March 13,
2014 beginning at 9:30 am MT. To participate in the call, dial 1-866-696-5910,
pass code: 8740503.


The live audio will be carried at: http://bell.media-server.com/m/p/kca8xoa5

Non-GAAP Terms

Funds flow used in, or from operations, working capital, adjusted net income,
operating netback per barrel and net debt may from time to time be used by the
Company, but do not have any standardized meaning under IFRS and may not be
comparable to similar measures presented by other companies. Funds flow used in,
or from operations includes all cash generated from operating activities and is
calculated before changes in non-cash working capital. Funds flow used in, or
from operations is reconciled with net earnings in the consolidated statements
of cash flows. Funds flow per share is calculated by dividing funds flow used
in, or from operations by the weighted average number of shares outstanding.
Working capital includes current assets less current liabilities but may not
include the change in non-cash working capital from one period to the next.
Adjusted net income is determined by adding back any losses or deducting any
gains associated with the Company's derivative financial liability. Operating
netback per barrel equals sales revenue, less royalties, production expense and
transportation expense, divided by total equivalent sales volume. Total net debt
is a non-GAAP measure defined as the sum of working capital less the convertible
debentures (excluding the derivative financial liability associated with the
convertible debentures). Diluted shares include common shares plus in-the-money
stock options based on the period end common share price. Management uses these
non-GAAP measures for its own performance measurement and to provide
shareholders and investors with additional measurements of the Company's
efficiency and its ability to fund a portion of its future growth expenditures.


This news release does not constitute an offer to sell securities, nor is it a
solicitation of an offer to buy securities, in any jurisdiction. 


Reserve Advisory

"Proved" reserves are those reserves that can be estimated with a high degree of
certainty to be recoverable. It is likely that the actual remaining quantities
recovered will exceed the estimated proved reserves. 


"Probable" reserves are those additional reserves that are less certain to be
recovered than proved reserves. It is equally likely that the actual remaining
quantities recovered will be greater or less than the sum of the estimated
proved plus probable reserves.


"Possible" reserves are those additional reserves that are less certain to be
recovered than probable reserves. There is a 10 percent probability that the
quantities actually recovered will equal or exceed the sum of proved plus
probable plus possible reserves. It is unlikely that the actual remaining
quantities recovered will exceed the sum of the estimated proved plus probable
plus possible reserves.


All evaluations and reviews of future net cash flow are stated prior to any
provision for interest costs or general and administrative costs and after the
deduction of estimated future capital expenditures for wells to which reserves
have been assigned. It should not be assumed that the estimated future net cash
flow shown below is representative of the fair market value of the Company's
properties. There is no assurance that such price and cost assumptions will be
attained, and variances could be material. The recovery and reserve estimates of
crude oil reserves provided are estimates only, and there is no guarantee that
the estimated reserves will be recovered. Actual crude oil reserves may be
greater than or less than the estimates provided.


Advisory on Forward Looking Statements

Certain information regarding Parex set forth in this document contains
forward-looking statements that involve substantial known and unknown risks and
uncertainties. The use of any of the words "plan", "expect", "prospective",
"project", "intend", "believe", "should", "anticipate", "estimate" or other
similar words, or statements that certain events or conditions "may" or "will"
occur are intended to identify forward-looking statements. Such statements
represent Parex's internal projections, estimates or beliefs concerning, among
other things, future growth, results of operations, production, future capital
and other expenditures (including the amount, nature and sources of funding
thereof), competitive advantages, plans for and results of drilling activity,
environmental matters, business prospects and opportunities. These statements
are only predictions and actual events or results may differ materially.
Although the Company's management believes that the expectations reflected in
the forward-looking statements are reasonable, it cannot guarantee future
results, levels of activity, performance or achievement since such expectations
are inherently subject to significant business, economic, competitive, political
and social uncertainties and contingencies. Many factors could cause Parex'
actual results to differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, Parex.


In particular, forward-looking statements contained in this document include,
but are not limited to, statements with respect to the performance
characteristics of the Company's oil properties; supply and demand for oil;
financial and business prospects and financial outlook; results of drilling and
testing, results of operations; drilling plans; activities to be undertaken in
various areas; capital plans in Colombia and exit rate production; plans to
acquire and process 3-D seismic; timing of drilling and completion; and planned
capital expenditures and the timing thereof. In addition, statements relating to
"reserves" or "resources" are by their nature forward-looking statements, as
they involve the implied assessment, based on certain estimates and assumptions
that the resources and reserves described can be profitably produced in the
future. The recovery and reserve estimates of Parex' reserves provided herein
are estimates only and there is no guarantee that the estimated reserves will be
recovered.


These forward-looking statements are subject to numerous risks and
uncertainties, including but not limited to, the impact of general economic
conditions in Canada, Colombia and Trinidad & Tobago; industry conditions
including changes in laws and regulations including adoption of new
environmental laws and regulations, and changes in how they are interpreted and
enforced, in Canada, Colombia and Trinidad & Tobago; competition; lack of
availability of qualified personnel; the results of exploration and development
drilling and related activities; obtaining required approvals of regulatory
authorities, in Canada, Colombia and Trinidad & Tobago; risks associated with
negotiating with foreign governments as well as country risk associated with
conducting international activities; volatility in market prices for oil;
fluctuations in foreign exchange or interest rates; environmental risks; changes
in income tax laws or changes in tax laws and incentive programs relating to the
oil industry; ability to access sufficient capital from internal and external
sources; the risks that any estimate of potential net oil pay is not based upon
an estimate prepared or audited by an independent reserves evaluator; that there
is no certainty that any portion of the hydrocarbon resources will be
discovered, or if discovered that it will be commercially viable to produce any
portion thereof; and other factors, many of which are beyond the control of the
Company. Readers are cautioned that the foregoing list of factors is not
exhaustive. Additional information on these and other factors that could effect
Parex'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).


Although the forward-looking statements contained in this document are based
upon assumptions which Management believes to be reasonable, the Company cannot
assure investors that actual results will be consistent with these
forward-looking statements. With respect to forward-looking statements contained
in this document, Parex has made assumptions regarding: current commodity prices
and royalty regimes; availability of skilled labour; timing and amount of
capital expenditures; future exchange rates; the price of oil; the impact of
increasing competition; conditions in general economic and financial markets;
availability of drilling and related equipment; effects of regulation by
governmental agencies; receipt of all required approvals for the Acquisition;
royalty rates, future operating costs, and other matters. Management has
included the above summary of assumptions and risks related to forward-looking
information provided in this document in order to provide shareholders with a
more complete perspective on Parex's current and future operations and such
information may not be appropriate for other purposes. Parex's actual results,
performance or achievement 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, what benefits Parex will derive.
These forward-looking statements are made as of the date of this document and
Parex disclaims any intent or obligation to update publicly any forward-looking
statements, whether as a result of new information, future events or results or
otherwise, other than as required by applicable securities laws.


Neither the TSX nor its Regulation Services Provider (as that term is defined in
the policies of the TSX) accepts responsibility for the adequacy or accuracy of
this release.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Parex Resources Inc.
Michael Kruchten
Vice-President Corporate Planning and Investor Relations
[phone]
[e-mail]
www.parexresources.com