Buffalo Resources Announces Record Results for 2008

Buffalo Resources Corp. ("Buffalo") (TSX VENTURE:BFR) is pleased to announce
record financial results for the year ended December 31, 2008.


2008 HIGHLIGHTS

- Cash flow increased 311% to $31.6 million ($0.43 per share) for the year
compared to $7.7 million ($0.15 per share) for the ten months ended December 31,
2007.


- Earnings of $8.8 million ($0.12 per share) for the year compared with a loss
of $5.2 million in 2007.


- Daily average production increased 11% to 3,281 boe/d for the year ended
December 31, 2008 from 2,956 boe/d for the ten months ended December 31, 2007.


- Net debt reduced to $51.8 million at December 31, 2008 from $63.6 million at
December 31, 2007.


- Proved plus probable reserves increased 42% to 21.5 million boe.

- Net asset value of $3.14 per fully diluted share at December 31, 2008 using
the value of proved plus probable reserves discounted at 10% per annum of $270
million (as evaluated by Paddock, Lindstrom & Associates Ltd.) plus the balance
sheet values of undeveloped land, seismic data, bank debt, net working capital
deficit and asset retirement obligations (December 31, 2007 - $2.25 per fully
diluted share).


- Finding, development and acquisition costs of proved plus probable reserves
basis, including future development costs, of $7.52 per boe.


- Drilled 31 (net 13.0) wells at a 96% success rate in 2008.



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FINANCIAL ($000s except shares and per share amounts)

                     Three months   Four months                  Ten months
                            ended         ended    Year ended         ended
                      December 31,  December 31,  December 31,  December 31,
                             2008          2007          2008          2007
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Revenue                    12,030        20,664        78,115        39,208
Cash flow from
 operations                 2,913         4,382        31,619         7,696
 Basic and diluted
  per share                $ 0.04        $ 0.07        $ 0.43        $ 0.15
Net earnings (loss)          (657)       (3,096)        8,838        (5,236)
 Basic and diluted per
  share                    $(0.01)       $(0.05)       $ 0.12        $(0.10)
Capital expenditures,
 net                       10,549        19,618        28,876        83,435

As at December 31                                        2008          2007
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Working capital (deficit)                             (51,840)      (63,600)
Shareholders' equity                                  113,887        94,461
Total assets                                          205,835       205,272
Common shares outstanding (000s)                       76,702        65,702
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OPERATIONS

                     Three months   Four months                  Ten months
                            ended         ended    Year ended         ended
                      December 31,  December 31,  December 31,  December 31,
                             2008          2007          2008          2007
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Average daily production
 Oil and NGLs (bbls/d)      1,621         2,101         1,635         1,241
 Natural gas (mcf/d)        8,930        11,716         9,876        10,289
 Barrels of oil
  equivalent (boe/d)        3,109         4,054         3,281         2,956
Average realized prices
 Oil and NGLs ($/bbls)      42.83         45.53         76.25         48.82
 Natural gas ($/mcf)         6.91          6.17          8.67          6.47
 Barrels of oil
  equivalent ($/boe)        42.06         41.78         65.05         43.35
Field netback ($/boe)       19.60         15.17         33.73         17.59
Cash flow ($/boe)           10.18          8.86         26.33          8.51
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OPERATIONS

In 2008, Buffalo achieved average daily production of 3,281 boe/d and realized
an average selling price of $65.05 per boe, thereby generating revenue of $78.1
million. This revenue was a 99% increase over the ten months ended December 31,
2007 and led to record cash flow from operations of $31.6 million and record
earnings of $8.8 million. Not only did the Company achieve record results, but
the balance sheet was also strengthened by a reduction in net debt to $51.8
million at December 31, 2008, an $11.8 million decrease from December 31, 2007.


In Q4 2008, average daily production was 3,109 boe/d, a decrease from the fourth
quarter of 2007 mainly reflecting the disposition of the Killam oil property
midway through 2008 (approximately 386 boe/d) and the shut-in of the Pincher
Creek gas property (approximately 500 boe/d). Buffalo's gas production from
Pincher Creek is processed at Shell Canada's Waterton Gas Plant where operations
were suspended for construction of a new sour gas processing train. It is
anticipated the Pincher Creek property will be back on production in May 2009.
Buffalo maintained a balanced production commodity split during the quarter with
oil representing 52% of production by volume.


Field netback increased to $19.60 per boe or $5.6 million for the three months
ended December 31, 2008 compared with $15.17 per boe in Q4 2007. This
improvement in field netback was largely the result of reduced royalty expense
at $7.85 per boe in 2008 compared with $11.10 per boe in 2007. The higher
proportion of oil production in 2008 reduced the average royalty rate. The 2007
royalty expense included an overcharge of crown royalties, which the Company was
successful in recovering in 2008. Operating costs were $14.61 per boe for the
quarter compared with $15.51 per boe in Q4 2007, which mainly reflects the
curtailment of costs at Pincher Creek while operations are suspended and a
number of non recurring charges in 2007. 


EXPLORATION AND DEVELOPMENT

In Q4 2008, six (2.1 net) wells were drilled including two development gas wells
at Whitecourt, a follow up horizontal oil well at Alameda, Saskatchewan, a gas
well at Ferrybank, a horizontal oil well at Royce in the Peace River Arch and an
exploration well in the Peace River Arch. The drilling was successful and, with
the exception of the Peace River Arch exploration well, all have subsequently
been placed on production. The remaining Peace River Arch well is expected to be
tied-in and on production in Q3 2009. This success has encouraged the Company to
tie-up offset land on a farmin basis in the surrounding Peace River Arch area
and could result in a new production area for Buffalo. Capital expenditures for
the fourth quarter of 2008 totalled $10.5 million and, in addition to the above
drilling, included tie-in of four wells at Whitecourt and one at Alameda, all of
which had been drilled in Q3 2008, the buy out of rental compressors at a cost
of $0.5 million, and the purchase of land at a cost of $2.2 million, mainly in
the Peace River Arch.


In the three prior quarters, Buffalo drilled 25 (10.9 net) wells including 13
oil wells and one D&A well at Frog Lake, six gas wells at Whitecourt, a deep
horizontal gas well at Pincher Creek, two oil and one gas well at Killam which
were subsequently sold and a horizontal oil well at Alameda. Overall, Buffalo
enjoyed a 96% drilling success rate in 2008.


OUTLOOK

In November 2008, Buffalo's Board of Directors approved a 2009 capital budget of
$32 million with the request that the Company monitor cash flow and undertake
only those projects that could be completed through the reinvestment of cash
flow from operations. The deteriorating commodity price environment resulted in
the Company revising the 2009 capital program to $19.6 million in February 2009.


Reflective of the lower oil and gas commodity selling prices in the first
quarter of 2009, Buffalo undertook only the minimum capital expenditures
including the tie-in of a well drilled in Q4 2008, fulfillment of partner
drilling commitments and completion of a seismic purchase commitment. By March
2009, oil prices were starting to firm to levels that should sustain a drilling
program at Frog Lake in the summer of 2009 given that there have been some
noticeable reductions in oilfield service costs. In December 2008, Buffalo
received approval of its application for reduced spacing of producing wells at
Frog Lake (downspacing application). This approval enables Buffalo to proceed
with its plans to drill up to 200 additional wells at Frog Lake. The $19.6
million capital program would allow the Company to drill 56 (18 net) wells,
including 44 wells at Frog Lake, four at Whitecourt, three in the Peace River
Arch, two in southeast Saskatchewan and one at Viking.


On March 26, 2009, the Company announced that its Board of Directors had
appointed an M&A Committee of independent directors with a mandate to consider
strategic alternatives for the Company, which may include a sale, merger or
other business combination involving Buffalo or the sale of some or all of the
assets of the Company.


Buffalo is an emerging Canadian junior oil and gas company engaged in the
exploration, development and production of oil and gas reserves in the provinces
of Alberta and Saskatchewan.


Buffalo's annual financial statements and Management's Discussion and Analysis
for the year ended December 31, 2008 are available on SEDAR (www.sedar.com) and
on Buffalo's website at www.buffaloresources.com.


Certain information set forth in this press release contains forward looking
statements. Readers are cautioned that the assumptions used in the preparation
of such information, although considered reasonable at the time of preparation,
may prove to be imprecise and, as such, reliance should not be placed on forward
looking statements. Buffalo's actual results, performance or achievements 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 so, what benefits Buffalo will derive therefrom. Buffalo disclaims
any intention or obligation to update or revise any forward looking statements,
whether as a result of new information, future events or otherwise. The forward
looking statements contained in this press release are made as of the date
hereof and Buffalo undertakes no obligation to update publicly or revise any
forward looking statements or information, whether as a result of new
information, future events or otherwise, unless so required by applicable
securities laws.


Barrels of oil equivalent (Boe's) may be misleading, particularly if used in
isolation. A boe conversion ratio of 6 Mcf of gas = 1 Bbl of oil is based upon
an energy equivalency conversion method primarily applicable at the burner tip
and does not represent a value equivalency at the wellhead. The terms "cash flow
from operations" and "field netback" are non-GAAP financial measures that do not
have any standardized meaning prescribed by Canadian Generally Accepted
Accounting Principles ("GAAP") and are therefore unlikely to be comparable to
similar measures presented by other issuers. Both "cash flow from operations"
and "field netback" provide useful information to investors and management since
they are an indicator of the Corporation's profitability and ability to fund
future capital expenditures which drives growth. Cash flow from operations is
calculated as earnings (loss) before charges for depletion, depreciation and
accretion, stock-based compensation and future income taxes and after deducting
asset retirement expenditures. The inclusion of changes in non-cash operating
working capital results in cash flow from operating activities. Field netback
represents the profit margin from the sale of oil, natural gas and natural gas
liquids and is calculated as revenues less royalties and operating expenses.