Diaz Announces Year End 2012 Results

Diaz Resources Ltd. (TSX VENTURE:DZR) ("Diaz" or the "Company") announces that
it has filed its 2012 MD&A, Financial Statements and Annual Information Form
("AIF") on SEDAR.


Diaz is pleased to report the capital restructuring proposed in Q4 2012 was
approved by all stakeholders in December and has resulted in the conversion of
$15 million of debenture debt into common equity. This reduced the Company's net
debt to $3.9 million, saving Diaz $1.58 million annually in interest charges and
puts the Company into a better financial condition to seek strategic
alternatives for its future. 


Over the past four years Diaz has been working with limited financial resources
to increase its heavy oil production base and improve its financial stability in
light of deteriorating access to credit and capital markets. The continuation of
low gas prices combined with a significant drop in heavy oil prices, as heavy
oil price differentials widened in 2012, has increased the difficulty of
achieving an internally financed growth plan. 


For the year ended December 31, 2012 Diaz has continued to grow its heavy oil
production, increasing production rates by 59% to 186 Bopd compared with 2011.
However, gas production declined to 0.9 MMcfd as the Company shut-in a
substantial portion of its gas wells because of unacceptably low gas prices. Gas
prices declined 36%, averaging only $2.68 per Mcf in 2012 and heavy oil prices
declined over the year to a low of $63.91 per Bbl in Q4 2012. Consequently net
oil and gas revenues decreased to $5.3 million from $5.6 million in the prior
year. Increased financing costs for the year were offset by the elimination of
$723,000 of debenture interest otherwise payable as a result of the capital
restructuring. Cash flow from operations increased to $682,000 in 2012 from
$77,000 in 2011.


To see a graph of Total Debt - Face Value, click the following link:
http://media3.marketwire.com/docs/dzr_graph1.jpg 


To see a graph of Heavy Oil Production, click the following link:
http://media3.marketwire.com/docs/dzr_graph2.jpg


Capital Restructuring

On December 17, 2012, the Company completed, through a plan of arrangement under
the Alberta Business Corporations Act, the conversion of an aggregate of
$15,085,000 of debt into equity, eliminating approximately $1,584,000 in annual
interest payments. Pursuant to the arrangement: (i) the Common Shares were
consolidated 25 to 1; (ii) Diaz's outstanding Unsecured Debentures were
converted to Common Shares at a rate of 1 Share for every $0.477 of principal;
(iii) Diaz's outstanding Secured Debentures were converted to Common Shares at a
rate of 1 Share for every $0.105 of principal; and (iv) the accrued and unpaid
interest on the Unsecured and Secured Debentures was cancelled without any
payment.


Operations

During 2012, Diaz drilled three (1.35 net) horizontal heavy oil wells at its
Macklin, Saskatchewan field. The Company now has a total of 7 (3.15 net)
horizontal heavy oil wells producing from its key field at Macklin.


At the Macklin field, facility enhancements in the third quarter included the
tie in of an existing water disposal well to the main battery by pipeline and
reconfiguration of the battery. The enhanced water handling and disposal
facilities resulted in lower operating costs in Q4 2012 relative to the previous
quarter. Diaz is exploring financing alternatives to continue with its heavy oil
development drilling program late in Q2 2013, after spring breakup. 


Production

For the year ended December 31, 2012, the Company's average production decreased
to 344 BOEd from 408 BOEd in the prior year. The Company's Q4 2012 production
decreased to average 302 BOEd compared with the Q4 2011 average of 431 BOEd. 


Outlook

Despite the significant lowering of Diaz's financial obligations and ongoing
interest costs, and its portfolio of heavy oil development opportunities, the
Company still does not have sufficient resources to continue its development
drilling program, in a timely fashion. The Company must deal with continued
restrictions on its access to both debt and equity financing resulting from low
commodity prices. The Company's current term credit facility is due at the end
of March 2013 and management will be in continued discussions with its banker to
arrange a new credit facility. There is no guarantee that Diaz will be able to
enter into a new credit facility and any failure to do so will be materially
adverse to Diaz absent alternative financing arrangements. 


Management believes however that the capital restructuring completed in December
2012 has better positioned Diaz to pursue financial or strategic alternatives
that would facilitate the development of its asset base.


Diaz is an oil and gas exploration and production company based in Calgary,
Alberta. Diaz's current focus is on oil development and exploration in Alberta
and Saskatchewan.


ADVISORY: Certain information in this news release, including drilling plans and
projected drilling, completion and equipping costs, and production rates from
the Lloydminster and Macklin fields may constitute forward-looking statements
under applicable securities laws and necessarily involve risks including,
without limitation, risks associated with oil and gas exploration, development,
exploitation, production, marketing and transportation, loss of markets,
volatility of commodity prices, currency fluctuations, environmental risks,
competition from other producers, inability to retain drilling rigs and other
services, capital expenditure costs, including drilling, completion and
facilities costs, delays resulting from or inability to obtain required
regulatory approvals and ability to access sufficient capital from internal and
external sources. 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. 


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).


The forward looking statements contained in this press release are made as of
the date hereof and Diaz undertakes no obligations 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.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Diaz Resources Ltd.
Robert W. Lamond
Chairman & CEO
[phone]
[phone] (FAX)


Diaz Resources Ltd.
Donald K. Clark
Vice President Operations & COO
[phone]
[phone] (FAX)