Questfire Energy Corp. Announces Year End 2013 Financial Results and Files Its Annual Information Form

NOT FOR DISSEMINATION IN THE UNITED STATES OR TO U.S. PERSONS.

Questfire Energy Corp. (the "Corporation" or "Questfire") (TSX VENTURE:Q.A)(TSX
VENTURE:Q.B) is pleased to announce that it has filed on SEDAR its audited
financial statements, related management's discussion and analysis ("MD&A") and
its Annual Information Form ("AIF") for the year ended December 31, 2013.
Included in the AIF is the Corporation's reserves data and other oil and gas
information for the year ended December 31, 2013 as mandated by National
Instrument 51-101 Standards of Disclosure for Oil and Gas Activities.


Financial and Operating Highlights



                            Three months ended     Year ended December 31,  
                               December 31,                                 
                                2013         2012         2013         2012 
----------------------------------------------------------------------------
Financial                                                                   
Oil and natural gas                                                         
 sales                  $ 15,900,716 $    212,957 $ 40,537,638 $    509,124 
Funds flow from (used                                                       
 in) operations (1)        4,782,463   (2,097,289)  11,919,693   (3,012,451)
  Per share, basic              0.37        (0.16)        0.92        (0.24)
  Per share, diluted            0.08        (0.16)        0.25        (0.24)
Loss                      (1,929,541)  (1,390,346)  (2,178,474)  (3,524,622)
  Per share, basic and                                                      
   diluted                     (0.15)       (0.11)       (0.17)       (0.28)
Capital expenditures       4,302,399       77,257    8,194,033    2,570,321 
Property acquisitions              -            -   84,788,453            - 
Working capital deficit                                                     
 (end of year)                                      47,554,483    1,531,123 
Non-current debentures                                                      
 (end of year)                                      31,002,508    1,352,811 
Shareholders' deficiency                                                    
 (end of year)                                       4,023,402    2,073,926 
Shares outstanding (end                                                     
 of year)                                                                   
  Class A                                           12,963,001   12,813,001 
  Class B                                            2,055,840      555,840 
Options outstanding (end                                                    
 of year)                                            1,971,000    1,281,000 
Warrants outstanding                                                        
 (end of year)                                       1,510,000    1,510,000 
Weighted-average basic                                                      
 shares outstanding       12,963,001   12,813,001   12,910,809   12,813,001 
Weighted-average diluted                                                    
 shares outstanding       12,963,001   12,813,001   12,910,809   12,813,001 
Class A share trading                                                       
 price                                                                      
  High                          1.30         0.50         1.47         1.20 
  Low                           0.92         0.45         0.50         0.40 
  Close                         1.03         0.50         1.03         0.50 
                                                                            
Operations(2)                                                               
Production                                                                  
  Natural gas (Mcf/d)         24,630          411       16,998          366 
  NGL (bbls/d)                   718           11          441            5 
  Crude oil (bbls/d)             467            2          317            2 
  Total (boe/d)                5,290           82        3,591           68 
                                                                            
Benchmark prices                                                            
  Natural gas                                                               
    AECO (Cdn$/GJ)              3.34         3.05         3.01         2.27 
  Crude oil                                                                 
    WTI (US$/bbl)              97.46        88.30        97.98        94.19 
    Edmonton par                                                            
     (Cdn$/bbl)                86.26        84.43        93.24        86.57 
Average realized prices                                                     
 (3)                                                                        
  Natural gas (per Mcf)         3.66         3.70         3.24         2.61 
  Natural gas liquids                                                       
   (per bbl)                   63.71        58.76        62.71        62.15 
  Crude oil (per bbl)          78.97        73.24        89.60        77.95 
Operating netback (per                                                      
 boe)                          12.98        19.25        13.19        11.02 
Funds flow netback (per                                                     
 boe)                           9.83      (279.56)        9.09      (121.71)

1.  See "Additional GAAP measures" in the MD&A. 
2.  For a description of the boe conversion ratio, refer to the commentary
    in the MD&A under Basis of Barrel of Oil Equivalent. 
3.  Before hedging. 



2013 Corporate Highlights



--  Achieved record average production of 3,591 boe per day for the year,
    with fourth quarter production of 5,290 boe per day, 78 percent natural
    gas. 
    
--  Achieved record quarterly sales in the fourth quarter of $15.9 million
    and funds flow from operations of $4.8 million ($0.37 per basic share). 
    
--  Achieved record annual sales of $40.5 million and funds flow from
    operations of $11.9 million for ($0.92 per basic share). 
    
--  Made capital expenditures of $8.2 million for the year, focused on
    drilling, well workovers, recompletions and facility maintenance and
    optimization. 
    
--  At year-end, corporate working interest reserves were 18.972 million boe
    for total proved and 25.687 million boe for proved plus probable. 
    
--  In the fourth quarter drilled a successful 100 percent working interest
    light oil well at Open Lake, and participated in a successful horizontal
    14 degrees API oil well in Auburndale (33 percent working interest).
    Combined, these projects added production of approximately 100 boe per
    day net (65 percent oil). 
    
--  In the fourth quarter participated at 50 percent working interest in a
    high-productivity Nisku liquids-rich natural gas recompletion in the
    Pembina field, expected to add 150 boe per day net production including
    20 percent natural gas liquids. 
    
--  Subsequent to year-end, on March 26, 2014, Questfire repurchased $32.6
    million of its 2013 Debentures, for a purchase price of $13.6 million.
    Concurrently, the Corporation agreed to purchase a minimum of 1.5
    million Class B shares at $2.60 per share by way of an Issuer Bid open
    for acceptance until May 5, 2014. 



President's Message

Two-thousand thirteen was a momentous and transformative year for Questfire and
may also mark a turning point for western Canada's natural gas industry. Looking
back to the fourth quarter of 2012 Questfire was a micro-cap junior natural gas
company with three producing wells, 82 boe per day of production, six employees,
negative funds flow from operations and very limited capital. A year later, in
only Questfire's second full quarter of operations following the Advantage asset
acquisition in April, we produced 5,290 boe per day, generating $15.9 million in
sales with $4.8 million of quarterly funds flow from operations. We have built a
high-quality organization with 25 office staff and 26 full-time field staff and
contractors, and have a large inventory of drilling prospects with a
low-decline, stable cash flow base to fund them.


Adding Value Per Share

One of the most notable aspects of our corporate transformation is that the
number of basic Class A shares outstanding has remained essentially unchanged at
13.0 million. This means that Questfire has avoided dilution of the Class A
shares and thus added significant value per share. Our debt levels are
manageable and the recent 2013 Debenture redemption, announced on March 26,
2014, again adds significant value to the Corporation and reduces our overall
debt by approximately $19 million. Once the Class B Issuer Bid is completed it
will greatly reduce the risk of future Class A share dilution resulting from
conversion of Class B shares.


This dramatic set of changes was achieved thanks to the efforts and hard work of
the Questfire team over the last year. We have been very fortunate to attract
talented and experienced office staff and field personnel of top quality,
creating one of the best teams I have worked with in my career.


Based on the independent 2013 year-end corporate reserve evaluation prepared by
GLJ Petroleum Consultants Ltd. ("GLJ") year-end working interest reserves stood
at 18.972 million boe for total proved and 25.687 million boe for proved plus
probable. The net present value of these reserves are significant and represent
a large increase in value corporately and on a per share basis. The details of
the GLJ reserve evaluation are contained in Questfire's Annual Information Form
("AIF") which has been filed on SEDAR.


Operational Successes

We are very pleased with our asset base, which continues to produce as expected,
with a relatively low annual production decline rate of approximately 12
percent. Our large land base is yielding several promising oil plays and
numerous natural gas opportunities. 


During the fourth quarter Questfire participated in a number of exciting and
successful drilling and recompletion projects. Late in the quarter we drilled a
100 percent working interest vertical infill oil well at Open Lake, which was
placed on-production in the middle of the first quarter of 2014. The results are
promising with production expected to stabilize in the 75 boe per day range.
This success may lead to a further 10 to 12, 100 percent working interest
drilling locations in the Open Lake field. 


Questfire also participated in a successful horizontal oil well (33 percent
working interest) in the Auburndale field in East Central Alberta. It is
currently producing in excess of 120 barrels per day gross of 14 degrees API oil
and has created significant further drilling potential. Questfire also
participated (50 percent working interest) in the recompletion of a liquids-rich
Nisku gas well in the Pembina field. This well is expected to be placed
on-production in mid-2014 at approximately 150 boe per day net. These diverse
successes, coming within months of closing the Advantage acquisition, begin to
illustrate the broad range of opportunities that we expected to find in our new
assets, which had been under-capitalized and under-worked for many years.


Commodity Price Improvement

The fourth quarter also saw the start of the winter heating season in North
America, which turned into one of the coldest winters in decades. Looking back,
this may be a turning point in the natural gas industry. The winter's resulting
high heating demand depleted natural gas storage to decade low weekly levels at
the time of this report. Natural gas prices not only spiked in response to the
winter's various cold snaps around the continent, but also increased in overall
terms, driving sharply improved cash flow and growing optimism amongst natural
gas-weighted producers. In addition, real progress is occurring on numerous LNG
export projects in North America, which bodes well for expanded natural gas
demand and, in turn, longer-term natural gas prices.


First Quarter 2014 Developments

The first quarter of 2014 saw a number of exciting and important events that we
believe will create significant value for Questfire. First, the cold winter held
natural gas prices at higher than forecast levels and, with the drastic
reduction in storage and delay in the seasonal "turn" to net natural gas
injection, we believe prices could exceed industry forecasts for the remainder
of 2014. Approximately 70 percent of our natural gas production in 2014 has no
ceiling price restriction. The result so far has been higher than forecast funds
flow from operations for the first quarter, currently estimated at $6-$7
million. This is significantly higher than our estimated capital expenditures of
$3.3 million for the quarter. 


Second, on the operations front, the two successful oil wells drilled late in
the fourth quarter were placed on production and production results support
follow-up drilling. In addition, a 657-metre-deep stratigraphic test well was
drilled in February on our 100 percent working interest lands in the Mannville
field in East Central Alberta. The well encountered approximately 14 metres of
oil-bearing sands in three Mannville zones. A multi-well surface pad site is
being acquired and the first horizontal well is being prepared, with a likely
spud in May. With success, this 14 degrees API oil play could support an
additional 8 to 12, 100 percent working interest horizontal wells drilled by
Questfire. 


Third, as press-released on March 26, 2014, Questfire successfully negotiated
and closed a deal to repurchase the $32.6 million of its convertible senior
secured debentures due April 30, 2016 (the "2013 Debentures") for a purchase
price of $13.6 million, which reduced the Corporation's debt by approximately
$19 million. The Corporation also agreed to purchase by way of Issuer Bid a
minimum of 1.5 million Class B shares at $2.60 per share. At this date, the
Issuer Bid has been mailed to all Class B Shareholders and will be open for
acceptance until May 5, 2014. The 2013 Debenture redemption and Class B Share
purchase will simplify the overall capital structure and dramatically reduce
future dilution risk to the Class A shareholders.


2014 Outlook

Questfire's Board of Directors has approved a conservative capital budget for
2014 of approximately $20 million, of which $13 million is to be allocated for
drilling and completions. Drilling will be focused on infill vertical wells on
our 100 percent working interest Open Lake light oil property and our emerging
heavier oil horizontal plays in the Wildmere, Mannville and Auburndale fields in
East Central Alberta, which have Questfire working interests ranging from 25 to
100 percent. These drilling projects impose relatively modest gross capital
costs of approximately $1.5 million total cost per vertical well and $1.25
million per horizontal well. The horizontal wells are relatively shallow at
700-900 metres true vertical depth and do not require hydraulic fracturing.
Facility and well optimization projects will continue to be pursued on our
natural gas properties with the goal of reducing or eliminating gas production
declines. Our original goal for the year had been to increase funds flow without
adding to debt. Current commodity prices are already providing added
flexibility.


Our current production forecast for 2014 is an average of 5,200-5,300 boe per
day, with forecast funds flow from operations of approximately $25-$28 million.
We expect to exit 2014 with production of approximately 5,500 boe per day with
an oil and NGL weighting of 28 percent, an increase from the current 22 percent.
An operations update will likely be issued in June with further drilling and
production results and updated forecasts.


Questfire Energy Corp. is an Alberta-based company formed to participate in oil
and gas exploration, development and acquisitions focusing in the W4 and W5
regions of Alberta. The Corporation's shares trade on the TSX Venture exchange
under the symbols Q.A and Q.B. The Corporation currently has 13,013,001 Class A
shares and 2,055,840 Class B shares outstanding.


To view a full copy of the Corporation's audited financial results for the year
ended December 31, 2013, including the Corporation's audited financial
statements and accompanying MD&A, please refer to the SEDAR website at
www.sedar.com or contact the Corporation at Questfire Energy Corp., 500, 400 -
3rd Ave S.W., Calgary, Alberta, T2P 4H2.


Reader Advisory

This news release contains certain forward-looking statements, including
management's assessment of future plans and operations, and capital expenditures
and the timing thereof, that involve substantial known and unknown risks,
uncertainties, and assumptions certain of which are beyond Questfire's control.
Such risks, uncertainties, and assumptions include, without limitation, 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, delays resulting from or inability to obtain required regulatory
approvals and ability to access sufficient capital from internal and external
sources, the impact of general economic conditions in Canada, the United States
and overseas, industry conditions, changes in laws and regulations (including
the adoption of new environmental laws and regulations) and changes in how they
are interpreted and enforced, increased competition, the lack of availability of
qualified personnel or management, fluctuations in foreign exchange or interest
rates, stock market volatility and market valuations of companies with respect
to announced transactions and the final valuations thereof, and obtaining
required approvals of regulatory authorities. Questfire's actual results,
performance or achievements could differ materially from those expressed in, or
implied by, these forward-looking statements and, accordingly, no assurances 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, including the
amount of proceeds, that Questfire will derive therefrom. Readers are cautioned
that the foregoing list of factors is not exhaustive. All subsequent
forward-looking statements, whether written or oral, attributable to Questfire
or persons acting on its behalf are expressly qualified in their entirety by
these cautionary statements. Furthermore, the forward-looking statements
contained in this news release are made as at the date of this news release and
Questfire 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.


Petroleum and natural gas volumes are converted to an equivalent measurement
basis referred to as a "barrel of oil equivalent" (boe) on the basis of 6
thousand cubic feet of natural gas equalling 1 barrel of oil. This is based on
an energy equivalency conversion method applicable at the burner tip and does
not necessarily represent a value equivalency at the wellhead, which under
current commodity price conditions is in the range of 20-25 Mcf to 1 bbl.
Readers are cautioned that boe figures may be misleading, particularly if used
in isolation.


To request a free copy of Questfire's financial report or if you would like to
be put on Questfire's mailing list please contact Ronald Williams, Vice
President, Finance and CFO at [e-mail].


Neither 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.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Questfire Energy Corp.
Mr. Richard Dahl
President and CEO
[phone]
[phone] (FAX)


Questfire Energy Corp.
Mr. Ronald Williams
Vice President, Finance and CFO
[phone]
[phone] (FAX)