Stonefire Energy Corp. Announces Year End 2007 Financial Results and Files Its NI 51-101 Disclosure

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES.


Stonefire Energy Corp. (the "Corporation" or "Stonefire") (TSX VENTURE:SFE.A)
(TSX VENTURE:SFE.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 for the year ended December 31, 2007.
The Corporation has also filed today its reserves data and other oil and gas
information for the year ended December 31, 2007 as mandated by National
Instrument 51-101 Standards of Disclosure for Oil and Gas Activities. Selected
operational and financial results are outlined below and should be read in
conjunction with Stonefire's audited financial statements and related MD&A.
Copies of these filings can be found at www.sedar.com.




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Financial and Operating Highlights
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                       Three months ended               Year ended
                  Dec 31, 2007   Dec 31, 2006   Dec 31, 2007   Dec 31, 2006
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($ except 
 share amounts)     (unaudited)    (unaudited)      (audited)      (audited)
FINANCIAL
Petroleum and 
 natural gas 
 revenues        $   1,720,144    $   296,681  $   2,880,146    $   586,427
Funds flow from 
 (used in) 
 operations (1)        673,994         38,175        632,351       (161,619)
 Per share, basic 
  and diluted (1)         0.03           0.00           0.03          (0.01)
Net income (loss)      343,164          1,685       (399,404)      (485,507)
 Per share, basic 
  and diluted             0.01           0.00          (0.02)         (0.04)
Capital 
 expenditures    $   4,850,234    $ 2,933,151     18,731,496     13,748,274
Working capital 
 (deficit) 
 (end of period)                               $  (7,691,921)   $ 1,694,131 
Shares outstanding 
 (end of period)
 Class A, including 
  shares under share 
  purchase loans                                  18,265,000     11,850,000 
 Class B                                           1,012,000      1,012,000
 Options                                           1,775,000      1,061,000
Weighted average 
 shares outstanding
 Class A            16,701,821     11,096,739     14,803,815      9,197,397
 Class B             1,012,000      1,012,000      1,012,000        806,827
 Conversion of 
  Class B shares (2) 9,108,000      4,641,631      9,108,000      3,700,589
                    -----------    -----------    -----------    -----------
Weighted average 
 shares outstanding 
 - basic            26,821,821     16,750,370     24,923,815     13,704,813
Class A share 
 trading
 High                                          $        2.29    $      4.00 
 Low                                                    0.72           1.60
 Close                                         $        0.80    $      1.79
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OPERATIONS
Production
 Natural gas 
  liquids (bbls/d)         102             14             42              7
 Natural gas (mcf/d)     1,629            336            735            186
 Total (boe/d at 6:1)      373             70            164             38
Reference prices
 WTI (US$ per bbl)   $   90.69      $   60.21      $   72.34      $   66.21
 AECO (Cdn$ per GJ)       5.82           6.55           6.11           6.19
Average selling price 
 Natural gas liquids 
  (per bbl)              70.72          50.42          65.90          57.57
 Natural gas (per mcf)    7.07           7.49           7.00           6.57
Operating netback 
 (per boe at 6:1)        25.68          22.99          23.88          20.29
Funds flow netback 
 (per boe at 6:1)    $   19.64      $    5.93      $   10.56      $  (11.65)

(1) Management uses funds flow from operations (before changes in non-cash
    working capital) to analyze operating performance and leverage. Funds 
    flow from operations as presented does not have any standardized 
    meaning prescribed by Canadian generally accepted accounting principles
    (GAAP) and, therefore, may not be comparable with the calculation of 
    similar measures by other entities.

(2) For the year ended December 31, 2007, the Class B shares are converted 
    at the Class A share price of $1.00 and added to the Class A shares to
    calculate basic shares outstanding.



2007 Corporate Highlights

- Stonefire achieved a 2007 exit production rate of 611 boe/d based on field
estimated production for the last week of December 2007, an all-time high for
the Corporation.


- Average production for Q4 2007 was 373 boe/d, an all-time quarterly high and
an increase of 433 percent over Q4 2006 average production of 70 boe/d.


- Constructed and commissioned a 100 percent working interest, 5.5 mmscf/d
capacity, natural gas processing plant in the Corporation's core Edson area in
September 2007.


- Continued exploration success, drilling four gross (3.5 net) exploration wells
in the Edson exploration area, achieving a 100 percent exploration success rate
for the year.


- Discovered 1.574 million boe of proved plus probable reserves in 2007. All-in
finding and development cost averaged $15.36 per boe, including $4.4 million of
gas plant capital and changes in future development capital. Excluding the gas
plant, proved plus probable finding and development costs for 2007 were a highly
competitive $12.49 per boe.


- Capital spending totalled $18.7 million in 2007 with approximately $10 million
spent on land and facilities. The Corporation also satisfied its corporate
flow-through spending commitments for 2007.


- Operating costs of $7.98 per boe in Q4 2007 were down by 16 percent from Q4
2006. Unit operating costs are expected to continue declining in 2008 with
increasing production.


- Stonefire generated revenue of $2.88 million in 2007, an increase of 391
percent over 2006 revenue of $590,000.


- Gross land base increased in 2007 from 16,160 acres at the start of 2007 to
24,800 gross acres at year-end, an increase of 54 percent.


President's Message

It is a great pleasure to report on Stonefire's activities for 2007. Stonefire
continued to execute its business growth plan in 2007 and achieved successes
that resulted in record production, record reserve growth, record revenue and
positive cash flow in Q4. We continue to build a solid foundation of
high-quality growth opportunities for the Corporation in the core Edson
exploration area.


In spite of continued turmoil in the equity and credit markets plus volatile
natural gas prices Stonefire continued to execute its business plan of targeting
long-life, liquids-rich natural gas and remained focused in the Edson area of
west central Alberta. Stonefire's operating strategy is based on controlling
each element of the exploration and production cycle in order to maximize
success rates, control costs and maximize operating netbacks. The cornerstones
of this business strategy are operatorship, high working interest, control of
facilities and an exploration focus on multi-zone, Deep Basin, liquids-rich
natural gas drilling prospects.


In 2007 Stonefire operated all its capital spending projects. The Corporation
successfully drilled four multi-zone exploration wells (3.5 net) in the Edson
and McLeod fields and achieved 100 percent exploration success. Three of these
four wells are 100 percent working interest. Stonefire gained control over its
gas processing in the core Edson area by building a 100 percent working interest
natural gas plant. The Edson gas plant came on production in September 2007. It
is a strategic asset allowing Stonefire to control development of its offsetting
lands and will allow us to achieve low operating costs, high liquids recoveries
and high netbacks. The Corporation currently has an inventory of over 30 gross
exploration and development wells with an average working interest of
approximately 70 percent.


As an exploration-focused growth company one of the key measures of our success
is our finding and development (F&D) costs. I am pleased to report that in spite
of significant spending on land and facilities in the first two years of
Stonefire's operations we have posted very respectable F&D costs. The all-in
proved plus probable F&D cost averaged $15.36 per boe of reserves added in 2007.
Since inception Stonefire has discovered 2.42 million boe of proved plus
probable reserves at an average cost of $15.97 per boe. All reserves have been
added through drilling.


Looking forward Stonefire plans to spend the majority of its $12 million budget
for 2008 on drilling. The Corporation plans to drill six gross (5.5 net) wells
in 2008. All wells will be Stonefire-operated and most will be 100 percent
working interest drilling prospects in the Edson area. A 16-square-kilometre
proprietary 3D seismic survey was shot over a portion of the Corporation's Edson
lands in early Q1 2008. The new data have proved up at least eight multi-zone
drilling locations. As of this date two of these wells (1.5 net) have been
drilled. Both have been cased and encountered multiple gas zones again achieving
a 100 percent drilling success rate. Based on the 2008 drilling success the
Corporation is on-track to execute the 2008 capital program and is forecasting
average production for 2008 of 800 boe/d with the year-end production rate
forecast to exceed 1,000 boe/d. The Corporation anticipates funding the 2008
budget with cash flow and bank debt.


Stonefire Energy Corp. is an Alberta-based company formed to participate in oil
and gas exploration, development and acquisitions focusing in the West Central
region of Alberta. The Company's shares trade on the TSX Venture exchange under
the symbols SFE.A and SFE.B. The Company currently has 18,265,000 Class A shares
and 1,012,000 Class B shares outstanding.


As referred to above, to view a full copy of the Corporation's audited financial
results for the year ended December 31, 2007, including the Corporation's
audited financial statements and accompanying MD&A, please refer to the SEDAR
website at www.sedar.com.


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 and
uncertainties, certain of which are beyond Stonefire's control. Such risks and
uncertainties 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. Stonefire'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 Stonefire 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 Stonefire 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 Stonefire 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. Readers are
cautioned that boe figures may be misleading, particularly if used in isolation.


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