Suroco Energy Inc. Recommends Rejection of Vetra Offer and Reaffirms Recommendation for Business Combination With Petroamerica

(NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA)

Suroco Energy Inc.  (TSX VENTURE:SRN) ("Suroco" or the "Corporation") announces
that its Board of Directors unanimously recommends that Suroco shareholders
REJECT the unsolicited cash offer from Vetra Acquisition Ltd., a wholly owned
subsidiary of VETRA Holding S.a.r.l. (collectively "Vetra") to acquire the
issued and outstanding common shares of Suroco (the "Vetra Offer").


Commenting on behalf of Suroco's Board of Directors, Daryl Gilbert, Chairman of
Suroco said, "While the Board is pleased that Vetra has finally started to
acknowledge the value of Suroco, the Board continues to believe that the
proposed strategic business combination transaction with Petroamerica Oil Corp.
is in the best interest of shareholders and continues to recommend that Suroco
shareholders vote in favour of the transaction with Petroamerica at the June 25,
2014 meeting of shareholders of Suroco. As we set forth in this press release,
Vetra's previous offers to acquire Suroco were consistently lacking in both
clarity and any material premium and do not provide shareholders the ability to
retain ongoing exposure to the exploration potential that shareholders will be
able to participate in under the transaction with Petroamerica. Besides setting
forth some of the reasons to reject the Vetra Offer, the Board would also like
to take this opportunity to address some of the inaccuracies found in the Vetra
Offer and to set the record straight."


Reasons to Reject the Vetra Offer 

The Board of Directors of Suroco, with the assistance of its financial and legal
advisors, carefully considered and reviewed the terms and conditions of the
Vetra Offer and recommends that Suroco shareholders REJECT the Vetra Offer and
instead vote their common shares of Suroco IN FAVOUR of the proposed combination
transaction with Petroamerica Oil Corp. ("Petroamerica") (see the Corporation's
Information Circular and Proxy Statement dated May 27, 2014 (the "Circular")
that has been sent to shareholders and which can also be found on Suroco's
profile on SEDAR at www.sedar.com) for a number of reasons, including the
following:




--  The Vetra Offer does not provide a premium to shareholders. Contrary to
    the claims by Vetra, the Vetra Offer does not provide a premium to the
    plan of arrangement transaction with Petroamerica (the "Petroamerica
    Arrangement"). Vetra's Offer constitutes a 4.8% discount to the June 10,
    2014 closing price for Suroco's common shares. Furthermore, based upon
    the June 10, 2014 closing price for the common shares of Petroamerica
    and Suroco, the Vetra Offer constitutes a 2.7% discount to the implied
    consideration of $0.62 offered under the transaction with Petroamerica
    as based upon the exchange ratio thereunder. 
    
--  The Vetra Offer is highly conditional. The Board is concerned that the
    Vetra Offer is highly conditional, to the benefit of Vetra, and contains
    no less than 25 conditions which must be satisfied or waived before
    Vetra is obligated to take up and pay for common shares of Suroco
    deposited under the Vetra Offer. Many of the conditions are not subject
    to a materiality threshold but rather provide Vetra with very broad
    discretion to decline to proceed with the Vetra Offer. Based on the
    foregoing, the Vetra Offer does not provide the certainty that it so
    claims and Suroco shareholders should realize that tendering to the
    Vetra Offer would, in effect, grant Vetra a free option to acquire the
    tendered shares. There is also at least one condition that it appears
    cannot be satisfied based upon existing circumstances. Vetra taking up
    and paying for more than 50% of Suroco's outstanding common shares
    pursuant to the Vetra Offer will constitute a "Change of Control" under
    Suroco's principal secured credit facility and 30 days thereafter an
    "Event of Default" under such credit facility, at which time Suroco will
    be obligated to repay the approximately US$23.5 million that is
    outstanding under such credit facility. Vetra has included in the Vetra
    Offer a condition that there be no event of default or acceleration in
    relation to any agreement to which Suroco is subject, as a consequence
    of taking up and paying for Suroco common shares under the Vetra Offer.
    It would appear that this condition cannot be satisfied, creating
    additional uncertainty as to whether the Vetra Offer can proceed. 
    
--  The Vetra Offer is inherently coercive. The Vetra Offer is structured
    such that Vetra need only acquire 50.1% of the Suroco common shares (on
    a fully diluted basis) in order to complete the Vetra Offer, and thus
    Vetra may gain effective control of Suroco without any obligation to
    acquire the outstanding common shares of Suroco that were not tendered
    to the Vetra Offer. This is inherently coercive because, absent the
    Petroamerica Arrangement, it forces Suroco's shareholders to decide
    whether to accept the Vetra Offer, sell into the market or reject the
    Vetra Offer and maintain their position without knowing whether and to
    what extent other shareholders might accept the Vetra Offer.
    Accordingly, if the Petroamerica Arrangement does not proceed, a Suroco
    shareholder may feel compelled to tender its Suroco common shares to the
    Vetra Offer even if the shareholder considers the Vetra Offer
    consideration to be unacceptable, out of a concern that Vetra may
    acquire less than 100% of Suroco, with the result that the shareholder
    may be left holding a minority investment, at a reduced price,
    reflective of a minority discount in a company under the control of
    Vetra and with reduced liquidity in the Suroco common shares. 
    
--  Vetra is attempting to extract value that should accrue to existing
    Suroco shareholders. Vetra holds interests in three out of five of
    Suroco's oil and gas exploration and production properties in Colombia.
    As a result, Vetra has a clear understanding of the upside potential of
    a significant portion of Suroco's asset base. To date, Vetra has
    repeatedly attempted to acquire Suroco for cash and at "low-ball"
    prices. The Vetra Offer is a further attempt to acquire ownership of
    Suroco's assets in a manner whereby existing Suroco shareholders are
    precluded from participating in Suroco's anticipated growth. 
    
--  The Board of Directors continues to believe that the proposed
    Petroamerica Arrangement will provide long term value in excess of the
    consideration being offered under the Vetra Offer. The Petroamerica
    Arrangement creates a combined company holding interests in eleven (11)
    exploration and production contracts focused on high netback light and
    medium oil exploration and production in the Llanos and Putumayo Basins
    in Colombia, including the recently acquired 50% interest in the
    Putumayo 7 Block in Colombia that is immediately adjacent to the
    Suroriente Block. Suroco's management believes that the Putumayo 7 Block
    may contain an extension of the recently discovered Quinde field and
    when drilled, is expected to add significant value to the combined
    company, under better economic terms than the Suroriente Block. By
    tendering their shares to the Vetra Offer, Suroco shareholders will not
    have the opportunity to realize the potential of the opportunities on
    the Putumayo 7 Block. 
    
--  The combined company will have a strong, underlevered balance sheet that
    is expected to fully fund the future development and exploration of its
    asset base. As of June 9, 2014, Petroamerica held over US$100 million in
    cash and, upon the completion of the Petroamerica Arrangement and after
    the payment of expenses thereunder, expects to hold at least US$65
    million in cash and only US$31.5 million in debt. For the 2014 fiscal
    year, the combined company expects to generate cash flows from
    operations of approximately US$116 million and have free cash flows
    (i.e. cash flow after all capital expenditures) of at least US$30
    million. It is also anticipated that the combined company will generate
    significant cash flows from its production assets in 2015 and beyond. 
    
--  Petroamerica has an established history of deal making and delivering
    reserves and production growth that has resulted in substantial value
    creation for its shareholders. Petroamerica has grown net production
    from an average of 155 barrels of oil equivalent per day ("boepd") in
    the first quarter of 2012 to 6,478 boepd in the first quarter of 2014.
    Petroamerica has also increased working interest proved plus probable
    reserves from 3.0 million barrels of oil as at December 31, 2011 to 4.9
    million barrels of oil equivalent as at December 31, 2013 and
    Petroamerica's share price has appreciated more than 230% from the
    beginning of 2012 to the June 10, 2014 close of trading of its shares.  
    
--  ISS Proxy Advisory Services Recommends the Petroamerica Arrangement over
    the Vetra Offer. ISS Proxy Advisory Services ("ISS") has published a
    report recommending their clients vote IN FAVOUR of the Petroamerica
    Arrangement and that the Vetra Offer does not appear compelling enough
    to warrant a change in its voting recommendation. In its June 9, 2014
    report, ISS concluded that the proposed transaction between Suroco and
    Petroamerica makes strategic sense as Petroamerica is a much larger and
    well established player in the same segment and further concluded that
    in light of the significant implied premium, the favourable market
    reaction, and absence of significant governance concerns, approval by
    Suroco shareholders of the Petroamerica Arrangement is warranted. ISS is
    a leading independent corporate governance analysis and proxy voting
    firm whose recommendations assist its clients in making choices
    regarding proxy voting and transaction decisions. 
    
--  The Vetra Offer is not supported by Suroco's largest shareholder nor by
    Suroco's directors and officers. Alentar Holdings Inc., Suroco's largest
    shareholder, and Suroco's directors and officers have all confirmed that
    they continue to support the Petroamerica Arrangement.



Inaccuracies Made by Vetra

Furthermore, the Board of Directors would like to address numerous inaccurate
claims made by Vetra in its description of its previous approaches to Suroco. As
Suroco disclosed in its Circular that has been sent to shareholders (a copy of
which can also be found on Suroco's profile on SEDAR at www.sedar.com), Vetra
has made prior offers to Suroco, which offers, as set forth below, have been
inadequate from the standpoint of consideration being offered and as to details
surrounding proposed terms, for example:




--  On May 20, 2014, Suroco received an unsolicited and non-binding offer
    from Vetra for the acquisition of all of the issued and outstanding
    common shares for a cash payment of $0.55 per Suroco Share. This offer
    was received subsequent to Suroco entering into an agreement with
    Petroamerica (the "Arrangement Agreement") in respect of the
    Petroamerica Arrangement, and therefore, Suroco was required to comply
    with the procedures set forth in such Arrangement Agreement when
    receiving an Acquisition Proposal (as defined in the Arrangement
    Agreement). Instead of providing to Suroco a detailed term sheet, which
    one could expect in any serious offer, Vetra provided a 1 and 1/4 page
    letter making a non-binding offer that was subject to due diligence and
    without any disclosure on financing certainty, or clarity on any
    material conditions to closing a transaction. At the date that Vetra was
    informed that the Board of Directors of Suroco was unable to determine
    that Vetra's May 20, 2014 offer could reasonably be expected to
    constitute a "Superior Proposal" under the Arrangement Agreement, the
    implied value for Suroco's shares in Petroamerica stock was $0.56 per
    share. By conducting a substantive review of the Arrangement Agreement,
    Vetra would have understood what would constitute a "Superior Proposal"
    under the Arrangement Agreement, the receipt of which would have allowed
    Suroco to negotiate without triggering payment of the break fee under
    the Arrangement Agreement. Instead, Vetra provided an incomplete and
    financially inadequate offer and then claims that Suroco just refused to
    negotiate with Vetra without providing the complete set of facts as to
    why Suroco was unable to negotiate without triggering a break fee. 
    
--  On March 25, 2014, Suroco received a non-binding offer from Vetra for
    the acquisition of all of the issued and outstanding Suroco shares for
    US$52.5 million in cash, which after discussions with Suroco's financial
    advisors was subsequently revised to an offer of $0.30 per share. The
    offer was subject to completion of due diligence and negotiation of
    definitive terms and documentation. The Suroco Board considered this
    offer, but after discussions with management and Suroco's financial
    advisor, determined that the consideration offered on a per share basis
    was significantly lower than the consideration being offered by
    Petroamerica. Suroco suggested that Vetra enter into Suroco's standard
    form confidentiality agreement and standstill so that Vetra would have
    full and proper access to all relevant data concerning Suroco and its
    assets that it did not already have, and so that Vetra could make a
    revised offer to Suroco, but Vetra declined to enter into such
    confidentiality agreement, nor negotiate any further with Suroco. 
    
--  On December 5, 2013, Suroco received a non-binding offer for the
    acquisition of Suroco's interest in the Suroriente block in Colombia for
    $47 million in cash. This offer was submitted to Suroco after Suroco had
    first initiated contact with Vetra in early November 2013. Vetra's offer
    was subject to completion of due diligence and negotiation of definitive
    terms and documentation. After discussions with management and Suroco's
    financial advisor, the Board of Directors determined that Vetra was
    making a "low-ball" offer as the consideration offered was significantly
    below Suroco's retention value for such asset, as well as below
    precedent transaction metrics.



Vetra was obviously aware of all the above facts but has elected not to disclose
them, which is disappointing as Vetra attempts to present itself as a credible
entity trying to buy Suroco. Given the foregoing, and the fact that the Vetra
Offer is so highly conditional, Suroco questions whether Vetra's true
motivations are in fact to attempt to disrupt the completion of the Petroamerica
Arrangement, rather than completing the Vetra Offer. 


Vetra's claim that Suroco is diluting minority rights through its dealings with
Alentar Holdings Inc. ("Alentar"), is another statement which is highly
misleading. Prior to entering into the Arrangement Agreement, Suroco was working
hard to secure a material interest in the Putumayo-7 Block that would benefit
all shareholders of the Corporation. Although the Corporation considered a
number of sources for the funds necessary to complete this acquisition,
including an equity financing, the Petroamerica Arrangement and certain
commercial matters, including the inability to obtain certain required third
party consents, made it impossible to pursue those alternatives. After a
consideration of the alternatives available to the Corporation and the likely
advantages to the shareholders of both Suroco and the resulting entity from the
Petroamerica Arrangement, the Board of Directors ultimately determined to borrow
the required funds from Alentar. The Alentar loan is the least dilutive of the
options that were available to Suroco. As a lender to Suroco, Alentar is
ultimately treated no differently if Petroamerica or Vetra acquires Suroco, and
Vetra's assertion is a poorly disguised attempt to suggest that Alentar somehow
has materially different motivations in completing a transaction than other
shareholders. This is untrue. 


Directors' Circular

The Board of Directors' unanimous recommendation to Suroco shareholders that
they REJECT the Vetra Offer and instead vote their Suroco shares IN FAVOUR of
the Petroamerica Arrangement, as well as a more detailed discussion of the
reasons for rejecting the Vetra Offer and corrections to Vetra's numerous
inaccuracies shall be set out in the Directors' Circular that will be mailed in
due course to each of Suroco's shareholders in compliance with applicable
securities laws and filed with Canadian securities regulatory authorities. The
Directors' Circular will be available on SEDAR at www.sedar.com and on Suroco's
website at www.suroco.com. Shareholders are advised to read the Directors'
Circular carefully and in its entirety, as it will contain important information
regarding Suroco and the Vetra Offer. If shareholders of Suroco have any
questions or require more information, they are encouraged to contact Suroco's
proxy solicitation agent, Georgeson Shareholder Communications Canada, Inc.
("Georgeson"), toll-free at 1-888-605-7641 or outside North America, collect at
781-575-2422 or by email at [e-mail].


This press release is specifically deemed to amend and supplement the Circular.

How to Vote IN FAVOUR of the Petroamerica Arrangement 

Any Suroco shareholder that has already voted IN FAVOUR of the Petroamerica
Arrangement need not take any action, as their votes will be counted. Any Suroco
shareholder who has voted AGAINST the proposed combination transaction is
encouraged to change its vote and vote IN FAVOUR of the Petroamerica
Arrangement. 


Registered shareholders of Suroco are requested to complete, date, sign and
return the form of proxy that accompanied the Circular (a copy of which can also
be found on Suroco's profile on SEDAR at www.sedar.com and which was filed on
May 30, 2014). To be valid, the form of proxy must be signed and forwarded so as
to reach, or be deposited with, Suroco's transfer agent, Computershare Trust
Company of Canada, 8th Floor, 100 University Avenue, Toronto, Ontario, M5J 2Y1,
Attention: Proxy Department, by fax to [phone], by internet at
www.investorvote.com or by telephone by calling [phone] (toll free)
(international direct dial [phone]), so that it is received not later
than 10:00 a.m. (Mountain time) on June 23, 2014.


Non-registered shareholders who receive voting instructions from their
intermediary should carefully follow the instructions provided by their
intermediary to ensure their vote is counted. 


If you have any questions that are not answered by the Circular, or would like
additional information, you should contact your professional advisors. You can
also contact Georgeson, the proxy solicitation firm engaged by Suroco, toll-free
at 1-888-605-7641 or outside North America, collect at 781-575-2422 or by email
at [e-mail] should you have any questions regarding voting of your
shares. 


How to REJECT the Vetra Offer and Withdraw Tendered Shares 

To reject the Vetra Offer, you should do nothing. The Vetra Offer is open for
acceptance until July 17, 2014. Shareholders who have already tendered their
shares to the Vetra Offer can withdraw them at any time before they have been
taken up and accepted for payment by Vetra. Shareholders holding shares through
a dealer, broker or other nominee should contact such dealer, broker or nominee
to withdraw their Suroco shares. Shareholders may also contact the proxy
solicitation firm retained by Suroco, Georgeson Shareholder Communications
Canada, Inc., toll-free at 1-888-605-7641 or outside North America, collect at
781-575-2422 or via email at [e-mail].


General 

Suroco is a Calgary-based junior oil and gas company, which explores for,
develops, produces and sells crude oil, natural gas liquids and natural gas in
Colombia. The Corporation's common shares trade on the TSX Venture Exchange
under the symbol SRN.


Definitions

For the foregoing discussions in this press release, "barrels of oil equivalent"
("boe") is at a conversion rate of 6,000 cubic feet ("cf") of natural gas for
one barrel of oil and is based on an energy equivalence conversion method. Boe
may be misleading, particularly if used in isolation. A boe conversion ratio of
6,000 cf: 1 barrel is based on an energy equivalence conversion method primarily
applicable at the burner tip and does not represent a value equivalence at the
wellhead.


Forward-Looking Statements

Certain statements included in this press release constitute forward-looking
statements under applicable securities legislation. These statements relate to
future events or future performance of the Corporation. All statements other
than statements of historical fact are forward-looking statements. In some
cases, forward-looking statements can be identified by terminology such as
"may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate",
"predict", "potential", "continue", or the negative of these terms or other
comparable terminology. Forward-looking statements or information in this press
release include, but are not limited to, statements concerning the expected
benefits of the Petroamerica Arrangement including expected operational results
and cash flows of the combined company following the completion of the
Petroamerica Arrangement, the long term value of the combined company and other
statements that are not historical facts. Readers are cautioned not to place
undue reliance on forward-looking statements, as there can be no assurance that
the plans, intentions or expectations upon which they are based will occur. By
their nature, forward-looking statements involve numerous assumptions, known and
unknown risks and uncertainties, both general and specific, that contribute to
the possibility that the predictions, estimates, forecasts, projections and
other forward-looking statements will not occur, which may cause actual
performance and results in future periods to differ materially from any
estimates or projections of future performance or results expressed or implied
by such forward-looking statements. These assumptions, risks and uncertainties
include, among other things, the state of the economy in general and capital
markets in particular; fluctuations in oil prices; the results of exploration
and development drilling, recompletions and related activities; changes in
environmental and other regulations; risks associated with oil and gas
operations and future exploration activities; the need to obtain required
approvals from regulatory authorities; product supply and demand; market
competition; political and economic conditions in the country in which the
Corporation operates; and other factors, many of which are beyond the control of
the Corporation. You can find an additional discussion of those assumptions,
risks and uncertainties in Suroco's Canadian securities filings. 


The forward-looking statements contained in this press release are made as of
the date of this press release. Except as required by law, Suroco disclaims any
intention and assumes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
Additionally, Suroco undertakes no obligation to comment on the expectations of,
or statements made by, third parties in respect of the matters discussed above.
New factors emerge from time to time, and it is not possible for management of
the Corporation to predict all of these factors and to assess in advance the
impact of each such factor on the Corporation's business or the extent to which
any factor, or combination of factors, may cause actual results to differ
materially from those contained in any forward-looking statement or information.
The forward-looking statements contained herein are expressly qualified by this
cautionary statement. Moreover, neither the Corporation nor any other person
assumes responsibility for the accuracy and completeness of the forward-looking
statements.


The TSX Venture Exchange Inc. has in no way passed upon the merits of the
Petroamerica Arrangement or the Vetra Offer and has neither approved nor
disapproved the contents of this press release.


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: 
Suroco Energy Inc.
Alastair Hill
President and Chief Executive Officer
[phone]
[phone] (FAX)


Suroco Energy Inc.
Travis Doupe
VP Finance and Chief Financial Officer
[phone]
[phone] (FAX)
www.suroco.com