WestFire Announces 2011 Reserves and Land Evaluation

WestFire Energy Ltd. ("WestFire" or the "Company") (TSX:WFE) is pleased to
announce the results of the independent evaluation of the Company's reserves for
the year ended December 31, 2011 (the "GLJ Report") by GLJ Petroleum Consultants
Ltd. ("GLJ") and the independent evaluation of the Company's undeveloped land
holdings as at December 31, 2011 (the "ILE Report") by Independent Land
Evaluations Inc. ("ILE").


WestFire will report its corporate finding, development and acquisition costs,
operating netback, and recycle ratio when WestFire announces its 2011 audited
annual financial results on or about March 27, 2012.


2011 Highlights of GLJ and ILE Reports



--  Total proved reserves of 28.9 million barrels of oil equivalent
    ("mmboe") (63 percent oil and liquids) represents an increase of 253
    percent over the prior year or 111 percent on a per diluted share basis;
    
--  Total proved plus probable reserves of 43.3 mmboe (66 percent oil and
    liquids) represents an increase of 204 percent over the prior year or 82
    percent on a per diluted share basis; 
    
--  Production replacement ratio of 9.8 for proved reserves and 13.7 for
    proved plus probable reserves based on reserve additions during the year
    divided by field reported 2011 production;  
    
--  Reserve life index of 9.0 years for proved reserves and 13.4 years for
    proved plus probable reserves based on year end reserves divided by
    annualized December 2011 production; 
    
--  Reserves value of $815.7 million (10% discount rate) before tax and
    $788.7 million (8% discount rate) after tax for proved plus probable
    reserves; 
    
--  Undeveloped land inventory of 212,000 net acres of which 148,500 net
    acres are prospective on the Viking light oil resource play on which
    1,205 gross (1,028 net) risked Viking drilling locations have been
    identified, 411 gross (350.6 net) of which are recognized in the GLJ
    Report. Undeveloped land inventory valued at $42.1 million in the ILE
    Report; and 
    
--  Fully diluted net asset value (proved plus probable reserves) per share
    of $8.71, up 10 percent from $7.95 at December 31, 2010 (based on
    estimated unaudited net debt of $124.8 million). 



During 2011, the Company completed two acquisitions in its Viking light oil
resource core area of Redwater. The first was on June 30, 2011, with the
acquisition of Orion Oil & Gas Corporation which also included Ellerslie light
oil assets at Redwater and liquids rich natural gas assets at Kaybob South. The
second Viking acquisition, in December 2011, was an asset acquisition with
Viking production and complementary lands. Combined proved plus probable
reserves evaluated for these two acquisitions was 25.3 mmboe in 2011. At
December 31, 2011, GLJ assigned total proved plus probable reserves of 24.8
mmboe net of approximately 0.5 mmboe of production to these assets with no
material changes to the acquired assets' reserves on a combined basis. Results
of the GLJ Report recognizes the continued growth of the Company's Viking light
oil resource at Redwater through these acquisitions coupled with the successful
2011 drilling program. The Company's proven plus probable reserves assigned to
the Viking light oil resource now amount to 19.6 mmboe representing 45 percent
of WestFire's total reserves. 


WestFire is on target to complete the most active and successful quarter in the
Company's history focusing primarily on the continued development of the Viking
light oil resource play. 


On March 5, 2012, WestFire press released that approximately 2,650 barrels of
oil equivalent per day ("boepd") was shut in at Kaybob due to the temporary,
unscheduled outage of the third-party operated Kaybob KA Gas Plant ("KA"). The
sour gas processing capacity at KA, which was suspended on February 27, 2012 is
now estimated to resume operations on or about March 24, 2012. The Company
maintains business interruption insurance which is anticipated to cover
operating losses incurred after the 15th day of the outage (estimated to be
March 12, 2012). Excluding the impact of the KA outage, WestFire's corporate
production, based on current field estimates, is now in excess of 10,000 boepd
(68 percent oil and liquids). 


Reserves Summary 

The following table provides summary information based upon the GLJ Report: 



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                                                               Natural Gas  
                            Light/Medium Oil    Heavy Oil        Liquids    
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                               Gross     Net   Gross     Net   Gross     Net
                                 (1)     (2)     (1)     (2)     (1)     (2)
                              (Mbbl)  (Mbbl)  (Mbbl)  (Mbbl)  (Mbbl)  (Mbbl)
Proved                                                                      
                                                                            
  Producing                    4,480   3,961     525     483   2,718   1,800
  Non-Producing                  236     200      62      56     548     369
  Undeveloped                  7,962   6,968     155     138   1,558   1,156
                            ------------------------------------------------
Total Proved                  12,678  11,129     741     677   4,824   3,325
Probable                       8,301   7,134     397     349   1,604   1,042
                            ------------------------------------------------
Total Proved & Probable       20,979  18,263   1,138   1,026   6,428   4,366
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                                  Conventional           Barrels of Oil     
                                   Natural Gas            Equivalent(3)     
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                                   Gross         Net       Gross         Net
                                     (1)         (2)         (1)         (2)
                                  (MMcf)      (MMcf)      (Mboe)      (Mboe)
Proved                                                                      
                                                                            
  Producing                       40,018      34,899      14,392      12,060
  Non-Producing                    7,333       6,501       2,068       1,709
  Undeveloped                     16,584      15,062      12,439      10,772
                            ------------------------------------------------
Total Proved                      63,934      56,462      28,899      24,541
Probable                          24,496      21,321      14,385      12,078
                            ------------------------------------------------
Total Proved & Probable           88,430      77,783      43,284      36,619
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Notes:                                                                      
(1)    "Gross" reserves means WestFire's working interest (operating and    
       non-operating) share of reserves before deduction of royalties and   
       include royalty interests of the Company.                            
(2)    "Net" reserves means WestFire's working interest (operated and non-  
       operated) share of reserves after deduction of royalties and include 
       royalty interests of the Company.                                    
(3)    Oil equivalent amounts have been calculated using a conversion rate  
       of six thousand cubic feet of natural gas to one barrel of oil.      
       Thousand barrels of oil equivalent ("Mboe")                          
(4)    Columns may not add due to rounding                                  



Reserves Value 

The net present value (before tax and at various discount rates) of WestFire's
reserves effective December 31, 2011 and based on the GLJ's (January 2012)
forecast prices and costs are summarized as follows:




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($ thousands)(1)                    0%         5%      10%      15%      20%
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Proved                                                                      
  Producing                    454,728    378,456  325,819  287,431  258,219
  Non-Producing                 66,433     47,554   36,436   29,243   24,249
  Undeveloped                  398,278    270,983  189,276  134,312   95,904
                           -------------------------------------------------
Total Proved(2)                919,440    696,993  551,530  450,986  378,372
Probable                       600,031    382,651  264,175  193,224  147,537
                           -------------------------------------------------
Total Proved plus                                                           
 Probable(2)                 1,519,471  1,079,644  815,705  644,210  525,909
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Notes:                                                                      
(1)    The estimated future net revenues are stated before deducting future 
       estimated site restoration costs and are reduced for estimated future
       abandonment costs and estimated capital for future development       
       associated with the reserves.                                        
(2)    Columns may not add due to rounding.                                 



Price Forecast 

The GLJ (January 2012) forecast prices (1) are summarized as follows:



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                                                        Natural      Natural
                                 Edmonton     Heavy      Gas at       Gas at
           Exchange      WTI @      Light  Crude at      AECO-C   Plant Gate
Year           Rate    Cushing  Crude Oil  Hardisty        Spot         Spot
                                                                            
                       $US/bbl   $Cdn/bbl  $Cdn/bbl  $Cdn/MMBtu   $Cdn/MMBtu
           $US/$Cdn        (2)        (3)       (4)         (5)          (6)
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2012          0.980      97.00      97.96     72.37        3.49         3.29
2013          0.980     100.00     101.02     73.60        4.13         3.93
2014          0.980     100.00     101.02     74.51        4.59         4.39
2015          0.980     100.00     101.02     74.51        5.05         4.84
2016          0.980     100.00     101.02     74.51        5.51         5.30
2017          0.980     100.00     101.02     74.51        5.97         5.75
2018          0.980     101.35     102.40     75.54        6.21         5.99
2019          0.980     103.38     104.47     77.09        6.33         6.11
2020          0.980     105.45     106.58     78.67        6.46         6.23
2021          0.980     107.56     108.73     80.28        6.58         6.36
2022 +        0.980   +2.0%/yr   +2.0%/yr  +2.0%/yr    +2.0%/yr     +2.0%/yr
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Note:                                                                       
(1)    Then current dollars.                                                
(2)    NYMEX WTI Near Month Futures Contract Crude Oil at Cushing, Oklahoma.
(3)    Light, Sweet Crude Oil (40 API, 0.3%S) at Edmonton.                  
(4)    Heavy Crude Oil Proxy (12 API) at Hardisty.                          
(5)    AECO-C Spot refers to the one month price averaged for the year.     
(6)    The plant gate price represents the price before raw gas gathering   
       and processing charges are deducted.                                 



Reserves Reconciliation 

The following reconciliation of WestFire's gross(1) reserves compares changes in
the Company's reserves as at December 31, 2010 to the reserves as at December
31, 2011, based on the GLJ (January 2012) forecast prices and costs:




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                         Light and Medium                     Natural Gas   
                               Oil            Heavy Oil         Liquids     
                                   Proved           Proved           Proved 
                           Total     Plus   Total     Plus   Total     Plus 
                          Proved Probable  Proved Probable  Proved Probable 
                         (Mbbls)  (Mbbls) (Mbbls)  (Mbbls) (Mbbls)  (Mbbls) 
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Balance, December 31,                                                       
 2010                      4,525    8,490   1,039    1,612     178      290 
Discoveries                   20        0      80       97       0        0 
Extensions, Infill                                                          
 Drilling & Improved                                                        
 Recovery                  4,777    6,013      30       75     233      343 
Technical Revisions          221      422    (235)    (444)     59       49 
Acquisitions               4,062    6,982      25       30   4,632    6,025 
Dispositions                   0        0      (1)     (36)     (1)      (1)
Production                  (927)    (927)   (196)    (196)   (278)    (278)
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Balance, December 31,                                                       
 2011(2)                  12,678   20,979     741    1,138   4,824    6,428 
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                               Conventional             Barrels of Oil      
                                Natural Gas               Equivalent        
                                      Proved Plus               Proved Plus 
                        Total Proved     Probable Total Proved     Probable 
                              (MMcf)       (MMcf)       (Mboe)       (Mboe) 
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Balance, December 31,                                                       
 2010                         14,656       23,085        8,185       14,239 
Discoveries                        8            0          102           97 
Extensions, Infill                                                          
 Drilling & Improved                                                        
 Recovery                      3,272        4,989        5,586        7,262 
Technical Revisions           (2,300)      (4,102)        (340)        (656)
Acquisitions                  52,635       68,799       17,491       24,503 
Dispositions                     (21)         (26)          (5)         (41)
Production                    (4,315)      (4,315)      (2,120)      (2,120)
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Balance, December 31,                                                       
 2011(2)                      63,934       88,430       28,899       43,284 
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Notes:                                                                      
(1)    "Gross" reserves means WestFire's working interest (operating and    
       non-operating) share of reserves before deduction of royalties and   
       include royalty interests of the Company.                            
(2)    Columns may not add due to rounding.                                 



The Company has no unconventional reserves (Bitumen, Synthetic Crude Oil,
Natural Gas from Coal, etc.) 


Land Holdings 

During 2011, WestFire was very active acquiring developed and undeveloped lands
through acquisitions and Crown land sales in Alberta and Saskatchewan. 


The Company retained ILE to complete an independent evaluation of the Company's
undeveloped land holdings as at December 31, 2011. The ILE Report has estimated
the value of WestFire's net undeveloped acreage at $42.1 million.




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                      Developed          Undeveloped            Total       
(acres)              Gross       Net     Gross       Net     Gross       Net
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Alberta            178,735   158,006   150,562   110,148   329,297   268,154
Saskatchewan        32,253    29,791   109,331   100,484   141,584   130,275
Other                1,330       206     3,300     1,031     4,630     1,237
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Total              212,318   188,003   263,193   211,663   475,511   399,666
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Undeveloped acreage on the Company's Viking light oil resource plays located at
Redwater and Provost, Alberta and Plato and Dodsland in West-Central
Saskatchewan comprises 70 percent of the total or 148,500 net acres.  


About WestFire 

WestFire is a Calgary based energy company primarily focused on light oil
development and production in Alberta and central Saskatchewan. Common shares of
WestFire are listed on the Toronto Stock Exchange under the symbol WFE. 


Cautionary Statements 

Reserves and Operational Information 

The reserves data set forth in this press release is based upon an independent
reserve assessment and evaluation prepared by GLJ with an effective date of
December 31, 2011 and dated March 15, 2012 and summarizes the Company's crude
oil, natural gas liquids and natural gas reserves and the net present values
before income taxes of future net revenue for the Company's reserves using
forecast prices and costs based on the GLJ Report. The GLJ Report has been
prepared in accordance with the standards contained in National Instrument
51-101 "Standards of Disclosure for Oil and Gas Activities" of the Canadian
Securities Administrators ("NI 51-101"). 


All evaluations of future net cash flows are stated prior to any provisions for
interest costs or general and administrative costs and after the deduction of
estimated future capital expenditures for wells to which reserves have been
assigned. It should not be assumed that the estimates of future net revenues
presented in the tables in this press release represent the fair market value of
the reserves. There is no assurance that the forecast prices and costs
assumptions will be attained and variances could be material. The recovery and
reserve estimates of our crude oil, natural gas liquids and natural gas reserves
provided herein are estimates only and there is no guarantee that the estimated
reserves will be recovered. Actual crude oil, natural gas and natural gas
liquids reserves may be greater than or less than the estimates provided herein.



The reserve data provided in this release only represents a summary of the
disclosure required under NI 51-101. Additional disclosure will be provided in
the Company's Annual Information Form filed at www.sedar.com on or before March
30, 2012.


Unaudited financial information 

Inclusion of net debt in this news release is based on unaudited estimated
results. This estimated result is subject to change upon completion of the
audited financial statements for the year ended December 31, 2011, and changes
could be material.


NAV Disclosure 

In relation to the disclosure of net asset value ("NAV"), the NAV is normally
referred to as a "produce-out" NAV calculation under which the current value of
the Company's reserves are produced out at forecast future prices and costs and
do not necessarily represent a "going concern" value of the Company. The value
is a snapshot in time and is based on various assumptions including commodity
prices and foreign exchange rates that vary over time. It should not be assumed
that the future net revenues estimated by GLJ represent the fair market value of
the reserves, nor should it be assumed that the value of its undeveloped land
holdings by ILE represent the fair market value of the lands. 


Acquired Reserves in 2011 

The combined proved plus probable reserves of 25.3 mmboe reserves set forth
above for the two acquisitions is based upon the simple arithmetical summation
by WestFire of the figures contained in: (i) the Orion Oil & Gas Corporation
reserve report prepared by GLJ, effective December 31, 2010 mechanically updated
at March 31, 2011 and (ii) the report of GLJ, effective September 30, 2011 for a
portion of the assets and an internal evaluation of the remaining acquired
assets also effective September 30, 2011 evaluating the crude oil, natural gas
liquids and natural gas reserves of Viking assets acquired by WestFire in
December 2011. Each of these reserve evaluators used their own technical
assumptions and interpretations, methodologies and pricing and cost assumptions.
The estimates of reserves and future net revenue for individual properties may
not reflect the same confidence level as estimates of reserves and future net
revenue for all properties due to the effects of aggregation. 


Forward-looking information and statements 

This news release contains certain forward-looking information and statements
within the meaning of applicable securities laws. The use of any of the words
"expect", "anticipate", "continue", "estimate", "may", "will", "project",
"should", "believe", "plans", "intends" and similar expressions are intended to
identify forward-looking information or statements. In particular, but without
limiting the forgoing, this news release contains forward-looking information
and statements pertaining to the following: the timing for the announcement of
the Company's 2011 audited annual financial results and the items to be reported
on in the announcement; the number of prospective Viking drilling locations; the
volumes and estimated value of WestFire's oil and gas reserves; the life of
WestFire's reserves; the volume and product mix of WestFire's oil and gas
production; future oil and natural gas prices; future results from operations
and operating metrics; and future costs, expenses and royalty rates. 


The recovery and reserve estimates of WestFire's reserves provided herein are
estimates only and there is no guarantee that the estimated reserves will be
recovered. In addition, forward-looking statements or information are based on a
number of material factors, expectations or assumptions of WestFire which have
been used to develop such statements and information but which may prove to be
incorrect. Although WestFire believes that the expectations reflected in such
forward-looking statements or information are reasonable, undue reliance should
not be placed on forward-looking statements because WestFire can give no
assurance that such expectations will prove to be correct. In addition to other
factors and assumptions which may be identified herein, assumptions have been
made regarding, among other things: results from drilling and development
activities consistent with past operations; the continued and timely development
of infrastructure in areas of new production; continued availability of debt and
equity financing and cash flow to fund WestFire's current and future plans and
expenditures; the impact of increasing competition; the general stability of the
economic and political environment in which WestFire operates; the timely
receipt of any required regulatory approvals; the ability of WestFire to obtain
qualified staff, equipment and services in a timely and cost efficient manner;
drilling results; the ability of the operator of the projects in which WestFire
has an interest in to operate the field in a safe, efficient and effective
manner; the ability of WestFire to obtain financing on acceptable terms; field
production rates and decline rates; the ability to replace and expand oil and
natural gas reserves through acquisition, development and exploration; the
timing and cost of pipeline, storage and facility construction and expansion and
the ability of WestFire to secure adequate product transportation; future
commodity prices; currency, exchange and interest rates; regulatory framework
regarding royalties, taxes and environmental matters in the jurisdictions in
which WestFire operates; and the ability of WestFire to successfully market its
oil and natural gas products. 


The forward-looking information and statements included in this news release are
not guarantees of future performance and should not be unduly relied upon. Such
information and statement, including the assumptions made in respect thereof,
involve known and unknown risks, uncertainties and other factors that may cause
actual results or events to defer materially from those anticipated in such
forward-looking information or statements including, without limitation: changes
in commodity prices; changes in the demand for or supply of WestFire's products;
unanticipated operating results or production declines; changes in tax or
environmental laws, royalty rates or other regulatory matters; changes in
development plans of WestFire or by third party operators of WestFire's
properties, increased debt levels or debt service requirements; inaccurate
estimation of WestFire's oil and gas reserve and resource volumes; limited,
unfavourable or a lack of access to capital markets; increased costs; a lack of
adequate insurance coverage; the impact of competitors; and certain other risks
detailed from time-to-time in WestFire's public disclosure documents (including,
without limitation, those risks identified in this news release and WestFire's
Annual Information Form to be filed on SEDAR on or before March 30, 2012). 


The forward-looking information and statements contained in this news release
speak only as of the date of this news release, and WestFire does not assume any
obligation to publicly update or revise any of the included forward-looking
statements or information, whether as a result of new information, future events
or otherwise, except as may be expressly required by applicable securities laws.



BOE Equivalent 

Barrel of oil equivalents or BOEs may be misleading, particularly if used in
isolation. A BOE conversion ratio of 6 mcf: 1 bbl is based on an energy
equivalency conversion method primarily applicable at the burner tip and does
not represent a value equivalency at the wellhead. In addition, as the value
ratio between natural gas and crude oil based on the current prices of natural
gas and crude oil is significantly different from the energy equivalency of 6:1,
utilizing a conversion on a 6:1 basis may be misleading as an indication of
value.