2013-02-22 15:33:25 -

Calgary, Alberta CANADA, February 22, 2013 /FSC/ - Reef Resources Ltd. (REE - TSX Venture)("Reef" or the "Company") is pleased to provide a market update on corporate activities and developments in the Enhanced Oil Recovery field operations:

The latter half of 2012 presented Reef with fluid lift challenges, and a mixed sense of optimism, while seeing production of extremely light foamy oil under low reservoir pressure conditions. In order to address associated performance issues the company retained a leading industry artificial lift consulting group with extensive international experience in providing solutions to difficult fluid lifting dynamics. Subsequent recommendations have prompted the design and implementation of a hybrid artificial gas lift system at the Ausable #5 well site that would replace

the Company's existing artificial lift equipment necessary to produce high gravity fluids from the well bore. The results of the lift program is deemed to be a success, demonstrating that oil and NGLs can be recovered from the Ausable Reef. The next step is continuation of gas injection to increase oil and NGL production. Currently field operations are temporarily suspended to minimize costs pending upgrades mentioned below.

To date, only 10% of the original reservoir volume has been replaced through the injection of equity gas and purchased utility gas. Without replacement of all voidage gas in the reservoir, an estimated 450 million cubic feet of gas, Reef will continue to achieve marginal results with a limited production profile. As voidage gas is replaced over time production will increase in parallel with gas injection volumes. As voidage gas is being injected we also have the ability to extract condensate for sale by recycling a portion of the gas throughout the reservoir. This will require a larger compressor and gas condensate storage bullet. All other components necessary for this process are installed and functional.

Based on data gathered to date management is confident the above field production operations can be maximized to unlock full value from the estimated 7.8 million barrels of reserves in place in the Ausable reef.

Reef is currently engaging a number of potential investors or partners in the bid of obtain funding for this essential stage of reservoir pressurization and production optimization in its planned CAPEX program. Additional program funding will be required for installation of the larger compressor and NGL storage facilities. The follow up phase would include installation of a -40C refrigeration plant, and drilling of Reef's horizontal and vertical well inventory to bring the Ausable Reef and the Airport North and South Reefs to maximum production levels.

The Ontario asset is not subject to the oil price discount currently being experienced in Western Canada and does not have pipeline takeaway restraints due to market proximity, Arnie Hansen advised. The President and CEO of Reef also stated, "we are very pleased with these performance enhancements in southern Ontario, this progress is confirmation our EOR program is on track in driving oil and liquids production at Ausable".

For more information please contact:

Arnie Hansen Dan Patience Larry Olson
President & CEO Noble Investment Corp. CFO
T: (403) 251-9447 T: 1 800 499 2388 T: (403)-251-9447
Suite 1120, 444 -5th Ave. SW C: (250) 460-2640
Calgary, AB T2P 2T8

Footnote: The Company's Ontario asset has gas storage rights, gas re-injection permit for gas recycle, NGL recovery, enhanced oil recovery and arbitrage. A key component of Reef's Ontario strategy is to identify and exploit undervalued prospects in the Ontario basin by utilizing the company's 23,500 acres of proprietary 3D seismic. In addition to its Ontario Properties, Reef has identified multiple oil and gas acquisition and development opportunities throughout Canada.

Forward-Looking Statements. This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Company, Investors should review the Company's registered filings which are available at www.sedar.com.

Certain financial and operating information included in this press release are based on audited financial results for the year ended July 31, 2012 and are subject to the same limitations as discussed under "Forward- Looking Statements" set out above.

Information Regarding Disclosure on Oil and Gas Reserves. The reserves data set forth above is based upon an independent reserves assessment and evaluation prepared by AJM Deloitte with an effective date of July 31, 2012 (the "AJM Deloitte Report"). The presentation summarizes the Company's crude oil, natural gas liquids and natural gas reserves and the net present values before income tax of future net revenue for the Company's reserves using forecast prices and costs based on the AJM Deloitte Report. The AJM Deloitte Report has been prepared in accordance with the standards contained in the COGEH and the reserve definitions contained in NI 51-101. All evaluations and reviews 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 above represent the fair market value of the reserves. There is no assurance that the forecast prices and cost 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 filed on www.sedar.com on or before November 29, 2012.

This news release shall not constitute an offer to sell or the solicitation of any offer to buy, nor any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws.

BOE presentation:

Barrel ("bbl") of oil equivalent ("boe") amounts may be misleading particularly if used in isolation. All boe conversions in this report are calculated using a conversion of six thousand cubic feet of natural gas to one equivalent barrel of oil (6 mcf=1 bbl) and is based on an energy conversion method primarily applicable at the burner tip and does not represent a value equivalency at the well head.

Trading in the securities of Reef Resources Ltd. should be considered highly speculative. Neither the 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.


To view this press release as a PDF file, click onto the link below:
www.usetdas.com/pr/ReefFeb222013.pdf




Source: Reef Resources Ltd. (TSX-V-REE) www.reefresources.ca
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