Source: Lightstream Resources Ltd.

PetroBakken Announces Reorganization of Petrobank and PetroBakken

CALGARY, ALBERTA--(Marketwire - Oct. 29, 2012) - PetroBakken Energy Ltd. ("PetroBakken") (TSX:PBN) is pleased to announce our participation in a corporate reorganization that will see shareholders of Petrobank Energy and Resources Ltd. ("Petrobank") (TSX:PBG) receive Petrobank's 57% interest in PetroBakken (the "Reorganization"). Petrobank and PetroBakken have signed an arrangement agreement detailing the terms and conditions of the Reorganization.

Pursuant to the Reorganization, a new Alberta corporation will be formed ("New Petrobank") which will acquire all of the existing assets and liabilities of Petrobank, including THAI® and related technologies but excluding Petrobank's ownership interest in PetroBakken shares, and existing shareholders of Petrobank will receive one share of New Petrobank for each Petrobank share held. Following this distribution of Petrobank's heavy oil business to New Petrobank, Petrobank and PetroBakken will, through a series of transactions, amalgamate, with the resulting company to continue under the name "PetroBakken Energy Ltd." ("New PetroBakken"). Existing PetroBakken shareholders will receive one share of New PetroBakken for every share of PetroBakken held prior to the Reorganization and Petrobank shareholders will receive, in aggregate, a number of New PetroBakken shares equal to the number of PetroBakken shares held by Petrobank immediately prior to the Reorganization. Further details in respect of New Petrobank can be found in Petrobank's press release, which can be accessed on Petrobank's website at

This Reorganization is designed to enhance long-term value for Petrobank and PetroBakken shareholders and is consistent with our long-held corporate goal of enhancing shareholder value by creating strong, independent and focused companies. PetroBakken is anticipated to benefit from the Reorganization through an increase to our publicly traded float, which should provide additional liquidity in the market, and the elimination of any share price trading discounts due to the perceived overhang of a control block owned by the parent company.

The Reorganization will not result in any changes to the existing Board and senior management of PetroBakken and we will continue to pursue our strategy of delivering accretive production and reserves growth, along with an attractive dividend yield. The Reorganization will also not affect the PetroBakken dividend policy and shareholders are expected to continue to receive monthly dividends. Pursuant to the Arrangement Agreement, Petrobank will receive the December 2012 dividend (to be paid January 15 2013) with respect to the PetroBakken shares it holds immediately prior to the Reorganization, and former Petrobank shareholders will receive any dividends declared on the New PetroBakken shares following the effective date of the Reorganization.

The Reorganization is expected to be non-taxable to PetroBakken and its shareholders. Tax information will be published on the websites of both Petrobank and PetroBakken in the near future; however shareholders are encouraged to seek the advice of their own tax professionals.

The Reorganization is subject to the approval of the shareholders of each of Petrobank and PetroBakken. It is anticipated that a joint-management information circular containing additional information with respect to the Reorganization will be mailed to each Petrobank and PetroBakken shareholder in mid-November and meetings of the shareholders of each of Petrobank and PetroBakken will be held in mid-December, 2012. The Board of Directors of each company, upon considering the recommendations of their respective independent committees, have recommended that their shareholders approve the Reorganization. Pending approvals from the shareholders of each company, approval of applicable courts, receipt of appropriate regulatory approvals and satisfaction of other customary closing conditions, the transaction is scheduled to become effective on December 31, 2012.

PetroBakken Energy Ltd. is an oil and gas exploration and production company combining light oil Bakken and Cardium resource plays with conventional light oil assets, delivering industry leading operating netbacks, strong cash flows and production growth. PetroBakken is applying leading edge technology to a multi-year inventory of Bakken and Cardium light oil development locations. Our strategy is to deliver accretive production and reserves growth, along with an attractive dividend yield.

Forward-Looking Statements. Certain information provided in this press release constitutes forward-looking statements. Specifically, this press release contains forward-looking statements relating to the terms of and timing for completion of the Reorganization, timing of mailing of shareholder materials and holding of shareholder meetings, payment of future dividends, expected tax treatment of the Reorganization and the future business of Petrobank and PetroBakken. Forward-looking statements are necessarily based upon assumptions and judgements with respect to the future including, but not limited to, the receipt of required shareholder and regulatory approvals and satisfaction of other conditions to the Reorganization, the outlook for commodity markets and capital markets, the performance of producing wells and reservoirs, well development and operating performance, general economic and business conditions, weather, the regulatory and legal environment and other risks associated with oil and gas operations. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. You can find a discussion of certain of those risks and uncertainties in our Canadian securities filings. Such factors include, but are not limited to: general economic, market and business conditions; fluctuations in oil prices; the results of exploration and development drilling, recompletions and related activities; timing and rig availability, fluctuation in foreign currency exchange rates; the uncertainty of reserve estimates; changes in environmental and other regulations; risks associated with oil and gas operations; risks associated with the approval of the Reorganization by our shareholders, the receipt of regulatory approvals, the satisfaction of other conditions to the Reorganization, and other factors, many of which are beyond the control of Petrobank and PetroBakken. There is no representation by Petrobank or PetroBakken that actual results achieved during the forecast period will be the same in whole or in part as those forecast. Except as may be required by applicable securities laws, neither Petrobank nor PetroBakken assumes any obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.

Contact Information:

PetroBakken Energy Ltd.
John D. Wright
President and Chief Executive Officer
(403) 268.7800

PetroBakken Energy Ltd.
Peter D. Scott
Senior Vice President and Chief Financial Officer
(403) 268.7800

PetroBakken Energy Ltd.
Bill A. Kanters
Vice President Capital Markets
(403) 268.7800

PetroBakken Energy Ltd.
Eighth Avenue Place, 2800, 525 - 8th Avenue S.W.
Calgary, Alberta T2P 1G1
(403) 268.7800
(403) 218.6075 (FAX)