Shoreline Energy Corporation Announces Successful Drilling Results, Increased Production, Operational Update and Updated Production Guidance

CALGARY, ALBERTA -- (Marketwire) -- 01/12/12 -- Shoreline Energy Corporation ("Shoreline") (TSX: SEQ) is pleased to provide an update on successful operations performed in the fourth quarter of 2011, status of current operations and production, and capital expenditure and production guidance for the first quarter of 2012.

Highlights

--  Shoreline exited December 2011 with an average monthly production rate
    of approximately 1,570 barrels of oil equivalent per day (Boe/d) (21%
    oil and liquids) an increase of 109% from May 2011 production rates.
--  Shoreline achieved a December 2011 exit production rate of approximately
    1,600 Boe/d (25% oil and liquids).
--  Estimated Q4 2011 capital expenditures of $3.7 million.
--  Total estimated 2011 capital expenditures of $5.1 million.
--  In addition to drilling activities, Shoreline has increased production
    through re-activations and work overs of shut in wells, adding
    production at an estimated cost of less than $3,000 per flowing Boe/d.
--  Increase in bank credit facility from $12 million to $17 million.
--  Shoreline will pay its second consecutive quarterly dividend of $0.20
    per common share on January 17, 2012 to shareholders of record December
    31, 2011.

Operational Summary

--  Q4 2011 drilled three (2.3 net) wells, including two (1.3 net) oil wells
    and one (1.0 net) gas well
--  Farmington Doig horizontal well (50% WI) came on stream December 6th,
    2011, capable of producing 250 barrels of oil per day (Bbl/d), with
    current average production of 125 Bbl/d due to production restrictions
    at a third party facility. Shoreline is currently working on a
    debottlenecking project that will remove this restriction.
--  Pouce Coupe Boundary Lake light oil discovery (83.3% WI), was tested in
    late December, averaging test rates of 150 Bbl/d. This new discovery is
    anticipated to be brought on stream in early February.
--  Hines Creek horizontal well (100% WI) was drilled and cased as a
    Bluesky/Cadomin gas well in December and has now been completed, with an
    average test rate of 2.7 mmcf/d from the Cadomin formation.
--  Shoreline is currently drilling a horizontal well in the Bonanza area,
    which spud on December 29th, 2011. The well targets high quality Charlie
    Lake light oil adjacent to known production. It is now at intermediate
    casing point and will rig release prior to the end of January.
--  December 31, 2011 bank indebtedness is estimated to be $5.7 million plus
    a working capital deficiency of approximately $3.5 million.

Q1 2012 Guidance

--  Shoreline expects to average approximately 1,775 Boe/d (29% oil and
    liquids) for the first quarter of 2012 and a March exit production rate
    of approximately 1,900 Boe/d (30% oil and liquids).
--  Total net capital expenditures are anticipated to be $5.5 to $6.5
    million in the first quarter of 2012 to drill five (3.2 net) oil wells
    and one (1.0 net) gas well as Shoreline continues to develop projects
    which further our goal of reaching a 50/50 oil to gas production
    weighting.

Investor Information

Currently, Shoreline has 5,640,882 common shares, 5,909,549 common share purchase warrants and 383,100 options outstanding.

Shoreline is a Calgary, Alberta based corporation engaged in the exploration, development and production of petroleum and natural gas. The Corporation's common shares are currently listed on the TSX under the trading symbol "SEQ." Additional information regarding Shoreline is available under the Corporation's profile at www.sedar.com or at the Corporation's website, www.shorelineenergy.ca.

Forward Looking and Cautionary Statements

This news release contains forward-looking statements relating to the Corporation's plans and other aspects of the Corporation's anticipated future operations, strategies, financial and operating results and business opportunities. These forward-looking statements may include opinions, assumptions, estimates, management's assessment of value, reserves, future plans and operations.

Forward-looking statements typically use words such as "will," "anticipate," "believe," "estimate," "expect," "intend," "may," "project," "should," "plan," and similar expressions suggesting future outcomes, and include statements that actions, events or conditions "may," "would," "could," or "will" be taken or occur in the future. The forward-looking statements are based on various assumptions including expectations regarding the success of current or future drill wells; the outlook for petroleum and natural gas prices; estimated amounts and timing of capital expenditures; estimates of future production; assumptions concerning the timing of regulatory approvals; the state of the economy and the exploration and production business; results of operations; business prospects and opportunities; future exchange and interest rates; the Corporation's ability to obtain equipment in a timely manner to carry out development activities; and the ability of the Corporation to access capital and credit. While the Corporation considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. All dollar figures shown are un audited and are estimates only.

Forward-looking statements are subject to a wide range of assumptions, known and unknown risks and uncertainties and other factors that contribute to the possibility that the predicted outcome will not occur, including, without limitation: risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation; loss of markets; volatility of commodities prices; currency fluctuations; imprecision of reserves estimates; environmental risks; competition from other producers; inability to retain drilling rigs and other services; incorrect assessment of the value of acquisitions; failure to realize the anticipated benefits of acquisitions; general economic conditions; delays resulting from or inability to obtain required regulatory approvals and to satisfy various closing conditions; and ability to access sufficient capital from internal and external sources. Readers are cautioned that the foregoing list of factors is not exhaustive.

Although Shoreline believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements and you should not rely unduly on forward-looking statements. The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by applicable law, Shoreline does not undertake any obligation to publicly update or revise any forward-looking statements.

Note Regarding BOEs

The term barrel of oil equivalent ("BOE") may be misleading, particularly if used in isolation. A conversion ratio for gas of 6 MCF : 1 BOE is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Contacts:
Shoreline Energy Corporation
Mr. Trevor Folk
Chief Executive Officer
[e-mail]

Shoreline Energy Corporation
Calgary Office
c/o Suite 400, 209-8th Ave SW
Calgary, Alberta, T2P 1B8
[phone]

Shoreline Energy Corporation
Toronto Office
Suite 103, 145 King Street West
Toronto, Ontario, M5H 1J8
www.shorelineenergy.ca