Sunshine Oilsands Ltd.: Announcement of Results for the First Quarter Ended March 31, 2016, Update on West Ells Progress and Extension of Closing of Private Placements

CALGARY, ALBERTA and HONG KONG, CHINA--(Marketwired - May 16, 2016) - Sunshine Oilsands Ltd. (the "Corporation" or "Sunshine") (HKEX:2012) today announced its financial results for the first quarter ended March 31, 2016. The Corporation's consolidated financial statements, notes to the consolidated financial statements and Management's Discussion and Analysis have been filed on SEDAR (www.sedar.com) and with The Stock Exchange of Hong Kong Limited (the "Hong Kong Stock Exchange") (www.hkexnews.hk) and are available on the Corporation's website (www.sunshineoilsands.com). Sunshine's annual general meeting of shareholders will be held on June 23, 2016 in Hong Kong. All figures used in this announcement are in Canadian dollars unless otherwise stated.

Summary of Financial Figures

For the first quarter of 2016, the Corporation had a net loss of $2.8 million, compared to $30.8 million for the same period in 2015, representing a net loss per share for each respective quarter of $0.00 and $0.01.

As at March 31, 2016 and December 31, 2015 the Corporation notes the following selected balance sheet figures:

Update on West Ells Progress

For the quarter ended March 31, 2016, the Corporation made progress in the following areas:

• Completed the commissioning of all systems for the West Ells central processing facility plant and Phase I well pad;

• All eight West Ells Phase I well pairs are on steam injection, with two well pairs converted to production mode;

• Achieved expected reservoir response to injection and production operations; and

• Preparations for initiation of production from multiple well pairs continued as planned.

The Corporation has continued with steaming operations, with only minor slowdowns resulting from the recent Fort McMurray area wildfires.

Extension of Closing of Private Placements

Extension of Closing of Private Placement under the General Mandate

Reference is made to the announcements of the Corporation dated March 16, 2016 (Hong Kong) / March 15, 2016 (Calgary) and April 28, 2016 (Hong Kong) / April 27, 2016 (Calgary) (collectively, the "Announcements") in relation to the proposed issue of a total of 558,823,500 new Class "A" Common Voting Shares ("Common Shares") to Bright Hope Global Investments Limited ("Bright Hope") under the General Mandate (as defined in the Announcements).

As disclosed in the announcement of the Corporation dated April 28, 2016 (Hong Kong)/ April 27, 2016 (Calgary), the Corporation completed the partial closing of 88,234,000 Common Shares at a price of HK$0.34 (approximately CDN$0.055 per Common Share) per Common Share (the "Partial Closing") pursuant to the subscription agreement with Bright Hope. At the Partial Closing, the Corporation received total gross proceeds of HK$29,999,560 (approximately CDN$4.9 million). Expenses for the Partial Closing are estimated to be approximately HK$700,000 (approximately CDN$0.1 million). In addition, an introduction fee of HK$599,991 (approximately CDN$0.1 million), being 2% of the gross proceeds of the Partial Closing, were incurred in relation to the Partial Closing.

Although the recent Fort McMurray area wildfires only caused Sunshine to temporarily slow down its activities at West Ells, Bright Hope expressed concerns about the potential impact of the wildfires on West Ells operations. After consideration of the matter, the Board of Directors of the Corporation consented to an extension of the closing date for the remaining 470,589,500 Common Shares (HK$160,000,430 or approximately CDN $26.0 million) subscribed for by Bright Hope from May 14, 2016 to June 30, 2016 with the view that such extension is in the best interests of the Corporation and its shareholders. The remaining subscribed Common Shares can be closed in one or more tranches closing no later than June 30, 2016.

An announcement will be issued when the Corporation completes the closing of the remaining 470,589,500 Common Shares (HK$160,000,430) subscribed for by Bright Hope.

Extension of Closing of Private Placement under the Specific Mandate

Reference is made to the announcements of the Corporation dated June 1, 2015 (Hong Kong), July 28, 2015 (Hong Kong), August 21, 2015 (Hong Kong), October 1, 2015 (Hong Kong), November 2, 2015 (Hong Kong), December 6, 2015 (Hong Kong), March 3, 2016 (Hong Kong) and May 3, 2016 (Hong Kong) and the circular of the Corporation dated June 22, 2015 (the "Circular"), in relation to, among other matters, the proposed issue of Common Shares under the Specific Mandate (as defined in the Circular) and the connected transactions involving subscriptions for new Common Shares by connected persons.

As disclosed in the announcement of the Corporation dated May 3, 2016 (Hong Kong)/ May 2, 2016 (Calgary), the Board of Directors of the Corporation, having taken into account the current market conditions, consented to a further extension of the closing date for the remaining 413,520,000 Common Shares (HK$310,140,000 or approximately CDN$53.5 million) subscribed by Prime Union Enterprises Limited ("Prime Union") to August 2, 2016 from May 2, 2016. The remaining subscribed Common Shares can be closed in one or more tranches with the last tranche closing no later than August 2, 2016.

To date, the Corporation has completed the closing of 111,214,210 Common Shares authorized under the Specific Mandate for total gross proceeds of HK$83,410,658 (approximately CDN$14.1 million) and the allotment and issue of 111,214,210 Common Shares at a price of HK$0.75 per Common Share (approximately CDN$0.13 per Common Share). An announcement will be issued when the Corporation completes the closing of the remaining 413,520,000 Common Shares (HK$310,140,000) subscribed for by Prime Union.

Corporate Matters

As at the date of this announcement, construction and commissioning of the West Ells Phase I facilities are complete with first oil production achieved in December 2015. All West Ells Phase I well pairs are now on steam injection or on production. The Corporation is fully committed to advancing its corporate initiatives. Thanks to the commitment and dedication of our operations staff, West Ells continued with steaming operations with only minor slowdowns resulting from the recent Fort McMurray area wildfires.

ABOUT SUNSHINE OILSANDS LTD.

The Corporation is a Calgary based public corporation, listed on the Hong Kong Stock Exchange since March 1, 2012. The Corporation was also listed on the Toronto Stock Exchange from November 16, 2012 to September 30, 2015, when it chose to voluntarily delist. The Corporation is focused on the development of its significant holdings of oil sands and heavy oil leases in the Athabasca oil sands region. The Corporation owns interests in oil sands and petroleum and natural gas leases in the Athabasca region of Alberta. The Corporation is currently focused on executing milestone undertakings in the West Ells project area. West Ells Phase I is operational and has an initial production target rate of 5,000 barrels per day.

FORWARD LOOKING INFORMATION

This announcement contains forward-looking information relating to, among other things, (a) the future financial performance and objectives of Sunshine; (b) the plans and expectations of the Corporation; and (c) the anticipated closings of the current private placements and the timing thereof. Such forward-looking information is subject to various risks, uncertainties and other factors. All statements other than statements and information of historical fact are forward-looking statements. The use of words such as "estimate", "forecast", "expect", "project", "plan", "target", "vision", "goal", "outlook", "may", "will", "should", "believe", "intend", "anticipate", "potential", and similar expressions are intended to identify forward-looking statements. Forward-looking statements are based on Sunshine's experience, current beliefs, assumptions, information and perception of historical trends available to Sunshine, and are subject to a variety of risks and uncertainties including, but not limited to, those associated with resource definition and expected reserves and contingent and prospective resources estimates, unanticipated costs and expenses, regulatory approval, fluctuating oil and gas prices, expected future production, the ability to access sufficient capital to finance future development and credit risks, changes in Alberta's regulatory framework, including changes to regulatory approval process and land-use designations, royalty, tax, environmental, greenhouse gas, carbon and other laws or regulations and the impact thereof and the costs associated with compliance.
Although Sunshine believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned that the assumptions and factors discussed in this announcement are not exhaustive and readers are not to place undue reliance on forward-looking statements as the Corporation's actual results may differ materially from those expressed or implied. Sunshine disclaims any intention or obligation to update or revise any forward-looking statements as a result of new information, future events or otherwise, subsequent to the date of this announcement, except as required under applicable securities legislation. The forward-looking statements speak only as at the date of this announcement and are expressly qualified by these cautionary statements. Readers are cautioned that the foregoing lists are not exhaustive and are made as at the date hereof. For a full discussion of the Corporation's material risk factors, see the Corporation's annual information form for the year ended December 31, 2015 (the "AIF") and risk factors described in other documents we file from time to time with securities regulatory authorities, all of which are available on the Hong Kong Stock Exchange at www.hkexnews.hk, on the SEDAR website at www.sedar.com or the Corporation's website at www.sunshineoilsands.com.

Contact

Dr. Qi Jiang
President & Chief Operating Officer
(1) (587) 390-0606
investorrelations@sunshineoilsands.com
www.sunshineoilsands.com