VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 21, 2013) - Hemisphere Energy Corporation (News - Market indicators) is pleased to announce the results of its year-end independent reserves evaluation in accordance with National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101") as at December 31, 2012.

The independent reserves evaluation covers a 10 month period ended December 31, 2012 as a result of a change in year-end and is primarily focused on Hemisphere's core oil producing property in Jenner, Alberta, representing over 96% of Hemisphere's total reserves. During the 10 month period in 2012, Hemisphere drilled and placed on production seven horizontal wells and one vertical well. In 2013, Hemisphere has drilled one horizontal well in Jenner to-date, which is currently being tied-in. This well tests land not reflected in the 2012 independent reserves evaluation. Initial production results will be released when available.

Highlights - December 31, 2012 compared to February 29, 2012

Proved Reserves

• Increased Proved reserves by 90% to 812.3 Mboe (91% oil).
• Increased NPV of Proved reserves by 65% to $18.0 million (before tax, discounted at 10%).
• Reserve replacement⁽¹⁾ of 309%.

Proved plus Probable Reserves

• Increased Proved plus Probable reserves by 60% to 1,265.1 Mboe (89% oil).
• Increased NPV of Proved plus Probable reserves by 42% to $26.5 million (before tax, discounted at 10%).
• Reserve replacement⁽¹⁾ of 380%.

Note: ⁽¹⁾ Based on estimated 10 month 2012 production of 124,721 boe.

Summary of Reserves

The reserves data set forth below is based upon an independent reserves evaluation prepared by Sproule Associates Limited ("Sproule") with an effective date of December 31, 2012 (the "Sproule Report"). The following presentation summarizes Hemisphere's crude oil, natural gas liquids and natural gas reserves and the net present values before income tax of future net revenue for Hemisphere's reserves using forecast prices and costs based on the Sproule Report. The Sproule Report has been prepared in accordance with definitions, standards, and procedures contained in the Canadian Oil and Gas Evaluation Handbook and 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 below 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. Reserves included herein are stated on a company gross basis (working interest before deduction of royalties without including any royalty interests) unless noted otherwise. In addition to the information disclosed in this news release, more detailed information will be included in Hemisphere's Annual Information Form which will be available on SEDAR at www.sedar.com and Hemisphere's website at www.hemisphereenergy.ca by April 30, 2013. All amounts are expressed in Canadian dollars unless otherwise noted. Due to rounding, certain columns may not add exactly.

Note: Hemisphere does not have light or medium oil.

Summary of Net Present Value

About Hemisphere Energy Corporation

Hemisphere Energy Corporation is an exploration and production company focused on developing core areas that provide low to medium risk drilling opportunities to increase production, reserves and cash flow. Hemisphere's continued growth plan is through drilling existing prospects and executing strategic acquisitions and farm-ins. Hemisphere trades on the TSX Venture Exchange under the symbol "HME".

Forward-looking Statements

This news release contains "forward-looking statements" that are based on Hemisphere's current expectations, estimates, forecasts and projections. These forward-looking statements include statements regarding Hemisphere's outlook for our future operations, plans and timing for the commencement or advancement of exploration and development activities on our properties, and other expectations, intention and plans that are not historical fact. The words "estimates", "projects", "expects", "intends", "believes", "plans", or their negatives or other comparable words and phrases are intended to identify forward-looking statements. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Many of these factors are beyond the control of Hemisphere. Consequently, all forward-looking statements made in this news release are qualified by this cautionary statement and there can be no assurance that actual results or developments anticipated by Hemisphere will be realized. For the reasons set forth above, investors should not place undue reliance on such forward-looking statements. Hemisphere disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise.

As defined in NI 51-101, proved reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves. Probable reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves.

A barrel of oil equivalent ("boe") 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.

Definitions and abbreviations