Hong Kong Exchanges and Clearing : ANNOUNCEMENT OF RESULTS FOR THE SECOND QUARTER ENDED JUNE 30, 2019

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

This announcement appears for information purpose only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities of Sunshine Oilsands Ltd.

SUNSHINE OILSANDS LTD.

陽光油砂有限公司*

(a corporation incorporated under the Business Corporations Act of the Province of Alberta, Canada with limited liability)

(HKEX: 2012)

ANNOUNCEMENT OF RESULTS

FOR THE SECOND QUARTER ENDED JUNE 30, 2019

Sunshine Oilsands Ltd. is pleased to announce its financial results for the second quarter ended June 30, 2019. Please see the attached announcement for further information.

By Order of the Board of Sunshine Oilsands Ltd.

Sun Kwok Ping

Executive Chairman

Hong Kong, August 21, 2019

Calgary, August 20, 2019

As at the date of this announcement, the Board consists of Mr. Kwok Ping Sun and Ms. Gloria Pui Yun Ho as executive directors; Mr. Michael John Hibberd, Ms. Linna Liu and Ms. Xijuan Jiang as non-executive directors; and Mr. Yi He, Mr. Alfa Li and Mr. Guangzhong Xing as independent non-executive directors.

*For identification purposes only

Sunshine Oilsands Ltd.

Announcement of Results for the Second Quarter

ended June 30, 2019 and

an Update on West Ells Progress

2Q19 Petroleum sales increased 56% compared

with 2Q18

2Q19 net loss narrowed by 69% to CAD$9.8 m

(2Q18 net loss: CAD$31.1 m)

2Q19 production rose by 27% to 2,044 bbl/day

compared with 2Q18

CALGARY/HONG KONG - Sunshine Oilsands Ltd. (the "Corporation" or "Sunshine") (HKEX: 2012) today announced its financial results for the second quarter ended June 30, 2019. The Corporation's condensed consolidated interim financial statements, notes to the condensed consolidated interim 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). All figures used in this release are in Canadian dollars unless otherwise stated.

MESSAGE TO SHAREHOLDERS

For three months ended June 30, 2019, the Corporation's average bitumen production was 2,044 bbls/day. Diluent was blended at 18.2% volumetric rate with the bitumen as part of the production process to create the marketable "Dilbit" blend product, and the average Dilbit sales volume was 2,506 bbls/day in the second quarter of 2019. The bitumen production and sales for 2Q19 have increased significantly compared with 1Q19.

SUNSHINE'S CAPITAL RAISING ACTIVITIES DURING 2Q19

On June 17, 2019, the Corporation entered into a subscription agreement for convertible bonds in the principal amount of USD 10.45 million (approximately CAD $13.68 million) with an independent third party. With an initial conversion price of HKD $0.0822 per share (approximately CAD $0.014 per share), a

maximum of 990,347,263 Class "A" common shares will be allotted and issued upon the full conversion

of the convertible bonds. The convertible bonds interest rate is 10.0% per annum and required repayment in full within two years from the issuance date. All the subscription proceeds were subsequently received on 29 July 2019. The entire proceeds will be used to financing its general working capital and capital expenditure for its West Ells project.

On May 15, 2019, the Board of the Corporation approved the payment of director fee of certain directors

(the "Connected Directors") for the period from October 1, 2017 to April 30, 2019 in shares in lieu of cash,

subject to Independent Shareholders' approval requirement under Chapter 14A of the Listing Rules. On June 24, 2019, the proposed issuance of 21,779,902 new Shares to the Connected Directors as payment of director fee has been approved by the independent shareholders at the Special General Meeting. The completion took place on July 11, 2019. An aggregate of 21,779,902 new Shares were allotted and issued to the Connected Directors at an Issue Price of HK$0.092 (approximately CAD $0.015 per share) per Share.

During the six months ended June 30, 2019, the Corporation issued no new Common Shares.

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The US$ 200 million senior notes matured on August 1, 2019 (New York time). As at the date of this announcement, the Company is in negotiation with the noteholders on further forbearance.

Summary of Financial Figures

For 2Q19, net Dilbit sales increased by 56% to CAD $14.2 million from CAD $9.1 million mainly due to higher bitumen sales volume and production. Net loss declined by 69% to CAD $9.8 million from CAD $31.1 million in 2Q18.

2Q19 bitumen production was 2,044 bbl/day.

As at June 30, 2019 and December 31, 2018, the Corporation notes the following selected balance sheet figures.

(Canadian $000s)	June 30,	December 31,
	2019	2018
Cash	555	583
Trade and other receivables	15,761	13,457
Prepaid expense and deposits	5,315	3,208
Exploration and evaluation assets	269,860	269,218
Property, plant and equipment	487,229	492,815
Total liabilities	563,662	527,328
Shareholders' equity	217,723	251,953

2019 Outlook

Sunshine sees a brightening outlook as international oil prices stabilize and steadily increase and the heavy price differential narrows. The Corporation will continue to focus on cost controls and on carefully improving production performance as SAGD chambers mature, which will increase production at West Ells. Since the end of the second quarter, the Dilbit sales have increased significantly. The Corporation intends to ramp up production in an environment that is expected to achieve increasingly positive operating Dilbit netbacks. In addition, the Corporation sees potentially significant benefits resulting from re-activation of the Muskwa and Godin Area activities under a revised joint venture with new owners of the joint venture operator.

Kwok Ping Sun	Gloria Ho
Executive Chairman	Chief Financial Officer

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 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 1 is operational and has an initial production target of 5,000 barrels per day.

For further enquiries, please contact:

Kwok Ping Sun

Executive Chairman

Tel: + 852-3188-9298

Gloria Ho

Chief Financial Officer

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Tel: + 852-3188-9298

Email: [e-mail]

Website: www.sunshineoilsands.com

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

1. 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, 2018 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.

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MANAGEMENT'S DISCUSSION AND ANALYSIS

For the three and six months ended June 30, 2019

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