Gear Energy Ltd. (TSX:GXE) announced the initiation of a strategic repositioning process. The company?s board of directors (the 'Board') have commenced a formal process to explore, review and evaluate strategic repositioning alternatives with a view to enhancing shareholder value (the 'Strategic Process'). With the company?s top tier cash flow generation ability, strong balance sheet, deep inventory of both drilling and enhanced oil recovery opportunities, and a material tax coverage position, the board and management believe that the company is ideally placed to undertake this process.

Although there have been no formal proposals received, the company has been approached by a number of parties interested in potential transactions. Through the Strategic Process, the Board intends to undertake a comprehensive review to identify and consider a broad range of alternatives to enhance shareholder value including, but not limited to, a merger, corporate sale, corporate restructuring, the sale of select assets, the purchase of assets, a potential spin-out of select assets, optimization of future capital allocation and return of capital strategies, or any combination of these alternatives. The Strategic Process may result in no specific transaction being pursued, with the Company looking to continue to optimize and improve its operations as they currently exist with a focus on providing long-term sustainable growth and competitive returns to shareholders.

Gear has engaged Peters & Co. Limited ('Peters & Co.') as financial advisor in connection with the Strategic Process. Gear and Peters & Co.

have created a virtual data room, which will be available for review by parties upon execution of a confidentiality agreement in connection with the Strategic Process. Gear has not set a definitive schedule for the conclusion of the Strategic Process or made a decision to pursue any particular alternative. Given the nature of the process and the need for confidentiality during this process, the Company does not intend to provide updates until such time as the Board approves a definitive transaction or strategic repositioning alternative, or otherwise determines that further disclosure is necessary or appropriate.