Sonde Resources Corp. announced that two of Sonde's three short radius horizontal wells have begun production. The 6-17-31-17W4 had a 5-day initial production (IP) of 205 boe/d (190 barrels of oil + 90 Mcf) and the 12-7-31-17W4 had 5-day IP of 158 boe/d (144 barrels of oil + 90 Mcf). Most of the frac oil has been produced back from these wells during the early production phase. The company expect to have the third well tied-in shortly and will provide an update when a reliable IP has been established. Sonde is encouraged by the IP and high oil cut of these wells, by ongoing production from its late 2011 13-17 well, and by the production rates and declines from nearby competitor wells. The company has identified another 20 horizontal infill locations on Sonde land for execution in 2013 and beyond. Sonde has completed an extensive waterflood modeling effort on its Mannville 'I' oil pool, and has six months of data on the 5-well waterflood pilot project initiated in March 2012. Sonde has initiated a 14-30 day test to flow back its initial Montney well to determine if initial high produced water volumes will decline, or can be adequately dealt with, to justify additional Montney drilling in the area. It is clear to Sonde that producible oil and gas is present on the new Ante Creek North subcrop edge, but economic development criteria remain to be established. Sonde would expect to complete these tests to make this determination in the next 45 to 60 days. Sonde has licensed its first Duvernay horizontal well and has continued to acquire oil-prospective acreage in the play. The Company currently has approximately 85,000 net acres of Duvernay rights in the oil window in various parts of the basin where Sonde believes that improved reservoir quality will allow oil and condensate to be produced in commercial quantities. Sonde has amassed approximately 45,000 net acres of highly prospective oil-oriented acreage in a new Wabamun horizontal play in NW Alberta, and recently worked-over an existing vertical well as proof-of-concept for this new play. Beginning in February 2012, Sonde shut-in approximately 550 boe/d (3 MMcf/d + 50 barrels of ngl/d) due to a steep decline in natural gas prices and resulting profit margins. Over the next 30 days Sonde expects to restore up to 50% of this shut in production.

The company anticipated that third quarter netback (cash flow before capital expenditures) will be approximate $1.0 million with third quarter average production of approximately 2,100 boepd.