Vermilion Energy Inc. is pleased to announce that it has entered into a definitive purchase and sale agreement with Northern Petroleum Plc. ("Northern") whereby Vermilion, through its wholly-owned subsidiary, will acquire 100% of the shares of Northern Petroleum Nederland B.V. ("NPN") (the "Acquisition"). NPN is the Netherlands subsidiary of UK-based Northern. The purchase price, which is subject to customary closing adjustments (including working capital and cash flows between the effective and closing dates), is $27.5 million. Vermilion will also grant Northern minority net profit participation rights on select license interests included in the Acquisition. The Acquisition has an effective date of January 1, 2013, and remains subject to customary conditions and receipt of all necessary regulatory approvals. The Acquisition is anticipated to close before the end of October, 2013, and will be funded with existing credit facilities.

The Acquisition includes interests in nine concessions, including six onshore licences in production or development, three onshore exploration licenses, and one offshore production license ("P12") in the Netherlands (the "Assets"). The interests in the Drenthe IIIb, Drenthe IV, Oosterwolde, and Zuid Friesland III licenses are located in the northeastern region of the Netherlands in close proximity to Vermilion's existing concessions. The remaining five onshore licenses include interests in Andel V, Engelen, Papekop, Utrecht, and Waalwijk, which are located in the southwestern region of the Netherlands.

All of the Assets to be acquired will be operated by Vermilion following closing of the Acquisition, with the exception of the offshore license P12, in which Vermilion will hold a 23.6% non-operated interest. The Assets cover approximately 298,500 net acres, of which approximately 98 percent is currently undeveloped. Production from the Assets is expected to average approximately 600 boe per day in 2013, comprised of 99% natural gas that is expected to produce an operating netback in-line with Vermilion's operating netback for natural gas in the Netherlands. Proved plus probable reserves have been estimated for Vermilion by GLJ Petroleum Consultants Ltd. ("GLJ") to be approximately 2.3 million boe as of the effective date of the purchase.

Disregarding any value attributable to undeveloped land, acquisition metrics are estimated at $46,000 per boe per day and $11.74 per boe of proved plus probable reserves. Using Vermilion's second quarter 2013 Netherland's operating netback for natural gas of $54.72 per boe as a proxy and estimated 2013 production levels, the cost of the Acquisition is approximately 2.3 times estimated 2013 operating cash flow. Upon closing of the Acquisition, Vermilion will continue to maintain considerable financial flexibility, with approximately $700 million of remaining borrowing capacity and a net debt-to-fund flows from operations(2) ratio of approximately 1.1 times.

The Acquisition increases our undeveloped land base in the Netherlands to more than 780,000 net acres. Vermilion has identified several development opportunities on the Assets that increase the already significant inventory of investment projects on our existing Netherlands asset base. The Assets enhance our position as the second largest natural gas producer onshore in the Netherlands, and offer a strong fit with our current operations. We believe this Acquisition is well aligned with our strategic objective to expand our exposure to European commodity markets.

About Vermilion

Vermilion (TSX, NYSE: VET) is an oil-leveraged producer that adheres to a value creation strategy through the execution of full cycle exploration and production programs focused on the acquisition, exploration, development and optimization of producing properties in Western Canada, Europe and Australia. Our business model targets annual organic production growth of approximately 5% along with providing reliable and growing dividends. Vermilion is targeting growth in production primarily through the exploitation of conventional resource plays in Western Canada, including Cardium light oil and liquids rich natural gas, the exploration and development of high impact natural gas opportunities in the Netherlands and through drilling and workover programs in France and Australia. Vermilion also holds an 18.5% working interest in the Corrib gas field in Ireland. In addition, Vermilion pays a monthly dividend of Canadian $0.20 per share, which provides a current yield in excess of 4%. Management and directors of Vermilion hold approximately 8% of the outstanding shares and are dedicated to consistently delivering superior rewards for all stakeholders, featuring an 18-year history of market outperformance. Vermilion trades on the Toronto Stock Exchange and the New York Stock Exchange under the symbol VET.

Natural gas volumes have been converted on the basis of six thousand cubic feet of natural gas to one barrel equivalent of oil. Barrels of oil equivalent (boe) may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet to one barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.