Delphi Energy Corp. (TSX:DEE) ("Delphi" or the "Company") is pleased to report its crude oil and natural gas reserves information for the year ended December 31, 2011.

2011 Highlights

Increased total proved reserves by ten percent to 25.1 million barrels of oil equivalent ("boe") and total proved plus probable reserves by 16 percent to 40.2 million boe compared to 2010, with minimal change in future development costs ("FDC");
Increased proved developed producing liquids (light and medium crude oil, and natural gas liquids) reserves by 42 percent, total proved liquids reserves by 27 percent and total proved plus probable liquids reserves by 34 percent compared to 2010;
Achieved finding, development and acquisition costs ("FD&A"), including changes in FDC, of $18.42 per boe for total proved reserves and $12.46 per boe for total proved plus probable reserves;
Improved three year average FD&A costs, including change in FDC, to $16.44 per boe for total proved reserves and $12.43 per boe for total proved plus probable reserves;
Achieved a recycle ratio of 1.95 in 2011 compared to 1.63 in 2010 and consistent with the three year average of 1.95;
Replaced 2011 production of 8,871 boe/d (29 percent oil and natural gas liquids) by 2.75 times with total proved plus probable reserve additions (net of all revisions and dispositions) of 8.9 million boe;
Increased proved plus probable reserve life index ("RLI") to 12.4 years in 2011 compared to 11.7 years in 2010.

Reserves at December 31	2011	2010	% change

Proved Developed Producing (mboe)	15,123	13,944	8
Proved Reserves (mboe)	25,074	22,721	10
Proved Plus Probable Reserves (mboe)	40,182	34,521	16

Proved FD&A including change in FDC ($/boe)⁽¹⁾	18.42	18.06	2
Proved Plus Probable FD&A including change in FDC ($/boe)⁽¹⁾	12.46	14.91	(16	)

Operating Netback ($/boe)⁽¹⁾	24.25	24.35	-
Proved Plus Probable Recycle Ratio⁽¹⁾	1.95	1.63	19

2011 Wells Drilled	Gross	Net	% of Total

Crude oil	9	6.0	25
Liquids rich natural gas (>40 bbl/mmcf NGL content)	16	12.8	54
Natural gas (<40 bbl/mmcf NGL content)	5	5.0	21
Total	30	23.8	100
Success rate (%)	100	100

⁽¹⁾ Certain financial and operating information included in this press release for the quarter and year ended December 31, 2011, such as finding and development costs, production information, operating netbacks, recycle ratios and net asset value calculations are based on unaudited financial results for the year ended December 31, 2011 and are subject to the same limitations as discussed under forward-looking statements outlined at the end of this release. These estimate amounts may change upon completion of the audited financial statements for the year ended December 31, 2011 and those changes may be material.

Reserves Summary

GLJ Petroleum Consultants Ltd. ("GLJ"), the Company's independent petroleum engineering firm, has evaluated Delphi's crude oil, natural gas and natural gas liquids reserves as at December 31, 2011 and prepared a reserves report in accordance with National Instrument 51-101 "Standards of Disclosure for Oil and Gas Activities" and the "Canadian Oil and Gas Evaluation Handbook".

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Following is summary information detailed in the GLJ reserves report at December 31, 2011 as compared to December 31, 2010.

		December 31, 2011							December 31, 2010
		Gas		Oil & NGLs		Total		% of	Total
Reserves⁽¹⁾		(mmcf	)	(mbbls	)	(mboe)⁽²	⁾	P+P	(mboe)⁽²	⁾	% Change
Proved
	Developed Producing	69,297		3,573		15,123		38	13,944		8
	Developed Non-producing	11,390		510		2,409		6	2,857		(16	)
	Undeveloped	34,103		1,859		7,543		19	5,920		27
Total Proved		114,790		5,942		25,075		63	22,721		10
Probable		71,072		3,263		15,107		37	11,800		28
Total Proved Plus Probable		185,862		9,205		40,182		100	34,521		16

⁽¹⁾ Delphi's reserves represent the operated and non-operated working interest share of reserves before deduction of royalties and include any royalty interests of the Company.

⁽²⁾ Oil equivalent amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil (6:1).

Net Present Value of Reserves

In 2011, the value of the net reserve additions of 8.9 million boe largely offset the decrease in GLJ's forecast natural gas prices as of January 1, 2012 as compared to January 1, 2011. The estimated future net revenues associated with Delphi's reserves at December 31, 2011, based on the GLJ January 1, 2012 price forecast, are summarized in the following table.

		Future net revenue before income taxes discounted at a rate of:
($ thousands)⁽¹⁾			%	5	%	10	%	15	%	20	%
Proved
	Developed Producing	316,018		249,550		206,872		177,479		156,111
	Developed Non-producing	48,642		34,780		26,906		21,901		18,444
	Undeveloped	139,091		83,516		53,798		36,063		24,613
Total Proved		503,751		367,846		287,576		235,443		199,168
Probable		362,466		199,454		126,544		87,815		64,673
Total Proved Plus Probable		866,217		567,300		414,120		323,257		263,841

⁽¹⁾ The estimated future net revenues are before the deduction of estimated future site restoration costs but are reduced for estimated future abandonment costs for reserve wells and estimated capital for future development associated with the reserves. The estimated values disclosed do not necessarily represent fair market value.

Reserves Reconciliation

The following reconciliation of Delphi's reserves compares changes in the Company's reserves at December 31, 2010 to the reserves at December 31, 2011, each evaluated in accordance with National Instrument 51-101 definitions.

	Proved (mboe	)	Probable (mboe	)	Proved Plus Probable (mboe	)
Reserves at December 31, 2010	22,721		11,800		34,521
Extensions and Improved Recovery	5,530		4,753		10,283
Technical Revisions	1,371		(1,344	)	27
Dispositions	(291	)	(260	)	(551	)
Economic Factors	(1,019	)	159		(860	)
Production	(3,238	)	-		(3,238	)
Reserves at December 31, 2011	25,074		15,108		40,182

Finding and Development Costs

Finding and development costs in 2011 and over the past three years were as follows:

			2011						2009 - 2011
			Proved			Proved Plus Probable			Proved			Proved Plus Probable
Capital ($ thousands)
	Exploration and Development Costs		115,272			115,272			255,010			255,010
	Change in Future Development Costs		311			8,177			37,634			65,250
	Total Development Costs		115,583			123,449			292,644			320,260

	Acquisition Costs		273			273			47,178			47,178
	Disposition Costs		(12,873	)		(12,873	)		(33,838	)		(33,838	)
	Total Costs		102,984			110,850			305,984			333,600

Reserves (mboe)
	Reserve Additions ⁽¹⁾		5,882			9,450			16,160			23,268
	Acquisitions and Dispositions		(291	)		(551	)		2,452			3,573
	Total Reserve Additions		5,591			8,899			18,612			26,841

Finding and Development Costs ($/boe)
	Exploration and Development, excluding change in FDC	$	19.60		$	12.20		$	15.78		$	10.96
	Exploration and Development, including change in FDC	$	19.65		$	13.06		$	18.11		$	13.76
	Exploration, Development, Acquisitions and Dispositions, including change in FDC	$	18.42		$	12.46		$	16.44		$	12.43

Total exploration and development costs incurred in the most recent financial year and the change during that year in estimated future development costs generally will not reflect the total cost of reserve additions in that year.

⁽¹⁾ Includes extensions and improved recovery, technical revisions, and economic factors.

Future Development Costs

Future development costs (inclusive of $132.3 million for development of locations and $10.8 million of non-drilling related capital) in the Company's proved plus probable reserves consists of:

		Wells
	FDC	Gross	Net
Hythe	66,461	28	22.2
Wapiti	29,647	18	12.4
Bigstone Cretaceous	18,274	15	8.6
Bigstone Montney	16,860	2	1.7
Other	11,852	8	3.2
	143,094	71	48.1

Net Asset Value

The estimated net asset value of the Company at December 31, 2011 has been calculated using before tax, net present value of reserves discounted at ten percent as follows:

($ thousands except per share value)	2011		2010		% Change
Estimated future net revenues of proved plus probable reserves ⁽¹⁾	414,120		399,454		4
Undeveloped land ⁽²⁾	68,676		27,650		148
Mark-to-market value of hedging contracts	(2,678	)	650		(512	)
In-the-money option proceeds ⁽³⁾	9,973		9,248		8
Total assets value	490,091		437,002		12
Bank debt plus working capital deficiency (unaudited) ⁽⁴⁾	(104,935	)	(108,054	)	(3	)
Net asset value	385,156		328,948		17
Common shares outstanding and in-the-money options	137,734,798		119,632,109		15
Net asset value per share	2.80		2.75		2

¹ Discounted at 10 percent and before deducting future income tax expenses and reclamation costs. The Company estimates it has approximately $300 million of tax deductions available to offset future taxable income.

² Undeveloped land was determined by an independent land valuation report by Seaton-Jordan & Associates Ltd. At December 31, 2011 Delphi had an interest in 239,186 net acres of undeveloped land versus 244,475 net acres at the end of 2010.

³ In-the-money option proceeds are based on the closing December 31, 2011 share price of $2.14.

⁴ December 31, 2011 net debt of $95.4 million plus carrying value of net assets held for sale of $9.5 million.

Delphi anticipates releasing its audited financial statements for the year ended December 31, 2011 on March 14, 2012 and its Annual Information Form by March 30, 2012, which will include all required National Instrument 51-101 reserves disclosure.

Delphi Energy is a Calgary-based company that explores, develops and produces oil and natural gas in Western Canada. The Company is managed by a proven technical team. Delphi trades on the Toronto Stock Exchange under the symbol DEE.

Forward-Looking Statements. This management discussion and analysis contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", may", "will", "should", believe", "intends", "forecast", "plans", "guidance" and similar expressions are intended to identify forward-looking statements or information.

More particularly and without limitation, this management discussion and analysis contains forward looking statements and information relating to the Company's risk management program, petroleum and natural gas production, future funds from operations, capital programs, commodity prices, costs and debt levels. The forward-looking statements and information are based on certain key expectations and assumptions made by Delphi, including expectations and assumptions relating to prevailing commodity prices and exchange rates, applicable royalty rates and tax laws, future well production rates, the performance of existing wells, the success of drilling new wells, the capital availability to undertake planned activities and the availability and cost of labour and services.

Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of estimates and projections relating to production rates, costs and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition, the ability to access sufficient capital from internal and external sources and changes in tax, royalty and environmental legislation. Additional information on these and other factors that could affect the Company's operations or financial results are included in reports on file with the applicable securities regulatory authorities and may be accessed through the SEDAR website ([ www.sedar.com ]). The forward-looking statements and information contained in this press release are made as of the date hereof for the purpose of providing the readers with the Company's expectations for the coming year. The forward-looking statements and information may not be appropriate for other purposes. Delphi undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Basis of Presentation. For the purpose of reporting production information, reserves and calculating unit prices and costs, natural gas volumes have been converted to a barrel of oil equivalent (boe) using six thousand cubic feet equal to one barrel. A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. This conversion conforms with the Canadian Securities Administrators' National Instrument 51-101 when boes are disclosed. Boes may be misleading, particularly if used in isolation.

Non-GAAP Measures. The MD&A contains the terms "funds from operations", "funds from operations per share", "net debt", "cash operating costs" and "netbacks" which are not recognized measures under Canadian generally accepted accounting principles. The Company uses these measures to help evaluate its performance. Management considers netbacks an important measure as it demonstrates its profitability relative to current commodity prices.Management uses funds from operations to analyze performance and considers it a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investments and to repay debt. Funds from operations is a non-GAAP measure and has been defined by the Company as net earnings plus the addback of non-cash items (depletion, depreciation and accretion, stock-based compensation, future income taxes and unrealized gain/(loss) on risk management activities) and excludes the change in non-cash working capital related to operating activities and expenditures on asset retirement obligations and reclamation.The Company also presents funds from operations per share whereby amounts per share are calculated using weighted average shares outstanding consistent with the calculation of earnings per share. Delphi's determination of funds from operations may not be comparable to that reported by other companies nor should it be viewed as an alternative to cash flow from operating activities, net earnings or other measures of financial performance calculated in accordance with Canadian GAAP. The Company has defined net debt as the sum of long term debt plus working capital excluding the current portion of future income taxes and risk management asset/liability. Net debt is used by management to monitor remaining availability under its credit facilities. Cash operating costs have been defined as the sum of operating expenses, transportation expenses, general and administrative expenses and interest costs. Operating netbacks have been defined as revenue less royalties, transportation and operating costs. Cash flow netbacks have been defined as operating netbacks less interest and general and administrative costs. Netbacks are generally discussed and presented on a per boe basis.

Contributing Sources

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Delphi Energy Increases Year End 2011 Reserves to Over 40 Million BOE with Finding and Development Costs of $12.46 per BOE

Delphi Energy Increases Year End 2011 Reserves to Over 40 Million BOE with Finding and Development Costs of $12.46 per BOE