ERINQ Erin Energy Corporation (CE)

Provides Operational Update on its West and East Africa Operations

Erin Energy Corporation (Erin Energy or the Company) (NYSE MKT:ERN) (JSE:ERN) announced today financial and operational results for the year ended December 31, 2016. The Company plans to file its Annual Report on Form 10-K for the year ended December 31, 2016 with the Securities and Exchange Commission after close of market today.

2016 Highlights:

• Crude sales volumes of more than 1.7 million net barrels of oil, an 18% increase over 2015;
• $77.8 million in revenue, a 14% increase over 2015;
• Total production of approximately 1.8 million net barrels of oil.

“During 2016, we produced approximately 1.8 million net barrels of oil and generated revenues of more than $77 million,” said Jean-Michel Malek, Interim Chief Executive Officer. “2016 was a challenging year for our industry, but Erin Energy’s perseverance allowed for good progress in our cost-cutting and balance sheet restructuring efforts.”

Malek continued, “Our finance team worked diligently to raise the capital necessary for this year’s drilling and looking ahead, 2017 promises to be an exciting year as we kick off our drilling campaign, increase Oyo production, and look to drill some of west Africa’s most prospective exploration wells.”

Operational Update

Average net daily production for 2016 was approximately 4,800 bopd compared to approximately 4,300 bopd for 2015. For the fourth quarter 2016, net daily production was approximately 5,800 bopd compared with 2,500 for the comparative period in 2015. The average price received for 2016 was $45.45 per barrel compared to $47.24 in 2015.

Production volumes for the year were approximately 1.8 million net barrels of oil compared to approximately 1.6 million net barrels in 2015. The Company’s crude oil inventory was approximately $9.4 million at December 31, 2016.

Erin Energy recently announced it has entered into a drilling services contract with Pacific Drilling and secured a sixth generation drillship, the Pacific Bora. The company will drill the Oyo-9 (Oyo-9) well first. The Oyo-9 is a development well, which will be drilled in the Oyo field and will be tied in to the field’s current production facility. The well is expected to add an additional 6,000 to 7,000 barrels of oil per day from the field.

The Company has the option to drill up to two additional wells with the Pacific Bora. Subject to capital availability, the Company will use the Pacific Bora to drill one to two of its Miocene exploration prospects. Erin Energy has four drill-ready prospects, which target P50 Prospective Resources of 2.4 billion barrels of oil. The G Prospect would be the first Miocene exploration well drilled on the Company’s 120 block.

In The Gambia, the Company is currently interpreting the 3-D seismic data processed by an outside contractor. The Company intends to pursue completion of the work program, and is also in talks with a potential farm-in partner for a portion of its rights to both offshore blocks.

In Kenya, the Company continues to evaluate the prospectivity of identified leads on its onshore blocks and is currently designing an additional, targeted 2-D seismic acquisition on the blocks. Erin Energy has stated that the most prospective of its Kenya assets are its onshore blocks and has focused the majority of its work on these blocks. The Company also announced it would not seek an additional extension of its offshore L-27 and L-28 blocks due to the high costs and risks associated with frontier exploration in the current price and market environments. Erin Energy stated that relinquishment of the two blocks was in the Company’s long-term best interest.

In Ghana, Erin Energy continues to conduct geotechnical subsurface studies of existing 3-D seismic data to further high-grade its prospect inventory on the Expanded Shallow Water Tano block. The Company is also planning a new 3-D marine seismic acquisition survey. The Company expects to issue a formal invitation to tender to marine seismic vendors in the second half of 2017. Actual field operations will take place after the resolution of the Ghana-Cote d’Ivoire maritime border dispute arbitration later this year.

The Company’s year-end 2016 SEC proved oil reserves were 9.3 million barrels (MMbbls). The Company’s reported reserves are prepared by DeGolyer and MacNaughton.

Financial Summary

Full year 2016 revenues were $77.8 million, up approximately 14% from $68.4 million in 2015. Fourth quarter 2016 revenues were $21.1 million compared to $39.8 for the same period in 2015.

The Company had a non-cash impairment charge of $0.6 million, mostly due to the write-off of the carrying value of its offshore Kenya leases and reported a net loss of $142.4 million or $0.67 per share for full year 2016 compared with a net loss of $430.9 million or a $2.04 loss per share for full year 2015.

Exploration expenses totaled $39.3 million for the full year, primarily related to the write-off of the Company's suspended exploratory well costs related to the Miocene and Pliocene exploration drilling. As of December 31, 2016 cash, cash equivalents and restricted cash were approximately $9.8 million.

Conference Call and Webcast Information

The Company will host a conference call on Thursday, March 16, 2017 at 11:00 a.m. CT (Noon ET) to discuss the results and update its current operations.

The dial-in number to access the conference call is 1-844-883-3907 in the United States or 1-412-317-9253 internationally. Participants should ask the call operator to be placed on the “Erin Energy Results Conference Call.”

For those unable to participate in the Company’s conference call, a replay will be available for audio playback until March 23, 2017. The number to access the conference call replay is 1-877-344-7529 or outside the US 1-412-317-0088. The passcode for the replay is 10102749.

Erin Energy Corporation is an independent oil and gas exploration and production company focused on energy resources in sub-Saharan Africa. Its asset portfolio consists of 9 licenses across 4 countries covering an area of 19,000 square kilometres (~5 million acres), including current production and other exploration projects offshore Nigeria, as well as exploration licenses offshore Ghana and The Gambia, and onshore Kenya. Erin Energy is headquartered in Houston, Texas, and is listed on the New York and Johannesburg Stock Exchanges under the ticker symbol ERN.

For more information about Erin Energy or to request a hard copy of the Company’s most recent complete audited financial statements free of charge, please call +1 713 797 2940 or visit www.erinenergy.com.

Forward-Looking Statements

This news release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical fact, concerning activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Although the Company believes the expectations reflected in these forward-looking statements are reasonable, they involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect.

The Company’s actual results could differ materially from those anticipated or implied in these forward-looking statements due to a variety of factors, including the Company’s ability to successfully finance, drill, produce and/or develop the wells and prospects identified in this release, and risks and other risk factors discussed in the Company’s periodic reports filed with the Securities and Exchange Commission. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. You should not place undue reliance on forward-looking statements, which speak only as of their respective dates. The Company undertakes no duty to update these forward-looking statements.

  ERIN ENERGY CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except for per share amounts)

(Unaudited)   Years Ended December 31, 2016   2015   2014 Revenues: Crude oil sales, net of royalties $ 77,815   $ 68,429   $ 53,844   Operating costs and expenses: Production costs 94,607 90,079 80,296 Crude oil inventory (increase) decrease (1,469 ) (2,502 ) 14,512 Workover expenses 7,860 972 — Exploratory expenses 39,269 16,437 14,283 Depreciation, depletion and amortization 58,051 97,179 21,590 Accretion of asset retirement obligations 1,867 1,931 2,166 Impairment of oil and gas properties 645 261,208 — Loss on settlement of asset retirement obligations 205 3,653 — General and administrative expenses 13,772   15,905   14,322   Total operating costs and expenses 214,807   484,862   147,169   Operating loss (136,992 ) (416,433 ) (93,325 ) Other income (expense): Currency transaction gain 15,674 2,520 1,758 Interest expense (21,924 ) (17,986 ) (4,383 ) Other, net —   —   (358 ) Total other expense (6,250 ) (15,466 ) (2,983 ) Loss before income taxes (143,242 ) (431,899 ) (96,308 ) Income tax expense —   —   —   Net loss before non-controlling interest (143,242 ) (431,899 ) (96,308 ) Net loss attributable to non-controlling interest 841   962   246   Net loss attributable to Erin Energy Corporation $ (142,401 ) $ (430,937 ) $ (96,062 ) Net loss attributable to Erin Energy Corporation per common share: Basic $ (0.67 ) $ (2.04 ) $ (0.49 ) Diluted $ (0.67 ) $ (2.04 ) $ (0.49 ) Weighted-average common shares outstanding: Basic 212,318 211,616 194,745 Diluted 212,318 211,616 194,745   ERIN ENERGY CORPORATION CONSOLIDATED BALANCE SHEETS

(In thousands, except for share and per share data)

(Unaudited)   As of December 31, 2016   2015 ASSETS Current assets: Cash and cash equivalents $ 7,177 $ 8,363 Restricted cash 2,600 8,661 Accounts receivable - trade — 1,029 Accounts receivable - partners 674 287 Accounts receivable - related party 1,956 1,186 Accounts receivable - other 29 28 Crude oil inventory 9,398 4,789 Prepaids and other current assets 872   684   Total current assets 22,706   25,027   Property, plant and equipment: Oil and gas properties (successful efforts method of accounting), net 265,713 368,891 Other property, plant and equipment, net 716   1,174   Total property, plant and equipment, net 266,429   370,065   Other non-current assets Other non-current assets 66   67   Other assets, net 66   67   Total assets $ 289,201   $ 395,159   LIABILITIES AND CAPITAL DEFICIENCY Current liabilities: Accounts payable and accrued liabilities $ 244,963 $ 213,120 Accounts payable and accrued liabilities - related party 29,513 30,133 Current portion of long-term debt, net 12,627   96,558   Total current liabilities 287,103   339,811   Long-term notes payable - related party 129,796 120,006 Term loan facility 74,446 — Asset retirement obligations 22,476   20,609   Total liabilities 513,821   480,426   Commitments and contingencies Capital deficiency:

Preferred stock $0.001 par value - 50,000,000 shares authorized; none issued and outstanding as of December 31, 2016 and 2015, respectively

— —

Common stock $0.001 par value - 416,666,667 shares authorized; 212,622,218 and 211,615,773 shares outstanding as of December 31, 2016 and 2015, respectively

213 212 Additional paid-in capital 792,972 789,615 Accumulated deficit (1,018,292 ) (875,891 ) Treasury stock at cost, 99,932 and -0- shares as of December 31, 2016 and 2015, respectively (228 ) —   Total deficit - Erin Energy Corporation (225,335 ) (86,064 ) Non-controlling interests 715   797   Total capital deficiency (224,620 ) (85,267 ) Total liabilities and capital deficiency $ 289,201   $ 395,159     ERIN ENERGY CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)   Years Ended December 31, 2016 2016   2015   2014 Cash flows from operating activities Net loss, including non-controlling interest $ (143,242 ) $ (431,899 ) $ (96,308 ) Adjustments to reconcile net loss to cash (used in) provided by operating activities: Depreciation, depletion and amortization 58,051 97,179 21,590 Impairment of oil and gas properties 645 261,208 — Write-off of suspended exploratory well costs 33,031 — — Asset retirement obligation accretion 1,867 1,931 2,166 Amortization of debt issuance costs 3,615 2,766 147 Loss on settlement of asset retirement obligations — 3,653 — Related party liability offset — — (32,880 ) Unrealized currency transaction gain (15,674 ) (2,520 ) (1,572 ) Share-based compensation 2,941 5,027 3,095 Payments to settle asset retirement obligations — (16,640 ) — Other — — (17 ) Changes in operating assets and liabilities: (Increase) decrease in accounts receivable 630 (804 ) 562 (Increase) decrease in crude oil inventory (1,469 ) (2,502 ) 14,512 (Increase) decrease in prepaids and other current assets (187 ) 746 (1,672 ) Increase in other non-current assets — — (15 ) Increase in accounts payable and accrued liabilities 66,147   84,000   56,845   Net cash provided by (used in) operating activities 6,355   2,145   (33,547 ) Cash flows from investing activities Capital expenditures (19,293 ) (84,039 ) (128,510 ) Allied transaction —   —   (170,000 ) Net cash used in investing activities (19,293 ) (84,039 ) (298,510 ) Cash flows from financing activities Proceeds from the issuance of common stock — — 270,000 Proceeds from the exercise of stock options and warrants 364 1,855 415 Payments for treasury stock arising from withholding taxes upon restricted stock vesting (228 ) — — Proceeds from (repayments of) term loan facility (5,968 ) (337 ) 100,000 Proceeds from note payable - related party, net 6,829 61,815 10,649 Proceeds from short-term note payable 504 — — Repayment of short-term note payable (449 ) — — Debt issuance costs (1,040 ) — (2,082 ) Funds released from restricted cash, net 6,061 — — Funds restricted for debt service — — (10,405 ) Allied Transaction adjustments — — (12,440 ) Funding from non-controlling interest —   553   900   Net cash provided by financing activities 6,073   63,886   357,037   Effect of exchange rate on cash and cash equivalents 5,679   1,228   —   Net increase (decrease) in cash and cash equivalents (1,186 ) (16,780 ) 24,980 Cash and cash equivalents at beginning of year 8,363   25,143   163   Cash and cash equivalents at end of year $ 7,177   $ 8,363   $ 25,143   Supplemental disclosure of cash flow information Cash paid for: Interest, net of amounts capitalized $ 10,407 $ 11,114 $ 8

Supplemental disclosure of non-cash investing and financing activities:

Issuance of common shares for settlement of liabilities $ — $ 125 $ — Discount on notes payable pursuant to issuance of warrants $ 53 $ 4,911 $ — Reduction in oil and gas properties arising from settlement of accounts payable and accrued liabilities $ 10,048 $ — $ — Reduction in accounts payable from settlement of Northern Offshore contingency $ — $ 24,307 $ — Receivable from non-controlling interest $ — $ 552 $ — Related party accounts payable, net, settled with related party notes payable $ — $ — $ (32,880 ) Change in asset retirement obligation estimate $ — $ (4,284 ) $ 3,766

View source version on businesswire.com: http://www.businesswire.com/news/home/20170316005677/en/

Erin Energy CorporationLionel McBee, +1 713-797-2960Director, Investor Relations and Corporate Communicationslionel.mcbee@erinenergy.com