RedWater Energy Corp. ("RedWater" or the "Company") (TSX VENTURE:RED) is pleased
to report the production test results of its recently drilled oil well in the
Redwater area. The well, drilled in late March and tested for two days, produced
an average rate of 75 barrels of clean light oil per day. Management has spent
considerable time reworking the geology in the area and believes that it has
discovered a new Manville light oil pool. The discovery sets the stage for the
drilling of 3-6 offset wells. The Company anticipates further production testing
in early June with full production to begin in July. 


CURRENT PRODUCTION AND LAND HOLDINGS

Current production is 65 boepd, primarily from the Wabamun zone, in the Westlock
Area. The production is split 50/50 between medium gravity oil and natural gas.
RedWater owns and operates 65+ sections of primarily 100% working interest
mineral holdings in central and southern Alberta. 


NEW PRODUCTION BEHIND PIPE

The Company has an additional 265 boepd of tested production in various stages
of equipping, re-activation and tie-in. This pending production is primarily
light oil in the Redwater area and heavy oil at Fairydell-Bon Accord. Behind
pipe production is split 65% oil and 35% natural gas. Oil production is
comprised of 115 bopd of light Manville oil at Redwater and 60 bopd of Leduc
heavy oil at Fairydell-Bon Accord. Additionally, RedWater has approximately 540
mcf/d (90 boepd) of potential gas production slated to come on-stream. 


2011 DRILLING PROGRAM

Phase 1:

RedWater plans to continue its previously announced 2011 Phase 1 exploration and
development program in June with the drilling of 5 conventional wells, targeting
light Manville oil in the Redwater area. The total cost of the program is
estimated at $2.5 million to be financed through cash on hand, bank credit
facilities and cash flow. 


Phase 2:

RedWater plans on initiating a 2nd phase of drilling 5-6 wells in 2011, starting
in the fourth quarter, targeting Viking light oil through horizontal drilling
and Manville light oil through conventional drilling. In its Phase 2 drilling
program, the Company plans to drill up to 2 horizontal Viking wells and up to
3-4 conventional Manville wells with a total estimated capital cost of $3.9-$4.4
million. Drilling will be contingent on available capital and Phase 1 drilling
success. 


SUMMARY

RedWater expects production to increase to 330 boepd over the next few months
with the equipping and tie-in of existing wells. Management's previously
announced 2011 production targets remain unchanged with average production of
200-250 boepd and exit production of 400 boepd. The Company will recommence
Phase 1 drilling in June. Plans are underway for the possible drilling of an
additional 5-6 wells to follow starting in the fourth quarter. Further guidance
towards production targets will be released once the Phase 1 drilling and
completion program has concluded. 


Business of RedWater Energy Corp.

RedWater Energy Corp. is a junior oil and gas exploration and development
company. RedWater is engaged in the acquisition, enhancement and exploration of
conventional oil and gas projects in Western Canada with a focus on developing
high working interest light oil opportunities. RedWater's core properties are
located in Redwater, Westlock, Fairydell-Bon Accord and Long Coolee areas of
Alberta. www.redwaterenergy.com.


Note: BOEs may be misleading, particularly if used in isolation. A BOE
conversion ratio of 6 Mcf: 1bbl is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not represent a value
equivalency at the wellhead


The information in this news release includes certain information and statements
about management's view of future events, expectations, plans and prospects that
constitute forward looking statements. These statements are based upon
assumptions that are subject to significant risks and uncertainties. Because of
these risks and uncertainties and as a result of a variety of factors, the
actual results, expectations, achievements or performance may differ materially
from those anticipated and indicated by these forward looking statements.
Although RedWater believes that the expectations reflected in forward looking
statements are reasonable, it can give no assurances that the expectations of
any forward looking statements will prove to be correct. Except as required by
law, RedWater disclaims any intention and assumes no obligation to update or
revise any forward looking statements to reflect actual results, whether as a
result of new information, future events, changes in assumptions, changes in
factors affecting such forward looking statements or otherwise.