Vermilion Energy Inc. Announces Dividend Increase, France Acquisition, Production and Capital Guidance, Initiation of NYSE

Vermilion Energy Inc. Announces Dividend Increase, France Acquisition, 
Production and Capital Guidance, Initiation of NYSE Secondary Listing and 
Appointment to Board of Directors 
CALGARY, Nov. 14, 2012 /CNW/ - Vermilion Energy Inc. ("Vermilion", the 
"Company", "We" or "Our") (VET - TSX) is pleased to announce that our Board of 
Directors has approved a 5.3% increase in the monthly cash dividend to $0.20 
CDN per share from the current level of $0.19 CDN per share. The increase is 
expected to become effective for the January 2013 dividend payable on February 
15, 2013((1)). This marks our third increase since initiating a dividend ten 
years ago. Vermilion has never reduced its dividend. 
Vermilion's operations continue to perform strongly, generating organic 
production growth in a capital-efficient manner. Assuming commodity prices 
remain near current levels for the remainder of this year, the Company 
anticipates that it will fully fund its net dividends((2)) and development 
capital expenditures (excluding capital investment for its Corrib asset) with 
fund flows from operations((2)) during 2012. With the increasing certainty for 
Corrib development timing, and the strength of anticipated fund flows from 
operations both prior to and following Corrib first gas, we are confident we 
can achieve our future growth objectives and continue to provide a reliable 
and growing dividend stream to investors. We believe the Company's balance 
sheet is capable of funding Corrib development through to first gas while 
remaining within acceptable net debt-to-fund flows from operations((2)) ratio 
limits, leaving Vermilion well positioned to execute its capital-efficient 
growth-and-income model. 
Vermilion has entered into a definitive agreement with ZaZa Energy Corporation 
("ZaZa") whereby Vermilion, through certain of its wholly owned subsidiaries, 
will acquire 100% of the shares of ZaZa Energy France S.A.S ("ZEF") (the 
"Acquisition") for approximately US$86 million, subject to customary closing 
adjustments, including working capital. ZEF's operating interests cover 
approximately 24,300 acres and 100% working interests in the Saint Firmin, 
Chateaurenard, Courtenay, Chuelles, and Charmottes fields in the Paris 
Basin. Current production is approximately 850 bbl/d of light Brent-based 
crude oil (approximately 27˚API). Proved plus probable developed producing 
reserves((3) )at December 31, 2012, as evaluated by GLJ Petroleum Consultants 
Ltd. ("GLJ"), were estimated to be approximately 6.3 million boe with a 
reserve life index of over 20 years, reflecting the low decline rates of the 
acquired assets. The Acquisition is subject to customary conditions and 
receipt of all necessary regulatory approvals. 
Acquisition metrics of approximately US$101,000 per boe/d and US$13.65 per boe 
of proved plus probable developed producing reserves continue to reflect the 
high netback, long-life nature of the acquired assets. The Acquisition will 
be financed with existing bank debt capacity. Following closing of the 
Acquisition, Vermilion will continue to maintain considerable financial 
flexibility, with approximately $500 million of remaining borrowing capacity 
and a net debt-to-fund flows from operations ratio of approximately 1.2 times, 
which remains well below our peer group average. 
The acquired assets offer a strong fit with our current French operations, and 
the transaction is well aligned with our strategic objective to consolidate 
assets within our core operating areas. The Acquisition further strengthens 
Vermilion's position as the leading oil producer in France and increases 
Vermilion's Brent-based weighting to approximately 45% of consolidated 
Capital guidance for 2012 has been revised due to delays in the arrival of our 
Australian drilling rig. We now anticipate that the drilling rig will arrive 
at Wandoo in the first quarter of 2013. In response to this delay, Vermilion 
has adjusted its remaining 2012 capital program to shift investment to Canada 
and the Netherlands to advance certain drilling and tie-in projects. In 
addition, we are taking advantage of the delay to accelerate planned marine 
maintenance activities in Australia. As a result of these adjustments, the 
Company now projects that capital spending for 2012 will total approximately 
$450 million, a $15 million decrease from previous guidance. Production 
guidance remains unchanged, with 2012 average daily production expected to be 
in the upper end of our previous guidance range of 37,000 to 38,000 boe/d. 
This represents anticipated production growth of approximately 7% from 2011 
levels, and a re-investment ratio (excluding capital investment for Corrib) of 
approximately 70% of fund flows from operations. 
For 2013, Vermilion's Board of Directors has approved an initial base capital 
program of approximately $475 million for our existing assets plus an 
estimated $10 million of development expenditures related to the Acquisition. 
The capital program will target high-margin projects, focusing on oil and 
high-netback European gas development, including approximately $85 million for 
ongoing development at Corrib. The 2013 development capital program, excluding 
Corrib and the Acquisition, is designed to deliver approximately 4% organic 
production growth at an anticipated re-investment ratio of approximately 70% 
of fund flows from operations. The increase in planned development capital 
expenditures for 2013 as compared to 2012 is primarily due to the deferral of 
Australian drilling costs into 2013. The shift of Australian drilling costs 
will decrease 2013 cash taxes as development expenditures are deductible in 
the calculation of Petroleum Resource Rent Tax in Australia. Including the 
Acquisition, our production guidance range for 2013 is 39,000 to 40,500 boe/d, 
with the mid-point of the range representing 6% production growth over 2012. 
The anticipated breakdown of 2012 and 2013 capital expenditures (by country 
and category of activity) is provided below. 
Total Capital Expenditures 
Country                          2012 Estimate ($mm) 2013 Budget ($mm) 
Canada                           $               275 $             230 
France                                            45                65 
Netherlands                                       20                30 
Australia                                         45                65 
                             $               385 $             390 
Ireland                                           65                85 
Base Development Capital         $               450 $             475 
ZaZa Assets                                                         10 
Total Development Capital        $               450 $             485 


Acquisition of assets in France                  106                86
(excluding w/c adjustments)*

Corrib Payment (US$135 million)                  134                --

Total Capital Expenditures       $               690 $             571

*January 2012 acquisition of certain working interests in six producing fields 
located in the Paris and Aquitaine basins in France (cash to close, excluding 
working capital acquired); ZaZa acquisition purchase price as of the effective 
date (excludes working capital and other adjustments).

Total Development Capital by Category

Category                          2012 Estimate ($mm) 2013 Budget ($mm)

Drilling, completion, workovers   $               240 $             255
and recompletions

Production equipment, facilities,                 135               190
new well equipment and tie-in
(including Ireland)

Seismic, studies, land and other                   75                30

Base Development Capital          $               450 $             475

Anticipated Canadian development expenditures of $230 million reflect an 
estimated 60 gross (48 net) well Cardium and liquids-rich natural gas drilling 
program, representing approximately 85% of planned Canadian development 
expenditures. Remaining Canadian expenditures will be directed to facilities 
and appraisal of our Duvernay land base.

Base development capital expenditures in France are estimated at approximately 
$65 million, including an active workover program throughout our French asset 
base and a four-well infill drilling program in the Champotran field. Other 
expenditures are for production optimization activities, facilities 
construction and land-related expenditures. Vermilion anticipates additional 
expenditures of approximately $10 million on the properties associated with 
the Acquisition.

In the Netherlands, Vermilion anticipates capital spending of approximately 
$30 million. The 2013 capital activities will include a three-well drilling 
program comprised of two exploration wells and one development well, tie-in of 
the Vinkega-2 and Langezwaag-1 wells, a debottlenecking project at Gorredijk 
and ongoing lease and facility construction.

Development capital expenditures for Australia are projected to be 
approximately $65 million in 2013. Remaining expenditures related to the 
2012 drilling program have been pushed into 2013 due to delay of drilling rig 
arrival. As previously mentioned, Vermilion is planning to accelerate certain 
marine maintenance activities into 2012, partially offsetting the impact of 
the rig delay. At present, we are planning a two-well sidetrack program once 
the rig arrives. Other expenditures in Australia are primarily related to 
platform maintenance activities and planning for future drilling programs.

Including the Acquisition, Vermilion's capital program for 2013 is anticipated 
to deliver production growth of approximately 6%, resulting in average daily 
2013 production between 39,000 to 40,500 boe/d. We project that our product 
mix will be approximately two-thirds weighted to oil and natural gas liquids, 
with the remainder split roughly equally between Canadian natural gas and 
high-netback European natural gas (which has received an average price greater 
than US$9.50 per mcf thus far in 2012).


Vermilion is pleased to announce that Mr. Loren Leiker has agreed to join 
Vermilion's Board of Directors and chair Vermilion's newly established New 
Growth Committee, through which he will provide guidance regarding Vermilion's 
global resource development initiatives.

Mr. Leiker most recently served as Senior Executive Vice President of 
Exploration for EOG Resources Inc. ("EOG") from 2007 until his retirement in 
2011, and was a key member of the executive team that developed corporate 
strategy and competitively placed EOG as one of the largest independent oil 
and natural gas companies in the United States. Mr. Leiker was instrumental in 
establishing EOG as a first mover in horizontal oil and liquids-rich natural 
gas resource plays, helping to position EOG as a leader in global tight 
resource development.

Prior to that appointment, Mr. Leiker held a variety of executive positions 
within EOG and its predecessor, Enron Oil and Gas Company. Throughout his 
career, Mr. Leiker has held a variety of global technical and managerial 
roles, and has overseen both conventional and unconventional exploration and 
development activities in the United States, Canada, the United Kingdom, 
Southeast Asia, South America, Trinidad, India, and North Africa.

We are excited to have someone with Mr. Leiker's proven track record in oil 
and liquids-rich resource plays join our Board of Directors. His expertise 
will be invaluable in guiding Vermilion through its next phase of growth.


Vermilion further wishes to announce that it has initiated the process with 
the NYSE Euronext for a secondary listing of the Company's common shares on 
the NYSE Euronext's New York Stock Exchange ("NYSE"). Listing will be 
subject to fulfilling all of the listing requirements of the NYSE. Pending 
receipt of all applicable exchange and regulatory approvals, the Company 
expects its common shares will be listed on the NYSE during the first quarter 
of 2013 under the ticker symbol "VET". As an international oil and gas 
producer, we believe that a secondary listing on the NYSE may prove valuable 
in broadening our shareholder base beyond Canada and improving liquidity in 
our equity.


Vermilion 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, the broader European region and 
Australia. Vermilion is targeting annual 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's Board of Directors has approved a 5.3% increase in the 
monthly cash dividend to $0.20 CDN per share from the current level of $0.19 
CDN per share. The increase is expected to become effective for the January 
2013 dividend payable on February 15, 2013((1)). This marks our third increase 
since initiating a dividend ten years ago. Vermilion has never reduced its 
dividend.Vermilion believes it is well positioned to continue to provide 
shareholders with steady growth and stable and growing dividends. Management 
and directors of Vermilion hold approximately 8% of the outstanding shares and 
are dedicated to consistently delivering superior rewards for all its 
stakeholders. Vermilion trades on the Toronto Stock Exchange under the 
symbol VET and over-the-counter in the United States under the symbol VEMTF. 
Vermilion has initiated the process with the NYSE Euronext for a secondary 
listing of the Company's common shares on the NYSE Euronext's New York Stock 
Exchange ("NYSE"). Listing will be subject to fulfilling all of the listing 
requirements of the NYSE. Pending receipt of all applicable exchange and 
regulatory approvals, the Company expects its common shares will be listed on 
the NYSE during the first quarter of 2013 under the ticker 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.

((1)) In accordance with applicable corporate law requirements (including 
solvency tests), formal declaration and payment of the January 2013 dividend 
remains subject to final Board of Director approval prior to its declaration 
on or about January 15, 2013.

((2) )Net dividends, fund flows from operations, net debt and netbacks are 
non-GAAP (as defined herein) measures that do not have standardized meanings 
prescribed by International Financial Reporting Standards ("IFRS" or, 
alternatively, "GAAP") and therefore may not be comparable with the 
calculations of similar measures for other entities. "Net dividends" are 
dividends declared less proceeds received by Vermilion for the issuance of 
shares pursuant to the dividend reinvestment plan, both as presented in 
Vermilion's consolidated statements of changes in shareholders' equity. 
Dividends both before and after the dividend reinvestment plan are reviewed by 
management and are also assessed as a percentage of fund flows from operations 
to analyze the amount of cash that is generated by Vermilion which is being 
used to fund dividends. Dividends declared is the most directly comparable 
GAAP measure to net dividends. "Fund flows from operations" represents cash 
flows from operating activities before changes in non-cash operating working 
capital and asset retirement obligations settled. Management considers fund 
flows from operations and fund flows from operations per share to be key 
measures as they demonstrate Vermilion's ability to generate the cash 
necessary to pay dividends, repay debt, fund asset retirement obligations and 
make capital investments. Management believes that by excluding the temporary 
impact of changes in non-cash operating working capital, fund flows from 
operations provides a useful measure of Vermilion's ability to generate cash 
that is not subject to short-term movements in non-cash operating working 
capital. "Net debt" is the sum of long-term debt and working capital as 
presented in Vermilion's consolidated balance sheets. Net debt is used by 
management to analyze the financial position and leverage of Vermilion. The 
most directly comparable GAAP measure is long-term debt. "Netbacks" are per 
boe and per mcf measures used in operational and capital allocation decisions. 
Estimated after-tax cash flow netbacks are calculated as cash flow from 
operating activities (determined in accordance with GAAP) expressed on a per 
boe basis.

((3)) Estimated proved plus probable developed producing reserves attributable 
to the Acquisition as evaluated by GLJ Petroleum Consultants Ltd. ("GLJ") in a 
report dated November 13, 2012 with an effective date of December 31, 2012.


Certain statements included in this press release may constitute 
forward-looking statements or financial outlooks under applicable securities 
legislation. Such forward-looking statements or information typically 
contain statements with words such as "anticipate", "believe", "expect", 
"plan", "intend", "estimate", "propose", or similar words suggesting future 
outcomes or statements regarding an outlook. Forward looking statements or 
information in this press release may include, but are not limited to:
    --  the effective date of the dividend increase;
    --  anticipated source of funding for 2012 net dividends and
        development capital expenditures;
    --  our ability to fund future growth objectives and dividends;
    --  anticipated source of funding Corrib development through to
        first gas and related balance sheet strength;
    --  anticipated completion of the Acquisition, including the
        timing, costs and benefits thereof;
    --  anticipated 2013 production from the fields to be acquired in
        the Acquisition;
    --  estimated reserves attributable to the fields to be acquired in
        the Acquisition;
    --  anticipated financial position following completion of the
    --  anticipated 2012 actual and 2013 capital budgets, capital
        expenditures and related development plans (including the
        anticipated allocation among countries and categories);
    --  anticipated 2012 average daily production, production growth
        and re-investment ratio;
    --  anticipated 2013 average daily production, production mix,
        production growth and re-investment ratio;
    --  anticipate crude oil and European gas growth;
    --  anticipated relative performance of operating and after-tax
        cash flow netbacks in 2013; and
    --  listing on the NYSE, including receipt of necessary approvals
        and timing for completion thereof and anticipated benefits
        related thereto.

In addition to any other assumptions identified in this document, assumptions 
have been made regarding, among other things:
    --  satisfaction of all conditions and closing of the proposed
    --  satisfaction of all conditions to listing on the NYSE;
    --  the ability of Vermilion to obtain equipment, services and
        supplies in a timely manner to carry out its capital
    --  the ability of Vermilion to market oil and natural gas
        successfully to current and new customers;
    --  the timing and costs of pipeline and storage facility
        construction and expansion and the ability to secure adequate
        product transportation;
    --  the timely receipt of required regulatory approvals;
    --  currency, exchange and interest rates;
    --  future oil and natural gas prices; and
    --  Management's expectations relating to the timing and results of
        development activities.

Although Vermilion believes that the expectations reflected in such 
forward-looking statements or information are reasonable, undue reliance 
should not be placed on forward looking statements because Vermilion can give 
no assurance that such expectations will prove to be correct. Financial 
outlooks are provided for the purpose of understanding Vermilion's financial 
strength and business objectives and the information may not be appropriate 
for other purposes. Forward-looking statements or information are based on 
current expectations, estimates and projections that involve a number of risks 
and uncertainties which could cause actual results to differ materially from 
those anticipated by Vermilion and described in the forward looking statements 
or information. These risks and uncertainties include but are not limited to:
    --  the ability of management to execute its business plan;
    --  the risks of the oil and gas industry, both domestically and
        internationally, such as operational risks in exploring for,
        developing and producing crude oil and natural gas and market
    --  risks and uncertainties involving geology of oil and natural
        gas deposits;
    --  risks inherent in Vermilion's marketing operations, including
        credit risk;
    --  the uncertainty of reserves estimates and reserves life;
    --  the uncertainty of estimates and projections relating to
        production, costs and expenses;
    --  potential delays or changes in plans with respect to proposed
        acquisitions (including the Acquisition), exploration or
        development projects or capital expenditures;
    --  potential delays relating to or failure to obtain a secondary
        listing of the Company's common shares on the NYSE;
    --  Vermilion's ability to enter into or renew leases;
    --  fluctuations in oil and natural gas prices, foreign currency
        exchange rates and interest rates;
    --  health, safety and environmental risks;
    --  uncertainties as to the availability and cost of financing;
    --  the ability of Vermilion to add production and reserves through
        development and exploration activities;
    --  general economic and business conditions;
    --  the possibility that government policies or laws may change or
        governmental approvals may be delayed or withheld;
    --  uncertainty in amounts and timing of royalty payments;
    --  risks associated with existing and potential future law suits
        and regulatory actions against Vermilion; and
    --  other risks and uncertainties described elsewhere in this
        document or in Vermilion's other filings with Canadian
        securities regulatory authorities.

Reference is made to the Company's annual information form for the year ended 
December 31, 2011 dated March 12, 2012 for a description of other risks that 
could affect the Company's results and cause results to differ from those 
expressed in the Company's forward looking statements and information.

The forward-looking statements or information contained in this document are 
made as of the date hereof and Vermilion 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, except as required by 
applicable securities laws.

Lorenzo Donadeo, President & CEO; Anthony Marino, Executive VP & COO;  Curtis 
W. Hicks, C.A., Executive VP & CFO; and/or Dean Morrison,  Director - Investor 
Relations TEL (403) 269-4884 | IR TOLL FREE 1-866-895-8101 

SOURCE: Vermilion Energy Inc.

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CO: Vermilion Energy Inc.
ST: Alberta

-0- Nov/14/2012 12:00 GMT

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