Sunshine Oilsands Ltd. — Capital/Financing Update 2018

Oct 3, 2018

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Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

This announcement appears for information purpose only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities of Sunshine Oilsands Ltd.

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SUNSHINE OILSANDS LTD. 陽光油砂有限公司 *

(a corporation incorporated under the Business Corporations Act of the Province of Alberta, Canada with limited liability)

(HKEX: 2012)

AMENDMENT TO THE TERMS OF PLACING CONVERTIBLE BONDS AND RESUMPTION OF TRADING

By Order of the Board of Sunshine Oilsands Ltd. Kwok Ping Sun Executive Chairman

Hong Kong, October 3, 2018 Calgary, October 2, 2018

As at the date of this announcement, the Board consists of Mr. Kwok Ping Sun and Ms. Gloria Pui Yun Ho as executive directors; Mr. Michael John Hibberd, Mr. Hong Luo, Ms. Linna Liu and Ms. Xijuan Jiang as non-executive directors; and Mr. Raymond Shengti Fong, Mr. Jeff Jingfeng Liu, Ms. Joanne Yan and Mr. Yi He as independent non-executive directors.

*For identification purposes only

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References were made to the announcements of the Company dated September 28, 2018 and October 2, 2018 (collectively, the “ Announcements ”) in relation to, among other matters, the proposed placing of convertible bonds under General Mandate and the extension of the Completion Date. Unless otherwise expressly indicated, capitalized terms used herein shall have the same meanings as those defined in the Announcements.

The Board wishes to supplement that the Conversion Price and interest rate of the Placing CB have been revised to HK$0.210 per Share and 13.7% per annum (from 5.0% per annum) respectively. Details are as follow.

INTEREST RATE

The interest rate will be revised from 5.0% per annum to 13.7% per annum.

CONVERSION PRICE

The revised Conversion Price of HK$0.210 per Conversion Share represents:

• I. equivalent to the closing price of HK$0.210 per Share as quoted on the Stock Exchange on October 2, 2018 (being the market close price of the last trading date immediately prior to the extension of the Completion Date of the CB Placing Agreement); and

• II. a premium of approximately 7.14% to the average closing price of HK$0.196 per Share as quoted on the Stock Exchange for the last five consecutive trading days up to and including September 28, 2018.

The Conversion Price is HK$0.210 per Share. The Conversion Price was determined after arm’s length negotiations between the Corporation and the Placing Agent with reference to the market condition and the prevailing market price of the Shares. The Directors consider that the Conversion Price is fair and reasonable.

Completion of the CB Placing

The Corporation and the Placing Agent shall use their respective best endeavor to procure the fulfilment of the conditions set out in the CB Placing Agreement on or before October 16, 2018. If the above conditions are not fulfilled by 5:00 p.m. on October 16, 2018 (or such other date as agreed between the Corporation and the Placing Agent in writing), the CB Placing Agreement shall forthwith cease and terminate and neither the Corporation nor the Placing Agent shall have any claim against each other, save for any antecedent breach.

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Saved as the above revisions, all other terms and conditions of the CB Placing Agreement remains unchanged.

The Directors (including the independent non-executive Directors) consider that these revised terms and conditions of the CB Placing Agreement, which were arrived at after arm’s length negotiations between the Corporation and the Placing Agent, are on normal commercial terms, fair and reasonable and are in the interests of the Corporation and the Shareholders as a whole.

RESUMPTION OF TRADING

At the request of the Corporation, trading in the Shares of the Corporation on the Stock Exchange has been halted with effect from 9:02 a.m. on Wednesday, October 3, 2018 (Hong Kong time) pending the release of this announcement. Application has been made by the Corporation to the Stock Exchange for the resumption of trading in the Shares on the Stock Exchange with effect from 1:00 p.m. on Wednesday, October 3, 2018 (Hong Kong time).

DEFINITIONS

In this announcement, unless the context otherwise requires, the following terms shall have the following meanings:

• “associate(s)” has the meaning ascribed to this term under the Listing Rules

• “Board” the board of Directors

• “Business Day” any day (not being a Saturday, Sunday and public or statutory holiday) on which licensed banks in Hong Kong are generally open for business throughout their normal business hours

• “CB Placing” the issue and placing of the Placing CB pursuant to the CB Placing Agreement

“CB Placing the placing agreement dated September 28, 2018 and entered Agreement” into between the Corporation and the Placing Agent in relation to the issue and placing of the Placing CB

“Completion” completion of the issue of the CB Placing pursuant to the terms of the CB Placing Agreement

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“Completion October 16, 2018 or such other date as agreed in writing by the Date” Corporation and the Placing Agent, subject to the fulfilment of the conditions precedent in the CB Placing Agreement “connected Has the meanings as ascribed thereto under the Listing Rules

“connected person(s)”

“Conversion

Price”

HK$0.210 per Share, subject to adjustments from time to time under the terms and conditions of the Placing CB

“Conversion the rights attached to the Placing CB to convert the whole or Rights” part thereof into Conversion Shares

“Conversion

Share(s)”

the Share(s) to be allotted and issued by the Corporation upon the exercise of the Conversion Rights

“Director(s)”

the Directors of the Corporation

“General Mandate”

“Group”

the general mandate granted to the Directors to allot and issue up to 20% of the aggregate nominal amount of the share capital of the Corporation in issue on June 25, 2018, by a resolution of the Shareholders passed at the annual general meeting of the Corporation held on June 25, 2018

the Corporation and its subsidiaries

“HK$”

Hong Kong dollars, the lawful currency of Hong Kong

“Hong Kong” the Hong Kong Special Administrative Region of the PRC

“Independent Independent third parties who is/are not connected person(s) of Third Party(ies)” the Corporation and is/are independent of and not connected with the Corporation and its Directors, chief executive, and substantial shareholders of the Corporation or any of its subsidiaries or their respective associates

“Issue Date” the date on which the Placing CB is issued pursuant to the CB Placing Agreement

“Listing the listing sub-committee of the board of directors of the Stock Committee” Exchange

“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

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“Placees” any institutional, professional and/or private investors procured by the Placing Agents to subscribe for any of the Placing CB pursuant to the CB Placing Agreement

• “Placing Agent” China Industrial Securities International Capital Limited, is a licensed corporation to carry out business in type 1 regulated activity (dealing in securities) and type 6 regulated activity (advising on corporate finance) under the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

• “Placing CB” the convertible Placing CB in the principal amount of up to HK$ 11 million to be issued by the Corporation pursuant to the CB Placing Agreement

“Share(s)” the Class “A” common voting share(s) in the issued share capital of the Corporation

• “Shareholder(s)” holder(s) of Share(s)

• “Stock The Stock Exchange of Hong Kong Limited

Exchange”

• “substantial has the meaning ascribed to it in the Listing Rules shareholder”

“%” per cent.

ABOUT SUNSHINE OILSANDS LTD.

The Corporation is a Calgary based public corporation listed on the Hong Kong Stock Exchange since March 1, 2012. The Corporation is focused on the development of its significant holdings of oil sands leases in the Athabasca oil sands region. The Corporation owns interests in approximately one million acres of oil sands and petroleum and natural gas leases in the Athabasca region. The Corporation is currently focused on executing milestone undertakings in the West Ells project area. West Ells has an initial production target of 5,000 barrels per day.

For further enquiries, please contact:

Mr. Kwok Ping Sun Executive Chairman Tel: (852) 3188 9298

Email: investorrelations@sunshineoilsands.com Website: www.sunshineoilsands.com

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FORWARD LOOKING INFORMATION

This announcement contains forward-looking information relating to, among other things, the plans and expectations of the Corporation. Such forward-looking information is subject to various risks, uncertainties and other factors. All statements other than statements and information of historical fact are forward-looking statements. The use of words such as “estimate”, “forecast”, “expect”, “project”, “plan”, “target”, “vision”, “goal”, “outlook”, “may”, “will”, “should”, “believe”, “intend”, “anticipate”, “potential”, and similar expressions are intended to identify forward-looking statements. Forward-looking statements are based on the Corporation’s experience, current beliefs, assumptions, information and perception of historical trends available to the Corporation, and are subject to a variety of risks and uncertainties including, but not limited to those associated with resource definition and expected reserves and contingent and prospective resources estimates, unanticipated costs and expenses, regulatory approval, fluctuating oil and gas prices, expected future production, the ability to access sufficient capital to finance future development and credit risks, changes in Alberta’s regulatory framework, including changes to regulatory approval process and land-use designations, royalty, tax, environmental, greenhouse gas, carbon and other laws or regulations and the impact thereof and the costs associated with compliance. Although the Corporation believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned that the assumptions and factors discussed in this announcement are not exhaustive and readers are not to place undue reliance on forward-looking statements as the Corporation’s actual results may differ materially from those expressed or implied. The Corporation disclaims any intention or obligation to update or revise any forward-looking statements as a result of new information, future events or otherwise, subsequent to the date of this announcement, except as required under applicable securities legislation. The forward-looking statements speak only as of the date of this announcement and are expressly qualified by these cautionary statements. Readers are cautioned that the foregoing lists are not exhaustive and are made as at the date hereof. For a full discussion of the Corporation’s material risk factors, see the Corporation’s annual information form for the year ended December 31, 2017 and risk factors described in other documents we file from time to time with securities regulatory authorities, all of which are available on the Hong Kong Stock Exchange at www.hkexnews.hk, on the SEDAR website at www.sedar.com or on the Corporation’s website at www.sunshineoilsands.com.