Daylight Energy Ltd. ("Daylight" or the "Corporation") (TSX:DAY) is pleased to
provide an operational update and declare Q2 2011 dividends.


OPERATIONAL UPDATE

Pembina Cardium Horizontal Oil Program 

Daylight continues to have success in our Pembina Cardium drilling as a key
component of our 2011 capital program. During Q1 2011, Daylight drilled 11 (9.5
net) wells in Brazeau, Tomahawk and East Pembina out of our currently budgeted
2011 drilling program of 28 wells. During Q1 2011, a total of 10 (8.5 net) wells
were placed on production including 4 (3.2 net) drilled in Q4 2010. The 30 day
initial production rate for Q4 2010 wells brought on production during Q4 2010
and Q1 2011 is 183 boe per day, consistent with our results in the Pembina
Cardium play to date. The remainder of the Q1 2011 drills are expected to be
placed on production during Q2 2011, with the exception of one well which will
be completed after spring break-up. Extreme weather conditions during the late
winter and early spring, including cold temperatures and very high snow
accumulations, caused delays in completion and tie-in of several of our Q1
Pembina Cardium wells. Field indications are that spring break-up could be more
extensive than normal due to the extremely high volume of snow accumulated in
many of Daylight's operating areas, and in particular the Pembina area.


Resource Play Natural Gas 

In addition to the Cardium activity detailed above, Daylight has been
selectively drilling our extensive inventory of natural gas resource play
development opportunities. During Q1 2011, Daylight successfully added
production in a wide variety of different resource play gas developments
reflecting the depth of inventory in Daylight's portfolio. Of particular note
are three new liquids rich vertical Rock Creek gas wells. These 3 (2.3 net)
wells in the Pembina area came on production in early Q2 2011 at rates of 3, 7
and 10 MMcf per day with liquids yields in excess of 50 bbls per MMcf. Based on
these successful well results, Daylight is planning additional follow-up
locations and evaluating potential horizontal development of the Rock Creek in
the Pembina area. Daylight has over 70 net sections of Rock Creek rights in the
Pembina area.


In our key resource play area of Elmworth, Daylight drilled another highly
successful horizontal Cadomin gas well (60% working interest), initially coming
on production late in Q1 2011 at over 9 MMcf per day. Also in Elmworth, Daylight
drilled a new Nikanassin gas well (100% working interest) with a horizontal
length of over 1,000 meters. Geological indications from this well and offset
vertical wells indicate a pay thickness in the upper Nikanassin of approximately
90 meters. This well is planned for completion in the second quarter. In Wapiti,
Daylight drilled another liquids rich Montney horizontal gas well (50% working
interest) during Q1 2011 and this well is scheduled for completion after spring
break-up. In our West Central core area, Daylight is pleased to announce a very
successful liquids rich Wilrich gas well (47.5% working interest) that came on
production during Q1 2011 at over 9 MMcf per day.


As disclosed in Daylight's press release dated March 15, 2011, a third party
processing disruption at the K3 gas plant resulted in a significant portion of
Daylight's liquids rich natural gas production from its West Central and Wapiti
Montney properties being temporarily shut in during Q1 2011 and early Q2 2011.
As at the date of this press release, production was beginning to flow to this
plant again and we anticipate full recovery of these volumes. Field estimates of
Daylight's production volumes for Q1 2011 indicate average daily production of
approximately 39,250 boe per day, which is consistent with our previous guidance
taking into consideration the third party processing disruption at the K3 gas
plant and the impact of the severe weather conditions discussed above.
Daylight's current production exceeds 41,000 boe per day with additional
production volumes yet to be recovered related to the K3 outage and several new
wells scheduled to be brought on stream early in Q2 2011. Daylight's bank debt
at March 31, 2011 was approximately $320 million.


Non-Core Asset Sales

Daylight is pleased to announce that the Corporation has executed two separate
purchase and sale agreements relating to the disposition of certain non-core
assets for gross cash proceeds of approximately $44 million, prior to customary
closing adjustments. These non-core assets to be disposed of represent average
daily production of approximately 1,600 boe per day (90% natural gas). These
transactions are expected to close prior to the end of April 2011. These assets
lie outside Daylight's core growth area in the premier Deep Basin area of
Alberta and British Columbia and were not considered to be competitive with our
other assets for attracting growth capital. Subsequent to the closing of these
transactions, over 95% of Daylight's production will be within our Deep Basin
core area.


The disposition transactions are subject to customary approvals and other
industry standard closing conditions. There is no guarantee that these
disposition transactions will be completed. FirstEnergy Capital Corp. has acted
as exclusive financial advisor to Daylight with respect to the non-core asset
dispositions.


Capital Budget Increase

The dispositions discussed above are a continuation of Daylight's strategic
repositioning of our asset portfolio towards growth by monetizing non-core
assets and focusing our financial and technical resources on our core growth
assets at Pembina, West Central Alberta and Elmworth. The net proceeds from
these dispositions will be utilized to fund an increase in Daylight's capital
budget for 2011 to $300 million. Details of the impact on Daylight's guidance
from this budget increase, the asset dispositions, and the production
disruptions discussed above will be provided in conjunction with the release of
our Q1 2011 results in May 2011.


CASH DIVIDENDS 

Daylight maintains a Q2 2011 cash dividend to shareholders of Cdn$0.05 per share
per month as follows:




----------------------------------------------------------------------------
----------------------------------------------------------------------------
Record Date     Ex-Dividend Date   Dividend Payment Date  Dividend Per Share
----------------------------------------------------------------------------
----------------------------------------------------------------------------
April 29, 2011    April 27, 2011            May 16, 2011            Cdn$0.05
May 31, 2011        May 27, 2011           June 15, 2011            Cdn$0.05
June 30, 2011      June 28, 2011           July 15, 2011            Cdn$0.05
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(i) The dividend is considered an "eligible dividend" for tax purposes.     



Daylight expects to pay a sustainable dividend on a monthly basis, provided
however that any decision to pay dividends on the common shares will be made by
the Board of Directors on the basis of Daylight's funds from operations,
earnings, financial requirements, commodity price levels, legal requirements and
other conditions existing at such future times. Daylight currently intends to
designate all dividends to be "eligible dividends" for the purposes of the
Income Tax Act (Canada) such that shareholders who are individuals will benefit
from the enhanced gross-up and dividend tax credit mechanism under the Income
Tax Act (Canada).


Daylight is a growing intermediate oil and natural gas producing company with a
high quality suite of resource play assets in Western Canada. Our highly focused
team utilizes our technical expertise in exploitation, development and
acquisitions to create long-term value for our shareholders. Our team has
developed a multi-year inventory of repeatable, low risk exploitation resource
play projects with substantial potential reserve additions on assets we
currently own and control in the premier Pembina Cardium light oil fairway and
in the premier Deep Basin area of Alberta and British Columbia.


Daylight has approximately 212 million common shares outstanding which trade on
the TSX under the symbol DAY. Daylight Series C and D convertible debentures
trade on the TSX under the symbols DAY.DB.C and DAY.DB.D, respectively.


Daylight's 2011 Annual General Meeting will be held on May 18, 2011 at 9:00 a.m.
at the Sun Life Plaza Conference Centre.


An updated corporate presentation is available on Daylight's website at
www.daylightenergy.com.


ADVISORY:

Forward-Looking Information and Statements

This press release 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", "objective",
"ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and
similar expressions are intended to identify forward-looking statements or
information. More particularly and without limitation, this press release
contains forward-looking statements and information concerning: Daylight's 2011
capital program, including allocation of expenditures associated therewith;
payment of Q2 2011 dividends and future dividends declared and payable on the
common shares; the anticipated record date and payment date in respect of Q2
2011 dividends; anticipated timing of drilling, completion and tie-in of
additional wells, and in particular the Corporation's wells drilled during Q1
2011; additional production volumes related to the K3 gas plant outage and
expected to be brought on stream early in Q2 2011; anticipated disposition of
additional non-core assets during Q2 2011; estimated initial production rates;
estimated liquids volumes associated with Daylight's natural gas resource play
drilling opportunities; and field estimates regarding Q1 2011 production
volumes.


The forward-looking statements and information in this press release are based
on certain key expectations and assumptions made by Daylight, including but not
limited to expectations and assumptions concerning: prevailing and future
commodity prices and exchange rates; applicable royalty rates and tax laws;
future production rates; the performance of existing and future wells;
application of existing technologies and future advancements in technology to
Daylight's operations and drilling activities; the success obtained in drilling
new wells; the inventory of new drilling locations; the sufficiency of budgeted
capital expenditures in carrying out planned activities; the availability and
cost of labor and services, including but not limited to completion equipment
and services; adequate weather and environmental conditions for drilling and
completion activities, including transportation of associated equipment; the
receipt, in a timely manner, of regulatory and third party approvals; and the
receipt of required regulatory and other third party approvals in connection
with non-core asset dispositions.


Although Daylight believes that the expectations and assumptions on which such
forward-looking statements and information are based are reasonable, undue
reliance should not be placed on the forward-looking statements and information
because Daylight can give no assurance that they will prove to be correct. There
is no representation by Daylight that actual results achieved during the periods
identified in this press release will be the same in whole or in part as those
forecast.


Since forward-looking statements and information address future events and
conditions, by their very nature they involve inherent risks and uncertainties.
Actual results could 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 reserve and resource (including original oil in place) estimates;
the uncertainty of estimates and projections relating to production, costs and
expenses; health, safety and environmental risks; risks associated with weather
and the impact on drilling and completion activities and the transportation of
associated equipment; commodity price and exchange rate fluctuations; marketing
and transportation of petroleum and natural gas and loss of markets;
environmental risks; competition; risks associated with utilizing existing
technologies and future technological advancements in Daylight's operations and
drilling activities; failure to realize the anticipated benefits of
acquisitions; risks regarding the integration of acquired entities and assets;
incorrect assessment of the values of acquisitions; Daylight's ability to
negotiate acceptable terms for non-core assets; Daylight's ability to obtain all
third party and regulatory approvals necessary to dispose of such non-core
assets; ability to access sufficient capital from internal and external sources;
failure to obtain required regulatory and other third party approvals; and
changes in legislation, including but not limited to tax laws, royalty rates and
environmental regulations. Readers are cautioned that the foregoing list of risk
factors is not exhaustive. Additional information on the factors that could
affect the business, operations or financial results of Daylight are included in
reports on file with applicable securities regulatory authorities, including but
not limited to Daylight's Annual Information Form for the year ended December
31, 2010 and Management's Discussion and Analysis for the year ended December
31, 2010, each of which may be accessed on Daylight's SEDAR profile at
www.sedar.com or on our website at www.daylightenergy.com.


The forward-looking statements contained in this press release are made as of
the date hereof and Daylight 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.


Barrels of Oil Equivalent

"Boe" or "barrel of oil equivalent" means barrel of oil equivalent on the basis
of 1 boe to 6,000 cubic feet of natural gas. Boe's may be misleading,
particularly if used in isolation. A boe conversion ratio of 1 boe for 6,000
cubic feet of natural gas is based on an energy equivalency conversion method
primarily applicable at the burner tip and does not represent a value
equivalency at the wellhead.
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