Attention Business Editors

Iteration Energy Ltd. Announces 33% per share Reserve Increase

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/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION

IN THE UNITED STATES/

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CALGARY, March 2 /CNW/ - Iteration Energy Ltd. ("Iteration" or "the

Company") (TSX: ITX) is pleased to report selected information from the

independent engineering evaluations of its reserves, together with an

operational update and guidance for the first half of 2009.

Reserve information in this press release is derived from the combined

McDaniel and Associates Consultants Ltd. ("McDaniel") and GLJ Petroleum

Consultants ("GLJ") reports dated effective December 31, 2008 (the "2008

Reserves Reports"). Iteration acquired Cyries Energy Inc. ("Cyries") on March

7, 2008. The comparisons of the company's reserves have been made to

Iteration's December 31, 2007 report, unless specifically identified as a

"proforma Iteration & Cyries" comparison, in which case the comparison is to

the summation of the reserve reports of the two companies dated effective

December 31, 2007.

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Reserves Evaluation Highlights:

- Total Proved Reserves increased year over year as follows:

- a 211% increase to 39.3 mmboe

- a 13% increase on the "proforma Iteration & Cyries" reserves.

- a 33% increase in reserves per share.

- a 38% increase in reserve life index to 6.0 years.(1)

- Total Proved plus Probable Reserves increased year over year as

follows:

- a 201% increase to 57.4 mmboe

- a 15% increase on the "proforma Iteration & Cyries" reserves.

- a 29% increase in reserves per share.

- a 34% increase in reserve life index to 8.7 years.(1)

- Reserve additions from the exploration and development program of

10.0 mmboe replaced production by a factor of 1.7 times on a proved

plus probable basis.

- Achieved proved plus probable finding and development costs of

$15.65/boe after revisions and before future development capital and

$20.81/boe after future development capital.

- Achieved proved plus probable finding, development and acquisition

costs of $19.84/boe including change in future capital.

% Change

December 31, December 31, from 2007

2008 2007 to 2008

------------- ------------- -----------

Proved producing reserves (mboe) 29,950 9,749 207%

Total proved reserves (mboe) 39,318 12,654 211%

Total proved plus probable reserves

(mboe) 57,447 19,064 201%

NPV10 proved plus probable reserves

($million)(1) 1,113 345 223%

Note:

(1) Based on the preceding year Q4 average production rate.

(2) NPV10 means the net present value discounted at 10%. Calculations are

before tax and based on forecast prices and costs as at January 1,

2009 by McDaniel and Associates Consultants Ltd. The price forecast

can be viewed on their website at www.mcdan.com

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The reserve information for the year ended December 31, 2008 is a summary

of information to be included in the Statement of Reserves and Other Oil and

Gas Information of Iteration for the year ended December 31, 2008, which will

be prepared in accordance with National Instrument 51-101 Standards of

Disclosure for Oil and Gas Activities and will be included in Iteration's

annual information form for the year ended December 31, 2008, a copy of which

will be filed on SEDAR (www.sedar.com) and on Iteration's website

(www.iterationenergy.com).

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Finding, Development and Acquisition costs

Proved

2008 Finding & Plus

Development Costs Capital Proved Probable Proved

("F&D") and Finding, Expen- Reserve Reserve Plus

Development & Net ditures Add- Proved Add- Probable

Acquisition ("FD&A") ($ itions Costs itions Costs

Costs thousands) (mmboe) ($/boe) (mmboe) ($/boe)

------------------------------------...

F&D exploration and

development program

before revisions 156,200 7.565 20.65 11.751 13.29

------------------------------------...

------------------------------------...

F&D exploration and

development program

after revisions 156,200 7.472 20.90 9.979 15.65

------------------------------------...

Change in proved future

development capital

associated 35,652

------------------------------------...

Change in proved plus

probable future

development capital

associated 51,491

------------------------------------...

Proved F&D including

change in future

development capital(a) 191,852 7.472 25.68

------------------------------------...

Proved plus probable

F&D including change in

future development

capital(b) 207,691 9.979 20.81

------------------------------------...

------------------------------------...

Acquisition Cyries

Energy 574,350 21.905 26.22 29.819 19.26

------------------------------------...

Change in proved future

development capital

associated 25,163

------------------------------------...

Change in proved plus

probable future

development capital

associated 34,671

------------------------------------...

Proved F&D including

change in future

development capital(c) 599,513 21.905 27.37

------------------------------------...

Proved plus probable F&D

including change in

future development

capital(d) 609,021 29.819 20.42

------------------------------------...

------------------------------------...

Other Acquisition 59,700 3.288 18.16 4.586 13.02

------------------------------------...

Change in proved future

development capital

associated 2,735

------------------------------------...

Change in proved plus

probable future

development capital

associated 4,262

------------------------------------...

Proved F&D including

change in future

development capital(e) 62,435 3.288 18.99

------------------------------------...

Proved plus probable F&D

including change in

future development

capital(f) 63,962 .586 13.95

------------------------------------...

------------------------------------...

Total 2008 proved FD&A

costs including future

development capital

(a+c+e) 853,800 32.664 26.14

------------------------------------...

Total 2008 proved plus

probable FD&A costs

including future

development capital

(b+d+f) 880,675 44.384 19.84

------------------------------------...

Summary of Gross Reserves

(forecast prices and costs)

December 31, December 31,

2008 2007

------------- -------------

Proved reserves

Light and medium oil (mbbls) 9,691 2,894

Heavy oil (mbbls) 784 697

Gas (mmcf) 155,843 46,606

Natural gas liquids (mbbls) 2,863 1,281

Sulphur (mlt) 5 15

BOE(1) (mboe) 39,318 12,654

Total proved plus probable reserves

Light and medium oil (mbbls) 13,593 4,301

Heavy oil (mbbls) 1,240 1,015

Gas (mmcf) 231,382 71,160

Natural gas liquids (mbbls) 4,042 1,865

Sulphur (mlt) 8 24

BOE(1) (mboe) 57,447 19,064

Note:

(1) "BOE" 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. A BOE conversion ratio of 1 boe

for lt of Sulphur is used.

Summary of Oil and Gas Reserves

As of December 31, 2008

(forecast prices and costs)

------------------------------------...

Light and medium

oil Heavy oil Natural gas

------------------------------------...

Gross(1) Net(2) Gross Net Gross Net

------------------------------------...

Reserve Category (mbbl) (mbbl) (mbbl) (mbbl) (mmcf) (mmcf)

------------------------------------...

Proved

------------------------------------...

Developed

producing 5,968 4,777 559 504 126,165 98,485

------------------------------------...

Developed non-

producing 360 304 129 108 16,009 12,096

------------------------------------...

Undeveloped 3,362 2,602 97 83 13,668 10,135

------------------------------------...

Total proved 9,691 7,684 784 695 155,843 120,715

------------------------------------...

Probable 3,903 2,844 456 382 75,539 57,867

------------------------------------...

Total proved plus

probable 13,593 10,528 1,240 1,077 231,382 178,582

------------------------------------...

------------------------------------...

BOE

Natural gas (including

Liquids sulphur)

------------------------------------...

Gross Net Gross Net

------------------------------------...

Reserve Category (mbbl) (mbbl) (mboe) (mboe)

------------------------------------...

Proved

------------------------------------...

Developed

producing 2,391 1,624 29,950 23,323

------------------------------------...

Developed non-

producing 226 147 3,383 2,575

------------------------------------...

Undeveloped 247 160 5,984 4,534

------------------------------------...

Total proved 2,863 1,931 39,318 30,433

------------------------------------...

Probable 1,178 803 18,130 13,676

------------------------------------...

Total proved plus

probable 4,042 2,733 57,447 44,108

------------------------------------...

Note:

(1) Gross reserves are company working interest excluding royalty

interest

(2) Net reserves are company working interest including royalty interest

and net of all royalties.

Net Present Value of Future Revenue

Before Income Taxes

As at December 31, 2008

Discounted at (%/year)

(forecast prices and costs)

------------------------------------...

0% 5% 10% 15% 20%

($M) ($M) ($M) ($M) ($M)

------------------------------------...

Reserve Category

------------------------------------...

Proved

------------------------------------...

Developed

producing 974,219 773,740 647,671 560,777 497,044

------------------------------------...

Developed

non-producing 85,666 71,068 60,260 52,140 45,880

------------------------------------...

Undeveloped 202,207 147,573 110,810 85,063 66,422

------------------------------------...

Total proved 1,262,091 992,381 818,741 697,981 609,346

------------------------------------...

Probable 650,378 405,380 284,554 214,069 168,470

------------------------------------...

Total proved plus

probable 1,912,469 1,397,760 1,113,294 912,050 777,816

------------------------------------...

Operational Highlights:

- Average production in the fourth quarter of 2008 was 18,000 boed,

an increase of 125% from Q4 2007.

- Average production for 2008 was 16,400 boed, an increase of 148%

from the previous year.

- Current production is approximately 19,000 boed (70% gas).

- Iteration drilled 14 net wells in the fourth quarter of 2008 with

a 93% success rate (2 oil, 3 heavy oil, 8 gas and 1 abandoned).

- The Company has drilled 6 net wells in the first quarter of 2009

with a 100% success rate (1 oil, 5 gas).

- This Q1 2009 drilling program encountered oil or gas in 15

separate reservoirs. Five of these zones have been completed to

date with a combined initial rate of 11MMcf/day (1,800 boed).

- The winter drilling and capital programs were significantly

reduced due to falling commodity prices.

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Guidance For The First Half Of 2009:

Iteration has a very large inventory of vertical and horizontal drilling

locations which should provide significant long term growth. However, these

drill locations provide a much reduced rate of return at the current commodity

prices and the Company has deferred almost all drilling activity at this time.

Iteration will adjust its capital program as commodity prices dictate and

expects to spend less than funds flow over the first half of 2009.

The Company's last guidance for the first half of 2009 was based on

significantly higher commodity prices and a larger drilling program in the

fourth quarter of 2008. Based on the price assumptions shown below the Company

has the following guidance for the first half of 2009:

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December 2008

March 2, 2009 Guidance Guidance

Q1 2009 Q2 2009 Q1 + Q2 2009

-------- -------- -------------

Average Production (boed) 18,300 17,400 20,000

Capital Program ($millions) 26 6 61

Funds Flow ($millions) 19 14 66

Net Debt ($millions) 283 275 275

Net Wells 6 1 24

Price Assumptions (February 23, 2009

Strip)

AECO gas $Cdn/GJ 5.15 4.35 6.80

WTI oil $Cdn/bbl 47.70 55.00 61.00

Iteration

Iteration is an Alberta based corporation engaged in the business of

exploring for and developing oil and natural gas reserves in Western Canada

and acquiring natural resource properties. Iteration's common shares are

listed on the Toronto Stock Exchange under the symbol "ITX".

Advisory Regarding Forward-Looking Statements

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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 information or statements. More particularly and without

limitation, this press release contains forward looking statements and

information concerning reserves, production, price, operating costs,

operational results funds flow, net debt, net wells, capital program and

capital expenditures. Statements relating to "reserves" are deemed to be

forward-looking statements, as they involve the implied assessment, based on

certain estimates and assumptions that the reserves described exist in the

quantities predicted or estimated and can profitably be produced in the

future. Forward-looking statements and information are based on Iteration's

current beliefs as well as assumptions made by and information currently

available to Iteration concerning anticipated financial performance, business

prospects, strategies and regulatory developments. Although management

considers these assumptions to be reasonable based on information currently

available to it, they may prove to be incorrect.

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 estimates, the uncertainty of

estimates and projections relating to reserves, production, costs and

expenses, health, safety and environmental risks, commodity price and exchange

rate fluctuations, marketing and transportation, loss of markets,

environmental risks, competition, incorrect assessment of the value of

acquisitions, failure to realize the anticipated benefits of acquisitions,

ability to access sufficient capital from internal and external sources,

failure to obtain required regulatory and other approvals, and changes in

legislation, including but not limited to tax laws, royalties and

environmental regulations. Accordingly, readers should not place undue

reliance on the forward-looking statements and information contained in this

press release concerning these times. Readers are cautioned that the foregoing

list of factors is not exhaustive.

Additional information on these and other factors that could affect

Iteration's, operations or financial results are included in Iteration's

Annual Information Form for the year ended December 31, 2007 filed with

applicable securities regulatory authorities and available on the SEDAR

website (www.sedar.com) and on Iteration's website (www.iterationenergy.com).

The forward-looking statements and information contained in this press release

are made as of the date hereof and Iteration 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.

-30-

/For further information: please see the Company website at

www.iterationenergy.com; or contact: Brian L. Illing, President and Chief

Executive Officer, Tel: (403) 290-4867; Jane Mactaggart, Vice President

Exploitation, Tel: (403) 290-4865/