Exhibit 99.3









Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


ABBREVIATIONS



|$M     | thousand dollars                                                                                                                                                                                                                      
|------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|$MM    | million dollars                                                                                                                                                                                                                       
|AECO   | the daily average benchmark price for natural gas at the AECO ‘C’ hub in southeast Alberta                                                                                                                                            
|bbl(s) | barrel(s)                                                                                                                                                                                                                             
|bbls/d | barrels per day                                                                                                                                                                                                                       
|bcf    | billion cubic feet                                                                                                                                                                                                                    
|boe    | barrel of oil equivalent, including: crude oil, natural gas liquids and natural gas (converted on the basis of one boe
    for six mcf of natural gas)                                                                                
|boe/d  | barrel of oil equivalent per day                                                                                                                                                                                                      
|btu    | British thermal units                                                                                                                                                                                                                 
|GJ     | gigajoules                                                                                                                                                                                                                            
|HH     | Henry Hub, a reference price paid for natural gas in US dollars at Erath, Louisiana                                                                                                                                                   
|mbbls  | thousand barrels                                                                                                                                                                                                                      
|mboe   | thousand barrel of oil equivalent                                                                                                                                                                                                     
|mcf    | thousand cubic feet                                                                                                                                                                                                                   
|mcf/d  | thousand cubic feet per day                                                                                                                                                                                                           
|mmboe  | million barrel of oil equivalent                                                                                                                                                                                                      
|mmbtu  | million British thermal units                                                                                                                                                                                                         
|mmcf   | million cubic feet                                                                                                                                                                                                                    
|mmcf/d | million cubic feet per day                                                                                                                                                                                                            
|MWh    | megawatt hour                                                                                                                                                                                                                         
|NBP    | the reference price paid for natural gas in the United Kingdom, quoted in pence per therm, at the National Balancing Point Virtual Trading Point operated by National Grid. Our production in Ireland is priced with reference to NBP.
|NGLs   | natural gas liquids                                                                                                                                                                                                                   
|PRRT   | Petroleum Resource Rent Tax, a profit based tax levied on petroleum projects in Australia                                                                                                                                             
|TTF    | the day-ahead price for natural gas in the Netherlands, quoted in MWh of natural gas, at the Title Transfer Facility                                                                                                                  
|       | Virtual Trading Point operated by Dutch TSO Gas Transport Services                                                                                                                                                                    
|WTI    | West Texas Intermediate, the reference price paid for crude oil of standard grade in US dollars at Cushing, Oklahoma                                                                                                                  
|CGU    | Cash generating unit, the basis upon which Vermilions assets are evaluated for potential impairments                                                                                                                                  
|DRIP   | Dividend Reinvestment Plan                                                                                                                                                                                                            



2


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


DISCLAIMER



Certain statements included or incorporated
by reference in this document 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 document may include, but
are not limited to: capital expenditures; business strategies and objectives; operational and financial performance; estimated
reserve quantities and the discounted net present value of future net revenue from such reserves; petroleum and natural gas sales;
future production levels (including the timing thereof) and rates of average annual production growth; estimated contingent resources;
exploration and development plans; acquisition and disposition plans and the timing thereof; operating and other expenses, including
the payment and amount of future dividends; royalty and income tax rates; and the timing of regulatory proceedings and approvals.



Such forward looking statements or information
are based on a number of assumptions all or any of which may prove to be incorrect. In addition to any other assumptions identified
in this document, assumptions have been made regarding, among other things: the ability of Vermilion to obtain equipment, services
and supplies in a timely manner to carry out its activities in Canada and internationally; the ability of Vermilion to market crude
oil, natural gas liquids 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; the ability of Vermilion to obtain financing on acceptable terms; foreign currency exchange rates and interest rates;
future crude oil, natural gas liquids and natural gas prices; and management’s expectations relating to the timing and results
of exploration and 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 position 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, natural gas liquids and natural gas; risks and
uncertainties involving geology of crude oil, natural gas liquids and natural gas deposits; risks inherent in Vermilion's marketing
operations, including credit risk; the uncertainty of reserves estimates and reserves life and estimates of resources and associated
expenditures; the uncertainty of estimates and projections relating to production and associated expenditures; potential delays
or changes in plans with respect to exploration or development projects; Vermilion's ability to enter into or renew leases on acceptable
terms; fluctuations in crude oil, natural gas liquids 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 exploration and development activities; 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.



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, unless required
by applicable securities laws.



All oil and natural gas reserve information
contained in this document has been prepared and presented in accordance with National Instrument 51-101 Standards of Disclosure
for Oil and Gas Activitiesand the Canadian Oil and Gas Evaluation Handbook. The actual crude oil and natural gas reserves
and future production will be greater than or less than the estimates provided in this document. The estimated future net revenue
from the production of crude oil and natural gas reserves does not represent the fair market value of these reserves.



Natural gas volumes have been converted on the
basis of six thousand cubic feet of natural gas to one barrel of oil equivalent. 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.



Financial data contained within this document are reported in Canadian
dollars, unless otherwise stated.



3


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


MANAGEMENT’S REPORT TO SHAREHOLDERS



Management’s Responsibility for Financial Statements

The accompanying consolidated financial statements
of Vermilion Energy Inc. are the responsibility of management and have been approved by the Board of Directors of Vermilion Energy
Inc. The consolidated financial statements have been prepared in accordance with the accounting policies detailed in the notes
to the consolidated financial statements and are prepared in accordance with International Financial Reporting Standards as issued
by the International Accounting Standards Board. Where necessary, management has made informed judgments and estimates of transactions
that were not yet completed at the balance sheet date. Financial information throughout the Annual Report is consistent with the
consolidated financial statements.



Management ensures the integrity of the consolidated
financial statements by maintaining high-quality systems of internal control. Procedures and policies are designed to provide reasonable
assurance that assets are safeguarded and transactions are properly recorded, and that the financial records are reliable for preparation
of the consolidated financial statements. Deloitte LLP, Vermilion’s external auditors, have conducted an audit of the consolidated
financial statements in accordance with Canadian generally accepted auditing standards and the standards of the Public Company
Accounting Oversight Board (United States) and have provided their report.



The Board of Directors is responsible for ensuring
that management fulfills its responsibility for financial reporting and internal control. The Board carries out this responsibility
principally through the Audit Committee, which is appointed by the Board and is comprised entirely of independent Directors. The
Committee meets periodically with management and Deloitte LLP to satisfy itself that each party is properly discharging its responsibilities
and to review the consolidated financial statements, the Management’s Discussion and Analysis and the external Auditor’s
Report before they are presented to the Board of Directors.



Management’s Report on Internal Control Over Financial
Reporting



Management is responsible for establishing
and maintaining an adequate system of internal control over financial reporting. Management conducted an evaluation of the effectiveness
of the system of internal control over financial reporting based on the criteria established in “Internal Control –
Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this
evaluation, management has assessed the effectiveness of Vermilion’s internal control over financial reporting as defined
in Rule 13a-15 under the US Securities Exchange Act of 1934 and as defined in Canada by National Instrument 52-109, Certification
of Disclosure in Issuers’ Annual and Interim Filings. Management concluded that Vermilion’s internal control over financial
reporting was effective as of December 31, 2015. The effectiveness of Vermilion’s internal control over financial reporting
as of December 31, 2015 has been audited by Deloitte LLP, the Company’s Independent Registered Public Accounting Firm, who
also audited the Company’s consolidated financial statements for the year ended December 31, 2015.



|(“Lorenzo Donadeo”)     | (“Curtis W. Hicks”)                               
|----------------------- | --------------------------------------------------
|                        |                                                   
|Lorenzo Donadeo         | Curtis W. Hicks                                   
|Chief Executive Officer | Executive Vice President & Chief Financial Officer
|February 25, 2016       |                                                   



4


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


Report of Independent Registered Public Accounting Firm



To the Board of Directors and Shareholdersof Vermilion Energy Inc.



We have audited the internal control over financial
reporting of Vermilion Energy Inc.and subsidiaries (the “Company”)as of December 31, 2015, based on the criteria established in Internal Control—Integrated Framework (2013)
issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company's management is responsible for maintaining
effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial
reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility
is to express an opinion on the Company's internal control over financial reporting based on our audit.



We conducted our audit in accordance with the
standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed
risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides
a reasonable basis for our opinion.



A company's internal control over financial
reporting is a process designed by, or under the supervision of, the company's principal executive and principal financial officers,
or persons performing similar functions, and effected by the company's board of directors, management, and other personnel to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.
A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance
with International Financial Reporting Standards as issued by the International Accounting Standards Board, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the
company's assets that could have a material effect on the financial statements.



Because of the inherent limitations of internal
control over financial reporting, including the possibility of collusion or improper management override of controls, material
misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of
the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls
may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.



In our opinion, the Company maintained, in all
material respects, effective internal control over financial reporting as of December 31, 2015, based on the criteria established
in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway
Commission.



We have also audited, in accordance with Canadian
generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States), the consolidated
financial statements as of and for the year ended December 31, 2015 of the Company and our report dated February 26, 2016 expressed
an unqualified opinion on those financial statements.



|(“/s/Deloitte LLP”)                                      
|---------------------------------------------------------
|                                                         
|                                                         
|Chartered Professional Accountants, Chartered Accountants
|February 26, 2016                                        
|Calgary, Canada                                          



5


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


Report of Independent Registered Public Accounting Firm



To the Board of Directors and Shareholders of
Vermilion Energy Inc.



We have audited the accompanying consolidated
financial statements of Vermilion Energy Inc. and subsidiaries (the “Company”), which comprise the consolidated balance
sheets as at December 31, 2015 and December 31, 2014, and the consolidated statements of net earnings (loss) and comprehensive
income (loss), cash flows, and changes in shareholders’ equity for the years then ended, and a summary of significant accounting
policies and other explanatory information.



Management's Responsibility for the Consolidated
Financial Statements



Management is responsible for the preparation
and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards
as issued by the International Accounting Standards Board, and for such internal control as management determines is necessary
to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or
error.



Auditor's Responsibility



Our responsibility is to express an opinion
on these consolidated financial statements based on our audits. We conducted our audits in accordance with Canadian generally accepted
auditing standards and the standards of the Public Company Accounting Oversight Board (United States). Those standards require
that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free from material misstatement.



An audit involves performing procedures to obtain
audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the
auditor's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether
due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation
and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the
circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.



We believe that the audit evidence we have obtained
in our audits is sufficient and appropriate to provide a basis for our audit opinion.



Opinion



In our opinion, the consolidated financial statements
present fairly, in all material respects, the financial position of Vermilion Energy Inc. and subsidiaries as at December 31, 2015
and December 31, 2014, and their financial performance and their cash flows for the years then ended in accordance with International
Financial Reporting Standards as issued by the International Accounting Standards Board.



Other Matter

We have also audited, in accordance with the
standards of the Public Company Accounting Oversight Board (United States), the Company’s internal control over financial
reporting as of December 31, 2015, based on the criteria established in Internal Control — Integrated Framework (2013)
issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 26, 2016 expressed
an unmodified opinion on the Company’s internal control over financial reporting.



|(“/s/Deloitte LLP”)                                       | 
|--------------------------------------------------------- | 
|                                                          | 
|Chartered Professional Accountants, Chartered Accountants | 
|February 26, 2016                                         | 
|Calgary, Canada                                           | 



6


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


CONSOLIDATED BALANCE SHEETS(THOUSANDS OF CANADIAN DOLLARS)



|                                         |      | December 31, | December 31,
|---------------------------------------- | ---- | ------------ | ------------
|                                         | Note |              | 2015        
|ASSETS                                   |      |              |             
|Current                                  |      |              |             
|Cash and cash equivalents                | 17   |              | 41,676      
|Accounts receivable                      |      |              | 160,499     
|Crude oil inventory                      |      |              | 13,079      
|Derivative instruments                   | 13   |              | 55,214      
|Prepaid expenses                         |      |              | 14,310      
|                                         |      |              | 284,778     
|                                         |      |              |             
|Derivative instruments                   | 13   |              | 13,128      
|Deferred taxes                           | 9    |              | 135,753     
|Exploration and evaluation assets        | 6    |              | 308,192     
|Capital assets                           | 5    |              | 3,467,369   
|                                         |      |              | 4,209,220   
|                                         |      |              |             
|LIABILITIES                              |      |              |             
|Current                                  |      |              |             
|Accounts payable and accrued liabilities |      |              | 248,747     
|Current portion of long-term debt        | 8    |              | 224,901     
|Dividends payable                        | 10   |              | 24,077      
|Income taxes payable                     | 9    |              | 6,006       
|                                         |      |              | 503,731     
|                                         |      |              |             
|Long-term debt                           | 8    |              | 1,162,998   
|Finance lease obligation                 | 16   |              | 23,565      
|Asset retirement obligations             | 7    |              | 305,613     
|Deferred taxes                           | 9    |              | 354,654     
|                                         |      |              | 2,350,561   
|                                         |      |              |             
|SHAREHOLDERS’ EQUITY                     |      |              |             
|Shareholders’ capital                    | 10   |              | 2,181,089   
|Contributed surplus                      |      |              | 107,946     
|Accumulated other comprehensive income   |      |              | 113,647     
|Deficit                                  |      |              | (544,023)   
|                                         |      |              | 1,858,659   
|                                         |      |              | 4,209,220   



APPROVED BY THE BOARD



|(Signed “Joseph F. Killi”) | (Signed “Lorenzo Donadeo”)
|-------------------------- | --------------------------
|                           |                           
|Joseph F. Killi, Director  | Lorenzo Donadeo, Director 



7


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


CONSOLIDATED STATEMENTS OF NET EARNINGS (LOSS) AND COMPREHENSIVE
INCOME (LOSS)(THOUSANDS OF CANADIAN DOLLARS, EXCEPT SHARE AND PER SHARE AMOUNTS)



|                                            |      |  | Year Ended  
|------------------------------------------- | ---- |  | ------------
|                                            |      |  | December 31,
|                                            | Note |  | 2015        
|REVENUE                                     |      |  |             
|Petroleum and natural gas sales             |      |  | 939,586     
|Royalties                                   |      |  | (65,920)    
|Petroleum and natural gas revenue           |      |  | 873,666     
|                                            |      |  |             
|EXPENSES                                    |      |  |             
|Operating                                   | 21   |  | 225,938     
|Transportation                              |      |  | 41,660      
|Equity based compensation                   | 11   |  | 75,232      
|Gain on derivative instruments              | 13   |  | (84,904)    
|Interest expense                            |      |  | 59,852      
|General and administration                  | 21   |  | 53,584      
|Foreign exchange (gain) loss                |      |  | (9,410)     
|Other (income) expense                      |      |  | (31,663)    
|Accretion                                   | 7    |  | 23,911      
|Depletion and depreciation                  | 5, 6 |  | 458,758     
|Impairment                                  | 5, 6 |  | 274,623     
|                                            |      |  | 1,087,581   
|EARNINGS (LOSS) BEFORE INCOME TAXES         |      |  | (213,915)   
|                                            |      |  |             
|INCOME TAXES                                | 9    |  |             
|Deferred                                    |      |  | (47,728)    
|Current                                     |      |  | 51,115      
|                                            |      |  | 3,387       
|                                            |      |  |             
|NET EARNINGS (LOSS)                         |      |  | (217,302)   
|                                            |      |  |             
|OTHER COMPREHENSIVE (LOSS) INCOME           |      |  |             
|Currency translation adjustments            |      |  | 107,925     
|COMPREHENSIVE (LOSS) INCOME                 |      |  | (109,377)   
|                                            |      |  |             
|NET EARNINGS (LOSS) PER SHARE               | 12   |  |             
|Basic                                       |      |  | (1.98)      
|Diluted                                     |      |  | (1.98)      
|                                            |      |  |             
|WEIGHTED AVERAGE SHARES OUTSTANDING ('000s) | 12   |  |             
|Basic                                       |      |  | 109,642     
|Diluted                                     |      |  | 109,642     



8


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


CONSOLIDATED STATEMENTS OF CASH FLOWS(THOUSANDS OF CANADIAN DOLLARS)



|                                                                   |         |  | Year Ended  
|------------------------------------------------------------------ | ------- |  | ------------
|                                                                   |         |  | December 31,
|                                                                   | Note    |  | 2015        
|OPERATING                                                          |         |  |             
|Net earnings (loss)                                                |         |  | (217,302)   
|Adjustments:                                                       |         |  |             
|Accretion                                                          | 7       |  | 23,911      
|Depletion and depreciation                                         | 5, 6    |  | 458,758     
|Impairment                                                         | 5, 6    |  | 274,623     
|Unrealized gain on derivative instruments                          | 13      |  | (43,548)    
|Equity based compensation                                          | 11      |  | 75,232      
|Unrealized foreign exchange (gain) loss                            |         |  | (8,787)     
|Unrealized other expense                                           |         |  | 1,008       
|Deferred taxes                                                     | 9       |  | (47,728)    
|Asset retirement obligations settled                               | 7       |  | (11,369)    
|Changes in non-cash operating working capital                      | 14      |  | (60,390)    
|Cash flows from operating activities                               |         |  | 444,408     
|                                                                   |         |  |             
|INVESTING                                                          |         |  |             
|Drilling and development                                           | 5       |  | (486,861)   
|Exploration and evaluation                                         | 6       |  | -           
|Property acquisitions                                              | 4, 5, 6 |  | (28,897)    
|Corporate acquisitions, net of cash acquired                       | 4       |  | -           
|Changes in non-cash investing working capital                      | 14      |  | (25,980)    
|Cash flows used in investing activities                            |         |  | (541,738)   
|                                                                   |         |  |             
|FINANCING                                                          |         |  |             
|Increase in long-term debt                                         | 8       |  | 138,341     
|Decrease in finance lease obligation                               | 16      |  | (2,246)     
|Cash dividends                                                     | 10      |  | (127,535)   
|Cash flows from financing activities                               |         |  | 8,560       
|Foreign exchange gain on cash held in foreign currencies           |         |  | 10,041      
|                                                                   |         |  |             
|Net change in cash and cash equivalents                            |         |  | (78,729)    
|Cash and cash equivalents, beginning of year                       |         |  | 120,405     
|Cash and cash equivalents, end of year                             | 17      |  | 41,676      
|                                                                   |         |  |             
|Supplementary information for operating activities - cash payments |         |  |             
|Interest paid                                                      |         |  | 62,911      
|Income taxes paid                                                  |         |  | 92,907      





9


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY(THOUSANDS OF CANADIAN DOLLARS)



|                                                                                     |               |               |               |               |               | Accumulated   |          |       |          
|------------------------------------------------------------------------------------ | ------------- | ------------- | ------------- | ------------- | ------------- | ------------- | -------- | ----- | ---------
|                                                                                     |               |               |               |               |               |               | Other    |       | Total    
|                                                                                     |               | Shareholders' | Contributed   | Comprehensive |               | Shareholders’
|                                                                                     | Note          | Capital       | Surplus       |               | Income        | Deficit       | Equity  
|Balances as at January 1, 2014                                                       |               |               | 1,618,443     |               | 75,427        |               | 47,142   |       | (24,637) 
|Net earnings                                                                         |               |               | -             |               | -             |               | -        |       | 269,326  
|Currency translation adjustments                                                     |               |               | -             |               | -             |               | (41,420) |       | -        
|Equity based compensation expense                                                    | 11            |               | -             |               | 67,081        |               | -        |       | -        
|Dividends declared                                                                   | 10            |               | -             |               | -             |               | -        |       | (272,732)
|Shares issued pursuant to the dividend reinvestment plan                             | 10            |               | 79,430        |               | -             |               | -        |       | -        
|Shares issued pursuant to corporate acquisition                                      | 4, 10         |               | 204,960       |               | -             |               | -        |       | -        
|Modification of equity based awards                                                  | 11            |               | -             |               | (2,395)       |               | -        |       | -        
|Vesting of equity based awards                                                       | 10, 11        |               | 47,925        |               | (47,925)      |               | -        |       | -        
|Share-settled dividends on vested equity
    based awards                            | 10, 11        |               | 7,542         |               | -             |               | -        |       | (7,542)  
|Shares issued pursuant to the bonus plan                                             | 10            |               | 721           |               | -             |               | -        |       | -        
|Balances as at December 31, 2014                                                     |               |               | 1,959,021     |               | 92,188        |               | 5,722    |       | (35,585) 
|                                                                                     |               |               |               |               |               |               |          |       |          
|                                                                                     |               |               |               |               |               | Accumulated   |          |       |          
|                                                                                     |               |               |               |               |               | Other         |          | Total
|                                                                                     | Shareholders’ | Contributed   | Comprehensive |               | Shareholders’
|Note                                                                                 | Capital       | Surplus       |               | Income        | Deficit       | Equity       
|Balances as at January 1, 2015                                                       |               |               | 1,959,021     |               | 92,188        |               | 5,722    |       | (35,585) 
|Net loss                                                                             |               |               | -             |               | -             |               | -        |       | (217,302)
|Currency translation adjustments                                                     |               |               | -             |               | -             |               | 107,925  |       | -        
|Equity based compensation expense                                                    | 11            |               | -             |               | 72,613        |               | -        |       | -        
|Dividends declared                                                                   | 10            |               | -             |               | -             |               | -        |       | (283,575)
|Shares issued pursuant to the dividend reinvestment and Premium
    DividendTM plans | 10            |               | 155,033       |               | -             |               | -        |       | -        
|Vesting of equity based awards                                                       | 10, 11        |               | 56,855        |               | (56,855)      |               | -        |       | -        
|Share-settled dividends on vested equity based awards                                | 10, 11        |               | 7,561         |               | -             |               | -        |       | (7,561)  
|Shares issued pursuant to the employee savings and bonus plans                       | 10            |               | 2,619         |               | -             |               | -        |       | -        
|Balances as at December 31, 2015                                                     |               |               | 2,181,089     |               | 107,946       |               | 113,647  |       | (544,023)



Description
of equity reserves



Shareholders’ capital

Represents the recognized amount for common
shares when issued, net of equity issuance costs and deferred taxes.



Contributed surplus

Represents the recognized value of employee
awards which are settled in shares. Once vested, the value of the awards is transferred to shareholders’ capital.



Accumulated other comprehensive income

Represents the cumulative income and expenses
which are not recorded immediately in net earnings (loss) and are accumulated until an event triggers recognition in net earnings
(loss). The current balance consists of currency translation adjustments resulting from translating financial statements of subsidiaries
with a foreign functional currency to Canadian dollars at period-end rates.



Deficit

Represents the cumulative net earnings (loss)
less distributed earnings of Vermilion Energy Inc.



10


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


notes to the Consolidated
Financial Statements

For
the year ended December 31, 2015 and 2014

(Tabular
amounts in thousands of Canadian dollars, except share and per share amounts)



1. BASIS OF PRESENTATION



Vermilion Energy Inc. (the “Company”
or “Vermilion”) is a corporation governed by the laws of the Province of Alberta and is actively engaged in the business
of crude oil and natural gas exploration, development, acquisition and production.



These consolidated financial statements were
approved and authorized for issuance by the Board of Directors of Vermilion on February 25, 2016.



2. SIGNIFICANT ACCOUNTING POLICIES



Accounting Framework

The consolidated financial statements have been
prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting
Standards Board (“IASB”).



Principles of Consolidation

Subsidiaries that are directly controlled by
the parent company or indirectly controlled through other consolidated subsidiaries are fully consolidated. Vermilion accounts
for joint operations by recognizing its share of assets, liabilities, income and expenses. All significant intercompany balances,
transactions, income and expenses are eliminated upon consolidation.



Vermilion currently has no special purpose entities
of which it retains control and accordingly the consolidated financial statements do not include the accounts of any such entities.



Exploration and Evaluation Assets

Vermilion accounts for exploration and evaluation
of petroleum and natural gas property (“E&E”) costs in accordance with IFRS 6 “Exploration for and Evaluation
of Mineral Resources”. Costs incurred are classified as E&E costs when they relate to exploring and evaluating a property
for which the Company has the licence or right to explore and extract resources.



E&E costs related to each license or prospect
area are initially capitalized within E&E assets. E&E costs that are capitalized may include costs of licence acquisitions,
technical services and studies, seismic acquisitions, exploration drilling and testing, directly attributable overhead and administration
expenses and, if applicable, the estimated costs of retiring the assets. Any costs incurred prior to the acquisition of the legal
rights to explore an area are expensed as incurred.



E&E assets are not initially depleted and
are carried at cost until technical feasibility and commercial viability of the area can be determined. The technical feasibility
and commercial viability of extracting the reserves is considered to be determinable when proven and probable reserves are identified.
If proven and probable reserves are identified as recoverable, the related E&E costs are reclassified to Petroleum and Natural
Gas (“PNG”) assets pending an impairment test. If reserves are not found within the license area or the area is abandoned,
the related E&E costs are amortized over a period not greater than five years.



Petroleum and Natural Gas Assets

Vermilion recognizes PNG assets at cost less
accumulated depletion, depreciation and impairment losses. Directly attributable costs incurred for the drilling of development
wells and for the construction of production facilities are capitalized together with the discounted value of estimated future
costs of asset retirement obligations. When components of PNG assets are replaced, disposed of, or no longer in use, they are derecognized.



Gains and losses on disposal of a component
of PNG assets, including oil and gas interests, are determined by comparing the proceeds of disposal with the carrying amount of
the component, and are recognized in net earnings (loss).



Depletion and Depreciation

Vermilion classifies its assets into PNG depletion
units, which are groups of assets or properties that are within a specific production area and have similar economic lives. The
PNG depletion units represent the lowest level of disaggregation for which Vermilion accumulates costs for the purposes of calculating
and recording depletion and depreciation.



The net carrying value of each PNG depletion
unit is depleted using the unit of production method by reference to the ratio of production in the period to the total proven
and probable reserves, taking into account the future development costs necessary to bring the applicable reserves into production.
The reserve estimates are reviewed annually by management or when material changes occur to the underlying assumptions.



For the purposes of the depletion calculations,
oil and gas reserves are converted to a common unit of measure on the basis of their relative energy content based on a conversion
ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent.



11


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


2. SIGNIFICANT ACCOUNTING POLICIES (Continued)



Furniture and office equipment are recorded
at cost and are depreciated on a declining-balance basis.



Impairment of Long-Lived Assets

E&E assets are tested for impairment when
reclassified to PNG assets or when indicators of impairment are identified.  If indicators of impairment are identified, E&E
assets are tested for impairment as part of the group of Cash Generating Units (“CGUs”) attributable to the jurisdiction
in which the exploration area resides.



PNG depletion units are aggregated into CGUs
for impairment testing.  The determination of CGUs is based on management’s judgment and represents the lowest level
at which there are identifiable cash inflows that are largely independent of the cash inflows of other groups of assets or properties.
CGUs are reviewed for indicators that the carrying value of the CGU may exceed its recoverable amount.  If an indication of
impairment exists, the CGU’s recoverable amount is then estimated.  A CGU’s recoverable amount is defined as the
higher of the fair value less costs to sell and its value in use.  If the carrying amount exceeds its recoverable amount,
an impairment loss is recorded to net earnings (loss) in the period to reduce the carrying value of the CGU to its recoverable
amount.



For PNG assets and E&E assets, when there
has been an impairment loss recognized, at each reporting date an assessment is performed as to whether the circumstances which
led to the impairment loss have reversed. If the change in circumstances leads to the recoverable amount being higher than the
carrying value after recognition of an impairment, that impairment loss is reversed, with such reversal not to exceed the depreciated
value of the asset had no impairment loss been previously recognized.



Finance leases

Finance leases, which transfer substantially
all the risks and rewards incidental to legal ownership, are recognized at the commencement of the least term. The lease obligation
and corresponding capitalized lease asset are measured at the lower of fair value of the leased property or the present value of
the minimum lease payments, which are determined at the inception of the lease. Capitalized leased assets are depreciated over
the shorter of the estimated useful life of the asset or the lease term.



Cash and Cash Equivalents

Cash and cash equivalents include monies on
deposit and short-term investments, which are comprised primarily of guaranteed investment certificates.



Crude Oil Inventory

Inventories of crude oil, consisting of production
for which title has not yet transferred to the customer, are valued at the lower of cost or net realizable value. Cost is determined
on a weighted-average basis and includes related operating expenses, royalties, and depletion.



Provisions and Asset Retirement Obligations

Vermilion recognizes a provision or asset retirement
obligation in the consolidated financial statements when an event gives rise to an obligation of uncertain timing or amount.



The estimated present value of the asset retirement
obligation is recorded as a long-term liability, with a corresponding increase in the carrying amount of the related asset. This
increase is depleted with the related depletion unit and is allocated to a CGU for impairment testing. The liability recorded is
increased each reporting period due to the passage of time and this change is charged to net earnings (loss) in the period as accretion
expense. The asset retirement obligation can also increase or decrease due to changes in the estimated timing of cash flows, changes
in the discount rate and/or changes in the original estimated undiscounted costs. Increases or decreases in the obligation will
result in a corresponding change in the carrying amount of the related asset. Actual costs incurred upon settlement of the asset
retirement obligation are charged against the asset retirement obligation to the extent of the liability recorded. Vermilion discounts
the costs related to asset retirement obligations using the discount rate that reflects current market assessment of the time value
of money and risks specific to the liabilities that have not been reflected in the cash flow estimates. Vermilion applies discount
rates applicable to each of the jurisdictions in which it has future asset retirement obligations. Asset retirement obligations
are remeasured at each reporting period in order to reflect the discount rates in effect at that time.



A provision for onerous contracts is recognized
when the expected benefits to be derived by Vermilion from a contract are lower than the unavoidable cost of meeting the obligations
under the contract. The provision is measured at the lower of the expected cost of terminating the contract and the present value
of the expected net cost of the remaining term of the contract. Before a provision is established, Vermilion first recognizes any
impairment loss on assets associated with the onerous contract. For the periods presented in the consolidated financial statements,
there were no onerous contracts recognized.



Revenue Recognition

Revenues associated with the sale of crude oil,
natural gas and natural gas liquids are recorded when title passes to the customer. For the majority of Canadian oil and natural
gas production, legal title transfers upon delivery to major pipelines. In Australia, oil is sold at the Wandoo B Platform. In
the Netherlands, natural gas is sold at the plant gate. In Germany, natural gas is sold upon delivery to major pipelines. In France,
oil is sold either when delivered to the refinery by pipeline or when delivered to the refinery via tanker. In the United States,
oil is sold when transferred to the truck from the tank and natural gas is sold at a custody transfer meter on location.



12


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


2. SIGNIFICANT ACCOUNTING POLICIES (Continued)



Financial Instruments

Cash and cash equivalents are classified as
held for trading and are measured at fair value. A gain or loss arising from a change in the fair value is recognized in net earnings
(loss) in the period in which it occurs.



Accounts receivable are classified as loans
and receivables and are initially measured at fair value and are then subsequently measured at amortized cost. The carrying value
of accounts receivable approximates the fair value due to the short-term nature of these instruments.



Accounts payable and accrued liabilities, dividends
payable, finance lease, and long-term debt have been classified as other financial liabilities and are initially recognized at
fair value and are subsequently measured at amortized cost.  Transaction costs and discounts are recorded against the fair
value of long-term debt on initial recognition.



All derivative instruments have been classified
as held for trading and are measured at fair value.  A gain or loss arising from a change in the fair value is recognized
in net earnings (loss) in the period in which it occurs.



Equity Based Compensation

Vermilion has long-term equity based compensation
plans for directors, officers and employees of Vermilion and its subsidiaries. Equity based compensation expense is recognized
in net earnings (loss) over the vesting period of the awards with a corresponding adjustment to contributed surplus. Upon vesting,
the amount previously recognized in contributed surplus is reclassified to shareholders’ capital.



The expense recognized is based on the grant
date fair value of the awards and incorporates an estimate of the forfeiture rate based on historical vesting data. The grant date
fair value of the awards is determined as the grant date closing price of Vermilion’s common shares on the Toronto Stock
Exchange, adjusted by the Company’s estimate of the performance factor that will ultimately be achieved.



Per Share Amounts

Net earnings (loss) per share is calculated
using the weighted-average number of shares outstanding during the period. Diluted net earnings per share is calculated using the
diluted weighted-average number of shares outstanding during the period. The diluted weighted-average number of shares is determined
by considering whether equity based compensation plans, if converted during the year, would result in reduced net earnings per
share.



The treasury stock method is used to determine
the dilutive effect of equity based compensation plans. The treasury stock method assumes that the deemed proceeds related to unrecognized
equity based compensation expense are used to repurchase shares at the average market price during the period. Equity based awards
outstanding are included in the calculation of diluted net earnings per share based on estimated performance factors.



Foreign Currency Translation

The consolidated financial statements are presented
in Canadian dollars, which is Vermilion’s reporting currency. As several of Vermilion’s subsidiaries transact and operate
primarily in countries other than Canada, they accordingly have functional currencies other than the Canadian dollar.



Transactions denominated in currencies other
than the functional currency of the subsidiary are translated to the functional currency at the prevailing rates on the date of
the transaction. Non-monetary assets or liabilities that result from such transactions are held at the prevailing rate on the date
of the transaction. Monetary items denominated in non-functional currencies are translated to the functional currency of the subsidiary
at the prevailing rate at the balance sheet date. All translations associated with currencies other than the respective functional
currencies are recorded in net earnings (loss).



Translation of all assets and liabilities from
the respective functional currencies to the reporting currency are performed using the rates prevailing at the balance sheet date.
The differences arising upon translation from the functional currency to the reporting currency are recorded as currency translation
adjustments in other comprehensive income (loss) and are held within accumulated other comprehensive income (loss) until a disposal
or partial disposal of a subsidiary. A disposal or partial disposal may give rise to a realized gain or loss, which is recorded
in net earnings (loss).



Within the consolidated group there are outstanding
intercompany loans which in substance represent investments in certain subsidiaries. When these loans are identified as part of
the net investment in a foreign subsidiary, any exchange differences arising on those loans are recorded to currency translation
adjustments within other comprehensive income (loss) until the disposal or partial disposal of the subsidiary.



Income Taxes

Deferred taxes are calculated using the liability
method of accounting. Under this method, deferred tax is recognized for the estimated effect of any temporary differences between
the amounts recognized on Vermilion’s consolidated balance sheets and respective tax basis. This calculation uses enacted
or substantively enacted tax rates that will be in effect when the temporary differences are expected to reverse. The effect of
a change in tax rates on deferred taxes is recognized in net earnings (loss) in the period in which the related legislation is
substantively enacted.



13


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


2. SIGNIFICANT ACCOUNTING POLICIES (Continued)



Deferred tax assets are reviewed each reporting
period and a valuation allowance is recognized if available evidence indicates that it is not probable that all or a part of a
deferred tax asset will be utilized in future periods. A previously recognized valuation allowance is removed when available evidence
indicates that all or a part of the valuation allowance is no longer required.



Vermilion is subject to current income taxes
based on the tax legislation of each respective country in which Vermilion conducts business.



Borrowing Costs

Borrowing costs that are directly attributable
to the acquisition or construction of an asset that necessarily takes a substantial period of time to prepare for its intended
use are capitalized as part of the cost of that asset. Borrowing costs are capitalized by applying interest rates attributable
to the project being financed and could include both general and/or specific borrowings. Interest rates applied from general borrowings
are computed using the weighted average borrowing rate for the period.



Measurement Uncertainty

The preparation of the consolidated financial
statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure
of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues
and expenses for the periods presented.



Key areas where management has made complex
or subjective judgments include asset retirement obligations, assessment of impairment or recovery of impairment of long-lived
assets and income taxes. Actual results could differ significantly from these and other estimates.



Asset Retirement Obligations

Vermilion’s asset retirement obligations
are based on the expected cost of adherence to environmental regulations and estimates of the amount and timing of future expenditures.
Changes in environmental regulations, the estimated costs associated with reclamation activities, the discount rate applied and
the timing of expenditures could materially impact Vermilion’s measurement of the obligations and, correspondingly, impact
Vermilion’s financial position and net earnings (loss).



Assessment of Impairments or Recovery of
Previous Impairments

Impairment tests are performed at a CGU level.
CGUs are determined based on management’s judgment of the lowest level at which there is identifiable cash inflows that are
largely independent of the cash inflows of other groups of assets or properties. The factors used by Vermilion to determine CGUs
may vary by country due to the unique operating and geographic circumstances in each country. However, in general, Vermilion will
assess the following factors in determining whether a group of assets generate largely independent cash inflows: geographic proximity
of the assets within a group to one another, geographic proximity of the group of assets to other groups of assets, homogeneity
of the production from the group of assets and the sharing of infrastructure used to process and/or transport production.



The calculation of the recoverable amount of
the CGUs is based on market factors, estimates of PNG reserves and future costs required to develop reserves. Vermilion’s
reserve estimates and the related future cash flows are subject to measurement uncertainty, and the impact on the consolidated
financial statements of future periods could be material. Considerable management judgment is used in determining the recoverable
amount of PNG assets, including determining the quantity of reserves, the time horizon to develop and produce such reserves and
the estimated revenues and expenditures of such production.



Income Taxes

Tax interpretations, regulations, and legislation
in the various jurisdictions in which Vermilion and its subsidiaries operate are subject to change and interpretation. Such changes
can affect the timing of the reversal of temporary tax differences, the tax rates in effect when such differences reverse and Vermilion’s
ability to use tax losses and other tax pools in the future. The Company’s income tax filings are subject to audit by taxation
authorities in numerous jurisdictions and the results of such audits may increase or decrease the tax liability.The determination
of current and deferred tax amounts recognized in the consolidated financial statements are based on management’s assessment
of the tax positions, which includes consideration of their technical merits, communications with tax authorities and management’s
view of the most likely outcome.



14


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


3. CHANGES TO ACCOUNTING PRONOUNCEMENTS



Accounting pronouncements not yet adopted



The impacts of the adoption of the following
pronouncements are currently being evaluated.



IFRS 9 “Financial Instruments”

On July 24, 2014, the IASB issued the
final element of its comprehensive response to the financial crisis by issuing IFRS 9 “Financial Instruments”. The
improvements introduced by IFRS 9 includes a model for classification and measurement, a single, forward-looking ‘expected
loss’ impairment model and a substantially-reformed approach to hedge accounting. Vermilion will adopt the standard for reporting
periods beginning January 1, 2018.



IFRS 15 “Revenue from Contracts with
Customers”

On May 28, 2014, the IASB issued IFRS
15 “Revenue from Contracts with Customers”, a new standard that specifies recognition requirements for revenue as well
as requiring entities to provide the users of financial statements with more informative and relevant disclosures. The standard
replaces IAS 11 “Construction Contracts” and IAS 18 “Revenue” as well as a number of revenue-related interpretations.
Vermilion will adopt the standard for reporting periods beginning January 1, 2018.



IFRS 16 “Leases”

On January 13, 2016, the IASB issued
IFRS 16, “Leases”, a new standard which will replace IAS 17, “Leases”.  Under IFRS 16, a single recognition
and measurement model will apply for lessees which will require recognition of assets and liabilities for most leases. Vermilion
will adopt the standard for reporting periods beginning January 1, 2019.



4. BUSINESS COMBINATIONS



Property acquisition:



Germany



In February of 2014, Vermilion acquired, through
a wholly-owned subsidiary, GDF's 25% interest in four producing natural gas fields and a surrounding exploration license located
in northwest Germany. GDF is an affiliate of GDF Suez S.A., a publicly traded, French multinational utility. The acquisition represented
Vermilion's entry into the German E&P business, a producing region with a long history of oil and gas development activity,
low political risk and strong marketing fundamentals. The acquisition was well aligned with Vermilion's European focus, and has
increased the company’s exposure to the strong fundamentals and pricing of the European natural gas markets. The acquisition
closed in February of 2014 for cash proceeds of $172.9 million. Vermilion funded this acquisition with existing credit facilities.



The acquired assets were comprised of four gas
producing fields across eleven production licenses and included both exploration and production licenses that comprised a total
of 207,000 gross acres, of which 85% was in the exploration license.



The acquisition was accounted for as a business
combination with the fair value of the assets acquired and liabilities assumed at the date of acquisition summarized as follows:



|($M)                                 | Consideration              
|------------------------------------ | ---------------------------
|Cash paid to vendor                  |                            
|Total consideration                  |                            
|                                     |                            
|($M)                                 | Allocation of Consideration
|Petroleum and natural gas assets     |                            
|Exploration and evaluation           |                            
|Asset retirement obligations assumed |                            
|Deferred tax liabilities             |                            
|Net assets acquired                  |                            



The results of operations from the assets
acquired were included in Vermilion's consolidated financial statements beginning February of 2014 and had contributed net revenues
of $33.3 million and a net loss of $0.3 million for the year ended December 31, 2014.



Had the acquisition occurred on January 1, 2014,
management estimates that consolidated revenues would have increased by an additional $4.6 million and consolidated net earnings
would have increased by $0.9 million for the year ended December 31, 2014.



15


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


4. BUSINESS COMBINATIONS (Continued)



Corporate acquisitions:



a) 	Elkhorn Resources Inc.



On April 29, 2014, Vermilion acquired Elkhorn
Resources Inc., a private southeast Saskatchewan producer. The acquisition created a new core area for Vermilion in the Williston
Basin.



The acquired assets included approximately 57,000
net acres of land (approximately 80% undeveloped), seven oil batteries, and preferential access to a minimum of 50% of capacity
at a solution gas facility.



Total consideration was comprised of $180.4
million of cash, which was funded with existing credit facilities, and the issuance of 2.8 million Vermilion common shares valued
at approximately $205.0 million (based on the closing price per Vermilion common share of $72.50 on the Toronto Stock Exchange
on April 29, 2014).



The acquisition was accounted for as a business
combination with the fair value of the assets acquired and liabilities assumed at the date of acquisition summarized as follows:



|($M)                                                | Consideration              
|--------------------------------------------------- | ---------------------------
|Cash paid to shareholders of Elkhorn Resources Inc. |                            
|Shares issued pursuant to corporate acquisition     |                            
|Total consideration                                 |                            
|                                                    |                            
|($M)                                                | Allocation of Consideration
|Petroleum and natural gas assets                    |                            
|Exploration and evaluation                          |                            
|Asset retirement obligations assumed                |                            
|Deferred tax liabilities                            |                            
|Long-term debt assumed                              |                            
|Cash acquired                                       |                            
|Acquired non-cash working capital deficiency        |                            
|Net assets acquired                                 |                            



The results of operations from the assets
acquired were included in Vermilion's consolidated financial statements beginning April 29, 2014 and contributed revenues of $50.6
million and operating income of $39.8 million for the year ended December 31, 2014.



Had the acquisition occurred on January
1, 2014, management estimates that consolidated revenues would have increased by an additional $8.8 million and consolidated operating
income would have increased by $7.0 million for the year ended December 31, 2014. In determining the pro-forma amounts, management
had assumed that the fair value adjustments, determined provisionally, that arose at the date of acquisition would have been the
same if the acquisition had occurred on January 1, 2014. It is impracticable to derive all amounts necessary to determine the impact
on net earnings from the acquisition as the acquired company was immediately merged with Vermilion’s operations.



16


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


5. CAPITAL ASSETS



The following table reconciles the change in Vermilion's capital
assets:



|                                                     | Petroleum and      | Furniture and    |  | Total         
|---------------------------------------------------- | ------------------ | ---------------- |  | --------------
|($M)                                                 | Natural Gas Assets | Office Equipment |  | Capital Assets
|Balance at January 1, 2014                           |                    | 2,784,634        |  | 15,211        
|Additions                                            |                    | 608,709          |  | 9,980         
|Property acquisitions                                |                    | 176,625          |  | -             
|Corporate acquisitions                               |                    | 390,523          |  | -             
|Changes in estimate for asset retirement obligations |                    | 19,107           |  | -             
|Depletion and depreciation                           |                    | (412,768)        |  | (5,072)       
|Effect of movements in foreign exchange rates        |                    | (75,635)         |  | (222)         
|Balance at December 31, 2014                         |                    | 3,491,195        |  | 19,897        
|Additions                                            |                    | 482,574          |  | 4,287         
|Property acquisitions                                |                    | 27,731           |  | -             
|Changes in estimate for asset retirement obligations |                    | (78,429)         |  | -             
|Depletion and depreciation                           |                    | (431,889)        |  | (6,453)       
|Recognition of finance lease asset(1)                |                    | 31,028           |  | -             
|Impairment(2)                                        |                    | (219,808)        |  | -             
|Effect of movements in foreign exchange rates        |                    | 146,641          |  | 595           
|Balance at December 31, 2015                         |                    | 3,449,043        |  | 18,326        
|Cost                                                 |                    | 5,114,188        |  | 54,723        
|Accumulated depletion and depreciation               |                    | (1,622,993)      |  | (34,826)      
|Carrying amount at December 31, 2014                 |                    | 3,491,195        |  | 19,897        
|Cost                                                 |                    | 5,624,809        |  | 57,652        
|Accumulated depletion and depreciation               |                    | (2,175,766)      |  | (39,326)      
|Carrying amount at December 31, 2015                 |                    | 3,449,043        |  | 18,326        



| | (1) | Refer to Financial Statement Note 16 – Leases
| | --- | ---------------------------------------------

| | (2) | Refer to Financial Statement Note 6 – Exploration and Evaluation Assets
| | --- | -----------------------------------------------------------------------



Depletion and depreciation rates

PNG assets (unit of production method)

Furniture and office equipment (declining balance
at rates of 5% to 25%)



Capitalized overhead

During the year ended December 31, 2015, Vermilion
capitalized $5.1 million (2014 - $7.7 million) of overhead costs directly attributable to PNG activities.



Impairments

On a quarterly basis, Vermilion performs an
assessment as to whether any CGUs have indicators of impairment. When indicators of impairment are identified, Vermilion assesses
the recoverable amount of the applicable CGU based on the higher of the estimated fair value less costs to sell and value in use
as at the reporting date. The estimated recoverable amount takes into account commodity price forecasts, expected production, estimated
costs and timing of development, and undeveloped land values.



As a result of declines in commodity price forecasts,
which decreased expected cash flows, Vermilion recorded a non-cash impairment charge of $131.6 million in the Canada segment for
the three months ended December 31, 2015 ($274.6 million for the year ended December 31, 2015, of which $219.8 million related
to PNG assets and $54.8 million related to E&E assets). The recoverable amount of each CGU was determined using a value in
use approach based on 2015 year end reserves and resource data, an after-tax discount rate of 9% for proved and probable reserves,
and an after-tax discount rate of 15% on resources carried within exploration and evaluation assets.



This impairment charge in the year ended December
31, 2015 related to the light crude oil play in Saskatchewan, Canada ($267.9 million based on a recoverable amount of $266.8 million)
and the shallow coal bed methane properties in Alberta, Canada ($6.7 million based on a recoverable amount of $19.7 million). The
determination of impairment is sensitive to changes in key judgments, including reserve or resource revisions, changes in forward
commodity prices and exchange rates, and changes in costs and timing of development. Changes in these key judgments would impact
the recoverable amount of CGUs, therefore resulting in additional impairment charges or recoveries. For the year ended December
31, 2015, a one percent increase in the assumed discount rate on expected cash flows of the Saskatchewan light crude oil and Alberta
shallow coal bed methane CGUs would result in an additional impairment of $19.5 million, and a five percent decrease in commodity
prices would result in an additional impairment of $33.3 million.



17


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


5. CAPITAL ASSETS (Continued)



Vermilion also identified indicators of impairment
on the Ireland CGU which consists of Vermilion’s non-operating interest in offshore Corrib natural gas field, but determined
that the recoverable amount exceeded its carrying value and accordingly, no impairment charge was recorded. For the year ended
December 31, 2015, a one percent increase in the assumed discount rate on expected cash flows of the Ireland CGU would have resulted
in impairment of $21.9 million, and a five percent decrease in commodity prices would result in an impairment of $33.6 million.



The following table outlines the forward commodity
price estimates that were used in the calculation of recoverable amounts:



|Forward Commodity Price Assumptions (1)
|---------------------------------------
|                                       
|2016                                   
|2017                                   
|2018                                   
|2019                                   
|2020                                   
|2021                                   
|2022                                   
|2023                                   
|2024                                   
|2025                                   
|Thereafter                             



| | (1) | Source: GLJ Petroleum Consultants price forecast, effective January 1, 2016.
| | --- | ----------------------------------------------------------------------------

| | (2) | The price of blended NGLs shown above is determined used a simple average for Ethane, Propane,
Butane, and C5+.
| | --- | ---------------------------------------------------------------------------------------------------------------



6. EXPLORATION AND EVALUATION ASSETS



The following table reconciles the change in Vermilion's exploration
and evaluation assets:



|($M)                                                 | Exploration and Evaluation Assets
|---------------------------------------------------- | ---------------------------------
|Balance at January 1, 2014                           |                                  
|Additions                                            |                                  
|Changes in estimate for asset retirement obligations |                                  
|Property acquisitions                                |                                  
|Corporate acquisitions                               |                                  
|Depreciation                                         |                                  
|Effect of movements in foreign exchange rates        |                                  
|Balance at December 31, 2014                         |                                  
|Changes in estimate for asset retirement obligations |                                  
|Property acquisitions                                |                                  
|Depreciation                                         |                                  
|Impairment (1)                                       |                                  
|Effect of movements in foreign exchange rates        |                                  
|Balance at December 31, 2015                         |                                  
|Cost                                                 |                                  
|Accumulated depreciation                             |                                  
|Carrying amount at December 31, 2014                 |                                  
|Cost                                                 |                                  
|Accumulated depreciation                             |                                  
|Carrying amount at December 31, 2015                 |                                  
|                                                     |                                  



| | (1) | Refer to Financial Statement Note 5 – Capital Assets
| | --- | ----------------------------------------------------



18


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


7. ASSET RETIREMENT OBLIGATIONS



The following table reconciles the change in
Vermilion’s asset retirement obligations:



|($M)                                                  | Asset Retirement Obligations
|----------------------------------------------------- | ----------------------------
|Balance at January 1, 2014                            |                             
|Additional obligations recognized                     |                             
|Changes in estimates for asset retirement obligations |                             
|Obligations settled                                   |                             
|Accretion                                             |                             
|Changes in discount rates                             |                             
|Effect of movements in foreign exchange rates         |                             
|Balance at December 31, 2014                          |                             
|Additional obligations recognized                     |                             
|Changes in estimates for asset retirement obligations |                             
|Obligations settled                                   |                             
|Accretion                                             |                             
|Changes in discount rates                             |                             
|Effect of movements in foreign exchange rates         |                             
|Balance at December 31, 2015                          |                             



Vermilion has estimated the net present value
of its asset retirement obligations to be $305.6 million as at December 31, 2015 (2014 - $350.8 million) based on a total undiscounted
future liability, after inflation adjustment, of $1.3 billion (2014 - $1.3 billion). These payments are expected to be made between
2016 and 2064. Vermilion calculated the present value of the obligations using discount rates between 7.1% and 10.3% (2014 - between
5.7% and 7.9%) to reflect the market assessment of the time value of money as well as risks specific to the liabilities that have
not been included in the cash flow estimates. Inflation rates used in determining the cash flow estimates were between 0.6% and
2.4% (2014 - between 0.8% and 2.4%).



Vermilion reviews annually its estimates of
the expected costs to reclaim the net interest in its wells and facilities. The resulting changes are categorized as changes in
estimates for existing obligations in the preceding table. The decrease in the liability for the year ended December 31, 2015 primarily
resulted from an overall increase in the discount rates applied to the abandonment obligations.



8. LONG-TERM
DEBT



The following
table summarizes Vermilion’s outstanding long-term debt:



|                           | As at       
|-------------------------- | ------------
|($M)                       | Dec 31, 2015
|Revolving credit facility  | 1,162,998   
|Senior unsecured notes (1) | 224,901     
|Long-term debt             | 1,387,899   



| | (1) | The senior unsecured notes, which matured on February 10, 2016, are included in the current portion
of long-term debt as at December 31, 2015.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------



Revolving Credit Facility



At December 31, 2015, Vermilion had in place
a bank revolving credit facility totalling $2 billion, of which approximately $1.16 billion was drawn. The facility, which matures
on May 31, 2019, is fully revolving up to the date of maturity.



The facility is extendable from time to time,
but not more than once per year, for a period not longer than four years, at the option of the lenders and upon notice from Vermilion.
If no extension is granted by the lenders, the amounts owing pursuant to the facility are due at the maturity date. This facility
bears interest at a rate applicable to demand loans plus applicable margins. For the year ended December 31, 2015, the interest
rate on the revolving credit facility was approximately 3.1% (2014 – 3.1%).



The amount available to Vermilion under this
facility is reduced by certain outstanding letters of credit associated with Vermilion’s operations totalling $25.2 million
as at December 31, 2015 (December 31, 2014 - $8.6 million).



19


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements




8. LONG-TERM
DEBT (Continued)



The facility is secured by various fixed and
floating charges against the subsidiaries of Vermilion. Under the terms of the facility, Vermilion must maintain:



| | - | A ratio of total borrowings (defined as amounts classified as “Long-term debt”, “Current
portion of long term debt”, and “Finance lease obligation” on the balance sheet and referred to collectively
as consolidated total debt), to consolidated net earnings before interest, income taxes, depreciation, accretion and other certain
non-cash items (defined as consolidated EBITDA) of not greater than 4.0.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | - | A ratio of consolidated total senior debt (defined as consolidated total debt excluding unsecured
and subordinated debt) to consolidated EBITDA of not greater than 3.0.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | - | A ratio of consolidated total senior debt to total capitalization (defined as amounts classified
as “Shareholders’ equity” on the balance sheet plus consolidated total senior debt as defined above) of not greater
than 50%.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As at December 31, 2015, Vermilion was in compliance
with all financial covenants.



Senior Unsecured Notes



On February 10, 2011, Vermilion issued $225.0
million of senior unsecured notes at par. The notes bear interest at a rate of 6.5% per annum and matured on February 10, 2016.
As direct senior unsecured obligations of Vermilion, the notes ranked pari passu with all other present and future unsecured and
unsubordinated indebtedness of the Company. The notes were initially recognized at fair value net of transaction costs and were
subsequently measured at amortized cost using an effective interest rate of 7.1%.



Subsequent to December 31, 2015, Vermilion repaid
the senior unsecured notes using funds from the revolving credit facility.



9. INCOME TAXES



Deferred taxes



The net deferred income tax liability at December 31, 2015 and 2014
is comprised of the following:



|                                  |                               | Year Ended  
|--------------------------------- | ----------------------------- | ------------
|($M)                              | Dec 31, 2015                  | Dec 31, 2014
|Deferred income tax liabilities:  |                               |             
|                                  | Derivative contracts          |             
|                                  | Capital assets                |             
|                                  | Asset retirement obligations  |             
|                                  | Unrealized foreign exchange   |             
|                                  | Other                         |             
|Deferred income tax assets:       |                               |             
|                                  | Capital assets                |             
|                                  | Non-capital losses            |             
|                                  | Asset retirement obligations  |             
|                                  | Unrealized foreign exchange   |             
|                                  | Other                         |             
|Net deferred income tax liability |                               | (218,901)   
|Comprised of:                     |                               |             
|                                  | Deferred income tax assets    |             
|                                  | Deferred income tax liability |             
|Net deferred income tax liability |                               | (218,901)   



20


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements




9. INCOME TAXES (Continued)



Income tax expense differs from the amount that would have been expected
if the reported earnings had been subject only to the statutory Canadian income tax rate of 26.2% (2014 - 25.5%), as follows:





|                                             |                                                                                                       | Year Ended  
|-------------------------------------------- | ----------------------------------------------------------------------------------------------------- | ------------
|($M)                                         | Dec 31, 2015                                                                                          | Dec 31, 2014
|Earnings (loss) before income taxes          |                                                                                                       | (213,915)   
|Canadian corporate tax rate                  |                                                                                                       | 26.2%(1)    
|Expected tax expense (recovery)              |                                                                                                       | (56,046)    
|Increase (decrease) in taxes resulting from: |                                                                                                       |             
|                                             | Petroleum resource rent tax rate (PRRT) differential(2)                                               |             
|                                             | Foreign tax rate differentials(2), (3)                                                                |             
|                                             | Equity based compensation expense                                                                     |             
|                                             | Amended returns and changes to estimated tax pools and tax positions                                  |             
|                                             | Changes in statutory tax rates and the estimated reversal rates associated with temporary differences |             
|                                             | Valuation allowance                                                                                   |             
|                                             | Other non-deductible items                                                                            |             
|Provision for income taxes                   |                                                                                                       | 3,387       





| | (1) | The corporate tax rate increased to 26.2% in 2015 from 25.5% in 2014 due to the Alberta corporate
tax rate increase of 2.0% effective July 1, 2015.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | In Australia, current taxes include both corporate income tax rates and PRRT. Corporate income
tax rates were applied at a rate of 30% and PRRT was applied at a rate of 40%.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | The combined tax rate was 34.4% in France, 46.0% in the Netherlands, 24.2% in Germany, 25% in Ireland,
and 35% in the United States. The corporate tax rate for Germany increased to 24.2% (2014 - 22.8%) due to a trade tax increase
of 1.4% effective January 2015.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



10. SHAREHOLDERS’
CAPITAL



The following table reconciles the change in
Vermilion’s shareholders’ capital:



|Shareholders’ Capital                                                            | Number of Shares ('000s) |         | Amount ($M)
|-------------------------------------------------------------------------------- | ------------------------ | ------- | -----------
|Balance as at January 1, 2014                                                    |                          | 102,123 |            
|Shares issued pursuant to corporate acquisition                                  |                          | 2,827   |            
|Shares issued pursuant to the dividend reinvestment plan                         |                          | 1,279   |            
|Vesting of equity based awards                                                   |                          | 955     |            
|Share-settled dividends on vested equity based awards                            |                          | 108     |            
|Shares issued pursuant to the bonus plan                                         |                          | 11      |            
|Balance as at December 31, 2014                                                  |                          | 107,303 |            
|Shares issued pursuant to the dividend reinvestment and Premium DividendTM plans |                          | 3,338   |            
|Vesting of equity based awards                                                   |                          | 1,158   |            
|Share-settled dividends on vested equity based awards                            |                          | 135     |            
|Shares issued pursuant to the employee savings and bonus plans                   |                          | 57      |            
|Balance as at December 31, 2015                                                  |                          | 111,991 |            



Vermilion is authorized to issue an unlimited
number of common shares with no par value.



Dividends



Dividends declared to shareholders for the year
ended December 31, 2015 were $283.6 million (2014 - $272.7 million). Dividends are approved by the Board of Directors and are paid
monthly. Vermilion has a dividend reinvestment plan (“DRIP”) which allows eligible holders of common shares to purchase
additional common shares at a 3% discount to market by reinvesting their cash dividends. Additionally, an amendment to the existing
DRIP to include a Premium DividendTM Component was announced in February 2015. With the addition of the Premium DividendTM
Component eligible shareholders have the option to reinvest their dividends in new common shares which are exchanged for a premium
cash payment equal to 101.5% of the reinvested dividends.



Subsequent to the end of year-end and prior
to the consolidated financial statements being authorized for issue on February 25, 2016, Vermilion declared dividends totalling
$48.5 million or $0.215 per share for each of January and February of 2016.



21


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


11. EQUITY BASED COMPENSATION



The following table summarizes the number of
awards outstanding under the Vermilion Incentive Plan (“VIP”):



|Number of Awards ('000s) | 2015  |  | 2014 
|------------------------ | ----- |  | -----
|Opening balance          | 1,775 |  | 1,665
|Granted                  | 609   |  | 707  
|Vested                   | (587) |  | (515)
|Modified                 | -     |  | (21) 
|Forfeited                | (86)  |  | (61) 
|Closing balance          | 1,711 |  | 1,775



The fair value of a VIP award is determined
on the grant date at the closing price of Vermilion’s common shares on the Toronto Stock Exchange, adjusted by the estimated
performance factor that will ultimately be achieved. Dividends, which notionally accrue to the awards during the vesting period,
are not included in the determination of grant date fair values. For the year ended December 31, 2015, the awards granted had a
weighted average fair value of $80.70 (2014 - $101.63).



The performance factor is determined by the
Board of Directors after consideration of Company performance using Vermilion’s balanced scorecard metrics including, but
not limited to, relative total shareholder return, financial and operational performance, and performance on strategic objectives.



The expense recognized is based on the grant
date fair value of the awards and incorporates an estimate of forfeiture rate based on historical vesting data. For the year ended
December 31, 2015, Vermilion incorporated an estimated forfeiture rate of 4.8% (2014 - 5.8%). Equity based compensation expense
of $72.6 million was recorded during the year ended December 31, 2015 (2014 - $67.1 million) related to the VIP.



12. PER SHARE AMOUNTS



Basic and diluted net earnings (loss) per share have been determined
based on the following:





|                                                | Year Ended  
|----------------------------------------------- | ------------
|($M except per share amounts)                   | Dec 31, 2015
|Net (loss) earnings [1]                         | (217,302)   
|Basic weighted average shares outstanding [2]   | 109,642     
|Dilutive impact of equity based awards          | -           
|Diluted weighted average shares outstanding [3] | 109,642     
|Basic (loss) earnings per share ([1] ÷ [2])     | (1.98)      
|Diluted (loss) earnings per share ([1] ÷ [3])   | (1.98)      



13. DERIVATIVE INSTRUMENTS



The nature of Vermilion’s operations results
in exposure to fluctuations in commodity prices, interest rates and foreign currency exchange rates. Vermilion monitors and, when
appropriate, uses derivative financial instruments to manage its exposure to these fluctuations. All transactions of this nature
entered into by Vermilion are related to an underlying financial position or to future crude oil and natural gas production. Vermilion
does not use derivative financial instruments for speculative purposes. Vermilion has elected not to designate any of its derivative
financial instruments as accounting hedges and thus accounts for changes in fair value in net earnings at each reporting period.
Vermilion has not obtained collateral or other security to support its financial derivatives as management reviews the creditworthiness
of its counterparties prior to entering into derivative contracts.



During the normal course of business, Vermilion
may enter into fixed price arrangements to sell a portion of its production or purchase commodities for operational use. Vermilion
does not apply fair value accounting on these contracts as they were entered into and continue to be held for the sale of production
or operational use in accordance with the Company’s expected requirements.



22


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


13. DERIVATIVE INSTRUMENTS (Continued)



The following tables summarize Vermilion’s
outstanding risk management positions as at December 31, 2015:



|                                      | Note | Volume        | Strike Price(s)        
|------------------------------------- | ---- | ------------- | -----------------------
|Crude Oil                             |      |               |                        
|WTI - Collar                          |      |               |                        
|July 2015 - March 2016                | 1    | 250 bbl/d     | 75.00 - 83.45 CAD $    
|July 2015 - June 2016                 | 2    | 500 bbl/d     | 75.50 - 85.08 CAD $    
|Dated Brent - Collar                  |      |               |                        
|July 2015 - June 2016                 | 3    | 1,000 bbl/d   | 80.50 - 93.49 CAD $    
|July 2015 - June 2016                 | 4    | 500 bbl/d     | 64.50 - 75.48 US $     
|October 2015 - June 2016              | 5    | 250 bbl/d     | 82.00 - 94.55 CAD $    
|January 2016 - June 2016              | 1    | 250 bbl/d     | 84.00 - 93.70 CAD $    
|                                      |      |               |                        
|North American Natural Gas            |      |               |                        
|AECO - Collar                         |      |               |                        
|November 2015 - March 2016            |      | 2,500 GJ/d    | 2.50 - 3.76 CAD $      
|November 2015 - October 2016          |      | 10,000 GJ/d   | 2.56 - 3.23 CAD $      
|January 2016 - December 2016          |      | 10,000 GJ/d   | 2.53 - 3.29 CAD $      
|April 2016 - October 2016             |      | 5,000 GJ/d    | 2.30 - 2.80 CAD $      
|AECO Basis - Fixed Price Differential |      |               |                        
|November 2015 - March 2016            |      | 2,500 mmbtu/d | Nymex HH less 0.47 US $
|Nymex HH - Collar                     |      |               |                        
|November 2015 - March 2016            | 6    | 5,000 mmbtu/d | 3.25 - 3.86 US $       



| | (1) | The contracted volumes increase to 500 boe/d for any monthly settlement periods above the contracted
ceiling price and are settled on the monthly average price (monthly average US$/bbl multiplied by the Bank of Canada monthly average
noon day rate).
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | The contracted volumes increase to 1,250 boe/d for any monthly settlement periods above the contracted
ceiling price and are settled on the monthly average price (monthly average US$/bbl multiplied by the Bank of Canada monthly average
noon day rate).
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | The contracted volumes increase to 2,500 boe/d for any monthly settlement periods above the contracted
ceiling price and are settled on the monthly average price (monthly average US$/bbl multiplied by the Bank of Canada monthly average
noon day rate).
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (4) | The contracted volumes increase to 1,000 boe/d for any monthly settlement periods above the contracted
ceiling price.
| | --- | ---------------------------------------------------------------------------------------------------------------------

| | (5) | The contracted volumes increase to 750 boe/d for any monthly settlement periods above the contracted
ceiling price and are settled on the monthly average price (monthly average US$/bbl multiplied by the Bank of Canada monthly average
noon day rate).
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (6) | The contracted volumes increase to 10,000 mmbtu/d for any monthly settlement periods above the
contracted ceiling price.
| | --- | ------------------------------------------------------------------------------------------------------------------------



23


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


13. DERIVATIVE INSTRUMENTS (Continued)



|                                | Note | Volume                 | Strike Price(s)  
|------------------------------- | ---- | ---------------------- | -----------------
|European Natural Gas            |      |                        |                  
|NBP - Call                      |      |                        |                  
|October 2016 - March 2017       |      | 2,638 GJ/d             | 4.64 GBP £       
|NBP - Collar                    |      |                        |                  
|April 2016 - March 2017         |      | 2,638 GJ/d             | 3.79 - 4.53 GBP £
|January 2017 - December 2017    |      | 2,638 GJ/d             | 3.22 - 3.75 GBP £
|January 2018 - December 2018    |      | 2,638 GJ/d             | 2.99 - 3.63 GBP £
|NBP - Put                       |      |                        |                  
|April 2016 - September 2016     |      | 2,638 GJ/d             | 3.79 GBP £       
|NBP - Swap                      |      |                        |                  
|July 2015 - March 2016          |      | 2,592 GJ/d             | 6.42 EUR €       
|October 2015 - March 2016       |      | 10,368 GJ/d            | 6.54 EUR €       
|January 2016 - June 2016        |      | 5,184 GJ/d             | 6.24 EUR €       
|January 2016 - June 2016        |      | 2,592 GJ/d             | 6.82 US $        
|July 2016 - March 2017          |      | 2,592 GJ/d             | 5.43 EUR €       
|January 2017 - December 2017    | 1    | 2,638 GJ/d             | 4.00 GBP £       
|January 2018 - December 2018    | 2    | 2,638 GJ/d             | 3.83 GBP £       
|TTF - Call                      |      |                        |                  
|October 2016 - March 2017       |      | 2,592 GJ/d             | 6.03 EUR €       
|TTF - Collar                    |      |                        |                  
|January 2016 - December 2016    | 3    | 2,592 GJ/d             | 5.76 - 6.50 EUR €
|April 2016 - December 2016      | 4    | 12,960 GJ/d            | 5.58 - 6.21 EUR €
|April 2016 - March 2017         | 5    | 5,184 GJ/d             | 5.28 - 6.35 EUR €
|July 2016 - December 2016       |      | 2,592 GJ/d             | 5.00 - 5.63 EUR €
|July 2016 - March 2017          | 3    | 2,592 GJ/d             | 5.07 - 6.56 EUR €
|July 2016 - March 2018          | 3    | 2,592 GJ/d             | 5.32 - 6.54 EUR €
|October 2016 - December 2017    |      | 2,592 GJ/d             | 5.00 - 5.89 EUR €
|January 2017 - December 2017    | 6    | 7,776 GJ/d             | 5.00 - 6.15 EUR €
|January 2018 - December 2018    |      | 5,184 GJ/d             | 4.17 - 5.03 EUR €
|TTF - Put                       |      |                        |                  
|April 2016 - September 2016     |      | 2,592 GJ/d             | 5.21 EUR €       
|TTF - Swap                      |      |                        |                  
|January 2015 - March 2016       |      | 5,184 GJ/d             | 6.40 EUR €       
|January 2015 - June 2016        |      | 2,592 GJ/d             | 6.07 EUR €       
|February 2015 - March 2016      |      | 5,184 GJ/d             | 6.24 EUR €       
|April 2015 - March 2016         |      | 5,832 GJ/d             | 6.18 EUR €       
|October 2015 - March 2016       |      | 2,592 GJ/d             | 6.64 EUR €       
|January 2016 - June 2016        |      | 5,184 GJ/d             | 5.94 EUR €       
|April 2016 - December 2016      |      | 2,592 GJ/d             | 5.91 EUR €       
|July 2016 - June 2018           |      | 2,700 GJ/d             | 5.58 EUR €       
|October 2016 - December 2016    |      | 2,592 GJ/d             | 5.45 EUR €       
|January 2017 - December 2017    | 7    | 2,592 GJ/d             | 5.04 EUR €       
|                                |      |                        |                  
|Electricity                     |      |                        |                  
|AESO - Swap                     |      |                        |                  
|January 2016 - December 2016    |      | 93.6 MWh/d             | 38.58 CAD $      
|                                |      |                        |                  
|Interest Rate                   |      |                        |                  
|CDOR to fixed - Swap            |      |                        |                  
|September 2015 - September 2019 |      | 100,000,000 CAD $/year | 1.00 %           
|October 2015 - October 2019     |      | 100,000,000 CAD $/year | 1.10 %           



| | (1) | On the last business day of each month, the counterparty has the option to increase the contracted
volumes by an additional 2,638 GJ/d at the contracted price, for the following month.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | On the last business day of each month, the counterparty has the option to increase the contracted
volumes to 7,913 GJ/d at the contracted price, for the following month.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | The contracted volumes increase to 5,184 GJ/d for any monthly settlement periods above the contracted
ceiling price.
| | --- | --------------------------------------------------------------------------------------------------------------------

| | (4) | The contracted volumes increase to 15,552 GJ/d for any monthly settlement periods above the contracted
ceiling price.
| | --- | ---------------------------------------------------------------------------------------------------------------------

| | (5) | The contracted volumes increase to 10,368 GJ/d for any monthly settlement periods above the contracted
ceiling price.
| | --- | ---------------------------------------------------------------------------------------------------------------------

| | (6) | The contracted volumes increase to 18,144 GJ/d for any monthly settlement periods above the contracted
ceiling price.
| | --- | ---------------------------------------------------------------------------------------------------------------------

| | (7) | On the last business day of each month, the counterparty has the option to increase the contracted
volumes by an additional 5,184 GJ/d at the contracted price, for the following month.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





24


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


13. DERIVATIVE
INSTRUMENTS (Continued)



The following table reconciles the change in the fair
value of Vermilion’s derivative instruments:





|                                                                                |                              | Year Ended  
|------------------------------------------------------------------------------- | ---------------------------- | ------------
|($M)                                                                            | Dec 31, 2015                 | Dec 31, 2014
|Fair value of contracts, beginning of year                                      | 24,794                       |             
|Reversal of opening contracts settled during the year                           | (23,391)                     |             
|Acquired derivative contracts                                                   | -                            |             
|Realized gain on contracts settled during the year                              | 41,356                       |             
|Unrealized gain during the year on contracts outstanding at the end of the year | 66,939                       |             
|Net receipt from counterparties on contract settlements during the year         | (41,356)                     |             
|Fair value of contracts, end of year                                            | 68,342                       |             
|Comprised of:                                                                   |                              |             
|                                                                                | Current derivative asset     | 55,214      
|                                                                                | Non-current derivative asset | 13,128      
|Fair value of contracts, end of year                                            | 68,342                       |             







The gain on derivative instruments for 2015 and 2014 were
comprised of the following:





|                                                                                | Year Ended  
|------------------------------------------------------------------------------- | ------------
|($M)                                                                            | Dec 31, 2015
|Realized gain on contracts settled during the year                              | (41,356)    
|Reversal of opening contracts settled during the year                           | 23,391      
|Unrealized gain during the year on contracts outstanding at the end of the year | (66,939)    
|Gain on derivative instruments                                                  | (84,904)    



14. SUPPLEMENTAL CASH FLOW INFORMATION



Changes in non-cash working capital is comprised of the following:



|                                              | Year Ended                              
|--------------------------------------------- | ----------------------------------------
|($M)                                          | Dec 31, 2015                            
|Changes in:                                   |                                         
|                                              | Accounts receivable                     
|                                              | Crude oil inventory                     
|                                              | Prepaid expenses                        
|                                              | Accounts payable and accrued liabilities
|                                              | Income taxes payable                    
|                                              | Movements in foreign exchange rates     
|Changes in non-cash working capital           | (86,370)                                
|Changes in non-cash operating working capital | (60,390)                                
|Changes in non-cash investing working capital | (25,980)                                
|Changes in non-cash working capital           | (86,370)                                



25


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


15. SEGMENTED INFORMATION



Vermilion has operations in three core areas:
North America, Europe, and Australia. Vermilion’s operating activities in each country relate solely to the exploration,
development and production of petroleum and natural gas. Vermilion has a Corporate head office located in Calgary, Alberta. Costs
incurred in the Corporate segment relate to Vermilion’s global hedging program and expenses incurred in financing and managing
our operating business units.



Vermilion’s chief operating decision maker
reviews the financial performance of the Company by assessing the fund flows from operations of each country individually. Fund
flows from operations provides a measure of each business unit’s ability to generate cash (that is not subject to short-term
movements in non-cash operating working capital) necessary to pay dividends, fund asset retirement obligations, and make capital
investments.



|                                            | Year
    Ended December 31, 2015
|------------------------------------------- | --------------------------------
|($M)                                        | Canada                          
|Total
    assets                            | 1,609,180                       
|Drilling
    and development                | 201,508                         
|Oil
    and gas sales to external customers | 320,613                         
|Royalties                                   | (28,144)                        
|Revenue
    from external customers         | 292,469                         
|Transportation
    expense                  | (16,326)                        
|Operating
    expense                       | (89,085)                        
|General
    and administration              | (16,888)                        
|PRRT                                        | -                               
|Corporate
    income taxes                  | -                               
|Interest
    expense                        | -                               
|Realized
    gain on derivative instruments | -                               
|Realized
    foreign exchange gain          | -                               
|Realized
    other income                   | -                               
|Fund
    flows from operations              | 170,170                         



|                                            | Year
    Ended December 31, 2014
|------------------------------------------- | --------------------------------
|($M)                                        | Canada                          
|Total
    assets                            | 1,865,942                       
|Drilling
    and development                | 291,046                         
|Exploration
    and evaluation              | 43,696                          
|Oil
    and gas sales to external customers | 537,788                         
|Royalties                                   | (65,563)                        
|Revenue
    from external customers         | 472,225                         
|Transportation
    expense                  | (14,625)                        
|Operating
    expense                       | (76,178)                        
|General
    and administration              | (16,791)                        
|PRRT                                        | -                               
|Corporate
    income taxes                  | -                               
|Interest
    expense                        | -                               
|Realized
    gain on derivative instruments | -                               
|Realized
    foreign exchange loss          | -                               
|Realized
    other income                   | -                               
|Fund
    flows from operations              | 364,631                         



26


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


15. SEGMENTED INFORMATION (Continued)



Reconciliation of fund flows from operations to net earnings (loss)



|                                          | Year Ended  
|----------------------------------------- | ------------
|($M)                                      | Dec 31, 2015
|Fund flows from operations                | 516,167     
|Equity based compensation                 | (75,232)    
|Unrealized gain on derivative instruments | 43,548      
|Unrealized foreign exchange loss          | 8,787       
|Unrealized other expense                  | (1,008)     
|Accretion                                 | (23,911)    
|Depletion and depreciation                | (458,758)   
|Deferred taxes                            | 47,728      
|Impairment                                | (274,623)   
|Net earnings (loss)                       | (217,302)   



Vermilion has two major customers with revenues
in excess of 10% within the France and Netherlands segments. Substantially all sales in the France and Netherlands segments for
the years ended December 31, 2015 and 2014 were to one customer in each respective segment.



16. LEASES



Vermilion had the following future commitments associated with its
operating and finance leases as at December 31, 2015:



|($M)                                           | Less than 1 year                        | 1 - 3 years | 4 - 5 years | After 5 years | Total  
|---------------------------------------------- | --------------------------------------- | ----------- | ----------- | ------------- | -------
|Operating lease payments by period             | 20,750                                  | 30,942      | 23,909      | 49,734        | 125,335
|Finance lease minimum lease payments by period | 6,285                                   | 12,571      | 9,515       | 6,984         | 35,355 
|                                               | Interest                                | 2,079       | 3,077       | 1,521         | 907    
|                                               | Present value of minimum lease payments | 6,029       | 10,746      | 7,069         | 4,148  



In addition, Vermilion has various other commitments
associated with its business operations; none of which, in management’s view, are significant in relation to Vermilion’s
financial position.



As part of an acquisition in April of 2014,
Vermilion assumed an agreement for the use of a solution gas facility. The substance of the arrangement was determined to be a
lease and has been classified as a finance lease. The assets are to be used for a minimum period of 10 years, with an option to
renew. As at December 31, 2015, the carrying amount of the asset included in capital assets is $28.4 million, and the current portion
of the finance lease obligation included in accrued liabilities in $5.9 million.



17. CASH AND CASH EQUIVALENTS



Cash and cash equivalents was comprised of the following:





|($M)                                         | Dec 31, 2015 | Dec 31, 2014
|-------------------------------------------- | ------------ | ------------
|Money on deposit with financial institutions | 31,175       | 116,643     
|Short-term investments                       | 10,501       | 3,762       
|Cash and cash equivalents                    | 41,676       | 120,405     





27


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


18. CAPITAL DISCLOSURES



Vermilion defines capital as net debt (a non-standardized
measure, which is defined by management as long-term debt as shown on the consolidated balance sheets plus net working capital)
and shareholders’ capital.



In managing capital, Vermilion reviews whether
fund flows from operations (a non-standardized measure, defined by management as cash flows from operating activities before changes
in non-cash operating working capital and asset retirement obligations settled), is sufficient to pay for all capital expenditures,
dividends and abandonment and reclamation expenditures. To the extent that the forecasted fund flows from operations is not expected
to be sufficient in relation to these expenditures, Vermilion will evaluate its ability to finance any excess with debt, an issuance
of equity or by reducing some or all categories of expenditures to ensure that total expenditures do not exceed available funds.



Additionally, Vermilion monitors the ratio of
net debt to fund flows from operations. Vermilion typically strives to maintain an internally targeted ratio of net debt to fund
flows from operations of 1.0 to 1.3 in a normalized commodity price environment. Where prices trend higher, Vermilion may target
a lower ratio and conversely, in a lower commodity price environment, the acceptable ratio may be higher. At times, Vermilion will
use its balance sheet to finance acquisitions and, in these situations, Vermilion is prepared to accept a higher ratio in the short
term but will implement a plan to reduce the ratio to acceptable levels within a reasonable period of time, usually considered
to be no more than 12 to 18 months. This plan could potentially include an increase in hedging activities, a reduction in capital
expenditures, an issuance of equity or the utilization of excess fund flows from operations to reduce outstanding indebtedness.



In the current low commodity price environment,
the net debt to fund flows ratio is expected to be higher than the longer term ratio. During this period, Vermilion is managing
the higher debt level by aligning capital expenditures within forecasted fund flows from operations, which is continually monitored
for revised forward price estimates, as well as by hedging additional European natural gas volumes to maintain a diversified commodity
portfolio.



The following table calculates Vermilion’s
ratio of net debt to fund flows from operations:



|                                                            | Year Ended  
|----------------------------------------------------------- | ------------
|($M except as indicated)                                    | Dec 31, 2015
|Long-term debt                                              | 1,162,998   
|Current liabilities(1)                                      | 503,731     
|Current assets                                              | (284,778)   
|Net debt [1]                                                | 1,381,951   
|Cash flows from operating activities                        | 444,408     
|Changes in non-cash operating working capital               | 60,390      
|Asset retirement obligations settled                        | 11,369      
|Fund flows from operations [2]                              | 516,167     
|Ratio of net debt to fund flows from operations ([1] ÷ [2]) | 2.7         



| | (1) | Includes the current portion of long-term debt, which, as at December 31, 2015, represents the
senior unsecured notes that matured on February 10, 2016.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------



Long-term debt, including the current
portion, as at December 31, 2015 increased to $1.39 billion from $1.24 billion as at December 31, 2014, primarily as a result of
draws on the revolving credit facility to fund capital expenditures as fund flows from operations for the year ended December 31,
2015 were lower due to weakening crude oil and natural gas prices. The increase in long-term debt resulted in an increase in net
debt from $1.27 billion as at December 31, 2014 to $1.38 billion as at December 31, 2015.



Driven primarily by the weakness in crude
oil prices, the ratio of net debt to fund flows from operations increased to 2.7 times for the year ended December 31, 2015.





28


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


19. FINANCIAL INSTRUMENTS



Classification of Financial Instruments



The following table summarizes information relating to Vermilion’s
financial instruments as at December 31, 2015 and December 31, 2014:



|                                 |                                              |                       |                                                                                                                                                                |  |  |                    | As
    at Dec 31, 2015 |             |  | As
    at Dec 31, 2014 |             |                    |            
|-------------------------------- | -------------------------------------------- | --------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | ------------------ | ---------------------- | ----------- |  | ---------------------- | ----------- | ------------------ | -----------
|Class
    of financialinstrument | Consolidated
    balancesheet caption        | Accountingdesignation | Related
    caption on Statement of NetEarnings (Loss)                                                                                                         |  |  | Carryingvalue ($M) | Fair
    value($M)     |             |  | Carryingvalue ($M)     |             | Fair
    value($M) |            
|Cash                             | Cash
    and cash equivalents                | HFT                   | Gains
    and losses on foreign exchange are included in foreign exchange (gain) loss                                                                          |  |  | 41,676             |                        | 41,676      |  |                        | 120,405     |                    | 120,405    
|Receivables                      | Accounts
    receivable                      | LAR                   | Gains
    and losses on foreign exchange are included in foreign exchange (gain) loss and impairments are recognized as general and
    administration expense |  |  | 160,499            |                        | 160,499     |  |                        | 171,820     |                    | 171,820    
|Derivative
    assets            | Derivative
    instruments                   | HFT                   | Gain
    on derivative instruments                                                                                                                             |  |  | 68,342             |                        | 68,342      |  |                        | 24,794      |                    | 24,794     
|Payables                         | Accounts
    payable and accrued liabilities | OTH                   | Gains
    and losses on foreign exchange are included in foreign exchange (gain) loss                                                                          |  |  | (272,824)          |                        | (272,824)   |  |                        | (321,266)   |                    | (321,266)  
|                                 | Dividends
    payable                        |                       |                                                                                                                                                                |  |  |                    |                        |             |  |                        |             |                    |            
|Long-term
    debt               | Long-term
    debt                           | OTH                   | Interest
    expense                                                                                                                                           |  |  | (1,387,899)        |                        | (1,387,998) |  |                        | (1,238,080) |                    | (1,238,505)



The accounting designations used in the above
table refer to the following:



HFT – Classified as “Held for trading”
in accordance with International Accounting Standard 39 “Financial Instruments: Recognition and Measurement”. These
financial assets and liabilities are carried at fair value on the consolidated balance sheets with associated gains and losses
reflected in net earnings (loss).



LAR – “Loans and receivables”
are initially recognized at fair value and are subsequently measured at amortized cost. Impairments and foreign exchange gains
and losses are recognized in net earnings (loss).



OTH – “Other financial liabilities”
are initially recognized at fair value net of transaction costs directly attributable to the issuance of the instrument and subsequently
are measured at amortized cost. Interest is recognized in net earnings (loss) using the effective interest method. Foreign exchange
gains and losses are recognized in net earnings (loss).



Level 1 – Fair value measurement is determined
by reference to unadjusted quoted prices in active markets for identical assets or liabilities.



Level 2 – Fair value measurement is determined
based on inputs other than unadjusted quoted prices that are observable, either directly or indirectly.



Level 3 – Fair value measurement is based
on inputs for the asset or liability that are not based on observable market data.



Determination of Fair Values



The level in the fair value hierarchy into which
the fair value measurements are categorized is determined on the basis of the lowest level input that is significant to the fair
value measurement. Transfers between levels on the fair value hierarchy are deemed to have occurred at the end of the reporting
period.



Fair values for derivative assets and derivative
liabilities are determined using pricing models incorporating future prices that are based on assumptions which are supported by
prices from observable market transactions and are adjusted for credit risk.



The carrying value of receivables approximate
their fair value due to their short maturities.



The carrying value of long-term debt outstanding
on the revolving credit facility approximates its fair value due to the use of short-term borrowing instruments at market rates
of interest.



The fair value of the senior unsecured notes
changes in response to changes in the market rates of interest payable on similar instruments and was determined with reference
to prevailing market rates for such instruments.



29


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


19. FINANCIAL INSTRUMENTS (Continued)



Nature and Extent of Risks Arising from
Financial Instruments



Vermilion is exposed to the following types
of risks in relation to its financial instruments:



Credit risk:

Vermilion extends credit to customers and is
due amounts from counterparties in relation to derivative instruments. Accordingly, there is a risk of financial loss in the event
that a counterparty fails to discharge its obligation. For transactions that are financially significant, Vermilion reviews third-party
credit ratings and may require additional forms of security. Cash held on behalf of the Company by financial institutions is also
subject to credit risk.



Liquidity risk:

Liquidity risk is the risk that Vermilion will
encounter difficulty in meeting obligations associated with its financial liabilities. Vermilion does not consider this to be a
significant risk as its financial position and available committed borrowing facility provide significant financial flexibility
and allow Vermilion to meet its obligations as they come due.



Currency risk:

Vermilion conducts business in foreign currencies
in addition to Canadian dollars and accordingly is subject to currency risk associated with changes in foreign exchange rates in
relation to cash and cash equivalents, receivables, payables and derivative assets and liabilities. The impact related to working
capital is somewhat mitigated as a result of the offsetting effects of foreign exchange fluctuations on assets and liabilities.
Vermilion monitors its exposure to currency risk and reviews whether the use of derivative financial instruments is appropriate
to manage potential fluctuations in foreign exchange rates.



Commodity price risk:

Vermilion uses derivative financial instruments
as part of its risk management program to mitigate the effects of changes in commodity prices on future cash flows. Changes in
the underlying commodity prices impact the fair value and future cash flows related to these derivatives.



Interest rate risk:

Vermilion’s long-term debt is comprised
of borrowings under the revolving credit facility and the Company’s senior unsecured notes. Borrowings under the revolving
credit facility bear interest at market rates plus applicable margins and as such changes in interest rates could result in an
increase or decrease in the amount Vermilion pays to service this debt. In 2015, Vermilion had interest rate swaps to mitigate
the effects of changes in variable interest rates. The senior unsecured notes bear interest at a fixed 6.5% interest rate and as
such, changes in prevailing interest rates would affect the fair value of these notes. However, as Vermilion does not intend to
settle this debt prior to maturity, the notes are carried at amortized cost and changes in fair value do not affect net earnings.



Summarized Quantitative Data Associated
with the Risks Arising from Financial Instruments



Credit risk:

As at December 31, 2015, Vermilion’s maximum
exposure to receivable credit risk was $228.8 million (December 31, 2014 - $196.6 million) which is the aggregate value of receivables
and derivative assets at the balance sheet date. Vermilion’s receivables are primarily due from counterparties that have
investment grade third party credit ratings or, in the absence of the availability of such ratings, have been satisfactorily reviewed
by Vermilion for creditworthiness. Additionally, cash and cash equivalents consist of moneys on deposit and short-term investments
which may be subject to counterparty credit risk. Vermilion mitigates this risk by transacting with North American institutions
with high third party credit ratings.



As at the balance sheet date the amount of financial
assets that were past due or impaired was not material.



Liquidity risk:

Vermilion’s derivative financial instruments
settle on a monthly basis.



30


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


19. FINANCIAL INSTRUMENTS (Continued)



The following table summarizes Vermilion’s undiscounted non-derivative
financial liabilities and their contractual maturities as at December 31, 2015 and December 31, 2014:



|                  |           | Later than     | Later than       | Later than    
|----------------- | --------- | -------------- | ---------------- | --------------
|                  |           | one month and  | three months and | one year and  
|                  | Due in    | not later than | not later than   | not later than
|($M)              | one month | three months   | one year         | five years    
|December 31, 2015 | 112,890   | 353,934        | 33,663           | 1,180,486     
|December 31, 2014 | 162,127   | 138,823        | 20,314           | 1,239,067     



Market risk:

Vermilion’s financial instruments are
exposed to currency risk related to changes in foreign currency denominated financial instruments and commodity price risk related
to outstanding derivative positions. The following table summarizes what the impact on comprehensive income before tax would be
for the year ended December 31, 2015 given changes in the relevant risk variables that Vermilion considers were reasonably possible
at the balance sheet date. The impact on comprehensive income before tax associated with changes in these risk variables for assets
and liabilities that are not considered financial instruments are excluded from this analysis. This analysis does not attempt to
reflect any interdependencies between the relevant risk variables.



|                                 | Before
    tax effect on comprehensive                                                              
|-------------------------------- | ----------------------------------------------------------------------------------------------------
|                                 | income
    - increase (decrease)                                                                    
|Risk
    ($M)                    | Description
    of change in risk variable                                                          
|Currency risk - Euro to Canadian | Increasein strength of the Canadian dollar against the Euro by 5% over the relevant closing rates   
|                                 |                                                                                                     
|                                 | Decreasein strength of the Canadian dollar against the Euro by 5% over the relevant closing rates   
|                                 |                                                                                                     
|Currency risk - US $ to Canadian | Increasein strength of the Canadian dollar against the US $ by 5% over the relevant closing rates   
|                                 |                                                                                                     
|                                 | Decreasein strength of the Canadian dollar against the US $ by 5% over the relevant closing rates   
|                                 |                                                                                                     
|Commodity price risk             | Increasein relevant oil reference price within option pricing models used to determine              
|                                 | the
    fair value of financial derivatives by US $5.00/bbl at the relevant valuation dates         
|                                 |                                                                                                     
|                                 | Decreasein relevant oil reference price within option pricing models used to determine              
|                                 | the
    fair value of financial derivatives by US $5.00/bbl at the relevant valuation dates         
|                                 |                                                                                                     
|                                 | Increasein relevant European natural gas reference price within option pricing models used to       
|                                 | determine
    the fair value of financial derivatives by €0.5/GJ at
    the relevant valuation dates
|                                 |                                                                                                     
|                                 | Decreasein relevant European natural gas reference price within option pricing models used to       
|                                 | determine
    the fair value of financial derivatives by €0.5/GJ at
    the relevant valuation dates
|                                 |                                                                                                     
|Interest rate risk               | Increasein average Canadian prime interest rate by 100 basis points during the relevant periods     
|                                 |                                                                                                     
|                                 | Decreasein average Canadian prime interest rate by 100 basis points during the relevant periods     



Reasonably possible changes in North American
natural gas prices would not have had a material impact on comprehensive income for the years ended December 31, 2015 and 2014.



31


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


20. RELATED PARTY DISCLOSURES



The compensation of directors and management are reviewed annually
by the independent Governance and Human Resources Committee against industry practices for oil and gas companies of similar size
and scope.



The following table summarizes the compensation of directors and
other members of key management personnel during the years ended December 31, 2015 and December 31, 2014:



|                                                    |              | Year Ended  
|--------------------------------------------------- | ------------ | ------------
|($M)                                                | Dec 31. 2015 | Dec 31, 2014
|Short-term benefits                                 |              | 5,460       
|Share-based payments                                |              | 20,310      
|                                                    |              | 25,770      
|Number of individuals included in the above amounts |              | 20          



21. WAGES AND BENEFITS



Included in operating expenses and general and
administrative expenses for the year ended December 31, 2015 were $47.7 million and $40.4 million of wages and benefits, respectively
(2014 – $56.2 million and $47.2 million, respectively).



22. SIGNIFICANT TRANSACTIONS



During Q1 2015, Vermilion was awarded a recovery
of costs resulting from an oil spill at the Ambès oil terminal in France that occurred in 2007. The French court awarded
Vermilion approximately €25 million (before taxes), of which 50% was due immediately to Vermilion upon posting a surety bond.
The payment was received in Q2 2015, with the remainder due upon conclusion of the appeal process. Based on the recent court decision
and the conclusions of the expert engaged by the French court, Vermilion is virtually certain that the award will be upheld.



32


Vermilion EnergyExhibit 99.3 - 2015 Annual Financial Statements


CORPORATE INFORMATION





|DIRECTORS
        
        Lorenzo
        Donadeo 1
        Calgary, Alberta
        
        Larry
        J. Macdonald 2, 4, 5, 6
        Chairman
        & CEO, Point Energy Ltd.
        Calgary,
        Alberta
        
        Claudio
        A. Ghersinich 3, 6
        Executive
        Director, Carrera Investments Corp.
        Calgary, Alberta
        
        Joseph
        F. Killi 3, 4
        Chairman,
        Parkbridge Lifestyle Communities Inc.
        Vice Chairman, Realex Properties Corp.
        Calgary,
        Alberta
        Loren M. Leiker 6
        Houston,
        Texas
        William
        F. Madison 5, 6
        Sugar Land, Texas
        Timothy R. Marchant 5, 6
        Calgary, Alberta
        
        Sarah
        E. Raiss 4, 5
        Calgary,
        Alberta
        
        Kevin J.
        Reinhart 3, 4
        Calgary, Alberta
        
        Catherine
        L. Williams 3, 4
        Calgary, Alberta
        1Chairman
        of the Board
        2Lead Director
        3	Audit Committee
        4	Governance and Human Resources Committee
        5	Health, Safety and Environment Committee
        6	Independent Reserves Committee
        
        ANNUAL
        GENERAL MEETING
        
        May 6, 2016
        10:00 AM MST
        The Ballroom
        Metropolitan
        Centre
        333 –
        4th Avenue S.W.
        Calgary,
        Alberta | OFFICERS AND KEY
        PERSONNELCANADA
        Anthony Marino, P.Eng.
        President & Chief Executive Officer
        John D. Donovan, FCA
        Executive Vice President
        Business Development
        
        Curtis W. Hicks, CA
        Executive Vice President
        & Chief Financial Officer
        
        Mona Jasinski, M.B.A.,
        ICD.D., C.H.R.P.
        Executive Vice President,
        People and Culture
        Michael Kaluza, P.Eng.
        Executive
        Vice President & Chief Operating Officer
        
        Dion
        Hatcher, P.Eng.
        Vice
        President Canada Business Unit
        
        Terry Hergott, CMA
        Vice President Marketing
        
        Daniel
        Goulet, P.Eng.
        Director
        Corporate HSE
        
        Bryce
        Kremnica, P.Eng.
        Director
        Field Operations – Canada Business Unit
        
        Dean
        N. Morrison, CFA
        Director
        Investor Relations
        
        Mike
        Prinz
        Director
        Information Technology & Information Systems
        
        Jenson
        Tan, P.Eng.
        Director
        New Ventures
        Robert (Bob) J. Engbloom, LL.B
        Corporate
        Secretary
        
        UNITED
        STATES
        Daniel
        G. Anderson
        Managing
        Director – U.S. Business Unit
        
        Timothy
        R. Morris
        Director,
        U.S. Business Development – U.S. Business Unit
        EUROPE
        Gerard
        Schut, P.Eng.
        Vice
        President European Operations
        
        Darcy
        Kerwin, P.Eng.
        Managing
        Director - France Business Unit
        
        Scott
        Seatter, P.Eng.
        Managing
        Director - Netherlands Business Unit
        
        Albrecht
        Moehring
        Managing
        Director - Germany Business Unit
        
        Bryan
        Sralla
        Managing
        Director - Central & Eastern Europe Business Unit
        
        AUSTRALIA
        Bruce
        D. Lake, P.Eng.
        Managing
        Director - Australia Business Unit | AUDITORS
        Deloitte LLP
        Calgary, Alberta
        
        BANKERS
        The Toronto-Dominion Bank
        Bank of Montreal
        Canadian Imperial Bank
        of Commerce
        
        Royal Bank of Canada
        
        The Bank of Nova Scotia
        
        National Bank of Canada
        Alberta Treasury Branches
        HSBC Bank Canada
        La Caisse Centrale Desjardins
        du Québec
        Wells Fargo Bank N.A.,
        Canadian Branch
        Bank of America N.A., Canada Branch
        BNP Paribas, Canada
        Branch
        Citibank N.A., Canadian
        Branch - Citibank Canada
        JPMorgan Chase Bank,
        N.A., Toronto Branch
        Union Bank, Canada Branch
        Canadian Western Bank
        
        Goldman Sachs Lending
        Partners LLC
        
        EVALUATION ENGINEERS
        GLJ Petroleum Consultants Ltd.
        Calgary, Alberta
        
        LEGAL COUNSEL
        Norton Rose Fulbright Canada LLP
        Calgary, Alberta
        
        TRANSFER AGENT
        Computershare Trust Company of Canada
        
        STOCK EXCHANGE LISTINGS
        The Toronto Stock Exchange (“VET”)
        The New York Stock Exchange
        (“VET”)
        
        INVESTOR RELATIONS
        CONTACT
        Dean Morrison, CFA
        Director Investor Relations
        403-269-4884 TEL
        403-476-8100 FAX
        1-866-895-8101 IR TOLL FREE
        investor_relations@vermilionenergy.com
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