Lone Pine Set to Establish Second Core Area Through Large-Scale Lease Issuance and Drilling Commitment Agreement

CALGARY, ALBERTA -- (Marketwired) -- 06/29/15 -- Lone Pine Resources Canada Ltd. ("Lone Pine" or the "Company") is pleased to announce that it has entered into a Lease Issuance and Drilling Expenditure Commitment Agreement (the "Agreement") with a public royalty company ("Royalty Company"), whereby Lone Pine will acquire petroleum and natural gas leases for 100% working interest on approximately 108 sections (approximately 69,000 acres) in the Wheatland area of Southeast Alberta (the "Lands" or the "Wheatland Area").

Lone Pine anticipates establishing a second core area through this large-scale arrangement, while maintaining its strong balance sheet position. The arrangement will significantly increase the Company's drilling inventory and diversify its asset base.

The multi-stacked pay zones in the Wheatland Area provide attractive development economics in today's commodity price environment. The Lands are comprised of 6 blocks of contiguous lands, which is expected to create further capital and operating efficiencies. Lone Pine has identified over 100 drilling locations mainly targeting the Lithic Glauconite, Ellerslie, Basal Quartz, and Turner Valley Formations. The scale of the transaction and the highly prospective nature of the Lands are anticipated to generate organic growth for the Company in both cash flows and reserves.

Overview of Lone Pine and Recent Developments

Lone Pine is a private company engaged in the exploration and development of crude oil and natural gas in Canada. Lone Pine's principal reserves, producing properties and exploration prospects are located in Canada in the provinces of Alberta, British Columbia and Quebec and the Northwest Territories. For more information about Lone Pine, please visit our website at www.lonepineresources.com.

Currently, Lone Pine has approximately 2,700 boe/d production (70% liquids), 65% of which are produced from the Evi area. The Company has been focusing its capital efforts at Evi on the waterflood project to enhance oil recovery. Phase 1 of the project was completed in July 2014, which included construction of water plant facilities, water distribution and injection pipelines and conversion of 4 producing wells into injection wells. Encouraging early responses with stabilizing oil production rate in the flooded sections, along with third party engineering studies indicating significant improvements to recovery efficiency have encouraged the Company to advance Phase 2 of the project, which will expand the waterflood pattern by adding 4 horizontal injection wells in the second half of 2015.

Lone Pine has a strong balance sheet with cash on hand and no debt currently outstanding. The Company has in place a $50 million credit facility with a syndicate of financial institutions, which is currently undrawn. In addition, the Company has a strong oil hedging program, which protects its cash flows for fiscal years 2015 to 2017.

Forward-Looking Statements

Certain statements and information in this press release may constitute forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond Lone Pine's control. All statements regarding the Company's strategy, future operations, financial position, estimated revenues and losses, projected production volumes, commodity prices or costs, expected or future expenditures or investment decisions, impact of future commitments, scheduled or budgeted activities, prospects, plans and objectives of management are forward-looking statements. The words "could," "believe," "anticipate," "intend," "plan," "estimate," "expect," "may," "continue," "predict," "potential," "project" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words.

Forward-looking statements are based on Lone Pine's current expectations, estimates, projections and assumptions that were made by the Company in light of information available at the time the statement was made and consider Lone Pine's experience and its perception of historical trends, including expectations and assumptions concerning: the success of future drilling and development activities; the performance of existing wells; the performance of new wells; the successful application of technology; validity of the geological and other technical interpretations that have been performed by Lone Pine's technical staff; the accuracy of reserves and resources estimates; commodity prices and interest and foreign exchange rates; capital efficiencies and cost savings; applicable royalty rates and tax laws; future production rates; the sufficiency of budgeted capital expenditures in carrying out planned activities; the availability and cost of labour and services; and the receipt, in a timely manner, of regulatory and third-party approvals.

Lone Pine believes the expectations and forecasts reflected in the Company's forward-looking statements are reasonable, but can give no assurance that they will prove to be correct. Readers are cautioned that these forward-looking statements can be affected by inaccurate assumptions and are subject to all of the risks and uncertainties incident to the exploration for and development, production and sale of oil and natural gas, most of which are difficult to predict and many of which are beyond the Company's control.

When considering forward-looking statements, you should keep in mind the assumptions, risk factors and other cautionary statements that include, among other things:

--  the volatility of oil, natural gas and NGL prices, and the related
    differentials between realized prices and benchmark prices;
--  the availability of capital on economic terms to fund the Company's
    significant capital expenditures and acquisitions;
--  the Company's ability to obtain adequate financing to pursue other
    business opportunities;
--  the Company's ability to generate sufficient cash flow from operations
    or obtain adequate financing to fund the Company's capital expenditures
    and meet working capital needs;
--  the Company's ability to replace and sustain production;
--  a lack of available drilling and production equipment, and related
    services and labour;
--  increases in costs of drilling, completion and production equipment and
    related services and labour;
--  unsuccessful exploration and development drilling activities;
--  regulatory and environmental risks associated with exploration, drilling
    and production activities;
--  declines in the value of the Company's oil and natural gas properties,
    resulting in impairments;
--  the adverse effects of changes in applicable tax, environmental and
    other regulatory legislation;
--  a deterioration in the demand for the Company's products;
--  the risks and uncertainties inherent in estimating oil and natural gas
    reserves and resources and in projecting future rates of production and
    the timing of expenditures;
--  the risks of conducting exploratory drilling operations in new or
    emerging plays;
--  intense competition with companies with greater access to capital and
    staffing resources; and
--  the risks of conducting operations in Canada and the impact of pricing
    differentials, fluctuations in foreign currency exchange rates and
    political developments on the financial results of the Company's
    operations.

Should one or more of the risks or uncertainties described above or elsewhere in this press release occur, or should underlying assumptions prove incorrect, Lone Pine's actual results and plans could differ materially from those expressed in any forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release, and Lone Pine undertakes no obligation to update this information to reflect events or circumstances after the delivery of this press release. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Lone Pine or any person acting on its behalf may make.

Contacts:
Lone Pine Resources Canada Ltd.
Tim Granger
President & Chief Executive Officer
Tel.: (403) 292-8000

Source: Lone Pine Resources Inc.

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