Front Range Reports Petroleum Initially-in-Place of 1.8 TCF at Its Pepper, Alberta Montney Property

CALGARY, AB --(Marketwired - April 06, 2017) -

Not for distribution to United States newswire services or for dissemination in the United States.

Front Range Resources Ltd. ("Front Range" or the "Company") (TSX VENTURE: FRK) reports the results of the Resource Assessment of its Pepper, Alberta property effective as at March 31, 2017 (the "Resource Report"), as evaluated by GLJ Petroleum Consultants ("GLJ"), an independent qualified reserves evaluator, in accordance with National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities and the Canadian Oil and Gas Evaluation Handbook.

A range of contingent and prospective resource estimates (low, best and high) were prepared by GLJ. The Resource Report best estimate gross unrisked contingent resources is 57.6 MMBoe (including 7.5 MMbbl of natural gas liquids). In addition, the Resource Report best estimate of gross unrisked prospective resources is 62.1 MMBoe (including over 8.0 MMbbl of natural gas liquids). Combined this represents a best estimate of gross unrisked recoverable resource of 119.7 MMBoe (including 15.5 MMbbl of natural gas liquids) across the Pepper block.

The Resource Report confirms the extensive potential of the Pepper play. The Company's ongoing winter drilling program consisted of 2 horizontal Montney wells with the goal of confirming productivity in a new field. Front Range is the first company to drill horizontal wells in this field and it has captured a large resource in an area with underutilized existing infrastructure. The Company believes that the location of this resource is strategic in light of the takeaway constraints faced by many Montney operators in other areas. Upon completion of the winter drilling and testing program, the Company will have made significant progress towards completing its Proof of Concept phase at Pepper. Once the results of the first two wells are fully evaluated, the Company expects to then move into the Optimization and Development phase. In this phase, insights learned from the initial wells would be applied towards driving well costs down and well productivity higher. This would be done in parallel with the initial infrastructure build-out to support additional field development.

At Pepper, Alberta, Front Range has an operated 100% working interest in 44 sections (28,160 acres) of Montney petroleum and natural gas rights.

The Montney Formation at Pepper is represented by a 60-70 metre erosional remnant of the Lower Montney. It is comprised of a series of 10 to 25 metre thick, coarsening upward sequences of silt to sand to coquina that were deposited in a near shore environment. Near shore deposition is typically characterized by coarser grain sizes, which has a positive influence on primary reservoir porosity and permeability. This play type has been widely developed horizontally in underpressured fields such as Kaybob South and Fir. Front Range's Pepper property represents the first time near shore deposition is being developed in an overpressured deep basin gas environment. The closest producing horizontal Montney well to the Pepper property is approximately 42 kilometres away.

Front Range is pushing horizontal Montney development into previously untested fields and has, as earlier reported, drilled the first 2 horizontal Montney exploration wells into the emerging South Montney Trend.

The Company's West Pepper Upper Montney discovery well (100% W.I.) at 3-26-52-23 W5M ("3- 26") had a bottomhole pressure of 43,500 kPa (6,300 psi) -- which represents 20% overpressure. The 3-26 well was opened to flow after tubing was installed and proceeded to unload a full wellbore of load fluid and then flowed at a rate of 6 MMscf/d increasing to 7.5 MMscf/d at 16,500 kPa (2,400 psi) over several hours. Subject to approval of a final budget by the Board of Directors, construction to equip and tie-in the 3-26 well is expected to commence in Q2, 2017.

Drilling operations at the 6-28-52-22 W5M Hz ("6-28") Basal Montney well (100% W.I.) at East Pepper have been completed with fracturing operations currently projected to commence in April 2017. The Basal Montney was previously tested in the 102/3-21-52-22 W5M vertical Montney well at a rate of 550 Mscf/d of natural gas with 29 barrels/MMscf of free condensate and up to an additional 30 barrels/MMscf of natural gas liquids (recoverable through shallow cut natural gas processing) at a flowing casing pressure of 293 kPa (47 psi). This test rate was obtained from a single 60-tonne frac in the vertical wellbore and represents the last 24 hours of the 141.5 hour flow test period.

The Resource Report estimated Petroleum Initially-in-Place (PIIP), both discovered and undiscovered, as well as recoverable contingent and prospective resources over the Pepper, Alberta property.

A summary of the tables from the Resource Report are included below.

⁽¹⁾ Petroleum Initially-in-Place (PIIP) was calculated in the Resource Report for gas volumes over the Pepper property. PIIP was divided into Discovered PIIP and Undiscovered PIIP, with Discovered PIIP being assigned to lands within two miles of a measurable hydrocarbon test.

⁽²⁾ Contingent resources are defined as those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingent resources have been assigned to lands within 2 miles of the successful test results. There is no certainty that it will be commercially viable to produce any portion of the contingent resources. The estimates of contingent resources involve implied assessment, based on certain estimates and assumptions, that the resources described exists in the quantities predicted or estimated, at a given date, and that the resources can be profitably produced in the future. Actual contingent resources (and any volumes that may be reclassified as reserves) and future production from such contingent resources may be greater than or less than the estimates provided, and variances may be material.

⁽³⁾ Prospective resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. There is no certainty that any portion of the prospective resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the prospective resources. The estimates of prospective resources involve implied assessment, based on certain estimates and assumptions, that the resources described exists in the quantities predicted or estimated, at a given date, and that the resources can be profitably produced in the future. Actual prospective resources and future production from such prospective resources may be greater than or less than the estimates provided, and variances may be material.

⁽⁴⁾ The contingent and prospective resources have been risked for the chance of commerciality. The chance of commerciality (CoC) is defined as: CoC = chance of development x chance of discovery, where the chance of discovery for contingent resources is equal to 1.0. The summary of the contingent resource risking factor for the Pepper property is as follows:

⁽⁵⁾ Column total does not add exactly due to rounding.

The Resource Report was subject to considerable uncertainty due to the scarcity of high quality log data, mostly due to bad hole in the majority of the offsets that were drilled to deeper targets, and a lack of core data in general, with no core analysis available in the silty, tight looking Montney sediments in the area.

The Company cautions that the economic case for the development of the contingent and prospective resources presented herein will be dependent upon favourable results of additional testing and/or drilling in the project area. The early stage of the project necessitates the consideration of risk factors with respect to the Resource Report. Additional well and/or well test data may positively or negatively impact these risk factors.

The contingent resources have been risked for the chance of commerciality, or commercial development, defined as the probability of the chance of discovery and the chance of development. For contingent resources, the chance of discovery is equal to one. The chance of development is the estimated probability that once discovered, a known accumulation will be commercially developed, and has been estimated at 0.34 for the contingent resources. The contingent resources have established technology status.

Contingent resources can be sub-classified based on their project maturity sub-class which help identify a project's change of commerciality. All of the contingent resources identified in the Resource Report have been classified as "development unclarified", which is defined as contingent resources when the evaluation is incomplete and there is ongoing activity to resolve any risks or uncertainties. The contingent resources are located in a region of little Montney development. For contingent resources to be converted into reserves, management needs to confirm productivity for development not immediately offsetting existing wells/tests, and then develop firm plans including timing, infrastructure and the commitment of capital. Confirmation of commercial productivity is generally required before the Company can prepare firm development plans and commit the required capital for the development of the contingent resources. Additional contingencies are related to the current lack of in-field infrastructure required to develop the resources in a relatively quick time frame.

In addition, a portion of the resources have been classified as prospective resources. This accounts for areas of the Pepper property that is not within range of commercially tested wells. In addition to the development risk of 0.34, the prospective resources are further risked for chance of discovery using a factor of 0.90, resulting in a chance of commerciality of 0.31.

ADVISORY ON FORWARD-LOOKING STATEMENTS
The Company cautions that flow test results are not necessarily indicative of long-term performance or of ultimate recovery.

Certain information set forth in this news release contains forward-looking statements or information ("forward-looking statements"), including statements regarding the volumes of resources, future development, areas of future development, development plans, the equip and tie-in of the 3-26 well, the timing of fracturing operations at the 6-28 well and the Optimization and Development phase at Pepper and infrastructure build-out. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond Front Range's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve and resource estimates, environmental risks, operational risks in exploration and development, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and the ability to access sufficient capital from internal and external sources. Although Front Range believes that the expectations in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information, including the data used by GLJ in preparing the Resource Report. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking information. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. The risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in our Annual Information Form and other documents available at www.sedar.com. Furthermore, the forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Front Range does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement. This news release shall not constitute an offer to sell or the solicitation of any offer to buy securities in any jurisdiction.

Where amounts are expressed on a barrel of oil equivalent ("BOE") basis, natural gas volumes have been converted to oil equivalence at six thousand cubic feet per barrel. The term BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet per barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value. References to oil in this discussion include light and medium crude oil and natural gas liquids ("NGLs"). NGLs include condensate, propane, butane and ethane. References to gas in this discussion include natural gas.

Resource Definitions

Resources encompasses all petroleum quantities that originally existed on or within the earth's crust in naturally occurring accumulations, including Discovered and Undiscovered (recoverable and unrecoverable) plus quantities already produced. "Total Resources" is equivalent to "Petroleum Initially-In-Place". Resources are classified in the following categories:

Petroleum Initially-In-Place ("PIIP") is that quantity of petroleum that is estimated to exist originally in naturally occurring accumulations. It includes that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations, prior to production, plus those estimated quantities in accumulations yet to be discovered.

Discovered Petroleum Initially-In-Place ("DPIIP") is that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations prior to production. The recoverable portion of discovered petroleum initially in place includes production, reserves, and contingent resources; the remainder is unrecoverable.

Contingent resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development but which are not currently considered to be commercially recoverable due to one or more contingencies. Economic Contingent Resources (ECR) are those contingent resources that are currently economically recoverable.

Undiscovered Petroleum Initially-In-Place ("UPIIP") is that quantity of petroleum that is estimated, on a given date, to be contained in accumulations yet to be discovered. The recoverable portion of undiscovered petroleum initially in place is referred to as Prospective Resources and the remainder is unrecoverable.

Prospective resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective resources have both an associated chance of discovery and a chance of development.

Unrecoverable is that portion of DPIIP and UPIIP quantities which is estimated, as of a given date, not to be recoverable by future development projects. A portion of these quantities may become recoverable in the future as commercial circumstances change or technological developments occur; the remaining portion may never be recovered due to the physical/chemical constraints represented by subsurface interaction of fluids and reservoir rocks.

Uncertainty Ranges are described by the Canadian Oil and Gas Evaluation Handbook as low, best, and high estimates for reserves and resources as follows:

Low Estimate: This is considered to be a conservative estimate of the quantity that will actually be recovered. It is likely that the actual remaining quantities recovered will exceed the low estimate. If probabilistic methods are used, there should be at least a 90 percent probability (P90) that the quantities actually recovered will equal or exceed the low estimate.

Best Estimate: This is considered to be the best estimate of the quantity that will actually be recovered. It is equally likely that the actual remaining quantities recovered will be greater or less than the best estimate. If probabilistic methods are used, there should be at least a 50 percent probability (P50) that the quantities actually recovered will equal or exceed the best estimate.

High Estimate: This is considered to be an optimistic estimate of the quantity that will actually be recovered. It is unlikely that the actual remaining quantities recovered will exceed the high estimate. If probabilistic methods are used, there should be at least a 10 percent probability (P10) that the quantities actually recovered will equal or exceed the high estimate.

Certain resource estimate volumes disclosed herein are arithmetic sums of multiple estimates of DPIIP or UPIIP, which statistical principles indicate may be misleading as to volumes that may actually be recovered. Readers should give attention to the estimates of individual classes of resources and appreciate the differing probabilities of recovery associated with each class as explained under this Resource Definitions section.

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