FRONTERA ANNOUNCES FOURTH QUARTER AND YEAR END 2023 RESULTS

Recorded Full Year Net Income of $193.5 Million, Including $92.0 Million in Q4'23

Delivered Full Year Average Daily Production of 40,919 Boe/d

Generated Full Year Operating EBITDA of $467.2 Million

Generated Full Year Adjusted Infrastructure EBITDA of $119.8 Million and Segment Income of $69.3 Million

Declared Quarterly Dividend of C$0.0625 Per Share, Or $3.9 Million in Aggregate, Payable on or around April 16, 2024

Recorded 164.1 Million Boe 2P Gross Reserves and 108.7 Million 1P Gross Reserves

$3.5 Billion 2P Net Present Value Before Tax Discounted At 10% As At December 31, 2023

7.3 Year 1P and 11.0 Year 2P Gross Reserves Life Index

514-628 Mmboe PMean Unrisked Gross Prospective Resources Estimated in Maastrichtian Horizons in the Northern Portion of the Corentyne Block

Commissioned First Solar Farm, Offset 50% of Emissions Through Carbon Credits, and Preserved and Restored 1,681 New Hectares in Casanare and Meta, Colombia

CALGARY, AB, March 7, 2024 /PRNewswire/ - Frontera Energy Corporation (TSX: FEC) ("Frontera" or the "Company") today reported financial and operational results for the fourth quarter and year ended December 31, 2023, and announced the results of its annual independent reserves assessment conducted by DeGolyer and MacNaughton Corp ("D&M"). All financial amounts in this news release and the Company's financial disclosures are in United States dollars, unless otherwise stated. All of the Company's booked reserves for the year ended December 31, 2023, are located in Colombia and Ecuador.

"During 2023, Frontera continued to take concrete steps to deliver significant value to shareholders. The Company delivered EBITDA of $467MM, at the higher end of guidance for 2023, closing the year with a strong balance sheet including $190 million cash position, and having a fully funded plan for 2024.

Our significant Infrastructure business generated Adjusted Infrastructure EBITDA of approximately $120 million and keeps building momentum following the announcement of the connection agreement between Refineria de Cartagena S.A.S ("Reficar") and Puerto Bahia's liquids terminal. On its Guyana exploration business, Frontera, and its JV partner CGX Energy Inc. ("CGX") with support from Houlihan Lokey, is pursuing a review of strategic options, including a farm down of its interest in Offshore Guyana, following the announcement of a second discovery in the Corentyne block. Lastly, the Company during the 4th quarter of 2023 renewed its normal course issuer bid ("NCIB") program and repurchased approximately 741,700 Common Shares for cancellation, returning $5.9 million to shareholders in 2023.

Frontera recently announced the initiation of a new quarterly dividend and remains committed to enhancing shareholder returns. The Company will continue to consider future shareholder value enhancement initiatives in 2024 and beyond, including potential additional dividends, distributions, or bond buybacks, based on the overall results of our businesses and strategic goals."

"Frontera successfully achieved its strategic, capital and production targets across the Company's three core businesses in 2023:

Through our Colombia and Ecuador Upstream onshore business, we delivered average daily production of 40,919 boe/d, with an increase to our heavy crude oil production of 9% year over year, while maintaining our production costs, transportation costs and capital expenditures within guidance.

Our commitment to sustained production and value over volumes continues to be supported by our upstream Colombia and Ecuador reserves which closed the year with 108.7 million and 164.1 million boe in 1P and 2P gross reserves, respectively. Achieved a three-year average gross Reserves Replacement Ratio of 79% for 2P Reserves and 104% for 1P reserves, while maintaining a Reserve Life index of 7.3 Years for 1P reserves and 11.0 Years for 2P reserves, and a significant 2P net present value of $3.5 billion before tax discounted at 10%.

In our standalone and growing infrastructure business, we generated full year Adjusted Infrastructure EBITDA of approximately $120 million. ODL transported over 243,000 bbl/day, generated $285 million in full year EBITDA and distributed over $135 million to its shareholders. Proportional to its 35% interest, the Company received $47 million in capital distributions and Frontera's Adjusted Infrastructure EBITDA benefited from $100 million associated with ODL's EBITDA. Puerto Bahia generated approximately $20 million in operating EBITDA, reached a connection agreement, started pre-construction activities with Reficar, and successfully refinanced its existing legacy project finance debt with room to grow.

In our potentially transformational Guyana exploration business, as announced in the December 11th, 2023 news release, we successfully completed the second well of our two-well program, where we believe that approximately 514-628 mmboe PMean unrisked gross prospective resources are present in multiple Maastrichtian horizons in the northern portion of the Corentyne block.

Frontera is committed to sustainability and achieved 108% of its 2023 ESG goals. We started the operation of our first solar farm named "Ikotia" in December which we expect will reduce CPE-6 power consumption from the grid and offset 50% of the block's scope 1 emissions.

As we turn now to 2024, we remain focused on executing our recently announced 2024 plan and continuing to deliver sustainable value-focused production, strong operational and financial results, and driving shareholder returns."

Fourth Quarter and Full Year 2023 Operational and Financial Summary

Fourth Quarter and Full Year Operational and Financial Results:

• The Company recorded net income of $92.0 million or $1.04/share in the fourth quarter of 2023, compared with net income of $32.6 million or $0.37/share in the prior quarter and net income of $197.8 million or $2.25/share in the fourth quarter of 2022. For the year ended December 31, 2023, the Company reported net income of $193.5 million, compared to net income of $286.6 million for the year ended December 31, 2022.
  
  
• Production averaged 39,267 boe/d in the fourth quarter 2023 (consisting of 23,002 bbl/d of heavy crude oil, 13,795 bbl/d of light and medium crude oil combined, 4,760 mcf/d of conventional natural gas and 1,635 boe/d of natural gas liquids) compared to 40,802 boe/d in the prior quarter and 41,806 boe/d in the fourth quarter of 2022, lower production during the quarter was a result of lower planned drilling and workover activity in the fourth quarter, natural decline, and unplanned maintenance on an injector well in Quifa. In 2023, Frontera's production averaged 40,919 boe/d (consisting of 23,359 bbl/d of heavy crude oil, 14,856 bbl/d of light and medium crude oil combined, 6,042 mcf/d of conventional natural gas and 1,644 boe/d of natural gas liquids), within the Company's 2023 guidance of 40,000-43,000 boe/d.
  
  
• Operating EBITDA was $121.0 million in the fourth quarter of 2023 compared with $137.8 million in the prior quarter and $145.0 million in the fourth quarter of 2022. The decrease in operating EBITDA quarter over quarter was primarily a result of lower commodity prices and lower volumes sold in the fourth quarter. Frontera's weighted average Brent price was $81.88/bbl in 2023, generating $467.2 million of EBITDA.
  
  
• Cash provided by operating activities in the fourth quarter of 2023 was $73.4 million, compared with $154.0 million in the prior quarter and $138.3 million in the fourth quarter of 2022. The decrease quarter over quarter was primarily due to changes in working capital mainly related to income taxes withheld, lower commodity prices and volumes sold.
  
  
• The Company reported a total cash position of $190.0 million at December 31, 2023, compared to $221.2 million at September 30, 2023 and $313.0 million at December 31, 2022. The Company generated $411.8 million of cash from operations in 2023, compared to $620.5 million in 2022. During the year, the Company primarily invested $442.7 million in capital expenditures, including $153.7 million related to the Wei-1, $12.7 million related to the acquisition of the IFC interest on ODL, $56.9 million in net debt service payments and $5.9 million in share buyback.
  
  
• As at December 31, 2023, the Company had a total crude oil inventory balance of 1,076,394 bbls compared to 1,330,418 bbls at September 30, 2023. As of December 31, 2023, the Company had a total inventory balance in Colombia of 551,715 barrels, including 322,639 crude oil barrels and 229,076 barrels of diluent and others. This compared to 812,797 as of September 30, 2023, and 683,416 barrels as at December 31, 2022. The decrease in inventory balance was primarily due to inventory drawn for export sales. Inventory balances in the fourth quarter related to Ecuador and Peru were 44,479 barrels and 480,200 barrels, respectively.
  
  
• Capital expenditures were approximately $82.3 million in the fourth quarter of 2023, compared with $74.1 million in the prior quarter and $134.2 million in the fourth quarter of 2022. During the fourth quarter, the Company drilled 14 development wells at its Quifa SW, Cajua and CPE-6 blocks as well as one exploration well, Perico Norte-A4 on the Perico block in Ecuador. For the full year 2023, the Company executed approximately $442.7 million in total capital spending, including $157.3 million in total capital spending related to the Wei-1 well, within its 2023 capital guidance of $420-475 million and compared to $417.6 million in 2022.
  
  
• The Company's net sales realized price was $73.28/boe in the fourth quarter of 2023, compared to $74.13/boe in the prior quarter and $75.24/boe in the fourth quarter of 2022. The decrease in net sales realized price quarter-over-quarter was primarily driven by the decrease in Brent benchmark oil price compared with the previous quarter, partially offset by lower royalties. The Company's net sales realized price in 2023 was $69.15/boe, compared to $82.34/boe in 2022.
  
  
• The Company's operating netback was $47.51/boe in the fourth quarter of 2023, compared with $48.54/boe in the prior quarter and $53.13/boe in the fourth quarter of 2022. The decrease in operating netback quarter-over-quarter was primarily due to a lower net sales realized price and, higher production costs, resulting from higher well services activity costs and higher energy costs. The Company's operating netback for the year ended December 31, 2023, was $44.69/boe, compared to $59.76/boe in 2022.
  
  
• Production costs (excluding energy cost), net of realized FX hedge impact, averaged $9.69/boe in the fourth quarter of 2023, compared with $8.82/boe in the prior quarter and $8.48/boe in the fourth quarter of 2022. The increase quarter over quarter was due to higher technical assistance and maintenance costs, partially offset by lower cost associated to well services activities. Frontera's total production costs, including energy cost, net of realized FX hedge impact, averaged $13.25/boe in 2023, within the Company's 2023 guidance range of $12.50-$13.50/boe.
  
  
• Transportation costs averaged $11.02/boe in the fourth quarter of 2023, compared with $11.73/boe in the prior quarter and up from $10.55/boe in the fourth quarter of 2022. The decrease during the quarter was mainly due to an increase in local sales volumes to the thermal market. Frontera's transportation costs averaged $11.21/boe in 2023, within the Company's 2023 guidance range of $10.50-$11.50/boe.
  
  
• Total ODL volumes transported were 252,810 bbl/d during the fourth quarter of 2023, up 13% versus the fourth quarter of 2022. Total volumes transported through ODL for 2023 were 243,617 and received capital distributions of $47 million during the year.
  
  
• Puerto Bahia liquids volumes were 52,754 bbl/d during the fourth quarter down 21% compared to the third quarter of 2022, driven mainly by lower imported crude volumes, and 60,718 bbl/d for the full year 2023 compared to 62,422 bbl/d in 2022. Puerto Bahia liquids revenues were $7.6 million during the fourth quarter, up 12% compared to the fourth quarter of 2022, mainly due to higher tariffs. For the full year 2023, Puerto Bahia liquids revenues were $32.1 million compared to $29.6 million in 2022, mainly due to higher tariffs.
  
  
• Adjusted Infrastructure EBITDA in the fourth quarter of 2023 was $30.7 million, compared with $26.6 million in the fourth quarter of 2022, and $119.8 million for the full year 2023.
  
  
• In the Company's exciting Guyana Exploration business, the discovery of 228 feet of net pay in Kawa-1 and 114 feet of net pay in Wei-1, on North Corentyne was confirmed. Results further demonstrate the potential for a standalone shallow oil resource development across the Corentyne block.
  
  
• Total costs associated for the Wei-1 well are now estimated to be $189 million following the successful implementation of several cost saving initiatives. Frontera's direct and indirect WI in the Corentyne block is estimated at up to 72.52% and 93.42%, respectively.
  
  
• During the fourth quarter of 2023, the Company repurchased for cancellation 280,500 Common Shares at a cost of approximately $1.7 million.

Frontera announced the results of its annual independent reserves assessment for the year ended December 31, 2023, conducted by DeGolyer and MacNaughton Corp ("D&M") in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook maintained by the Society of Petroleum Evaluation Engineers (Calgary Chapter) (the "COGE Handbook"), National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101") and CSA Staff Notice 51-324, and are based on the Reserves Report (as defined below). All of the Company's booked reserves for the year ended December 31, 2023, are located in Colombia and Ecuador.

Key Highlights:

• Added 4.2 MMboe of 2P gross reserves, for total Company 2P gross reserves of 164.1 MMboe consisting of 64% heavy crude oil, 24% light and medium crude oil, 8% conventional natural gas and 4% natural gas liquids, compared to 174.8 MMboe at December 31, 2022.
  
  
• 2023 year-end gross proved developed producing reserves increased by 2% to 40.0 MMboe and the proved developed producing reserves replacement ratio was 105%.
  
  
• Delivered three-year average gross PDP, 1P and 2P Reserves Replacement Ratio of 129%, 104% and 79%, respectively.

• Delivered a 1P gross reserves life index of 7.3 years compared to 7.4 years at December 31, 2022, and a 2P reserves life index of 11.0 years compared to 11.6 years at December 31, 2022.
  
  
• The NPV of the Company's 2P reserves, discounted at 10% before tax, is $3.5 billion ($21.60/2P boe) at December 31, 2023, compared to $3.7 billion ($21.24/2P boe) at December 31, 2022. The decrease in NPV10 for the 2P reserves is primarily due to a decrease in the forecast oil price used to calculate the NPV10, however the NPV10 per boe increased by 2% driven by operational efficiencies and reduced future development costs.
  
  
• Reduced the future development cost for 2P reserves by $300 million to $1.2 billion at December 31, 2023, compared to $1.5 billion at December 31, 2022. The reduction is primarily due to the Company's focus on sustained production, value over volumes and an optimized development plan.

2023 Year-End D&M Certified Gross Reserves Volumes(1)

Frontera achieved 108% of its 2023 Sustainability Goals, started the operation of its first solar farm (Ikotia) in December that will reduce almost 8,000 TCO2e from the power generation in CPE6 in 2024 and offset 50% of its scope 1 emissions. The Company also completed 5,737 cumulative hectares preserved and restored in key connectivity corridors in Casanare and Meta (Colombia) and recycled 45% of its operating water and 12% of its solid waste. Frontera handed over 1,000 hectares to the National Parks Association in Colombia, which contributed to the declaration of the Serranía de Manacacías as a National Park in Meta, a major environmental milestone for the country.

The Company invested approximately $5.5 million in education, including economic development, and quality of life initiatives, benefiting 94,875 people through 256 social projects in Colombia, Ecuador and Guyana. Frontera purchased $73.3 million worth of goods and services from local suppliers in nearby operation areas. In 2023 Frontera was included in the Bloomberg Gender-Equality Index ("GEI") and was recognized for the fourth consecutive year as one the most ethical companies in the world by the Ethisphere Institute.

Since 2018, Frontera has returned more than $306 million to shareholders through dividends and share buybacks while maintaining a strong balance sheet.

NCIB: Under the Company's current NCIB which commenced on November 21, 2023, Frontera is authorized to repurchase for cancellation up to 3,949,454 of the Company's common shares ("Common Shares"). As of March 7, 2024, the Company has repurchased approximately 624,600 Common Shares for cancellation for approximately $3.7 million.

Dividend: Pursuant to Frontera's dividend policy, Frontera's Board of Directors has declared a dividend of C$0.0625 per Common Share to be paid on or around April 16, 2024, to shareholders of record at the close of business on April 2, 2024. This dividend payment to shareholders is designated as an "eligible dividend" for purposes of the Income Tax Act (Canada). This dividend is eligible for the Company's Dividend Reinvestment Plan to provide shareholders of Frontera who are resident in Canada with the option to have the cash dividends declared on their Common Shares reinvested automatically back into additional Common Shares, without the payment of brokerage commissions or services charges.

Frontera's three core businesses include: (1) its Colombia and Ecuador Upstream Onshore business, (2) its standalone and growing Colombian Infrastructure business, and (3) its potentially transformational Guyana Exploration business offshore Guyana.

During the fourth quarter of 2023, Frontera produced 37,814 boe/d from its Colombian operations (consisting of 23,002 bbl/d of heavy crude oil, 12,342 bbl/d of light and medium crude oil, 4,760 mcf/d of conventional natural gas and 1,635 boe/d of natural gas liquids).

In the fourth quarter of 2023, the Company drilled 13 development wells at its Quifa and CPE-6 blocks well services at 11 others.

For the year ended December 31, 2023, Frontera drilled 65 development wells (including two injector wells) at its Quifa, CPE-6, Cajua and Cubiro blocks and completed well interventions at 73 others. The Company reduced its cost per well in 2023, due to drilling campaign efficiencies and well types.

Currently, the Company has 4 drilling rigs active at its Quifa and CPE-6 blocks in Colombia.

At Quifa, fourth quarter 2023 production averaged approximately 16,452 bbl/d of heavy crude oil (including both Quifa and Cajua). The Company drilled 8 wells on the block in the fourth quarter of 2023. The Company also invested in new flow lines in the Quifa block to integrate the SAARA project. The Company's current water handling capacity in Quifa is approximately 1.5 million bwpd.

During the fourth quarter 2023, Frontera continued with its recommissioning efforts supporting SAARA, its reverse osmosis water treatment facility. As of year-end 2023, the plant had processed 20.6 million barrels of water as part of its recommissioning program, providing irrigation source water to the Company's nearby ProAgrollanos palm oil plantation. In 2024, Frontera successfully completed the pilot phase of the SAARA project with Ecopetrol. The Company intends to invest in the commissioning of the first phase of the project, the stabilization phase, to reach a minimum of 250,000 barrels of water per day available for the Quifa block, subject to final JV approval.

At CPE-6, fourth quarter 2023 production averaged approximately 6,162 bbl/d of heavy crude oil, increasing 18% from 5,214 bbl/d at year end 2022. The Company drilled 5 development wells. Additionally, the Company invested in new flow lines and in the expansion and improvement of the development facilities in CPE-6 block, which doubled the water-handling capacity from 120,000 to 240,000 bwpd.

At Guatiquia, production during the fourth quarter 2023 averaged 6,206 bbl/d of light and medium crude compared with 6,763 bbl/d in the third quarter of 2023.

In the Cubiro Block production averaged 1,535 bbl/d of light and medium crude oil in the fourth quarter of 2023 compared with 1,729 bbl/d in the third quarter 2023.

At VIM-1 (Frontera 50% W.I., non-operator), production averaged 1,775 boe/d of light and medium crude oil in the fourth quarter of 2023 compared to approximately 1,798 boe/d of light and medium crude oil in the third quarter of 2023.

The Company's exploration focus remains on the Lower Magdalena Valley and Llanos Basins in Colombia. During the fourth quarter of 2023, the Company processed 163 square kilometers of 3D seismic, from the Llanos 99 block, confirming one of the exploratory opportunities previously identified by a 2D survey (LLA99 West), and identified multiple smaller traps to the NE of the 3D survey.

Additionally, during the year 2023, the Company received approval from the Agencia Nacional de Hidrocarburos ("ANH") to terminate by mutual agreement the CR-1 and COR-24 contracts, which reduced exploratory commitments by $11.1 million.

In Ecuador, fourth quarter 2023 gross production averaged approximately 1,453 bbl/d of light & medium crude oil. Frontera's share of production in Ecuador for the three months ended December 31, 2023, was 1,453 bbl/d of medium crude oil compared to 652 bbl/d in the prior quarter.

In the Perico Block, (Frontera 50% W.I. and operator), the Company spudded the Perico Norte-4 well on October 8, 2023, and reached a total depth of 11,433 ft MD on October 23, 2023. Petrophysical interpretation identified 49 ft of net pay in the lower U Sand. The well produced 1,000 bbl/d of 29.4 API, medium crude oil with 0.3% BSW.

The Perico Centro-1 well (formerly Jandiayacu-1) was spud on August 22, 2023, reaching total depth of 11,198 ft MD on September 11, 2023, and finding oil in three intervals The well was completed, and an initial test produced average production of 800 bbl/d of 28 API medium crude oil with 1% BSW.

The Perico Norte A-3 (formerly Yin-2) appraisal well was drilled in July, discovering 48 feet of net pay in the Lower U sand and 24 feet net pay in the Hollin main formation.

Frontera is currently conducting long-term testing and preparing the environmental impact assessments in order to obtain a production environmental license at the Perico Norte-1 (formerly Jandaya-1), Perico Sur B-1 (formerly Tui-1) and Perico Norte A-2 (formerly Yin-1) exploration wells. The Company has completed the four wells required as part of its exploration commitment on the Perico block.

At the Espejo block (Frontera 50% W.I. and non-operator), the Company expects to drill two exploration wells, targeting the Lower U Ss and M1 Ss.

In 2024, Frontera anticipates investing $35 – $45 million on various exploration activities in its core upstream Colombia and Ecuador business including drilling the high impact Hydra-1 well in the VIM-1 block and two wells in the Espejo block. Highlights of the Company's key exploratory activities include:

• VIM-1 block (Frontera 50% non-operator): the Company anticipates spudding the high-impact Hydra-1 exploration well mid-2024. The Hydra-1 well will be drilling using new seismic processing technology and will target gas and condensate.
• Espejo Block (Frontera 50% non-operated): the Company will drill two exploratory wells which target plays successfully tested in nearby areas.
• LLA119 block (Frontera 100%): the Company plans to complete 80 sqkm of 3D seismic data, complete pre-drilling activities and commence civil works.
• LLA99 and VIM46 block (Frontera 100%): the Company intends to complete pre-seismic and pre-drilling activities ahead of 3D seismic acquisition.

Frontera has investments in certain significant infrastructure and midstream assets seeking to capture stable and long-term revenue streams, including storage, port, and other facilities in Colombia as well as the Company's investments in certain pipelines which comprise its standalone and growing Colombia Infrastructure business. Frontera's Infrastructure Colombia Segment includes the Company's 35% equity interest in the ODL pipeline through Frontera's wholly owned subsidiary, PIL and the Company's 99.97% interest in Puerto Bahia.

The Company's Infrastructure Colombia Segment income increased by $2.0 million and $15.0 million for the three months and year ended December 31, 2023, respectively, compared with the same periods of 2022, mainly due to the increase in share of income from associates ODL which increased by $2.7 million and $14.4 million, respectively, driven by stronger crude oil volumes from the Cano Sur and Rubiales blocks. For the three months ended December 31, 2023, Puerto Bahia revenues decreased $1.3 million, compared with the same period of 2022, mainly due to lower volumes sold of general cargo. For the year ended December 31, 2023, Puerto Bahia revenues increased $1.4 million compared with the same period of 2022. The increase was primarily due to the higher liquids terminal revenues by $2.5 million, and a decrease by $1.2 million in general cargo terminal revenues due to lower volumes of cargo handled.

Cash provided by operating activities of the Infrastructure Colombia Segment for three months ended December 31, 2023, was $7.6 million, compared to $12.8 million, in the same period of 2022. The decrease was mainly due to the absence of dividends during the fourth quarter of 2023, while there was a dividend payment during the fourth quarter of 2022. For the year ended December 31, 2023, cash provided by operating activities of the Infrastructure Colombia Segment was $54.5 million, compared to $46.9 million, in the same period of 2022, mainly due to fluctuations in working capital.

The following table shows the volumes pumped per injection point in ODL:

The following table shows throughput for the liquids port facility at Puerto Bahia:

Frontera anticipates breaking ground on the connection construction during the first quarter of 2024 and connection start-up by the end of 2024. Frontera has secured an additional $30 million in committed funding, subject to certain conditions precedent, in connection with this project from its existing group of lenders led by Macquarie Group.

As disclosed in the December 11th, 2023 news release, the Company announced that its Joint Venture with CGX had discovered approximately 514 to 628 mmboe PMean unrisked gross prospective resources in the Corentyne block, offshore Guyana. The Joint Venture believes that the rock quality discovered in the Maastrichtian horizon in the Wei-1 well is analogous to that reported in the Liza Discovery on Stabroek block. The Joint Venture believes that they have discovered sufficient resources to underpin a potential standalone commercial oil development in the Maastrichtian horizons with additional potential upside in the deeper Campanian and Santonian horizons.

On November 9, 2023, Frontera announced that with the support from Houlihan Lokey, it is actively pursuing a possible farm down of its interests in the Corentyne block in Guyana, where a data room has been opened and management presentations are underway. There can be no guarantee that the strategic review processes will result in a transaction.

As part of its risk management strategy, Frontera uses derivative commodity instruments to manage exposure to price volatility by hedging a portion of its oil production. The Company's strategy aims to protect 40-60% of its estimated net after royalties' production using a combination of instruments, capped and non-capped, to protect the revenue generation and cash position of the Company, while maximizing the upside, thereby allowing the Company to take a more dynamic approach to the management of its hedging portfolio. Consistent with this strategy, the Company entered new put hedges totaling 2,574,826 bbls to protect a portion of the Company's production through June 2024. The following table summarizes Frontera's 2024 hedging position as of March 7, 2024.

The Company is exposed to foreign currency fluctuations primarily arising from expenditures that are incurred in COP and its fluctuation against the USD. As of March 7, 2024, the Company had entered new positions of foreign currency derivatives contracts as follows:

The following tables provide a summary of the Company's oil and natural gas reserves based on forecast prices and costs effective December 31, 2023, as applied in the Reserves Report. The Company's net reserves after royalties at December 31, 2023, incorporate all applicable royalties under Colombia and Ecuador fiscal legislations based on forecast pricing and production rates evaluated in the Reserves Report, including any additional participation interest related to the price of oil applicable to certain Colombian and Ecuadorian blocks, as at year-end 2023.

2023 2P Reserves Reconciliation

Gross Reserve Life Index ("RLI")(1)

Net Present Value of Future Net Revenue Before Tax Summary - D&M Reserves Report (2023 Brent Forecast)(1)

Future Development Costs (FDC) - Based on Forecast Prices and Costs(1)

The Company's 2023 year-end estimated reserves were evaluated by D&M in their report dated March 7, 2024, with an effective date of December 31, 2023 (the "Reserves Report"), in accordance with the definitions, standards and procedures contained in the COGE Handbook, NI 51-101 and CSA Staff Notice 51-324. D&M is an independent qualified reserves evaluator as defined in NI 51-101.

Additional reserves information as required under NI 51-101 will be included in the Company's statement of reserves data and other oil and gas information on Form 51-101F1, which is expected to be filed on SEDAR on March 7, 2024. See "Advisory Note Regarding Oil and Gas Information" section in the "Advisories", at the end of this news release.

Fourth Quarter and Year-end 2023 Conference Call Details

A conference call for investors and analysts will be held on Friday, March 8, 2024, at 10:00 a.m. Eastern Time. Participants will include Gabriel de Alba, Chairman of the Board of Directors, Orlando Cabrales, Chief Executive Officer, Rene Burgos, Chief Financial Officer, and other members of the senior management team.

Analysts and investors are invited to participate using the following dial-in numbers:

A replay of the conference call will be available until 11:59 p.m. Eastern Time on March 15, 2024.

Frontera Energy Corporation is a Canadian public company involved in the exploration, development, production, transportation, storage and sale of oil and natural gas in South America, including related investments in both upstream and midstream facilities. The Company has a diversified portfolio of assets with interests in 27 exploration and production blocks in Colombia, Ecuador and Guyana, and pipeline and port facilities in Colombia. Frontera is committed to conducting business safely and in a socially, environmentally, and ethically responsible manner.

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This news release contains forward-looking information within the meaning of Canadian securities laws. Forward-looking information relates to activities, events, or developments that the Company believes, expects, or anticipates will or may occur in the future. Forward-looking information in this news release includes, without limitation, statements regarding the Company's continued commitment to enhancing shareholder returns and its efforts to unlock shareholder value; statements regarding the payment of dividends, statements regarding expected reductions in grid power consumption and offset emissions stemming from the Company's solar farm; statements regarding the Company's intended investment in the SAARA project, including expectations regarding the results of such investment; anticipated exploration, activities in the Company's core upstream Colombia and Ecuador business; expectations regarding drilling exploration wells at the Espejo block; pursuit of a review of strategic options by the Company and its JV partner CGX with support from Houlihan Lokey, with respect to the Corentyne block, including a farm down of its interest in Offshore Guyana expectation; expectation with respect to the NCIB; and expectations with respect to the Company's hedging strategy; and statements regarding the Company's investor call. All information other than historical fact is forward-looking information.

Forward-looking information reflects the current expectations, assumptions and beliefs of the Company based on information currently available to it and considers the Company's experience and its perception of historical trends, including expectations and assumptions relating to commodity prices and interest and foreign exchange rates; the current and expected impacts of the COVID-19 pandemic, actions of the Organization of Petroleum Exporting Countries ("OPEC+") and the impact of the Russia-Ukraine conflict and the Israel-Palestine conflict, and the expected impact of measures that the Company has taken and continues to take in response to these events; expectations regarding the Company's ability to manage its liquidity and capital structure and generate sufficient cash to support operations, capital expenditures and financial commitments; the performance of assets and equipment; the Company's ability to achieve the increased oil and water handling capacity at Quifa; the availability and cost of labor, services and infrastructure; the execution of exploration and development projects; the receipt of any required regulatory approvals and outcome of discussions with governmental authorities; the success of the Company's hedging strategy; and the impact and success of the Company's ESG strategies.

Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be placed on such information. Forward-looking information is subject to a number of risks and uncertainties, some that are similar to other oil and gas companies and some that are unique to the Company. The actual results may differ materially from those expressed or implied by the forward-looking information, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. The Company's annual information form dated March 7, 2024, its annual management's discussion and analysis for the year ended December 31, 2023, and other documents it files from time to time with securities regulatory authorities describe the risks, uncertainties, material assumptions and other factors that could influence actual results and such factors are incorporated herein by reference. Copies of these documents are available without charge by referring to the company's profile on SEDAR+ at www.sedarplus.ca. All forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events, or results or otherwise.

This news release contains various "non-IFRS financial measures" (equivalent to "non-GAAP financial measures", as such term is defined in NI 52-112), "non-IFRS ratios" (equivalent to "non-GAAP ratios", as such term is defined in NI 52-112), "supplementary financial measures" (as such term is defined in NI 52-112), and "capital management measures" (as such term is defined in NI 52-112), which are described in further detail below. Such financial measures do not have standardized IFRS definitions. The Company's determination of these financial measures may differ from other reporting issuers, and they are therefore unlikely to be comparable to similar measures presented by other companies. Furthermore, these financial measures should not be considered in isolation or as a substitute for measures of performance or cash flows as prepared in accordance with IFRS. These financial measures do not replace or supersede any standardized measure under IFRS. Other companies in our industry may calculate these financial measures differently than we do, limiting their usefulness as comparative measures.

The Company discloses these financial measures, together with measures prepared in accordance with IFRS, because management believes they provide useful information to investors and shareholders, as management uses them to evaluate the operating performance of the Company. These financial measures highlight trends in the Company's core business that may not otherwise be apparent when relying solely on IFRS financial measures. Further, management also uses non-IFRS measures to exclude the impact of certain expenses and income that management does not believe reflect the Company's underlying operating performance. The Company's management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period and to prepare annual operating budgets and as a measure of the Company's ability to finance its ongoing operations and obligations.

Set forth below is a description of the non-IFRS financial measures, non-IFRS ratios, supplementary financial measures and capital management measures used in this news release.

EBITDA is a commonly used non-IFRS financial measure that adjusts net (loss) income as reported under IFRS to exclude the effects of income taxes, finance income and expenses, and DD&A. Operating EBITDA is a non-IFRS financial measure that represents the operating results of the Company's primary business, excluding the following items: restructuring, severance and other costs, post-termination obligation, payments of minimum work commitments and, certain non-cash items (such as impairments, foreign exchange, unrealized risk management contracts, and share-based compensation) and gains or losses arising from the disposal of capital assets. In addition, other unusual or non-recurring items are excluded from operating EBITDA, as they are not indicative of the underlying core operating performance of the Company.

Since the three and six months ended June 30, 2022, the Company changed the composition of its Operating EBITDA calculation to exclude certain unusual or non-recurring items as post-termination obligations and payments of minimum work commitments, which could distort future projections as they are not considered part of the Company's normal course of operations.

The following table provides a reconciliation of net income to Operating EBITDA:

Capital expenditures is a non-IFRS financial measure that reflects the cash and non-cash items used by the Company to invest in capital assets. This financial measure considers oil and gas properties, plant and equipment, infrastructure, exploration and evaluation assets expenditures which are items reconciled to the Company's Statements of Cash Flows for the period.

Each of Adjusted Infrastructure Revenue, Adjusted Infrastructure Operating Cost and Adjusted Infrastructure General and Administrative, is a non-IFRS financial measure, and each is used to evaluate the performance of the Infrastructure Colombia Segment operations. Adjusted Infrastructure Revenue includes revenues of the Infrastructure Colombia Segment including ODL's revenue direct participation interest. Adjusted Infrastructure Operating Cost includes costs of the Infrastructure Colombia Segment including ODL's cost direct participation interest. Adjusted Infrastructure General and Administrative includes general and administrative costs of Infrastructure Colombia Segment including ODL's general and administrative direct participation interest. A reconciliation of each of Adjusted Infrastructure Revenue, Adjusted Infrastructure Operating Cost and Adjusted Infrastructure General and Administrative is provided below.

Operating netback is a non-IFRS financial measure and operating netback per boe is a non-IFRS ratio. Operating netback per boe is used to assess the net margin of the Company's production after subtracting all costs associated with bringing one barrel of oil to the market. It is also commonly used by the oil and gas industry to analyze financial and operating performance expressed as profit per barrel and is an indicator of how efficient the Company is at extracting and selling its product. For netback purposes, the Company removes the effects of any trading activities and results from its midstream segment from the per barrel metrics and adds the effects attributable to transportation and operating costs of any realized gain or loss on foreign exchange risk management contracts. Refer to the reconciliation in the "Operating Netback" section on page 13 of the MD&A.

The following is a description of each component of the Company's operating netback and how it is calculated. Oil and gas sales, net of purchases, is a non-IFRS financial measure that is calculated using oil and gas sales less the cost of volumes purchased from third parties including its transportation and refining cost. Oil and gas sales, net of purchases per boe, is a non-IFRS ratio that is calculated using oil and gas sales, net of purchases divided by the total sales volumes, net of purchases.

A reconciliation of this calculation is provided below:

Net sales is a non-IFRS financial measure that adjusts revenue to include realized gains and losses from oil risk management contracts while removing the cost of any volumes purchased from third parties. This is a useful indicator for management, as the Company hedges a portion of its oil production using derivative instruments to manage exposure to oil price volatility. This metric allows the Company to report its realized net sales after factoring in these oil risk management activities. The deduction of cost of purchases is helpful to understand the Company's sales performance based on the net realized proceeds from its own production, the cost of which is partially recovered when the blended product is sold. Net sales also exclude sales from port services, as it is not considered part of the oil and gas segment. Refer to the reconciliation in the "Sales" section on page 14 of the MD&A.

Realized oil price, net of purchases, and realized gas price per boe are both non-IFRS ratios. Realized oil price, net of purchases, per boe is calculated using oil sales net of purchases, divided by total sales volumes, net of purchases. Realized gas price is calculated using sales from gas production divided by the conventional natural gas sales volumes.

Net sales realized price

Net sales realized price is a non-IFRS ratio that is calculated using net sales (including oil and gas sales net of purchases, realized gains and losses from oil risk management contracts less royalties). Net sales realized price per boe is a non-IFRS ratio which is calculated dividing each component by total sales volumes, net of purchases. A reconciliation of this calculation is provided below:

Production costs (excluding energy cost), net of realized FX hedge impact is a non-IFRS financial measure that mainly includes lifting costs, activities developed in the blocks, and processes to put the crude oil and gas in sales condition and the realized gain or loss on foreign exchange risk management contracts attributable to production costs. Production cost, net of realized FX hedge impact per boe is a non-IFRS ratio that is calculated using production cost (excluding energy cost), net of realized FX hedge impact divided by production (before royalties). A reconciliation of this calculation is provided below:

Energy costs, net of realized FX hedge impact is a non-IFRS financial measure that described the electricity consumption and the costs of localized energy generation and the realized gain or loss on foreign exchange risk management contracts attributable to energy costs. Energy cost, net of realized FX hedge impact per boe is a non-IFRS ratio that is calculated using e cost, net of realized FX hedge impact divided by production (before royalties). A reconciliation of this calculation is provided below:

Transportation costs, net of realized FX hedge impact is a non-IFRS financial measure that includes all commercial and logistics costs associated with the sale of produced crude oil and gas such as trucking and pipeline and the realized gain or loss on foreign exchange risk management contracts attributable to transportation costs. Transportation cost, net of realized FX hedge impact per boe is a non-IFRS ratio that is calculated using transportation cost, net of realized FX hedge impact divided by net production after royalties. A reconciliation of this calculation is provided below:

Realized gain (loss) on oil risk management contracts includes the gain or loss during the period, as a result of the Company's exposure in derivative contracts of crude oil. Realized gain (loss) on oil risk management contracts per boe is a supplementary financial measure that is calculated using Realized gain (loss) on risk management contracts divided by total sales volumes, net of purchases.

Restricted cash (short and long term) is a capital management measure, that sum the short-term portion and long-term portion of the cash that the Company has in term deposits that have been escrowed to cover future commitments and future abandonment obligations or insurance collateral for certain contingencies and other matters that are not available for immediate disbursement.

Total cash is a capital management measure to describe the total cash and cash equivalents restricted and unrestricted available and consists of the cash and cash equivalents and the restricted cash short and long-term.

Total debt and lease liabilities are capital management measures to describe the total financial liabilities of the Company, and comprises the debt of unsecured notes, loans, and liabilities from leases of various properties, power generation supply, vehicles and other assets.

This news release includes non-standardized measures, including reserves life index and reserves replacement ratio. Reserves life index is calculated as the gross reserves in the referenced category divided by the net production of the last year. It is a measure of how long the booked reserves will last if the production rate is maintained and no additional reserves are added. Reserves replacement ratio is calculated as the net reserves added in the referenced category divided by the net production of the last year. It is a measure of the capacity to replace the production. These measures should not be construed as alternative measures of financial performance. Such measures have been included to provide readers with additional means to evaluate the Company's performance but these non-standardized measures are not reliable indicators of the Company's future performance and therefore must not be relied upon unduly. The Company's method of calculating these measures may differ from other companies and, accordingly, they may not be comparable to similar measures used by other companies. Readers are cautioned that the information provided or derived by these measures should not be relied upon for investment purposes.

The reserves information contained in this press release has been prepared in accordance with NI 51-101, but only presents a portion of the disclosure required thereunder. Complete reserves disclosure required in accordance with NI 51-101 will be available on SEDAR at www.sedar.com on or around March 7, 2024. Actual oil and natural gas reserves and future production may be greater than or less than the estimates provided in this news release. There is no assurance that forecast prices and costs assumed in the Reserves Report, and presented in this news release, will be attained and variances from such forecast prices and costs could be material. The estimated future net revenue from the production of the disclosed oil and natural gas reserves in this news release does not represent the fair market value of these reserves.

The estimates of reserves for individual properties may not reflect the same confidence level as estimates of reserves for all properties, due to the effects of aggregation.

There are numerous uncertainties inherent in estimating quantities of crude oil, reserves and the future cash flows attributed to such reserves. The reserve and associated cash flow information set forth above are estimates only. In general, estimates of economically recoverable crude oil and natural gas reserves and the future net cash flows therefrom are based upon a number of variable factors and assumptions, such as historical production from the properties, production rates, ultimate reserve recovery, timing and amount of capital expenditures, marketability of oil and natural gas, royalty rates, the assumed effects of regulation by governmental agencies and future operating costs, all of which may vary materially. For those reasons, estimates of the economically recoverable crude oil and natural gas reserves attributable to any particular group of properties, classification of such reserves based on risk of recovery and estimates of future net revenues associated with reserves prepared by different engineers, or by the same engineers at different times, may vary.

The Company's actual production, revenues, taxes and development and operating expenditures with respect to its reserves will vary from estimates thereof and such variations could be material. All evaluations and reviews of future net revenue are stated prior to any provisions for interest costs or general and administrative costs and after the deduction of estimated future capital expenditures for wells to which reserves have been assigned. The tax calculations used in the preparation of the Reserves Report are done at the field level in accordance with standard practice, and do not reflect the actual tax position at the corporate level which may be significantly different.

Prospective resources are defined as those quantities of petroleum estimated, as of a given date, to be potentially prospective from undiscovered accumulations by application of future development projects. Prospective resources are not, and should not be confused with, reserves or contingent resources.

The prospective resource estimates were made based on separate reviews by two independent, third-party qualified reserves evaluators, effective as of October 30, 2023, and November 30, 2023, respectively. Such estimates have been prepared in compliance with NI 51-101 and the Canadian Oil and Gas Evaluation Handbook. All estimates of prospective resources presented herein are on an un-risked basis, meaning that they have not been adjusted for risk based on the chance or discovery or the chance of development, and all volumes are presented on a gross basis, meaning the Joint Venture's aggregate working interest before adjustment for royalties. There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources. Estimates of resources always involve uncertainty, and the degree of uncertainty can vary widely between accumulations/projects and over the life of a project. Readers are cautioned that the prospective resource potential disclosed in this news release are not necessarily indicative of ultimate recovery.

The resource estimates presented above are subject to certain risks and uncertainties, including those associated with the drilling and completion of future wells, limited available geological and geophysical data and uncertainties regarding the actual production characteristics of the reservoirs, all of which have been assumed for the preparation of the resource estimates. In addition, significant positive and negative factors related to the prospective resource estimate include the high exploration success rate of, and frequency of development projects by, operators in the Guyana-Suriname Basin, a lack of infrastructure and transportation in the Corentyne area and the capital expenditures and financing required to conduct additional appraisal activities and/or develop resources at an acceptable cost.

Definitions:

• "Proved Developed Producing Reserves" are those reserves that are expected to be recovered from completion intervals open at the time of the estimate. These reserves may be currently producing or, if shut-in, they must have previously been in production, and the date of resumption of production must be known with reasonable certainty.
• "Proved Developed Non-Producing Reserves" are those reserves that either have not been on production or have previously been on production but are shut-in and the date of resumption of production is unknown.
• "Proved Undeveloped Reserves" are those reserves expected to be recovered from known accumulations where a significant expenditure (e.g. when compared to the cost of drilling a well) is required to render them capable of production.They must fully meet the requirements of the reserves category (proved, probable, possible) to which they are assigned.
• "Proved" reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves.
• "Probable" reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves.
• "Possible" reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10 percent probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves. It is unlikely that the actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves.

Certain information in this presentation may constitute "analogous information" as defined in NI 51-101. Such information includes reservoir information retrieved from the continuous disclosure record of certain industry participants from www.sedarplus.ca or other publicly available sources. The Joint Venture believes the information is relevant as it may help to define the reservoir characteristics of certain lands in which the Joint Venture holds an interest. The Joint Venture is unable to confirm that the analogous information was prepared by a qualified reserves evaluator or auditor and is unable to confirm that the analogous information was prepared in accordance with NI 51-101. Such information is not an estimate of the resources attributable to lands held by the Joint Venture and there is no certainty that the resources data and commercial viability for the lands held by the Joint Venture will be similar to the information presented herein. The reader is cautioned that the data relied upon by the Joint Venture may be in error and/or may not be analogous to such lands held by the Joint Venture

For further information, please contact Investor Relations, at 1 403 705 8827, ir@fronteraenergy.ca, www.fronteraenergy.ca

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SOURCE Frontera Energy Corporation