Disclosure of Reserves Information
All estimates of proved reserves and related future net revenue disclosed in this news release have been prepared in accordance with NI 51- 101. Estimates of reserves and future net revenue made in accordance with NI 51-101 will differ from corresponding estimates prepared in accordance with applicable SEC rules and disclosure requirements of FASB, and those differences may be material. NI 51-101, for example, requires disclosure of reserves and related future net revenue estimates based on forecast prices and costs, whereas SEC and FASB standards require that reserves and related future net revenue be estimated using constant prices and costs (with prices based on a historical 12-month average price). In addition, NI 51-101 permits the presentation of reserves estimates on a "company gross" basis, representing Lone Pine's working interest share before deduction of royalties, whereas SEC and FASB standards require the presentation of net reserve estimates after the deduction of royalties and similar payments. There are also differences in the technical reserves estimation standards applicable under NI 51-101 and, pursuant thereto, the Canadian Oil and Gas Evaluation Handbook, and those applicable under SEC and FASB requirements. Further information regarding the principal differences between the methodology and other requirements applicable under NI 51-101 and those applicable under corresponding U.S. standards is contained in the Statement of Reserves Data and Other Oil and Gas Information under NI 51-101 that Lone Pine files with securities regulatory authorities in Canada, copies of which are available on SEDAR at www.sedar.com and on the Company's website at www.lonepineresources.com.
In addition to being a reporting issuer in certain Canadian jurisdictions, Lone Pine is a registrant with the SEC and subject to domestic issuer reporting requirements under U.S. federal securities law, including with respect to the disclosure of reserves and other oil and gas information in accordance with U.S. federal securities law and applicable SEC rules and regulations (collectively, "SEC requirements"). Disclosure of such information in accordance with SEC requirements is included in the Company's Annual Report on Form 10-K and in other reports and materials filed with or furnished to the SEC and, as applicable, Canadian securities regulatory authorities. The SEC permits oil and gas companies that are subject to domestic issuer reporting requirements under U.S. federal securities law, in their filings with the SEC, to disclose only estimated proved, probable and possible reserves that meet the SEC's definitions of such terms. Lone Pine has disclosed only estimated proved reserves in its filings with the SEC. In addition, Lone Pine prepares its financial statements in accordance with United States generally accepted accounting principles, which require that the notes to its annual financial statements include supplementary disclosure in respect of the Company's oil and gas activities, including estimates of its proved oil and gas reserves and a standardized measure of discounted future net cash flows relating to proved oil and gas reserve quantities. This supplementary financial statement disclosure is presented in accordance with FASB requirements, which align with corresponding SEC requirements concerning reserves estimation and reporting.
It should not be assumed that the estimates of future net revenues contained herein represent the fair market value of the Company's reserves. There is no assurance that the forecast prices and cost assumptions applied by DeGolyer &MacNaughton in evaluating the reserves of Lone Pine will be attained, and variances could be material. The reserves estimates attributed to the Company's properties are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual crude oil, natural gas and NGL reserves may be greater than or less than the estimates provided herein, and the difference may be material.
The determination of oil and gas reserves involves estimating subsurface accumulations of oil and natural gas that cannot be measured in an exact manner. The preparation of estimates is subject to an inherent degree of associated risk and uncertainty, including many factors that are beyond our control. The estimation and classification of reserves is a complex process involving the application of professional judgment combined with geological and engineering knowledge to assess whether specific classification criteria have been satisfied. It requires significant judgments and decisions based on available geological, geophysical, engineering and economic data as well as forecasts of commodity prices and anticipated costs. The accuracy of any reserves estimate is a function of the quality of available data and its interpretation, and estimates by different reserves engineers often vary, sometimes significantly. As circumstances change and additional data becomes available, whether through the results of drilling, testing and production or from economic factors such as changes in product prices or development and production expenses, reserves estimates also change. Revisions may be positive or negative. Oil and gas quantities ultimately recovered will vary from reserves estimates.
Lone Pine Resources Inc. is engaged in the exploration and development of natural gas and light oil 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. Lone Pine's common stock trades on the New York Stock Exchange and the Toronto Stock Exchange under the symbol LPR. For more information about Lone Pine, please visit its website at www.lonepineresources.com.
Lone Pine Resources Inc.
David M. Fitzpatrick
Interim Chief Executive Officer
Lone Pine Resources Inc.
Shane K. Abel
Vice President, Finance & Treasurer
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