Mr. Tim Granger reports

LONE PINE RESOURCES ANNOUNCES SHALE GAS LAND CONTINUATION AT POINTED MOUNTAIN IN THE LIARD BASIN

The National Energy Board of Canada has granted Lone Pine Resources Inc. a commercial discovery declaration for natural gas resources contained within the Upper and Lower Besa River shale intervals located in the Pointed Mountain area of the Liard basin in the Northwest Territories. Lone Pine had previously submitted an application for a CDD to the National Energy Board in February, 2012. Following the receipt of the CDD, Lone Pine has now contacted Aboriginal Affairs and Northern Development Canada for the standard 21-year lease extension in accordance with Section 62 of the Canada Oil and Gas Lease Regulations. Lone Pine holds a 100-per-cent-operated working interest in 52,202 acres at Pointed Mountain in the Liard basin.

In the third and fourth quarters of 2011, Lone Pine re-entered and recompleted an existing vertical wellbore (the L-68 well) to test two overpressured uphole shale formations. The L-68 well provided sweet gas flow rate data that support the potential deliverability of 12 million cubic feet per day from a multifractured horizontal completion. Lone Pine believes this analytical forecast is strongly supported by analogous data from other nearby operators in the Liard basin as well as the adjacent Horn River basin. In particular, a well located approximately 100 kilometres from the L-68 well had a 30-day gas flow rate of over 21 million cubic feet per day from the Lower Besa River. Existing infrastructure in the area includes roads and pipeline access to the Spectra Fort Nelson gathering system via the Pointed Mountain/Beaver River sour gas pipeline that intersects Lone Pine's acreage.

In granting the CDD, the NEB concluded that "it is reasonable that all of Lone Pine's 66 sections are developable by the use of hydraulic fracturing," and further added that "there are reasonable grounds to believe that the commercial discovery extends at least throughout the applied-for frontier lands." The CDD also acknowledges that the shale gas intervals "appear to be thicker over the Lone Pine lease area than the equivalent shales in Horn River basin," and further that "the thicker intervals combined with good reservoir parameters contribute to large original gas-in-place resource estimates."

Tim Granger, president and chief executive officer of Lone Pine, commented: "The receipt of this CDD is an important step in the company's shale gas development strategy. We are happy to have been granted this CDD, which is the first of its kind for an unconventional resource play that has been granted by the National Energy Board. Lone Pine continues to believe the full value of our diverse and deep asset base is not currently being reflected in trading values and is actively pursuing transactions aimed at further reducing this valuation gap."

Lone Pine engaged Netherland, Sewell and Associates Inc. to provide an independent resource assessment of the company's interests in the Upper and Lower Besa River shales at Pointed Mountain effective Sept. 30, 2012. The NSAI resource assessment was prepared in accordance with definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook and Canadian National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities. NSAI's best estimate of undiscovered shale gas initially in place on the company's Pointed Mountain lands is 20.6 trillion cubic feet with a low case of 14.4 trillion cubic feet and high case of 28.4 trillion cubic feet. NSAI's corresponding unrisked prospective shale gas resource has a best estimate of 3.8 trillion cubic feet with a low case of 1.8 trillion cubic feet and a high case of 7.4 trillion cubic feet.

            SUMMARY INFORMATION FROM THE NSAI RESOURCE ASSESSMENT

                      Undiscovered shale gas  Unrisked prospective shale gas 
Category          initially in place (bcf)(1)               resource (bcf)(2)
                                                                            
Low estimate(3)                       14,420                           1,828
Best estimate(3)                      20,615                           3,768
High estimate(3)                      28,426                           7,441


Notes:
1. Undiscovered petroleum initially in place (equivalent to undiscovered 
resources) 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 as unrecoverable.
2. 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. The prospective shale gas 
resources should not be construed as reserves or contingent resources; they 
represent exploration opportunities and quantify the development potential 
in the event a petroleum discovery is made. If they are discovered there is 
no certainty that it will be commercially viable to produce any portion of 
the prospective resources.
3. Uncertainty ranges as are described by the Canadian Oil and Gas 
Evaluation Handbook as low, best and high estimates for reserves and 
resources are as follows: 
a. 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-per-cent 
probability (P90) that the quantities actually recovered will equal or 
exceed the low estimate. 
b. 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-
per-cent probability (P50) that the quantities actually recovered will equal 
or exceed the best estimate. 
c. 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-per-cent 
probability (P10) that the quantities actually recovered will equal or 
exceed the high estimate. 

We seek Safe Harbor.