Frontera Announces First Quarter 2023 Results.

CALGARY, AB: Frontera Energy Corporation (TSX: FEC) ("Frontera" or the "Company") today reported financial and operational results for the first quarter ended March 31, 2023. All financial amounts in this news release are in United States dollars unless otherwise stated.

Gabriel de Alba, Chairman of the Board of Directors, commented:

Frontera's first quarter results were in-line with its 2023 capital and production guidance. The Company delivered average daily production of 41,586 boe/d, generated $91.9 million of operating EBITDA, and invested $131.5 million in capital expenditures.

Consistent with its strategic priorities, the Company successfully refinanced Puerto Bahia's existing legacy project finance debt via a new $120 million loan facility with a group of lenders led by Macquarie Capital, which extended the tenor of the borrowings and provided for up to $30 million in additional funding to pursue strategic investment opportunities within its Midstream business. With the refinancing complete, Frontera's standalone midstream business is fully capitalized with funding to grow. Subsequent to the quarter, the Company designated Frontera Energy Guyana Holding Ltd. and Frontera Energy Guyana Corp. as unrestricted subsidiaries and released Frontera Energy Guyana Corp. as a note guarantor for its senior bonds due 2028. The designation is a positive forward step as the Company nears the completion of its exploration obligations in Guyana and supports ongoing capital discipline.

The Company remains focused on aligning its Upstream, Midstream, and Guyana core businesses to achieve the Company's strategic priorities and unlock shareholder value.

Orlando Cabrales, Chief Executive Officer (CEO), Frontera, commented:

"I'm pleased with Frontera's first quarter operational and financial results. Despite community blockades in early February which temporarily shut-in production at our Quifa and CPE-6 operations, the Company's first quarter production was largely in-line with last quarter. YTD, we are delivering average daily production of approximately 41,800 boe/d and in March and April we averaged 42,500 boe/d. This is due to better than expected performance from our new Cajua wells where current gross average heavy oil production is 4,860 bopd, higher VIM-1 liquids and NGL production, better performance at CPE-6, Coralillo 1 and 3 wells, as well as the Tapiti-1 well.

The Company continues to focus on managing costs across the business. Frontera's field breakeven of approximately $34 - $38/boe ensures operational resilience even in volatile market conditions and under varying oil price scenarios.

We expect improved profitability throughout the rest of the year as we advance our development portfolio in Colombia and Ecuador, increase Quifa and CPE-6 water-handling infrastructure and facilities as we lay the foundation for the Company's path to grow production to 50,000 boe/d, leverage our advantaged transportation and logistics structure to maximize realized prices and mature our self-sustaining and growing midstream business.

During the quarter, Frontera and its Joint Venture partner spud the Wei-1 well and we are currently at 19,142 feet. We have encountered oil-bearing intervals so far and are currently drilling ahead to our planned total depth.

Importantly, during the quarter, Frontera was recognized for a third consecutive year by Ethisphere as one of the World's Most Ethical Companies in 2023. The Company was added to the 2023 Bloomberg Gender-Equality Index, achieved ISO certification in Ecuador and was recognized by Friendly Biz for our LGBT+ friendly workplace."

First Quarter 2023 Operational and Financial Summary

Q1 2023

Q4 2022

Q1 2021

Operational Results

Heavy crude oil production (1)

(bbl/d)

22,270

22,144

21,214

Light and medium crude oil production (1)

(bbl/d)

16,518

17,073

17,248

Total crude oil production

(bbl/d)

38,788

39,217

38,462

Conventional natural gas production (1)

(mcf/d)

8,590

9,097

9,530

Natural gas liquids production (1)

(boe/d)

1,291

993

966

Total production (2)

(boe/d) (3)

41,586

41,806

41,100

Inventory Balance

Colombia

(bbl)

1,032,876

683,416

937,583

Peru

(bbl)

480,200

480,200

480,200

Ecuador

(bbl)

98,125

75,164

16,328

Total Inventory

(bbl

1,611,201

1,238,780

1,434,111

Oil and gas sales, net of purchases (4)

($/boe)

69.16

82.67

90.12

Realized (loss) on risk management contracts (5)

($/boe)

(1.16)

(1.32)

(1.06)

Royalties (5)

($/boe)

(3.36)

(6.04)

(7.58)

Other dilution costs (5)

($/boe)

(0.09)

(0.07)

(0.12)

Net sales realized price (4)

($/boe)

64.55

75.24

81.36

Production costs (5)

($/boe)

(12.07)

(11.56)

(13.34)

Transportation costs (5)

($/boe)

(11.20)

(10.55)

(9.72)

Operating netback per boe (4)

($/boe)

41.28

53.13

58.30

Financial Results

Oil and gas sales, net of purchases (6)

($M)

189,376

261,059

228,826

Realized (loss) on risk management contracts

($M)

(3,175)

(4,182)

(2,682)

Royalties

($M)

(9,213)

(19,076)

(19,244)

Other dilution costs

($M)

(256)

(235)

(298)

Net sales (6)

($M)

176,732

237,566

206,602

Net income (loss) (7)

($M)

(11,330)

197,796

102,228

Per share - basic

($)

(0.13)

2.29

1.08

Per share - diluted

($)

(0.13)

2.25

1.05

General and administrative

($M)

12,669

12,761

14,656

Outstanding Common Shares

Number of Shares

85,188,573

85,592,075

94,070,294

Operating EBITDA (6)

($M)

91,922

144,994

132,998

Cash provided by operating activities

($M)

845

138,312

114,748

Capital expenditures (6)

($M)

131,452

134,165

113,545

Cash and cash equivalents - unrestricted

($M)

162,272

289,845

257,373

Restricted cash short and long-term (8)

($M)

30,877

23,202

66,146

Total cash (8)

($M)

193,149

313,047

323,519

Total debt and lease liabilities (8)

($M)

519,471

511,552

558,281

Consolidated total indebtedness (Excl. Unrestricted Subsidiaries) (9)

($M)

400,361

407,808

410,161

Net Debt (Excl. Unrestricted Subsidiaries) (9)

($M)

279,843

178,534

199,303

1. References to heavy crude oil, light and medium crude oil combined, conventional natural gas and natural gas liquids in the above table and elsewhere in this news release refer to the heavy crude oil, light and medium crude oil combined, conventional natural gas and natural gas liquids, respectively, product types as defined in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101").

2. Represents W.I. production before royalties. Refer to the "Further Disclosures" section.

3. Boe has been expressed using the 5.7...