Frontera Announces Completion of Substantial Issuer Bid

Source: 8/11/2022, Location: North America

Frontera Energy Corporation has taken up and paid for 5,416,666 of its outstanding common shares (the "Shares") at a price of $12.00 per Share (the "Purchase Price") under its substantial issuer bid pursuant to which the Company offered to purchase from shareholders for cancellation up to $65 million (equivalent to US$50 million) of Shares (the "Offer"). All dollar amounts are in Canadian dollars unless otherwise specified.

The Shares taken up and paid for by the Company represent approximately 5.84% of the total number of Frontera's issued and outstanding Shares as of August 8, 2022. The aggregate Purchase Price is equal to approximately $65 million. After the cancellation of the Shares taken up and paid for by the Company, Frontera anticipates that 87,408,875 Shares will be issued and outstanding.

6,498,558 Shares were validly tendered and not withdrawn pursuant to auction tenders at or below the Purchase Price and pursuant to purchase price tenders. Since the Offer was oversubscribed, shareholders who made auction tenders at or below the Purchase Price and shareholders who made, or were deemed to have made, purchase price tenders will have the number of Shares purchased prorated (other than "odd lot" tenders, which are not subject to proration).

Shareholders who made auction tenders at or below the Purchase Price and shareholders who made, or were deemed to have made, purchase price tenders will have approximately 83.3% of their tendered Shares purchased by the Company. Shareholders who made auction tenders at a price in excess of the Purchase Price should not expect to have any of their Shares purchased by the Company. 609 Shares were taken up and purchased pursuant to proportionate tenders.

Payment for Shares taken up by the Company under the Offer will be effected by Computershare Investor Services Inc., the depositary for the Offer, on or about August 15, 2022, in accordance with the Offer and applicable law. Any Shares not taken up, including such Shares not taken up as a result of proration or Shares tendered pursuant to auction tenders at prices higher than the Purchase Price or invalidly tendered, will be returned to shareholders as soon as practicable.

To assist shareholders in determining the tax consequences of the Offer, Frontera estimates that a deemed dividend in the amount of $2.04 per Share was triggered on the repurchase of each Share, based on the estimated paid-up capital of $9.96 per Share at August 8, 2022. The dividend deemed to have been paid by Frontera to Canadian resident persons is designated as an "eligible dividend" for purposes of the Income Tax Act (Canada) and any corresponding provincial and territorial tax legislation.

For the purposes of subsection 191(4) of the Income Tax Act (Canada), the "specified amount" in respect of each Share is $11.41.

Shareholders should consult with their own tax advisors with respect to the income tax consequences of the disposition of their Shares under the Offer.

The terms and conditions of the Offer are described in the offer to purchase and issuer bid circular dated June 24, 2022, letter of transmittal, notice of guaranteed delivery, and notice of variation dated July 25, 2022, copies of which were filed and are available without charge on SEDAR at

This news release is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell Shares.

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