The operational successes of the previous quarters in Contact’s East Kakwa Montney Project are now having a material positive impact on the Company. Three additional wells, 5-23-63-6W6 (the “5-23 Well”), 16-25-63-6W6 (the “16-25 Well”) and 16-17-63-6W6 (the “16-17 Well”), have been placed into production subsequent to the end of the quarter, and are flowing into the Company’s newly built compressor station. East Kakwa volumes have grown significantly. Since bringing its central compressor and condensate stabilization facility online in mid-January 2014, Contact’s aggregate net production has fluctuated between 500 – 800 boe/d, on a per producing day basis. We expect production from our existing Kakwa wells to stabilize once all early stage operational matters are addressed in the normal course. Going forward, we expect to drill up to eight new operated wells by the end of fiscal 2015 (being March 31, 2015). With success and assuming stable commodity prices, production from this drilling program is expected to generate sufficient cash flow to enable us to ‘self-fund’ our operational activity at East Kakwa going forward into fiscal 2016.


The central compression and condensate stabilization facility located at 16-7-63-5W6 (“16-7 Facility”) was fully constructed and commissioned in early January 2014. The 16-7 Facility is being used to compress natural gas from the Contact-operated Kakwa area wells for transportation to a third party gas plant, as well as to stabilize and store condensate prior to trucking liquids to sales off-take facilities. The plant was designed initially to handle up to 2500 bbls/d of condensate and 15MMcf/d natural gas, but was designed in a modular fashion such that additional capacity can be added as required.


We are currently drilling the 02/14-30-63-5W6 Well (the “02/14-30 Well”) a well that was originally slated to be bottom hole 15-30. This well will penetrate the uppermost D4 interval in the Montney, located at stratigraphically about 75m above the other producing Middle Montney zone in Contact’s operated wells. Successful results in the 02/14-30 Well will encourage material reserves additions to the East Kakwa project. Contact previously participated in a non-operated well at 14-2-63-6W6, which is also being produced from this interval.


Stepping beyond East Kakwa, Contact has expanded its Alberta Deep Basin land position extensively. As discussed at the end of our last quarter, following a technical evaluation of the region, the Company acquired additional sections with Montney/Duvernay prospectivity, including 11 sections at West Kakwa, 27 sections at Chime and 22 sections at Pinto. Contact now has the opportunity to expand its focus into these new project areas, where we believe the Montney formation has strong condensate prospectivity. Other industry participants own surrounding acreage, and are also planning near term activity, which will not only begin to highlight these project areas, but will also serve to assist in technically de-risking the lands.


Although less active operationally, much time has been dedicated by Contact’s management to progressing Contact’s assets in Atlantic Canada. Our alignment with Pieridae Energy Limited (“Pieridae”), the Canadian energy infrastructure development company that has announced the development of a liquefied natural gas (“LNG”) export facility in Goldboro, Nova Scotia, Canada, continues to move forward strongly. We are currently working within the regulatory process, seeking permits for 2 vertical exploratory wells within our leasehold in the Moncton Sub-basin of New Brunswick. Pieridae has committed that they will fund each of these wells at 100% up to $15.4M to earn a 50% interest in approximately 33 sq. miles of prospective acreage.


Contact’s oil assets in Atlantic Canada, at both Stoney Creek and Hopewell, are of significant value to the Company. We anticipate conducting operational activity at both in conjunction with mobilizing equipment for the Pieridae project.


The Company successfully completed a non-brokered flow-through private placement financing, closing on December 31, 2013, issuing an aggregate of 5,555,556 “flow-through” common shares in the private placement, at a price of $0.36 per share for aggregate gross proceeds of $2,000,000. The proceeds of this raise are expected to be used to expand the Company’s Montney project.


In addition, Contact’s secured lender has increased the amounts available under the Company’s credit facilities. Under the amended facility, the Company is able borrow up to $4,500,000 (up from $3,000,000) under its operating line at prime plus 1.5% per annum, and also has access to a nonrevolving acquisition or development demand loan in the amount of $3,200,000 (up from $1,500,000) at prime plus 2.0% per annum.


Contact has successfully executed an extensive operational campaign at Kakwa resulting in material growth for the Company. We are positioned for further growth with both new Deep Basin acreage and within additional zones within our lands at Kakwa, which growth we will be focused on realizing within the upcoming quarters. Our projects in Atlantic Canada and in particular our alignment with Pieridae, offer significant upside, diversifying our portfolio and increasing our ability to impact corporate growth. We look forward to sharing additional information on our many exciting projects with our shareholders as we move forward.






On behalf of the Board of Directors,

Steve Harding

President / CEO

February 20, 2013

President’s Message

 

Contact Exploration Inc.
Suite 1520, 700 6th Ave. SW
Calgary, AB, Canada T2P 0T8

Ph:   1 (403) 234-8663
Fax: 1 (403) 695-3915

NEWS RELEASE

Contact Exploration Announces Participation in New Acreage Well; Provides Montney Operations Update

January 29, 2013 (Calgary, Alberta) Contact Exploration Inc. (“Contact” or the “Company”) (TSX-V: CEX) is pleased to announce that it will be participating in a new non-operated Montney well, immediately adjacent to Contact’s existing 25% working interest Kakwa acreage. The operator advises that drilling of this well is expected to commence in mid-February 2013. 

NEWS RELEASE

Contact Exploration Announces Filing of Third Quarter Results and Increased Credit Facilities

February 28, 2013, (Calgary, Alberta) Contact Exploration Inc. (TSX-V: CEX) announces that it has filed its unaudited Condensed Interim Consolidated Financial Statements for the three and nine month periods ended December 31, 2012 and the related Management’s Discussion and Analysis on www.sedar.com

NEWS RELEASE

Contact Exploration and Pieridae Energy Announce Partnership to Focus on Natural Gas Production for LNG Export 

March 4, 2013, (Calgary, Alberta) Contact Exploration Inc. (“Contact”) (TSX-V: CEX) and Pieridae Energy Limited (“Pieridae”) are pleased to announce the creation of a new natural gas-focused exploration and production entity – Pieridae Production Limited Partnership (“PPLP” or the "Partnership”).

PPLP has been formed by Pieridae and Contact to source, develop and produce natural gas to serve as significant portion of the feedstock for Pieridae’s proposed Goldboro LNG Terminal in Guysborough, Nova Scotia.

NEWS RELEASE

Contact Exploration Inc.Issues Incentive Options

March 8, 2013, (Calgary, Alberta)

Contact Exploration Inc. ("Contact" or the "Company") (TSX-V: CEX) announces that it has issued a total of 2,850,000 stock options to employees, executive officers and directors of the Company in accordance with the Company's shareholder approved stock option plan. The stock options are exercisable at a price of $0.24 per share, expire in five years and vest immediately. 

NEWS RELEASE

Contact Exploration Continues Success with Kakwa Liquids-Rich Montney Development

March 21, 2013, (Calgary, Alberta) Contact Exploration Inc. ("Contact" or the "Company") (TSX-V: CEX) is pleased to announce that the third Contact-operated horizontal Montney well (the "3-19 Well") has been successfully completed and tested. The well was flow-tested for 161 hours. During the final 24 hours of flow-back the well averaged gross production rates of 1,798 boe/d consisting of 826 bbl/d condensate and 5,833 mscf/d gas (207 bbl/d and 1,458 mscf/d, or 450 boe/d combined, net to Contact) against anticipated gathering system pressure of approximately 5,000 kPa.

NEWS RELEASE

Contact Exploration Announces Long-term Customer Signed by Pieridae Energy for Goldboro LNG Project

June 3, 2013, (Calgary, Alberta) – Contact Exploration Inc. (“Contact” or the “Company”) (TSX-V:CEX) is pleased to announce that Pieridae Energy (Canada) Ltd. (“Pieridae”) has entered into a long-term sales agreement with E.ON Global Commodities SE ("E.ON"), a subsidiary of E.ON SE, and one of the world's largest investor-owned power and gas companies, for the purchase of liquefied natural gas ("LNG") from the Goldboro LNG project being developed by Pieridae in Nova Scotia, Canada. Under the agreement, Pieridae is to deliver approximately 5 million tons per annum ("MTPA") of LNG to E.ON for 20 years into a number of locations in Western Europe.

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NEWS RELEASE

Contact Reserves Increase by 320% in Fiscal 2013

July 2, 2013, (Calgary, Alberta) Contact Exploration Inc. ("Contact" or the "Company") (TSX-V: CEX) is pleased to report that independent reserves evaluations effective March 31, 2013 have been completed by the Company's reserves evaluators in accordance with the COGE Handbook. GLJ Petroleum Consultants Ltd. ("GLJ") evaluated the Company's Stoney Creek and Hopewell properties in New Brunswick, while McDaniel and Associates Consultants Ltd. ("McDaniel") evaluated the Company's core area at Kakwa, Alberta.

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NEWS RELEASE

Contact Exploration Provides Upper Montney Operations Update

July 24, 2013 (Calgary, Alberta) Contact Exploration Inc. ("Contact" or the "Company") (TSX-V: CEX) is pleased to announce that its 23.75% non-operated 14-2-63-6 W6M Kakwa Montney well (the "14-2 Well") has been successfully completed within the upper interval of the Montney Formation. This interval had not previously been tested by Contact; however, other operators have demonstrated repeated success in this interval within the Kakwa/Resthaven trend. The 14-2 Well has been flow-tested by the operator for a total of 191 hours, including the final 98 hours with tubing in hole. 

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NEWS RELEASE

Contact Announces Private Placement

July 25, 2013, (Calgary, Alberta) – Contact Exploration Inc. ("Contact" or the "Company") (TSX-V:CEX) is pleased to announce its intention to complete a brokered private placement of up to 12,500,000 common shares (the "Shares") of the Company, at a price of $0.26 per Share, and up to 5,833,334 Shares to be issued on a "flow-through" basis pursuant to the Income Tax Act (Canada) (the "Flow-Through Shares"), at a price of $0.30 per Flow-Through Share, for aggregate gross proceeds of up to $5,000,000 (the "Private Placement").

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NEWS RELEASE

Contact Announces Increase to Previously Announced Private Placement

August 1, 2013, (Calgary, Alberta) – Contact Exploration Inc. ("Contact" or the "Company") (TSX-V:CEX) is pleased to announce that due to demand from potential investors, it has increased the size of its previously announced brokered private placement, to be conducted on a commercially reasonable "best efforts” agency basis through a syndicate of agents led by Integral Wealth Securities Limited and including Dundee Securities Corp., MGI Securities Inc. and Beacon Securities Ltd.

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NEWS RELEASE

Contact Announces Approval of Advance Notice By-law

August 2, 2013, (Calgary, Alberta) – Contact Exploration Inc. ("Contact" or the "Company") (TSX-V:CEX) is pleased to announce that the board of directors (the "Board") of Contact has approved amendments to the Company's standard by-laws. The amendments include certain housekeeping amendments to update the by-laws to current standards, as well as the adoption of an advance notice by-law (the "Advance Notice By-law").

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NEWS RELEASE

Contact Announces Closing of Private Placement

August 8, 2013, (Calgary, Alberta) Contact Exploration Inc. ("Contact" or the "Company") (TSX-V: CEX) is pleased to announce that it has closed its previously announced brokered private placement (the "Private Placement") pursuant to which it has issued 14,009,616 common shares ("Common Shares") of the Company at a price of $0.26 per Common Share and 9,495,000 Common Shares issued on a "flow-through" basis pursuant to the provisions of the Income Tax Act (Canada) (the "Flow-Through Shares") at an issue price of $0.30 per Flow-Through Share for aggregate gross proceeds of $6,491,000.00 (the "Private Placement").

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NEWS RELEASE

Contact Announces Interim Filings 

August 27, 2013, (Calgary, Alberta) Contact Exploration Inc. ("Contact" or the "Company") (TSX-V:CEX) is pleased to announce that it has today filed its condensed interim consolidated financial statements for the three months ended June 30, 2013 and the related management's discussion and analysis ("MD&A") on the Company's profile on the System for Electronic Document Analysis and Retrieval ("SEDAR") website at www.sedar.com.

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NEWS RELEASE

Contact Exploration Inc. Issues Incentive Options  

September 5, 2013, (Calgary, Alberta) Contact Exploration Inc. (the "Company") (TSX-V: CEX) announces that it has issued a total of 1,100,000 stock options to certain employees and consultants of the Company in accordance with the Company's shareholder approved stock option plan. The stock options are exercisable at a price of $0.20 per share, expire in August 2018 and vest immediately.

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NEWS RELEASE

Contact Exploration Provides Operations Update  

September 9, 2013, (Calgary, Alberta) Contact Exploration Inc. (“Contact” or the “Company”) (TSX-V: CEX) is pleased to announce that the fourth Contact-operated Kakwa Montney well, at 5-23-63-6 W6M (the ”5-23 Well") has been successfully drilled horizontally to a total measured depth of 5017 meters. The 5-23 Well included a planned vertical stratigraphic penetration, whereby a full suite of logs throughout the Montney Formation was acquired and full diameter core data through the Upper and Middle Montney intervals was retrieved, allowing Contact to further calibrate the 5-23 Well and the other wells in the area.

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NEWS RELEASE

Contact Exploration Continues Success with Kakwa Liquids-Rich Development

October 16, 2013, (Calgary, Alberta) Contact Exploration Inc. (“Contact” or the “Company”) (TSX-V: CEX) is pleased to announce that the fourth Contact-operated horizontal Montney well at 5-23-63-6 W6 (the "5-23 Well") (Contact 25% working interest) has been successfully completed and tested. The well was flow-tested for approximately 170 hours. During the final 24 hours of flow-back the well produced against anticipated gathering system pressure of approximately 2,000 kPa and averaged gross production rates of 1,433 boe/d consisting of 815 bbl/d condensate and 3,704 mscf/d natural gas (204 bbl/d and 920 mscf/d, or 358 boe/d combined, net to Contact)...

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NEWS RELEASE

Contact Announces Interim Filings and Land Acquisitions

November 27,2013, (Calgary, Alberta) Contact Exploration Inc. (‘’Contact’’ or the ‘’Company’’) (TSX-V:CEX) is pleased to announce that it has today filed its condensed interim consolidated financial statements for the three and six month periods ended September 30, 2013 and the related management’s discussion and analysis on the Company’s profile on the System for  Electronic Document Analysis and Retrieval  website at www.sedar.com  ...

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NEWS RELEASE

Contact Exploration Announces Private Placement of Flow-Through Common Shares

December 26, 2013, (Calgary, Alberta) Contact Exploration Inc. (“Contact” or the “Company”) (TSX-V: CEX) announces that it is carrying out a non-brokered private placement (the "Private Placement") of common shares in the capital of the Company, to be issued on a "flow-through" basis pursuant to the Income Tax Act (Canada) ("Flow-Through Shares"). Contact expects to issue up to 5,555,556 Flow-Through Shares in the Private Placement, at a price of $0.36 per share, for maximum aggregate gross proceeds of $2,000,000.16.

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NEWS RELEASE

Contact Exploration Announces Closing of Private Placement

December 31, 2013, (Calgary, Alberta) Contact Exploration Inc. (“Contact” or the “Company”) (TSX-V: CEX) is pleased to announce that it has closed its previously announced non-brokered private placement (the "Private Placement") of common shares in the capital of the Company, to be issued on a "flow-through" basis pursuant to the Income Tax Act (Canada) ("Flow-Through Shares"). Contact issued an aggregate of 5,555,556 Flow-Through Shares in the Private Placement, at a price of $0.36 per Flow-Through Share for aggregate gross proceeds of $2,000,000.16. 

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NEWS RELEASE

Contact Exploration Provides Operations Update

January 20, 2014, (Calgary, Alberta) Contact Exploration Inc. (“Contact” or the “Company”) (TSX-V: CEX) is pleased to provide an operations update on its activities in the Kakwa area of Alberta.

Operated Activities  Contact holds a 25% working interest in all Montney wells and associated facilities on a 16¾ section block in the Kakwa, Alberta area, other than in the 13-17-63-5W6 Well (“13-17 Well”) in which the Company's working interest is 37.5% before payout, 25% after payout. Contact is the operator of all wells and facilities on this 16¾ section block.

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NEWS RELEASE

Contact Announces Interim Filling, Credit Facilities Increase and Operations Update

February 28, 2014, (Calgary, Alberta) Contact Exploration Inc. ("Contact" or the "Company") (TSX-V:CEX) is pleased to announce that it has today filed its condensed interim consolidated financial statements for the three and nine month periods ended December 31, 2013 and the related management's discussion and analysis ("MD&A") on the Company's profile on the System for Electronic Document Analysis and Retrieval ("SEDAR") website at www.sedar.com.

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NEWS RELEASE

Contact Exploration’s Kakwa Development Continues with Successful Test Results in Upper Montney Zone

April 7, 2014, (Calgary, Alberta) Contact Exploration Inc. (“Contact” or the “Company”) (TSXV:CEX) is pleased to announce that the seventh Contact-operated horizontal Montney well at 02/14-30-63-5 W6 (the "02/14-30 Well") (Contact 25% working interest) drilled in the Upper Montney D4 interval has been successfully completed and tested.The well was drilled to a total measured depth of 4,563 metres, with a horizontal leg of 1,068 metres, approximately 200-500 metres shorter than Contact’s other Kakwa wells and the shortest of the Company’s Kakwa horizontal wells drilled to date.

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