CALGARY and HOUSTON, April 30, 2018 /CNW/ - Sterling Resources Ltd. ("Sterling" or the "Company") (TSX-V: SLG) is pleased to provide a summary of its 2017 year-end financial and operating results and the results of an independent evaluation of its oil reserves, prepared by Netherland, Sewell & Associates, Inc. ("NSAI"), a qualified reserves evaluator, as of December 31, 2017.

Selected financial, operational and reserves information is outlined below and should be read in conjunction with the Company's audited consolidated financial statements ("Financial Statements"), management's discussion and analysis ("MD&A") and annual information form ("AIF") for the year ended December 31, 2017, which are available on SEDAR at www.sedar.com and the Company's website at www.sterling-resources.com. All figures referred to in this press release are denominated in U.S. dollars.

2017 YEAR-END HIGHLIGHTS

• Completed a reverse take-over transaction and amalgamated with PetroTal Ltd. ("PetroTal")
• Completed the acquisition of Gran Tierra Energy International (Peru) Holdings B.V., an indirect wholly-owned subsidiary of Gran Tierra Energy Inc. ("Gran Tierra")
• Commenced operation of Bretana oil field assets
• 2P Reserves estimated at approximately 39.8 million barrels of oil
• 3P Reserves estimated at approximately 79.3 million barrels of oil
• NPV-10 of approximately $282 million for 2P Reserves and $775 million for 3P Reserves

OPERATIONS UPDATE

The Company's objective of developing the Bretana oil field on a modular basis and putting the field online by year-end 2018 is on target. Existing facilities have been transported from storage to the field and new oil production facilities have arrived. Once installed, the Company will begin commissioning an initial set of oil production facilities. Formation water treatment facilities, reinjection facilities and oil production facilities for this first phase are expected to be ready for commissioning by late 2018 and fully operational by year-end. Both the existing oil production wells and water reinjection wells have been intervened to remove plugs and are ready for operation. The Company is negotiating future oil prices and pipeline tariffs with Peru's state oil company, PetroPeru, and the crude oil price formula to calculate royalty payments with Peru's state agency, Perupetro S.A.  

Manolo Zuniga, Sterling's President and Chief Executive Officer, stated, "We are pleased to have completed the reverse take-over and merger of PetroTal and Sterling. We have assumed operation of the Bretana assets and are moving forward with plans to put the Bretana oil field online.  Since acquiring the assets in December 2017, we have initiated field development and facilitated an independent evaluation of the reserves. We are also preparing to drill Bretana's second oil producer, and are readying the data room to promote the Osheki prospect."

NEAR AND MEDIUM-TERM OBJECTIVES

• Maintain cost controls to ensure the Bretana oil field comes online within the capital budget
• Reactivate oil production and water injection wells
• Commission equipment to facilitate a safe transition to full production

FINANCIAL HIGHLIGHTS

The following table summarizes key financial highlights associated with the Company's financial performance.

The year ended December 31, 2017 was a transformative year for the Company. The transactions that were completed had a significant impact on the comparability of the Company's period over period results. See Sterling's Financial Statements and MD&A for further details.

2017 YEAR-END RESERVES SUMMARY ^{(1)(2)(3)(4)(5)}

Summary of Oil Reserves as of December 31, 2017.

Summary of Net Present Values of Future Net Revenue as of December 31, 2017.

See Sterling's March 8, 2018 press release and AIF for further details.

ABOUT BRETANA FIELD

Oil in the Bretana field was first discovered in the 1970's and was subsequently re-discovered by Gran Tierra. Several wells have been drilled to delineate the field and recent seismic has de-risked the structure. The rediscovery well drilled by Gran Tierra in 2014 well tested 18.5 degree API oil from the Vivian formation. The Northern oil fields in Peru have produced over one billion barrels of oil, mostly from the Vivian formation. The Company acquired the assets in Peru on December 18, 2017 from Gran Tierra. The Company is working to put the field on long-term test and begin production as early as Q4 2018.

ABOUT STERLING

Sterling is a publicly-traded oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru.  The Company's management team has significant experience in developing oil fields in Northern Peru and is led by an independent Board of Directors, focused on safely and cost effectively developing and exploiting the Bretana oil field.

READER ADVISORIES

FORWARD-LOOKING STATEMENTS: This press release may contain certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to: the Company's objectives; the Company's capital program, capital budget and proposed drilling, reactivation, water and other activities and the anticipated costs and results of such activities; cost controls; negotiations with PetroPeru and Perupetro S.A.; the size of the oil reserves of the Corporation and anticipated future production and revenue from such reserves; future development and growth prospects.  All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "believe", "expect", "plan", "estimate", "potential", "will", "should", "continue", "may", "objective" and similar expressions. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, reservoir characteristics, recovery factor, exploration upside,  prevailing commodity prices and the actual prices received for Sterling's products, the availability and performance of drilling rigs, facilities, pipelines, other oilfield services and skilled labour, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the accuracy of Sterling's geological interpretation of its drilling and land opportunities, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of new wells, the Company's growth strategy, general economic conditions, availability of required equipment and services and prevailing commodity prices. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), commodity price and exchange rate fluctuations, legal, political and economic instability in Peru, access to transportation routes and markets for the Company's production, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the risk factors identified in the AIF and MD&A which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

PRESENTATION OF OIL AND GAS INFORMATION: Reserves are classified according to the degree of certainty associated with the estimates. Proved (1P) reserves are those reserves that can be estimated with a high degree of certainty to be recoverable.  It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves. Probable (2P) reserves are those additional reserves that are less certain to be recovered than proved reserves.  It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves. Possible (3P) reserves are those additional reserves that are less certain to be recovered than probable reserves. It is unlikely that the actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves. The qualitative certainty levels referred to in the definitions above are applicable to individual reserve entities (which refers to the lowest level at which reserves calculations are performed) and to reported reserves (which refers to the highest level sum of individual entity estimates for which reserve estimates are prepared).  Reported reserves should target the following levels of certainty under a specific set of economic conditions: at least a 90 percent probability that the quantities actually recovered will equal or exceed the estimated proved (1P) reserves; at least a 50 percent probability that the quantities actually recovered will equal or exceed the estimated proved plus probable (1P+2P) reserves; and at least a 10 percent probability that the quantities actually recovered will equal or exceed the sum of the estimated proved plus probable plus possible (1P+2P+3P) reserves.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

SOURCE Sterling Resources Ltd.

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