CEX Contact Exploration Inc.

CALGARY, ALBERTA--(Marketwired - May 21, 2014) - Contact Exploration Inc. ("Contact" or the "Company") (TSX-VENTURE:CEX) is pleased to report that independent reserves evaluations effective March 31, 2014 have been completed by the Company's reserves evaluators in compliance with National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101") and in accordance with the Canadian Oil and Gas Evaluation ("COGE") Handbook. GLJ Petroleum Consultants Ltd. ("GLJ") evaluated the Company's Stoney Creek and Hopewell properties in New Brunswick (the "GLJ Report"), while McDaniel and Associates Consultants Ltd. ("McDaniel") evaluated the Company's Montney Formation assets at East Kakwa, Alberta (the "McDaniel Report").

Highlights of the Company's reserves evaluations include (all reserve volumes are reported as net to the Company, before tax and royalty deductions with the increases referenced being against the evaluations carried out on Contact's reserves for the year ended March 31, 2013):

• Total Company reserves (net proved and probable) increased by 43% to 10,643 MBOE (56% oil and natural gas liquids).
• Total Company net present value (net proved and probable reserves discounted at 10%) increased by 69% to $174.4MM.
• Total proved reserves increased from 1,815 MBOE (61% oil and natural gas liquids) to 5,926 MBOE (52% oil and natural gas liquids), an increase of 226%.
• Net present value of proved reserves (discounted at 10%) increased from $28.0MM in 2013 to $92.7MM in 2014, an increase of 231%.

Kakwa - McDaniel Report

During the fiscal year ended March 31, 2014, the Company expanded development at its East Kakwa property, drilling and completing four additional Contact operated horizontal wells (average 25% working interest ("WI")) and participating in a fifth non-operated well (24% WI). The confirmed regional extent of prospective Montney reserves at East Kakwa was expanded and the prospectivity of a second zone (the Upper Montney D4 interval) was confirmed in the McDaniel Report. Considerable additional data was collected from Contact's extensive operational program, which included securing more than 100 meters of Montney formation core from the Company's 5-23-63-6W6 well. Also during the fiscal year, Contact successfully expanded its Kakwa pipeline gathering system and constructed and commissioned the 16-7 compressor and condensate stabilization facility.

The reserves assignments by McDaniel in the McDaniel Report now encompass 10.5 gross sections (out of 18.75 total gross sections) in the middle Montney (D2 interval) and two gross sections (out of 18.75 total gross sections) in the upper Montney (D4 interval) at East Kakwa, where Contact holds a 25% WI. Contact's Montney acreage at West Kakwa, Chime and Pinto, consisting of 61 composite sections (100% WI), were not evaluated as part of the McDaniel Report.

Highlights of the McDaniel Report include (all reserve volumes are reported as net to the Company, before tax and royalty deductions with the increases referenced being against the evaluation carried out on Contact's reserves at Kakwa by McDaniel for the year ended March 31, 2013):

• East Kakwa proved plus probable reserves increased by 61% to 8,451 MBOE in 2014 consisting of 4,325 MBOE natural gas and 4,125 MBOE liquids.
• The net present value of Contact's East Kakwa net proved and probable reserves (discounted at 10%) increased by 99% to $127.6MM.
• East Kakwa proved reserves increased by 299% to 5,510 MBOE in 2014 consisting of 2,819 MBOE natural gas and 2,691 MBOE liquids.
• The net present value of Contact's East Kakwa net proved reserves (discounted at 10%) increased by 332% to $82.5MM.

Stoney Creek New Brunswick - GLJ Report

The Company's Stoney Creek and Hopewell, New Brunswick reserve evaluation remained consistent from the year ended March 31, 2013, with total proved and probable reserves decreasing less than 1% (2,210 MBOE to 2,192 MBOE). Continued well performance at Stoney Creek, combined with improved commodity forecasts, enabled net present value (discounted at 10%) during the year ended March 31, 2014 to increase by 20% to $46.8MM from $38.9MM.

Operations Update

The Company's first mile and a half horizontal well was drilled from the 7-19 pad location at East Kakwa, reaching a total measured depth of 5,504 meters in 36 days. This well achieved total depth in fewer days than any of the Company's previous mile long horizontal wells. On the second well drilled from the 7-19 site, Contact is nearing total depth of 5,400 meters, at a similar pace to that of the first well. The Company expects to spud a third well off of the same surface pad before the end of May 2014. Once the third well has reached total depth, Contact plans to consecutively complete and tie-in each of these wells to the Company's existing infrastructure. Contact holds a 25% WI in all three wells.

In addition, Contact is the process of contracting a second rig that is expected to be used to accelerate drilling at East Kakwa. This rig could also be used for drilling on the Company's 100% WI acreage at West Kakwa, Chime or Pinto.

About Contact Exploration Inc.

Contact Exploration Inc. is a public oil and gas company which has a long-term history of operating in Atlantic Canada and has recently demonstrated success in Alberta's liquids-rich Montney Formation tight gas play. For more information, please see the Company's website: www.contactexp.com

Cautionary Statements

Information Regarding Disclosure on Oil and Gas Reserves and Operational Information

ADVISORY ON USE OF "BOEs": "BOEs" may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil or natural gas liquids as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.

ADVISORY ON FORWARD-LOOKING STATEMENTS: This press release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "continue", "estimate", "may", "will", "should", "believe", "plans", "cautions" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the forgoing, this press release contains statements concerning the volumes and net present values of the Company's reserves; timing to spud a new well at the 7-19 surface pad, the Company's plans to consecutively complete and tie-in three wells drilled at the 7-19 pad and the use of a second rig at East Kakwa.

Forward-looking statements or information are based on a number of material factors, expectations or assumptions of Contact which have been used to develop such statements and information but which may prove to be incorrect. Although Contact believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them because Contact 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. In particular, in addition to other factors and assumptions which may be identified herein, no assurances can be given respecting: whether the Company's exploration and development activities respecting the Company's Kakwa and Stoney Creek projects will be successful or that material volumes of petroleum and natural gas reserves will be encountered, or if encountered can be produced on a commercial basis; the ultimate size and scope of any hydrocarbon-bearing formations at the Company's Kakwa and Stoney Creek projects; that the additional drilling operations in the Company's Kakwa and Stoney Creek projects will be successful such that further development activities in these areas are warranted; that Contact's efforts to raise additional capital will be successful; that Contact will continue to conduct its operations in a manner consistent with past operations; results from drilling and development activities will be consistent with past operations; the accuracy of the estimates of Contact's reserve volumes and those volumes reported by GLJ and McDaniel in the GLJ Report and the McDaniel Report, respectively; the general stability of the economic and political environment in which Contact operates; drilling results; field production rates and decline rates; the general continuance of current industry conditions; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Contact to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Contact operates; and the ability of Contact to successfully market its oil and natural gas products.

Further, events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including, without limitation: changes in commodity prices; changes in the demand for or supply of the Company's products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Contact or by third party operators of Contact's properties, increased debt levels or debt service requirements; inaccurate estimation of Contact's oil and gas reserve and resource volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in Contact's public disclosure documents. Additional information regarding some of these risk factors may be found under "Risk Factors" in the Company's management discussion and analysis prepared for the year ended March 31, 2013. The reader is cautioned not to place undue reliance on this forward-looking information. The forward-looking statements contained in this press release are made as of the date hereof and Contact undertakes no obligations 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.

Internal estimates

Certain information contained herein are based on estimated values the Company believes to be reasonable and are subject to the same limitations as discussed under "Advisory on Forward-Looking Statements" above.

Oil and Gas Advisory

The reserves information contained in this press release has been prepared in accordance with NI 51-101. Complete NI 51- 101 reserves disclosure will be included in the Company's filing for the year ended March 31, 2014 required in accordance with NI 51-101, which are expected to be filed in late June 2014. Listed below are cautionary statements applicable to our reserves information that are specifically required by NI 51-101:

1. Individual properties may not reflect the same confidence level as estimates of reserves for all properties due to the effects of aggregation.
2. This press release contains estimates of the net present value of our future net revenue from our reserves. Such amounts do not represent the fair market value of our reserves.
3. Reserves included herein are stated on a Company Interest basis (before royalty burdens and including royalty interests) unless noted otherwise as well as on a gross and net basis as defined in NI 51-101. "Company Interest" is not a term defined by NI 51-101 and as such the estimates of Company Interest reserves herein may not be comparable to estimates of "gross" reserves prepared in accordance with NI 51-101 or to other issuers' estimates of Company Interest reserves."

Additionally, the recovery and reserve estimates of Contact's reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered.

Certain Defined Terms

Neither 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 release.

Contact Exploration Inc.Steve HardingPresident and CEO(403) 771-1091(403) 695-3915sharding@contactexp.comwww.contactexp.com

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