Forest Oil Announces Continued Progress on Deleveraging Plan with Agreement to Sell South Louisiana Properties

  Forest Oil Announces Continued Progress on Deleveraging Plan with Agreement
  to Sell South Louisiana Properties

Business Wire

DENVER -- October 12, 2012

Forest Oil Corporation (NYSE:FST) (Forest or the Company) today announced that
it has entered into a definitive agreement to sell all of its properties
located in South Louisiana for approximately $220 million. The transaction is
expected to close on November 16, 2012, with an effective date of August 1,
2012, and is subject to customary closing conditions and post-closing purchase
price adjustments. The properties produced 20 MMcfe/d (65% liquids) during the
third quarter of 2012 and had estimated proved reserves of 45 Bcfe (62%
liquids) as of December 31, 2011. Forest intends to use the proceeds from this
divestiture to repay outstanding borrowings under its bank credit facility.

Since embarking on its deleveraging plan in early July, Forest has completed
or has under contract, transactions totaling approximately $277 million. This
includes the previously announced East Texas natural gas gathering assets for
$34 million, approximately 5,600 net acres in the Eagle Ford Shale for $15
million, and other miscellaneous properties for $8 million. Upon closing of
the South Louisiana transaction, Forest intends to update 2012 guidance.

                                  Estimated  3Q12        Proved Reserves at
                                   Proceeds    Production   December 31, 2011
Transaction                        ($MM)       (MMcfe/d)    (Bcfe)
                                                            
South Louisiana Properties         220         20           45
East Texas Natural Gas Gathering   34          -            -
Assets
Eagle Ford Shale Acreage           15          -            -
Miscellaneous Properties           8           2            7
                                                          
Total                              277         22           52
                                                            

Patrick R. McDonald, President and CEO, stated, “We are pleased to announce
continued progress in our deleveraging plan with the sale of our non-core
South Louisiana properties. Our team has made meaningful strides in improving
the Company’s financial position, and we will continue to focus on other
non-core divestitures to improve our balance sheet and increase our financial
flexibility as we maintain focus on the development of our core oil
properties.”

                          FORWARD-LOOKING STATEMENTS

This news release includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements, other than statements of historical
facts, that address activities that Forest assumes, plans, expects, believes,
projects, estimates or anticipates (and other similar expressions) will,
should, or may occur in the future are forward-looking statements. The
forward-looking statements provided in this press release are based on
management's current belief, based on currently available information, as to
the outcome and timing of future events. Forest cautions that future natural
gas and liquids production, revenues, cash flows, liquidity, plans for future
operations, expenses, outlook for oil and natural gas prices, timing of
capital expenditures, and other forward-looking statements relating to Forest
are subject to all of the risks and uncertainties normally incident to their
exploration for and development and production and sale of liquids and natural
gas.

These risks relating to Forest include, but are not limited to, oil and
natural gas price volatility, its level of indebtedness, its ability to
replace production, its ability to compete with larger producers,
environmental risks, drilling and other operating risks, regulatory changes,
credit risk of financial counterparties, risks of using third-party
transportation and processing facilities and other risks as described in
reports that Forest files with the SEC, including its Annual Report on Form
10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. Any of
these factors could cause Forest's actual results and plans to differ
materially from those in the forward-looking statements.

Forest Oil Corporation is engaged in the acquisition, exploration,
development, and production of natural gas and liquids in the United States
and selected international locations. Forest's principal reserves and
producing properties are located in the United States in Arkansas, Louisiana,
Oklahoma, Texas, Utah, and Wyoming. Forest's common stock trades on the New
York Stock Exchange under the symbol FST. For more information about Forest,
please visit its website at www.forestoil.com.

October 12, 2012

Contact:

Forest Oil Corporation
Larry C. Busnardo, 303-812-1441
Director - Investor Relations
 
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