Open Range Energy Corp. Enters Into Arrangement Agreement With Peyto Exploration & Development Corp. and Terminates Arrangement Agreement With Cequence Energy Ltd.

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CALGARY, ALBERTA--(Marketwire - July 3, 2012) - Open Range Energy Corp. ("Open Range" or the "Company") (ONR.TO) is pleased to announce that it has entered into an arrangement agreement (the "Peyto Arrangement Agreement") with Peyto Exploration & Development Corp. ("Peyto"), whereby Peyto has agreed to acquire all of the issued and outstanding common shares (the "Open Range Shares") of Open Range (the "Peyto Arrangement"). Pursuant to the terms of the Peyto Arrangement Agreement, holders ("Open Range Shareholders") of Open Range Shares will receive 0.0696 (the "Exchange Ratio") of a Peyto common share (the "Peyto Shares") for each Open Range Share held. Based on the closing trading price of the Peyto Shares on the Toronto Stock Exchange on June 29, 2012, the Exchange Ratio implies an aggregate value of approximately $179.5 million for all of the issued and outstanding Open Range Shares, and a value of $1.34 per Open Range Share.

Termination of Cequence Arrangement

In accordance with the terms of the amended and restated arrangement agreement dated June 10, 2012 (the "Cequence Arrangement Agreement") between Open Range and Cequence Energy Ltd. ("Cequence"), the board of directors of Open Range (the "Open Range Board") determined that the proposed Peyto Arrangement constituted a "superior proposal", as such term is defined in the Cequence Arrangement Agreement and Open Range provided notice of the proposed Peyto Arrangement to Cequence. Cequence did not exercise its right, as provided for in the Cequence Arrangement Agreement, to revise its existing business combination with Open Range (the "Cequence Arrangement") to increase the consideration payable pursuant to the Cequence Arrangement to match the proposed consideration being offered under the Peyto Arrangement. As a result, in accordance with the terms of the Cequence Arrangement Agreement, Open Range terminated the Cequence Arrangement Agreement and paid to Cequence the non-completion fee of $4.6 million. Open Range then entered into the Peyto Arrangement Agreement.

In addition, Open Range has cancelled its special shareholders' meeting scheduled for July 30, 2012, which had been called to consider the Cequence Arrangement. As described below, Open Range will call a special shareholders' meeting expected to be held on or about August 14, 2012 to consider the Peyto Arrangement.

Peyto Arrangement

The Peyto Arrangement will provide Open Range Shareholders with enhanced liquidity and participation in an intermediate exploration and production company with a proven track record of creating shareholder value.

Additional benefits to Open Range Shareholders include:

-- immediate creation of value in the form of the exchange premium referred

to above;

-- a $0.06 per share monthly dividend ($0.72 per share annually). Holders

of Peyto Shares on August 31, 2012 (which based on the expected closing

of the Peyto Arrangement on or about August 14, 2012 would include

former Open Range Shareholders) will be entitled to the dividend payable

on September 14, 2012;

-- the lowest total cash costs in the industry delivering substantially

greater profitability;

-- the longest producing reserve life in the industry; and

-- operational and infrastructure synergies for even greater long-term

shareholder value creation.

Completion of the Peyto Arrangement is subject to the satisfaction of a number of conditions, including the receipt of requisite shareholder, court and regulatory approvals. The Peyto Arrangement will need to be approved by not less than 66 2/3% of the votes cast by Open Range Shareholders (and by a majority of votes cast by Open Range Shareholders after excluding the votes cast by certain members of Open Range management), voting in person or by proxy, at a special meeting expected to be held on or about August 14, 2012 (the "Open Range Meeting"). The Peyto Arrangement also requires the approval of the Court of Queen's Bench of Alberta.

Under the terms of the Peyto Arrangement Agreement, Open Range has agreed that it will not solicit or initiate any inquiries or discussions regarding any other business combination or sale of assets. Open Range has granted Peyto the right to match any superior proposals. The Peyto Arrangement Agreement also provides for the payment by Open Range to Peyto of a non-completion fee of $5 million under certain circumstances. For more information on the Peyto Arrangement and the Peyto Arrangement Agreement refer to the full Peyto Arrangement Agreement, a copy of which will be filed by Open Range on SEDAR and will be available for viewing under Open Range's SEDAR profile on www.sedar.com.

National Bank Financial Inc. is acting as financial advisor to Open Range in connection with the Peyto Arrangement and has provided the Open Range Board with its verbal opinion that, subject to review of the final documentation, the consideration to be received by the Open Range Shareholders is fair, from a financial point of view, to the Open Range Shareholders.

The Open Range Board has unanimously approved the Peyto Arrangement Agreement, and, based on a fairness opinion provided by National Bank Financial Inc., determined that the consideration to be received by Open Range Shareholders pursuant to the Peyto Arrangement is fair to Open Range Shareholders, determined that the Peyto Arrangement is in the best interests of Open Range, and unanimously resolved to recommend that Open Range Shareholders vote in favour of the Arrangement. Management and directors of Open Range holding approximately 8.3 percent of the issued and outstanding Open Range Shares have entered into support agreements to vote their Open Range Shares in favour of the Peyto Arrangement at the Open Range Meeting.

The mailing of an information circular to the Open Range Shareholders regarding the Open Range Meeting is expected to occur on or about July 19, 2012, with the Open Range Meeting and the closing of the Peyto Arrangement expected to be held on or about August 14, 2012, provided that all shareholder, court and regulatory approvals are obtained.

Further Information

Open Range is a publicly traded Canadian energy company with focused operations in the Deep Basin region of Alberta. Further information about Open Range may be found in its continuous disclosure documents filed with Canadian securities regulators at www.sedar.com.

Forward-Looking Information

Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Such forward-looking information is provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions. Forward-looking information typically contains statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", "project" or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information in this press release may include, but is not limited to, timing for completion of the transaction with Peyto and the timing and amount of future dividend payments by Peyto. Forward-looking information is based on a number of factors and assumptions which have been used to develop such information but which may prove to be incorrect. Although Open Range believes that the expectations reflected in its forward-looking information are reasonable, undue reliance should not be placed on forward-looking information because Open Range can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this press release, assumptions have been made regarding and are implicit in, among other things, the timely receipt of any required regulatory approvals (including Court and shareholder approvals). Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used.

Forward-looking information is based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by Open Range and described in the forward-looking information. The forward-looking information contained in this press release is made as of the date hereof and Open Range undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. The forward looking information contained in this press release is expressly qualified by this cautionary statement.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Peyto Shares to be offered have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended and may not be offered or sold in the United States or to a U.S. person absent registration or an applicable exemption from the registration requirements.

The Toronto Stock Exchange has neither approved nor disapproved the contents of this press release.

Contact:
Scott Dawson
Open Range Energy Corp.
President and Chief Executive Officer
(403) 205-3704

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