Crest Petroleum Corp. Announces Proposed Qualifying Transaction

NEWS RELEASE

CREST PETROLEUM CORP. ANNOUNCES PROPOSED QUALIFYING TRANSACTION

June 26, 2014 – Calgary, Alberta: Crest Petroleum Corp. (“Crest”) (TSX-V: CTP.P) is pleased to announce that it has entered into an agreement in principle dated June 25, 2014 (the “Agreement in Principle”) with Sara Creek Gold Corp. (“Sara Creek”) pursuant to which Crest will acquire a non-operated working interest in two oil fields in southern California (the “Proposed Transaction”). The Proposed Transaction will constitute a Qualifying Transaction as that term is defined by the TSX Venture Exchange (the “Exchange”).

Agreement in Principle

Pursuant to the Agreement in Principle, Crest will acquire a 21.8% indirect net interest (subject to certain customary working capital adjustments) in Tapia, LLC (“Tapia”) for an aggregate purchase price of US$1.5 million and the provision of US$100,000 towards Sara Creek’s working capital. Tapia, a wholly owned subsidiary of TEG Oil and Gas USA, Inc. (“TEG”), was created for the sole purpose of holding all of the assets (the “Assets”) and liabilities of TEG, who will then sell an 80% interest in such entity to Tapia Holdings, LLC (“Tapia Holdings”) (the “Acquisition”).Tapia Holdings is a wholly owned subsidiary of Sara Creek and Crest will be issued membership interests in Tapia Holdings in exchange for the purchase price.

The completion of the Proposed Transaction is subject to a number of conditions including, but not limited to:

(i) receipt of Exchange approval;

(ii) completion by Crest of a private placement of subscription receipts (“Crest Receipts”) for gross proceeds of not less than $1,800,000 (the “Private Placement”) at a price to be determined in the context of the market with each Crest Receipt to be exchanged for one common share of Crest (the “Crest Shares”) upon completion of the Proposed Transaction;

(iii) completion of the Acquisition;

(iv) refinancing or replacement of certain outstanding indebtedness of TEG in respect of the Assets; and

(v) independent verification of title to the Assets satisfactory to the Corporation.

Subject to the foregoing conditions being satisfied or waived, Crest expects to close the Proposed Transaction on or about July 31, 2014.

The Assets

The Assets to be acquired by Tapia consist of 4 leases encompassing the Tapia Canyon field (the “Tapia Assets”) and one lease west of the Tapia Canyon field (the “Eureka Asset”).

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Tapia Assets

The Tapia Canyon field covers an area of approximately 383 acres located about 40 miles north of the Los Angeles metropolitan area. The Tapia Canyon field was discovered in 1957, when the Yule No. 2 well tested at 120 barrels per day of 18 degree API oil. The Tapia Canyon field commenced production in August 1957.

The Tapia Assets produced 100 barrels of oil per day (May 2014) from 17 wells at a reservoir depth of just over 1,000 feet. The Tapia Assets benefit from low royalty burdens which average approximately 7%. Production is from the Yule reservoir which is on average, greater than 100 feet thick over the majority of the oilfield and comprised of sand and silts.

The field operator built a small steam generator for testing purposes in 2007 and has completed 31 steam injection cycles of various sizes to assist in field modelling, and has confirmed the value of Thermal EOR at Tapia. During the last full-time cyclic steam test in October 2013, production reached 170 barrels of oil per day. Extensive infrastructure exists currently in the field to facilitate steaming operations going forward and for oil gathering and storage purposes.

Eureka Asset

The Eureka Asset covers an area of approximately 1,600 acres located about 25 miles West of the Tapia Canyon field in Ventura County. The Eureka Asset currently produces 8 barrels of oil per day.

About Crest

Crest is a “reporting issuer” in the Provinces of Alberta, British Columbia and Ontario and was incorporated under the laws of the Province of British Columbia on January 24, 2012. The Crest Shares are listed for trading on the Exchange under the trading symbol “CTP.P” and Crest is classified as a “capital pool company” pursuant to Policy 2.4 of the Exchange. As a capital pool company, the current business of Crest is to identify and evaluate potential acquisitions of commercially viable businesses and assets that have the potential to generate profits and add shareholder value. Except as specifically contemplated in the policies of the Exchange, until the completion of a Qualifying Transaction, Crest will not carry on business, other than the identification and evaluation of companies, businesses or assets with a view to completing a Qualifying Transaction. Since incorporation, Crest has had no operations other than identifying and evaluating potential acquisitions of oil and gas related businesses.

The President and CEO of Crest is Toby Pierce and the CFO and Corporate Secretary of Crest is James Greig. No change to the board of directors or management of Crest is anticipated as a result of the Proposed Transaction. Crest will continue to be head-quartered in Vancouver, BC, Canada.

The Crest Shares will remain halted pending receipt of applicable documentation by the Exchange.

Arm’s Length Qualifying Transaction

The Proposed Transaction was negotiated by the parties who are dealing at arm’s length with each other and therefore, in accordance with the policies of the Exchange, is not a Non-Arm’s Length Qualifying Transaction, as that term is defined by the Exchange. As a result, approval of the Proposed Transaction by holders of the Crest Shares is not required under the policies of the Exchange as a condition to the completion of the Proposed Transaction.

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Sponsorship

The Exchange also requires the Proposed Transaction to be sponsored by a participating organization of the Exchange. Crest will apply to the Exchange for an exemption from the sponsorship requirement in connection with the Proposed Transaction. However, there is no assurance that the exemption will be granted. If such exemption is not granted, Crest will be required to engage a sponsor for the Proposed Transaction.

Post-Transaction

Upon completion of the Proposed Transaction, Crest will be involved, through its indirect interest in Tapia, in the oil and gas resource exploration and development sector. Crest will have the right to appoint 1 of 4 directors of Tapia Holdings and 1 of 5 directors of Tapia. It is a condition to the completion of the Proposed Transaction that governance documentation in respect of Tapia Holdings and Tapia be entered into in form and content satisfactory to the Corporation, acting reasonably.

Further Information

Pursuant to Policy 2.4 of the Exchange, it is expected that Crest will file on SEDAR a Filing Statement in respect of the Proposed Transaction at least 7 business days prior to the closing of the Proposed Transaction. The Filing Statement will include full disclosure regarding the Proposed Transaction, Crest and the Assets.

For further information, please contact Toby Pierce, President and Chief Executive Officer of Crest, by telephone at +44 7517 131 747.

Reader Advisory

The completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the filing statement to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The TSX Venture Exchange has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved of the contents of this press release.

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.

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FORWARD-LOOKING STATEMENTS

This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws (collectively, “forward-looking statements”). The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends” and similar expressions are intended to identify forward-looking statements. More particularly and without limitation, this news release contains forward-looking statements concerning the terms of the Proposed Transaction and the Private Placement, the completion of the Proposed Transaction, the Acquisition and the Private Placement, the filing of the Filing Statement, and Crest’s business upon completion of the Proposed Transaction. The forward-looking statements are based on certain key expectations and assumptions made by Crest, including expectations and assumptions concerning the results of its due diligence review of Tapia, Tapia Holdings and the Assets, Crest’s ability to complete the Proposed Transaction and the Private Placement and the ability of Sara Creek to complete the Acquisition. Although Crest believes that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Crest can give no assurance that they will prove to be correct. By its nature, such forward-looking statements are subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed. Readers are cautioned not to place undue reliance on these forward-looking statements, which are given as of the date hereof, and to not use such forward-looking statements for anything other than their intended purpose. Crest undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Certain data contained in this news release is based upon information from third party publications, reports and websites, or based on estimates derived from such publications, reports and websites. Third party publications and reports do not guarantee the accuracy or completeness of their information. While management of Crest believes this data to be reliable, market and industry data is subject to variations and cannot be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey. Accordingly, the accuracy, currency and completeness of this information cannot be guaranteed. Crest has not independently verified any of the data from third party sources referred to in this news release or ascertained the underlying assumptions relied upon by such sources.