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Error: Undefined variable: "$loader-overlay--z-index".

Error: Undefined variable: "$loader-overlay--z-index".

I am trying to develop a theme based on magento2-theme-blank-sass. I installed snowdog frontools,  magento2-theme-blank-sass and my theme via composer. Then under `my_project/vendor/snowdog/frontools`, I ran `npm install`. After that I ran `gulp setup`. I headed to `my_project/dev/tools/frontools/config` and edited the themes.json file. I used the existing pattern and I added my theme there. 
The issue is when ever I ran `gulp setup` under  `my_project/vendor/snowdog/frontools`, gulp throws and error of `Error: Undefined variable: "$loader-overlay--z-index"`, the variable is coming from magento2-theme-blank-sass, under `../../../var/view_preprocessed/frontools/frontend/my_project/en_US/styles/vendor/magento-ui/_loaders.scss`. I tried to remove view_preprocessed & cache and redeploy content but it didn't help.
I can't find the source of issue, it seems if I add my custom theme the inheritance and parenting is not working correctly. If I remove my theme from themes.json and run `gulp styles` the style of sass-blank theme is compiled correctly. 

I am using Magento 2.1.15, snowdog 1.3.0 & snowdog-blank-sass 0.11.1


Re: Error: Undefined variable: "$loader-overlay--z-index".

Show how your custom theme looks like.