Mr. Michael Binnion reports

QUESTERRE REPORTS FIRST QUARTER 2023 RESULTS

Questerre Energy Corp. has released its financial and operating results for the quarter ended March 31, 2023.

Michael Binnion, president and chief executive officer of Questerre, commented, "We are taking a more active role at Red Leaf, our 40-per-cent-owned investee company, as they develop their core assets: a wax processing facility in the Uintah basin with environmental permits in place and their patented technology to produce oil from shale that incorporates carbon capture."

He added: "We have been leading discussions with stakeholders, including producers in the basin, prospective purchasers and financial advisers. These have been very encouraging and support the business case for the wax project. Red Leaf has also been working closely with us and a potential licensee for a small-scale project using their technology in the Kingdom of Jordan.

"We are following the legal process for our claim against the Quebec government, including the preparation of our damage assessment. As our clean gas remains a viable option to resolve the impending electricity energy shortage in the province, we are still seeking a business and political solution. During the quarter, the Quebec Ministry of Energy sent us a request for a proposal for pilot projects that would foster carbon neutrality and help attain targets in the fight against climate change. This was followed by the announcement of a consultation process ahead of new legislation this fall on a new clean energy strategy for the province."

Highlights:

• Red Leaf commissions prefront-end engineering design engineering study for 40,000-barrel-per-day wax processing facility;
• Government of Quebec seeks proposals for pilot projects;
• Average daily production of 1,790 barrels of oil equivalent per day and adjusted funds flow from operations of $4.3-million.

Production volumes increased in the first quarter of 2023 to 1,790 boe/d from 1,288 boe/d last year following the conversion of its royalty interest at Kakwa North into a working interest in the fourth quarter of 2022. The impact of higher production volumes was largely offset by the lower crude and natural gas prices during the period. Petroleum and natural gas revenue totalled $10.5-million in the period compared with $9.6-million last year. The company generated net income of $900,000 for the quarter (2022: $2.4-million) and adjusted funds flow from operations of $4.3-million unchanged from last year.

The company incurred capital expenditures of $3.2-million for the period (2022: $4.9-million) and reported a working capital surplus of $25.5-million as of March 31, 2023 (2022: $1.2-million).

Questerre is an energy technology and innovation company. It is leveraging its expertise gained through early exposure to low permeability reservoirs to acquire significant high-quality resources. It believes it can transition its energy portfolio. With new clean technologies and innovation to responsibly produce and use energy, it can sustain both human progress and its natural environment.

Questerre is a believer that the future success of the oil and gas industry depends on a balance of economics, environment and society. It is committed to being transparent and is respectful that the public must be part of making the important choices for its energy future.

We seek Safe Harbor.