Mr. Cameron Taylor reports

ROK RESOURCES FILES FINANCIAL RESULTS AND MANAGEMENT DISCUSSION & ANALYSIS FOR THE FIRST QUARTER OF 2023

Rok Resources Inc. has filed its interim financial results and management discussion and analysis for the three months ended March 31, 2023.

Financial and operating highlights

In Q1 2023, the company realized production volume of 372,570 total barrels of oil equivalent (4,140 barrels of oil equivalent per day), resulting in crude and natural gas sales of $24.1-million and funds from operations of $13.3-million. This equates to an operating netback, after hedging, per barrel of oil equivalent of $33.71 and an operating income profit margin, after hedging, of 52.0 per cent. For Q1 2022, a gain on acquisition of $66.8-million significantly contributed to the resulting net income of $76.2-million for the quarter.

Net debt

The continued reduction of net debt quarter over quarter is a result of organically generated funds flows utilized to reduce company indebtedness. Rok uses net debt as a measure of the company's financial position and liquidity; however, it is not intended to be viewed as an alternative to other measures calculated in accordance with IFRS (international financial reporting standards).

Complete reports and statements are available on SEDAR.

First quarter highlights:

• Record production of 4,140 barrels of oil equivalent per day (70 per cent liquids);
• Net debt of $8.3-million as of March 31, 2023, a decrease of $27-million from Q4 2022, after Q1 2023 capital expenditures of $5.4-million;
• Successfully drilled two gross (1.6 net) wells: one vertical test well in southeast Saskatchewan and one horizontal Cardium well in Kaybob, Alta.;
• Realized a quarterly hedge gain on commodity contracts of $2.7-million.

Early repayment of term loan and hedge strategy

Through a combination of monthly cash flow and strategic non-operated asset dispositions, the company was able to pay down the term loan from the initial balance of $52.5-million to $7.1-million in Q1 2023, with the full repayment of the remaining balance in May, 2023. As a result of the early term loan repayment, the company made the strategic decision to unwind certain commodity swap hedges placed in 2023, 2024 and 2025, as more particularly described in its May 2, 2023, press release.

Impact of Alberta wildfires

The Alberta wildfires have affected Rok's Kaybob, Alta., operations, resulting in production shut-ins of approximately 300 barrels of oil equivalent per day (80 per cent natural gas). It is expected that some production will remain shut in through Q2 2023 and potentially into Q3 2023; however, Rok will provide additional guidance as further details emerge. The company's corporate 2023 year-end production target of 4,500 barrels of oil equivalent per day remains unchanged with the 2023 second half drilling program scheduled to begin in July, 2023.

About Rok Resources Inc.

Rok is primarily engaged in exploring for petroleum and natural gas development activities in Alberta and Saskatchewan. Its head office is located in Regina, Sask., Canada, and ROK's common shares are traded on the TSX Venture Exchange under the trading symbol ROK.

We seek Safe Harbor.