Mr. Paul Baay reports

TOUCHSTONE EXPLORATION PROVIDES CENTRAL BLOCK OPERATIONAL UPDATE

Touchstone Exploration Inc. has provided an operational update on the Central block asset located onshore in the Republic of Trinidad and Tobago.

As previously announced, on May 16, 2025, the company, through its wholly owned Trinidadian subsidiary, completed the acquisition of 100 per cent of the share capital of Shell Trinidad Central Block Ltd. The acquired entity, now renamed Touchstone Trinidad Central Block Ltd., holds a 65-per-cent operating interest in the onshore Central block exploration and production licence. Heritage Petroleum Company Ltd. holds the remaining 35-per-cent participating interest. The Central block asset includes four producing natural gas wells and a gas processing facility. Financial and operational results from the acquired entity have been consolidated into the company's financial statements from the May 16, 2025, acquisition date.

Production update

Gross production volumes from the Central block averaged 2,969 barrels of oil equivalent per day (1,930 barrels of oil equivalent per day net) during the first quarter of 2025, comprising approximately 16.74 million cubic feet of natural gas per day and 179 barrels of NGLs (natural gas liquids) per day.

Based on preliminary field estimates, second quarter 2025 gross production averaged 3,023 barrels of oil equivalent per day (1,965 barrels of oil equivalent per day net), comprising approximately 17.05 million cubic feet of natural gas per day and 181 barrels of NGLs per day.

Sales and pricing update

Natural gas from the Central block is sold under two separate contracts: one linked to LNG (liquefied natural gas) export pricing and the other to domestic market pricing, primarily supplying Trinidad's petrochemical sector. LNG sales are subject to vessel availability, referred to as liftings.

From January through April, 2025, 11 LNG liftings (including associated liquids) were completed, totalling 2,207,696 million British thermal units. An additional 11,065 million British thermal units was sold into the domestic market. These volumes generated gross revenue of $13.6-million ($8.9-million net). After transportation and processing costs, gross revenue totalled $8.9-million ($5.8-million net). The Central block also generated $1-million in gross revenues ($650,000 net) from condensate sales at the facility, resulting in total gross revenue of $9.9-million ($6.4-million net) for the period. All sales volumes are subject to a 12.5-per-cent state royalty and applicable plant operating costs.

The LNG liftings and associated liquids achieved an average realized price of $6.15 per million British thermal units, translating to a plant gate price of $4 per million British thermal units after deductions. Domestic sales achieved an average net plant gate price of $4.33 per million British thermal units. Condensate was sold at an average price of $48.49 per barrel.

Development activities

Touchstone has completed site surveys for two additional well pads, each capable of supporting up to four drilling locations. The company is currently awaiting government construction approvals.

Paul R. Baay, president and chief executive officer, commented: "We are pleased to provide our first operational update on the Central block following the successful completion of the acquisition. Since the completion, we have delivered quarter-over-quarter production growth through continued plant optimization -- an excellent achievement by our Central block team.

This update also highlights the strategic advantage of integrating LNG-based pricing into our marketing portfolio. With commercial documentation complete and the first LNG payment expected by the end of July, we are positioned to benefit from predictable cash flows under the export contract.

"The Central block's strong performance supports our acquisition rationale and enhances our marketing flexibility, diversifying revenue streams across LNG, petrochemical and fixed-price gas sales."

About Touchstone Exploration Inc.

Touchstone Exploration is a company based in Calgary, Alta., engaged in the business of acquiring interests in petroleum and natural gas rights and the exploration, development, production and sale of petroleum and natural gas. Touchstone is currently active in onshore properties located in the Republic of Trinidad and Tobago. The company's common shares are traded on the Toronto Stock Exchange and the AIM (Alternative Investment Market) of the London Stock Exchange under the symbol TXP.

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