Mr. Corey Ruttan reports

ALVOPETRO ANNOUNCES BINDING ARBITRATION DECISION IN FAVOUR OF ALVOPETRO

The arbitral tribunal before the International Court of Arbitration of the International Chamber of Commerce has found in favour of Alvopetro Energy Ltd.'s request to give effectiveness to the decision of the independent expert appointed by Alvopetro and its third party partner in connection with the redetermination of working interests in the unitized area, which includes Alvopetro's Cabure natural gas field.

Background

Alvopetro's interest in the unit is governed by a unit operating agreement, and its working interest is subject to periodic redeterminations. The first redetermination commenced in 2023, and the parties engaged the expert to evaluate each party's interpretation of the respective working interests. On April 4, 2024, Alvopetro and its partner received the expert's decision wherein the expert found in favour of Alvopetro, increasing Alvopetro's working interest in the unit from 49.1 per cent to 56.2 per cent. Alvopetro's partner filed a notice of dispute with respect to the expert's decision, seeking to stay the redetermination procedure. Alvopetro subsequently filed a request for emergency arbitration before the ICC seeking to make the expert decision, effective starting on June 1, 2024, as provided for in the UOA. On May 10, 2024, Alvopetro received the order of the emergency arbitrator wherein the arbitrator found in favour of Alvopetro, making the expert decision effective June 1, 2024. On Aug. 1, 2025, the order of the emergency arbitrator was upheld by the tribunal until the issuance of the final order.

Tribunal final decision

On April 27, 2026, Alvopetro received the final order of the tribunal. Pursuant to the final order, the tribunal found in favour of Alvopetro stating that the decision of the expert is final, valid and effective, definitively binding the parties, pursuant to the UOA and maintaining Alvopetro's 56.2-per-cent working interest in the unit.

With respect to costs, the final order stipulates that its partner shall be responsible for 90 per cent of the costs of the proceeding.

Alvopetro is deploying a balanced capital allocation model where it seeks to reinvest roughly half its cash flows into organic growth opportunities and return the other half to stakeholders. Alvopetro's organic growth strategy is to focus on the best combinations of geologic prospectivity and fiscal regime. Alvopetro is balancing capital investment opportunities in Canada and Brazil where it is building off the strength of its Cabure and Murucututu natural gas fields and the related strategic mid-stream infrastructure.

We seek Safe Harbor.