Calgary, Alberta--(Newsfile Corp. - November 18, 2025) - Lycos Energy Inc. (TSXV: LCX) ("Lycos" or the "Company") is pleased to announce its operating and financial results for the three and nine months ended September 30, 2025. Selected financial and operating information is outlined below and should be read with Lycos' unaudited condensed interim consolidated financial statements and related management's discussion and analysis ("MD&A") for the three and nine months ended September 30, 2025. These filings are available on SEDAR+ at www.sedarplus.ca and the Company's website at www.lycosenergy.com.

Financial and Operating Highlights

⁽¹⁾ See Non-IFRS Measures, Non-IFRS Financial Ratios and Capital Management Measures.
⁽²⁾ Realized prices are based on revenue, net of blending expense.
⁽³⁾ The nine months ended September 30, 2024, includes a non-cash loss on disposals of $41.2 million and a non-cash impairment loss of $23.2 million

Q3 2025 Financial and Operating Highlights

Highlights for the three months ended September 30, 2025, include:

• Average production of 2,958 boe/d (99% crude oil) generated adjusted funds flow from operations⁽¹⁾ of $9.6 million in Q3 2025 compared to $17.0 million in Q3 2024, representing a 44% decrease. However, adjusted funds flow from operations⁽¹⁾ per boe declined only 8% to $35.12 from $38.22, demonstrating improved operating efficiency despite lower production volumes.
• Net operating expense⁽¹⁾ per boe decreased 30% and 19%, respectively, to $15.48 in Q3 2025 from $22.08 in the comparable period of 2024 and $18.99 from the prior quarter of 2025. The reduction in operating costs is due to operational efficiencies and the Southwest Saskatchewan disposition (the "SW Saskatchewan Disposition"), the Frog Lake disposition (the "Frog Lake Disposition") and the Lloydminster, Saskatchewan disposition (the "Non-Core Saskatchewan Disposition"). The disposed properties had higher net operating expenses per boe, averaging approximately $43.27/boe, $49.20/boe and $46.86/boe, respectively.
• Exit net debt⁽¹⁾ of $11.8 million, representing 0.3X annualized net debt to adjusted funds flow from operations ratio⁽¹⁾.
• Executed a purchase and sale agreement to dispose of certain properties in Elnora, Alberta for total cash consideration of $0.3 million, subject to closing adjustments. The disposition closed on October 1, 2025 and the properties were classified as held for sale on September 30, 2025. The property had higher operating expenses, averaging approximately $60.80/boe.

⁽¹⁾ See Non-IFRS Measures, Non-IFRS Financial Ratios and Capital Management Measures

Subsequent Event

Subsequent to September 30, 2025, the Company entered into and closed a purchase and sale agreement to dispose of certain assets in the Lindbergh, Moose Lake and Fishing Lake areas of Alberta (the "North Disposition") for total cash consideration of $60.0 million, subject to customary closing adjustments. The Company utilized $9.0 million of the net proceeds towards debt repayment and is in the process of distributing $47.9 million of the net proceeds as a return of capital to shareholders in the amount of $0.90 per Common Share (the "Return of Capital"). As previously announced, the Return of Capital will be paid on November 28, 2025.

Operations Update

As previously disclosed, the Company remained austere on its capital spending during the quarter, pausing exploration and development activities while prioritizing operational efficiency across its portfolio. Earlier divestitures completed in Q1 and Q2 removed higher-operating cost and higher-asset retirement obligation assets from its asset base, contributing to a lower cost structure and allowing Lycos to intensify its focus on operating efficiencies. Throughout Q3, the Company advanced several initiatives aimed at tightening operating procedures, improving logistics, and streamlining field execution to further enhance performance.

With the recent divestiture of its North assets, Lycos is now concentrating on its retained core areas and actively reconfiguring its drilling plans with a view to resuming capital activity in January 2026. The Company's current production is approximately 1,700 boe/day. With minimal net debt, the Company is well positioned to navigate commodity price volatility and capitalize on emerging opportunities. In conjunction with the previously announced Return of Capital, Lycos enters 2026 in a strong position to responsibly grow the business and deliver meaningful shareholder value.

About Lycos

Lycos is an oil-focused, exploration, development and production company based in Calgary, Alberta, operating high-quality, heavy-oil, development assets in the Lloydminster and Greater Lloydminster area.

Additional Information

Reader Advisories

Forward-Looking and Cautionary Statements

Certain statements contained within this press release constitute forward-looking statements within the meaning of applicable Canadian securities legislation. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "outlook", "plan", "endeavor", "continue", "estimate", "evaluate", "expect", "forecast", "monitor", "may", "will", "can", "able", "potential", "target", "intend", "consider", "focus", "identify", "use", "utilize", "manage", "maintain", "remain", "result", "cultivate", "could", "should", "believe" and similar expressions (including negatives and variations thereof). Lycos believes that the expectations reflected in such forward-looking statements are reasonable as of the date hereof, but no assurance can be given that such expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Without limitation, this press release contains forward-looking statements pertaining to: Lycos' business strategy, objectives, strength and focus, including its renewed focus on its retained core areas; the resumption of the Company's capital program and drilling plans in 2026; the ability of the Company to achieve drilling success consistent with management's expectations; the performance characteristics of the Company's oil and natural gas properties; payment of the Return of Capital and timing thereof; the Company's ability to grow the business and deliver shareholder value; expectations in respect of the Company's wells, including anticipated benefits and results; and the source of funding for the Company's activities.

The forward-looking statements and information are based on certain key expectations and assumptions made by Lycos, including, but not limited to: expectations and assumptions concerning the business plan of Lycos; the timing of and success of future drilling, development and completion activities; the geological characteristics of Lycos' properties; prevailing and future commodity prices, price volatility, price differentials and the actual prices received for the Company's products; the availability and performance of drilling rigs, facilities, pipelines and other oilfield services; the timing of past operations and activities in the planned areas of focus; the drilling, completion and tie-in of wells being completed as planned; the performance of new and existing wells; the application of existing drilling and fracturing techniques; prevailing weather and break-up conditions; general economic conditions; royalty regimes and exchange rates; the application of regulatory and licensing requirements; the continued availability of capital and skilled personnel; the ability to meet its obligations under, maintain or grow its credit facility; the accuracy of Lycos' geological interpretation of its drilling and land opportunities, including the ability of seismic activity to enhance such interpretation; and Lycos' ability to execute its plans and strategies.

Although Lycos believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because Lycos can give no assurance that they will prove to be correct. By its nature, such forward-looking information is subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed. These risks and uncertainties include, but are not limited to: incorrect assessments of the value of benefits to be obtained from acquisitions and exploration and development programs; fluctuations in commodity prices (including pursuant to determinations by the Organization of Petroleum Exporting Countries and other countries (collectively referred to as OPEC+) regarding production levels) and the risk of an extended period of low oil and natural gas prices; changes in industry regulations and political landscape both domestically and abroad; the impact of tariffs and other restrictive trade measures imposed or threatened by the U.S. administration, the Canadian administration and foreign governments, including retaliatory or countermeasures, on global economic markets, market volatility and the demand and/or market price for the Company's products; wars (including Russia's military actions in Ukraine and the Israel-Hamas conflict in Gaza); hostilities; civil insurrections; foreign exchange or interest rates; increased operating and capital costs due to inflationary pressures (actual and anticipated); volatility in the stock market and financial system; impacts of pandemics; the retention of key management and employees; and risks with respect to unplanned third-party pipeline outages, including in respect of safety, asset integrity and shutting in production. Ongoing military actions between Russia and Ukraine have the potential to threaten the supply of oil and gas from the region. The long-term impacts of the actions between these nations remains uncertain. Please refer to the Company's annual information form for the year ended December 31, 2024, and the MD&A for additional risk factors relating to Lycos, which can be accessed either on the Company's website at www.lycosenergy.com or under the Company's SEDAR+ profile at www.sedarplus.ca. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. Lycos undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about the Company's prospective results of operations and production and growth, exit net debt, , and expectations, and components thereof, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. FOFI contained in this document was approved by management as of the date of this document and was provided for the purpose of providing further information about Lycos' proposed business activities. Lycos and its management believe that FOFI has been prepared on a reasonable basis, reflecting management's best estimates and judgments, and represent, to the best of management's knowledge and opinion, the Company's expected course of action. However, because this information is highly subjective, it should not be relied on as necessarily indicative of future results. Lycos disclaims any intention or obligation to update or revise any FOFI contained in this document, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this document should not be used for purposes other than for which it is disclosed herein. Changes in forecast commodity prices, exchange rates, differences in the timing of capital expenditures, and variances in average production estimates can have a significant impact on the Company's key performance measures. The Company's actual results may differ materially from these estimates.

Disclosure of Oil and Gas Information

Unit Cost Calculation. The term barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet per barrel (6 Mcf/bbl) of natural gas to barrels of oil equivalence is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. All boe conversions in the report are derived from converting gas to oil in the ratio mix of six thousand cubic feet of gas to one barrel of oil.

Product Types. Throughout this press release, "crude oil" or "oil" refers to heavy crude oil product types as defined by National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101").

Non-IFRS Measures, Non-IFRS Financial Ratios and Capital Management Measures

This press release includes various specified financial measures, including non-IFRS financial measures, non-IFRS financial ratios and capital management measures as further described herein. These measures do not have a standardized meaning prescribed by International Financial Reporting Standards ("IFRS") and, therefore, may not be comparable with the calculation of similar measures by other companies.

"Adjusted working capital (net debt) (capital management measure)" is calculated as current assets less current liabilities, excluding the current portion of decommissioning liabilities and financial derivative receivable and liabilities. Adjusted working capital (Net Debt) is a capital management measure which management uses to assess the Company's liquidity. See the MD&A for a detailed calculation and reconciliation of adjusted working capital (net debt) to the most directly comparable measure presented in accordance with IFRS.

"Adjusted funds flow from operations (capital management measure)" is funds flow is calculated by taking cash flow from operating activities and adding back changes in non-cash working capital. Adjusted funds flow is further calculated by adding back decommissioning costs incurred and transaction costs. Management considers adjusted funds flow from operations to be a key measure to assess the performance of the Company's oil and gas properties and the Company's ability to fund future capital investment. Adjusted funds flow from operations is an indicator of operating performance as it varies in response to production levels and management of costs. Changes in non-cash working capital, decommissioning costs incurred and transaction costs vary from period to period and management believes that excluding the impact of these provides a useful measure of Lycos' ability to generate the funds necessary to manage the capital needs of the Company. See the MD&A for a detailed calculation and reconciliation of adjusted funds flow from operations to the most directly comparable measure presented in accordance with IFRS.

"Capital expenditures (non-IFRS financial measure)" includes exploration and development capital, facilities, land and seismic and acquisitions and dispositions. Management considers capital expenditures to be a key measure to assess the Company's capital investment in exploration and production activity, as well as property acquisitions and dispositions. The directly comparable IFRS measure to capital expenditures is net cash used in investing activities.

"Net debt to adjusted funds flow from operations ratio (non-IFRS financial ratio)" is calculated as net debt divided by adjusted funds flow from operations for the applicable period. Lycos utilizes net debt to adjusted funds flow from operations to measure the Company's overall debt position and to measure the strength of the Company's balance sheet. Lycos monitors this ratio and uses this as a key measure in making decisions regarding financing, capital expenditures and shareholder returns.

"Net operating expenses (non-IFRS financial measure)" is operating expenses, less processing income primarily generated by third party volumes at processing facilities where the Company has an ownership interest. The Company's principal business is not that of a midstream entity whose activities are dedicated to earning processing and other infrastructure payments. Where the Company has excess capacity at its facilities, it will look to process third party volumes as a means to reduce the cost of operating/owning the facility.

"Operating netback (non-IFRS financial measure)" is petroleum and natural gas revenues, less royalties, less net operating costs and transportation expenses, excluding the effects of financial derivatives. These metrics can also be calculated on a per boe basis, which results in them being considered a non-IFRS financial ratio. Management considers operating netback an important measure to evaluate Lycos' operational performance, as it demonstrates field level profitability relative to current commodity prices. See the MD&A for a detailed calculation and reconciliation of operating netback per boe to the most directly comparable measure presented in accordance with IFRS. "Operating netback, including financial derivatives" is calculated as petroleum and natural gas revenues, less royalties, less net operating costs and transportation expenses.

"Total petroleum and natural gas sales, net of blending (non-IFRS financial measure)" is total petroleum and natural gas sales, net of blending expense to compare realized pricing to benchmark pricing. This is calculated by deducting the Company's blending expense from petroleum and natural gas sales. Blending expense is recorded within blending and transportation expense in the condensed interim consolidated financial statements. See the MD&A for a detailed calculation and reconciliation of total petroleum and natural gas sales, net of blending, to the most directly comparable measure presented in accordance with IFRS.

Please refer to the MD&A on pages 16 to 18 for additional information relating to specified financial measures, including non-IFRS financial measures, non-IFRS financial ratios and capital management measures. The MD&A can be accessed either on the Company's website or under the Company's SEDAR+ profile on www.sedarplus.ca.

Abbreviations

All dollar figures included herein are presented in Canadian dollars, unless otherwise noted.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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