Mr. James Morris reports

LNG ENERGY GROUP PROVIDES AN OPERATIONAL UPDATE AND CHANGE OF TRANSFER AGENT

LNG Energy Group Corp. has provided an operational update on its projects in Venezuela and Colombia.

Corporate

Since August, 2023, the company has been able to repay approximately $14.7-million (U.S.) in amortization on its long-term bank debt.

Colombia

Environmental, health and safety, and sustainability practices

The company is pleased to announce that its wholly owned subsidiary, Lewis Energy Colombia Inc. (LEC), has completed the following ISO recertifications, after an audit performed by Bureau Veritas:

• 9001:2015 -- quality management system: This certification recognizes LEC for its successful implementation and continual improvement of its QMS.
• 14001:2015 -- environmental management systems: This certification recognizes LEC's commitment to take pro-active measures to minimize its environmental footprint, comply with relevant legal requirements and achieve its environmental objectives.
• 45001:2018 -- occupational health and safety management system: This certification recognizes LEC's commitment to systematically assess hazards and implement risk control measures, leading to reduced workplace injuries, illnesses and incidents.

LEC is also in the process of assigning 25 hectares (62 acres) to the Corporacion Autonoma Regional del Atlantico (CRA), the environmental agency for the Atlantico state in northern Colombia. This land will be used for reforestation projects and for the purpose of protecting the local watershed. Currently, LEC has approximately 360 hectares (900 acres) in the area, and this is land that will be used for environmental compensation purposes, contributing to a reduction in LEC's carbon footprint.

Compressor at the Bullerengue field

The company is pleased to announce the completion of its new compressor project at the Bullerengue field. The compressor recently began operation and will be instrumental in increasing the reserves life of the field while facilitating access to an additional 1.67 billion of natural gas at the north side of the field. The compressor will also serve to increase LEC's ability to respond to regulatory requirements and improve general operational efficiencies.

Oil field service division

LEC is continuing studies to offer drilling rig services to third parties in Colombia as a way of optimizing resource use to increase company income, while allowing it to maintain a strong core rig crew, which helps improve its operational efficiency.

LEC has three rigs on the ground in its Sinu-San Jacinto Norte-1 block near Barranquilla, Colombia. They include one 1,600-horsepower top-drive drilling rig, one 1,000-horsepower top-drive drilling rig and one 550-horsepower workover rig. These rigs come complete with generators, pumps, BOPs, mud systems, tanks and other equipment needed to fully execute drilling and workovers operations. Together, the rigs and associated equipment have an estimated value of approximately $10-million (U.S.).

The company looks to mobilize its equipment and personnel in the fourth quarter of 2024 to pursue workover and drilling activities.

Gas sales agreements

As a result of unexpected production restrictions at certain wells in the Bullerengue natural gas field, the company has had to limit natural gas deliveries under certain gas sales agreements dedicated to supplying natural gas demand. As a result of careful review of the legal, social and security circumstances, the natural gas supply needs of the Colombian gas market, and the company's commitment to meet its commercial obligations with its offtakers and strategic partner contracts, the company considers it prudent to pursue short-term volume delivery amendments, reducing volumes by 5.0 million British thermal units per day for a period of four months with no significant changes to LEC's average natural gas sales price.

The company is currently working on remediating this disruption and expects to have production back to normal levels upon execution of well maintenance and drilling activity. The company is working on workover and drilling initiatives to make up for these sales volumes in the future and meet its average production and long-term valuation creation objectives, and therefore does not expect this situation to have a long-term material impact on its operations and results.

Capital expenditures

For the rest of 2024, the company expects to drill at least one additional development well and conduct a re-entry at an existing well at the SSJN-1 block onshore in Colombia in addition to its remaining workover campaign. The workover campaign is designed to address maintenance declines in production, as well as increase production from the company's existing wells.

Venezuela

On April 17, 2024, LNG Energy's wholly own subsidiary, LNGEG Growth I Corp., was conditionally entered into a binding agreement with PDVSA Petroleo SA, a subsidiary of Petroleos de Venezuela SA, the Venezuelan national oil company, for the operation of the Nipa-Nardo-Niebla and the Budare-Elotes CPPs in onshore Venezuela. The Venezuelan blocks are currently producing 3,000 barrels per day of light and medium oil.

The company is preparing a baseline to understand the work program and activities required to take over operations of these fields and optimize production, and is in the process of certifying the reserves at certain of the Venezuelan blocks in accordance with National Instrument 51-101 (Standards of Disclosure for Oil and Gas Activities). The disclosure of these reserves is subject to review and approval of the PPSA.

The CPPs were executed within the term of general licence 44 issued by the U.S. Office of Foreign Assets Control. Licence 44 has been replaced by licence 44A, and the corporation is following the applicable regulatory procedures to operate in full compliance with the applicable sanction regimes. LNG Venezuela and PPSA have mutually agreed to extend the outside date of the CPPs to Nov. 30, 2024.

Transfer agent

LNG Energy announces that Odyssey Trust Company has replaced Computershare Investor Services Inc. as the registrar and transfer agent of the company, effective Sept. 11, 2024. Shareholders need not take any action in respect of the change in transfer agent.

All inquiries and correspondence relating to shareholders' records, transfer of shares, lost certificates or change of address should now be directed to Odyssey as follows.

Odyssey Trust Company,

Trader's Bank Building,

702, 67 Yonge St.,

Toronto, Ont., M5E 1J8

Phone: 1-587-885-0960

Fax: 1-800-517-4553

E-mail: clients@odysseytrust.com

As of the date hereof, Computershare remains the trustee of any applicable warrants and escrow arrangements.

About LNG Energy Group Corp.

The company is focused on the acquisition and development of oil and gas exploration and production assets in Latin America.

We seek Safe Harbor.