Mr. Jim Hill reports

WELCHAU GAS EXPLORATION WELL UPDATE

MCF Energy Ltd. spudded the Welchau-1 gas exploration well on Feb. 24, 2024, using the Red Drilling & Services GmbH E200 drill rig in the ADX-AT-II exploration licence in Upper Austria.

Starting operations at 6 a.m. on Feb. 26, 2024, the well drilled a 17.5-inch hole at a depth of 125 metres, where 13-3/8ths-inch casing was run in the hole and cemented back to surface. This completes the first planned protection string of casing outlined in the approved drilling program.

Summary of well program

The Welchau-1 gas exploration well is targeting the mid-Triassic-age Steinalm formation, in which gas was discovered at the nearby Molln-1 well. The expected total drill depth is between 1,500 metres and 1,900 metres measured depth. The main target depth is between 1,100 metres and 1,800 metres measured depth. The success case drilling and evaluation program is anticipated to take approximately 39 days.

Community engagement and public interest

The Welchau-1 exploration project has received extensive exposure in both television and print media in Austria due to its location proximal to a nature reserve. The project's environmental clearance was received following an extensive review process which weighed up the touristic and environmental impact of the project versus the local community and national benefits of a potential gas discovery at Welchau-1, which is located in the municipality of Molln.

Limited resistance to the project has been received from some special-interest groups. Despite a vocal minority, there has been overwhelming support for the project from the local community. The Welchau exploration project has been determined by the relevant authorities to be in the public interest due to its potential to reduce dependency on Russian natural gas imports, increase gas supply security, diversify gas supply, reduce reliance on imports, and fulfill the Austrian federal mandate to explore and produce hydrocarbons.

MCF and the licence operator, ADX Energy Ltd., are taking the necessary planning and operational measures to ensure natural gas exploration and, if successful, production can co-exist with environmental protection and local tourism. To achieve the high standards required, ADX and MCF have ensured the required safety, noise and environmental emission standards are met by contractors and service providers. ADX and MCF have endeavoured to maximize local content, where there is an excellent past record of safety, environmental protection and project execution. The company would like to make the following correction to the Feb. 26, 2024, press release on the acquisition of the Czech gas projects.

Independent reserve report

An independent reserve report by Boury Global Energy Consultants reviewed the NT Ridge area, which is located about 28 kilometres southeast of Ostrava, the third-largest city in the Czech Republic. Reviewing the geology, the report confirmed 13 proved undeveloped and two probable undeveloped locations for development having an estimated 11.9 billion cubic feet of proven and probable reserves within the NT Ridge area. The report gives an estimated net present value before tax (discounted at 10 per cent) for the proved and probable reserves of $53.55-million (U.S.) for the NT Ridge area. The two other production concessions, Krasna NP and LM, are not included in the report and represent significant additional upside for MCF Energy shareholders.

About MCF Energy Ltd.

MCF Energy was established in 2022 by leading energy executives to strengthen Europe's energy security through responsible exploration and development of natural gas resources within the region. The company has secured interests in several significant natural gas exploration projects in Austria and Germany, with additional concession applications pending. MCF Energy is also evaluating additional opportunities throughout Europe. The company's leaders have extensive experience in the European energy sector and are working to develop a cleaner, cheaper and more secure natural gas industry as a transition to renewable energy sources. MCF Energy is a publicly traded company and headquartered in Vancouver, B.C.

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