Mr. Sean Guest reports

VALEURA ENERGY INC. ANNOUNCES Q2 2024 OPERATIONS AND FINANCIAL UPDATE

Valeura Energy Inc. has provided an update on its second quarter (Q2) 2024 operations. All dollar figures are in U.S. dollars unless otherwise indicated.

Highlights for Q2 2024:

• Oil production averaged 21,100 barrels per day (bbl/d) (1);
• Drilling success across the portfolio, including exploration success at Nong Yao D, production wells at Nong Yao A and the start of development drilling at Nong Yao C;
• Price realizations of $87.7 per barrel (bbl), a record $2.70-per-barrel premium over Brent;
• Revenue of $164-million;
• No debt and cash of $145-million, after having paid an aggregate $109-million in taxes, the purchase of the Nong Yao floating storage and offloading (FSO) vessel and the final contingent consideration associated with the asset acquisition from KrisEnergy (Asia) Ltd.

(1) Working interest share production before royalties.

Sean Guest, president and chief executive officer, commented:

"I am pleased to share that production was robust throughout the quarter and in line with our expectations, averaging 21,100 bbl/d. Demonstrating our agility, we have remained nimble with our drilling program, and took the opportunity to drill both exploration and infill wells at Nong Yao, before starting our extensive development program on Nong Yao C, which is now well under way and progressing on track for first oil later in Q3 2024.

"Our financial performance has been strong. We recorded gross revenue of $164-million during the quarter on the back of 1.9 million bbl of liftings and improved oil prices. During the quarter, we had cash outlays related to scheduled tax payments and several one-off payments amounting to $109-million in total, but still concluded the period with a solid cash position of $145-million and no debt. We believe this performance highlights the highly cash-generative nature of our business and the resilience of our balance sheet.

"On June 27, 2024, we announced a precautionary suspension of production at our Wassana field to ensure a safe situation while we investigate a potential risk to the production facility's structural integrity. While the temporary deferral of production at Wassana is an unfortunate setback in an operational sense and results in our current production being in the 17,000 bbl/d range (Valeura working interest share before royalty over the past 10 days), safety remains our top priority in such matters, and we are progressing swiftly to fully understand the situation, implement potential remedies and restart production as soon as possible.

"I am also pleased to announce that we have started FEED study work on the greater Wassana redevelopment project to include new discovered resources and the existing production area. We anticipate taking a final investment decision on this project at approximately the end of 2024. Growth projects like greater Wassana, alongside a potential pipeline of merger-and-acquisition-led opportunities we see in the region, continue to form the backbone of our growth-oriented strategy."

Q2 2024 update

Oil production averaged 21,100 bbl/d during Q2 2024 (Valeura's working interest share before royalties), a decrease of 4 per cent from the prior quarter. Q2 2024 average production rates were affected by natural declines, in line with the company's expectations, while most drilling activity was focused on either exploration or development wells, which will come on line in Q3 2024.

Oil sales totalled 1.9 million bbl during Q2 2024, above Q1 2024. At the end of the quarter, the company held crude oil inventory of 900,000 bbl, which was approximately the same as the inventory at the start of the quarter.

Oil revenue during Q2 2024 was $164.0-million, up 10 per cent from Q1 2024 due to higher liftings, coupled with a higher realized price.

Price realizations averaged $87.7 per bbl during Q2 2024, a $2.70-per-barrel premium over the Brent crude oil benchmark. Premiums have increased due to deliberate actions on the company's part to find more lucrative local markets for its heavier crudes, in particular.

The company paid taxes of $83.4-million during the quarter, relating primarily to the full year 2023 in respect of its Jasmine field, and the second half (H2) of 2023, in relation to its other fields, and include payment for a $11.4-million tax obligation, which was recently identified, relating to the 2018/2019 time frame, while the assets were under their previous ownership. In addition, during Q2 2024, the company completed its $19-million acquisition of the Nong Yao FSO and paid the final $7.0-million contingent consideration relating to its asset acquisition from KrisEnergy (Asia). The company's cash position at June 30, 2024, was $145.1-million, which includes $17.3-million held as restricted cash. Valeura has no debt.

Operations update

Nong Yao C update

Valeura's drilling operations during Q2 2024 were focused on the Nong Yao field (90-per-cent operated working interest), where the company achieved drilling success across the portfolio. Activity included an exploration discovery in the Nong Yao D area and two production infill wells at Nong Yao A, prior to the start of development drilling on the Nong Yao C accumulation.

Through the Nong Yao C development project, the company is targeting an increase in production output from the greater Nong Yao area from approximately 7,000 bbl/d to a total of 11,000 bbl/d (Valeura working interest share before royalties). Drilling operations are proceeding as planned, with the company having substantially drilled approximately half of the planned drilling targets. First oil from the Nong Yao C development is planned for Q3 2024.

The company believes achievements at the Nong Yao asset illustrate Valeura's multifaceted strategy to add value through growth. The company anticipates that this asset will be the largest source of production growth in 2024 and the largest single source of production in the portfolio. Valeura further expects that when evaluated at year-end 2024, recoverable volumes from the asset are likely to have increased as a result of both exploration, new field development and infill drilling activity in 2024. From a value perspective, the company is forecasting a decrease in unit operating costs and further upside in the medium term through the potential for successful appraisal of additional stepout targets.

Wassana mobile offshore production unit (MOPU) update

Production at the Wassana field (100-per-cent operated interest) was steady throughout Q2 2024, including contributions from the new infills drilled earlier in the year. On June 28, 2024, the company implemented a precautionary suspension of production (at the time, approximately 5,000 bbl/d before royalties) after a scheduled underwater inspection of the MOPU identified a crack within a weld on one of three steel legs of the MOPU.

Subsequent review of the findings, including input from an experienced third party engineering firm, has suggested that the crack may be superficial and therefore may not indicate a risk to the structural integrity of the MOPU. Valeura is preparing to conduct a more advanced underwater inspection work, which is scheduled to be completed around the end of July, 2024. If this inspection demonstrates that the crack is superficial, then the company intends to restart production without delay. If it is demonstrated to propagate further into the structure, then more extensive repairs would be required prior to restarting production.

Wassana redevelopment update

Following the company's 2023 appraisal drilling program, which confirmed the presence of oil deeper than previously demonstrated in the Wassana field, Valeura has assessed the potential for a redevelopment of the field, to yield an increase in production and extension of the field's economic life.

Valeura is pleased to announce that it has awarded a contract for front end engineering and design (FEED) work for the redevelopment of the Wassana field to Thai Nippon Steel Engineering & Construction Corp. Ltd., which has already commenced work. Following the FEED study, Valeura will consider a final investment decision at approximately the end of 2024.

Results timing

Valeura intends to release its full unaudited financial and operating results for Q2 2024 on Aug. 8, 2024, and will discuss the results in more detail through a management webcast. In addition, the company intends to announce revised 2024 guidance estimates once the way forward for the Wassana MOPU has been determined.

About Valeura Energy Inc.

Valeura is a Canadian public company engaged in the exploration, development and production of petroleum and natural gas in Thailand and in Turkey. The company is pursuing a growth-oriented strategy and intends to reinvest into its producing asset portfolio and to deploy resources toward further organic and inorganic growth in Southeast Asia. Valeura aspires toward value accretive growth for stakeholders while adhering to high standards of environmental, social and governance responsibility.

We seek Safe Harbor.