Mr. Corey Ruttan reports

ALVOPETRO ANNOUNCES JANUARY 2024 SALES VOLUMES AND OUR SEMI-ANNUAL NATURAL GAS PRICE UPDATE

Alvopetro Energy Ltd. has released its January, 2024, sales volumes and its updated natural gas price effective Feb. 1, 2024.

January sales volumes

January sales volumes averaged 1,699 barrels of oil equivalent per day, including natural gas sales of 9.7 million cubic feet per day, associated natural gas liquids sales from condensate of 75 barrels of oil per day and oil sales of nine bopd, based on field estimates. January sales volumes were impacted by reduced nominations from the company's offtaker, Bahiagas. Nominations for February have increased back to 10.6 MMcfpd.

            NATURAL GAS, NGLS AND CRUDE OIL SALES   
  
                                  January,        December,
Natural gas (Mcfpd), by field        2024             2023            
Cabure                              9,305           12,777       
Murucututu                            382              536          
Total company natural gas (Mcfpd)   9,687           13,313       
NGLs (bopd)                            75              105          
Oil (bopd)                              9                7            
Total company (boepd)               1,699            2,331        

   

Natural gas pricing update

Effective Feb. 1, 2024, the company's natural gas price under its long-term gas sales agreement with Bahiagas has been adjusted to 1.94 Brazilian reals/metre cubed or $12.36/thousand cubic feet (based on average heat content to date, the Jan. 31, 2024, Brazilian real/U.S. dollar exchange rate of 4.95 and enhanced sales tax credits expected to continue to apply in 2024). The contracted price is based on the adjusted ceiling price of $10.58/million British thermal units which increased 0.5 per cent from the Aug. 1, 2023, price due to the U.S. inflation adjustment for the six-month period. With the appreciation of the Brazilian real relative to the U.S. dollar in the second half of 2023 compared with the first half of 2023, the Brazilian real contracted price decreased from 1.99 Brazilian reals/m3 as of Aug. 1, 2023, to 1.94 Brazilian reals/m3 as of Feb. 1, 2024. The new contracted price will apply to all natural gas sales from Feb. 1, 2024, to July 31, 2024.

Corporate presentation

Alvopetro's updated corporate presentation is available on the company's website.

Alvopetro Energy Ltd.'s vision is to become a leading independent upstream and mid-stream operator in Brazil. Its strategy is to unlock the on-shore natural gas potential in the state of Bahia in Brazil, building off the development of its Cabure natural gas field and its strategic mid-stream infrastructure.

We seek Safe Harbor.