Mr. Rob Zakresky reports

COELACANTH ENERGY INC. ANNOUNCES OPERATIONS UPDATE

Coelacanth Energy Inc. has completed and tested four wells at its Two Rivers East project, including three Lower Montney wells and one Basal Montney well on the 5-19 pad.

Lower Montney

The three Lower Montney wells (C5-19, D5-19, E5-19) were drilled with an average horizontal length of 3,140 metres and completed with approximately 2.5 tonnes of sand per horizontal metre. Drilling and completion costs came in slightly under budget at approximately $9-million per well. The wells were placed on test for cleanup for an average of 10 days until the frac water substantially dissipated and a stabilized rate was achieved. The test rates noted herein are based on the final 24 hours of each test.

The average rate achieved for the three Lower Montney wells was 1,338 barrels of oil equivalent/day per well, comprising 729 barrels/day of 39 American Petroleum Institute (API) light sweet oil and 3.7 million cubic feet/day of liquids-rich gas. The rates per well were similar as outlined in the attached table.

The company is very pleased with the overall results and more particularly with the oil rates.

Basal Montney

The Basal Montney well (A5-19) was completed over 2,000 metres of horizontal length and placed on test for cleanup for six days. The well required nitrogen assist to keep it flowing and the company decided to cut the test short due to the high daily testing cost. The company plans to run tubing and retest the well on an extended basis in Q3 or Q4 2024. Although the well only recovered 7.3 per cent of the frac water, it did flow 395 boe/d over its final 24 hours, comprising 223 bbl/d of 40 API light sweet oil and one mmcf/d of liquids-rich gas. A proper retest will determine commerciality of the current drilling and frac design for future wells.

Infrastructure and takeaway

As previously disclosed, Coelacanth has secured long-term takeaway and processing for up to 60 mmcf/d of gas and will now look to build required facilities and pipelines to handle the 5-19 and subsequent pads. The company is in the process of obtaining final regulatory approval with an estimated completion date of Q1 2025.

Financial

Coelacanth estimates that it had approximately $65-million of positive working capital and no debt at the end of 2023.

President and chief executive officer Rob Zakresky states, "Over all, Coelacanth believes this was a critical first step in its development as it not only proves success in the drilling and completions design but will allow for years of growth in both reserves and production as we expand the development and prove productivity over multiple potential Montney layers across our current land base of 150 contiguous sections of Montney."

We seek Safe Harbor.