An anonymous director reports

CANACOL ENERGY LTD. ANNOUNCES THE CLOSING OF A US $75 MILLION SENIOR SECURED TERM LOAN

On Sept. 3, 2024, Canacol Energy Ltd. entered into a committed 24-month $75-million (U.S.) senior secured term loan facility with Macquarie Group.

The initial draw on financing is expected to be $50-million (U.S.), with a further commitment of $25-million (U.S.) available for a 12-month period should certain production metrics be met. The facility bears an annual interest rate of secured overnight financing rate plus 8.0 per cent on drawn amounts and 2.4 per cent on undrawn amounts during the commitment period. The corporation expects to enter an SOFR hedging agreement with Macquarie fixing the interest rate. The facility matures on Sept. 3, 2026, and has a 12-month principal payment grace period. No prepayments may be made during the first 12 months. The facility is secured by all material assets of the corporation.

Covenants on the facility have been largely harmonized with the corporation's existing covenants on its 2028 senior unsecured notes and its senior unsecured revolving credit facility, which matures in February, 2027.

As of June 30, 2024, the corporation had $43-million (U.S.) of cash and a leverage ratio of 2.69 times being well inside of its existing leverage ratio covenants of 3.25 times (incurrence) and 3.5 times (maintenance).

Canacol intends on using the proceeds of the facility for general corporate purposes.

In connection with the facility, Macquarie will be issued 1,888,448 common share purchase warrants, with each warrant entitling Macquarie to purchase one common share of the corporation at an exercise price equal to the five-day volume-weighted average trading price of the common shares ending on the date hereof. The warrants will expire three years after the date of issuance. The warrants remain subject to the final approval of the Toronto Stock Exchange.

The entire credit and guarantee agreement will be posted on SEDAR+.

Gas sales update

Realized contractual natural gas sales (which are gas produced, delivered and paid for) averaged approximately 161 million standard cubic feet per day during July, 2024, and approximately 167 MMscfpd during August, 2024.

About Canacol Energy Ltd.

Canacol is a natural gas exploration and production company with operations focused on Colombia. The corporation's common stock trades on the Toronto Stock Exchange, the OTCQX in the United States and the Colombia Stock Exchange under ticker symbol CNE, CNNEF and CNE.C, respectively.

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