Mr. Nick DeMare reports

EAST WEST PETROLEUM COMMENTS ON FINANCIAL RESULTS FOR THE NINE MONTHS ENDED DECEMBER 31, 2023

East West Petroleum Corp. has commented on its financial results for the nine months ended Dec. 31, 2023.

During the nine months ended Dec. 31, 2023, the company generated revenue of $2,056,017 with direct costs of $1,842,854, resulting in a gross profit of $213,163 and, after corporate expenses and other items, the net loss for the period was $158,932.

On Oct. 31, 2023, the company entered into an interim agreement with Cheal Petroleum Ltd., the owner of a 70-per-cent interest in PMP 60291 and operator, whereby Cheal would purchase the company's 30-per-cent interest in PMP 60291. The key terms of the interim agreement were as follows:

• Purchase price of $1-million (U.S.);
• Effective date of sale is July 31, 2023;
• Purchaser assumes all reclamation obligations;
• Contingent consideration of $350,000 (U.S.) should an additional well be drilled and completed;
• Refundable deposit of $250,000 (U.S.) on signing definitive agreement.

The terms described under the interim agreement were subject to the negotiation and execution of a definitive agreement. Closing of the sale is subject to receipt of all necessary New Zealand government approvals (ministerial consent), regulatory and TSX Venture Exchange approval, as well as approval of the company's shareholders. An annual and special meeting of the shareholders of the company was held on Dec. 15, 2023, and shareholder approval was obtained. As at Dec. 31, 2023, the company received conditional approval from the TSX-V. On Jan. 10, 2024, the company and Cheal finalized and signed the definitive agreement (the asset sale and purchase agreement), which formalized the terms under the interim agreement. The deposit due to the company on signing was received.

Closing is expected to occur upon receipt of ministerial consent. In the event the ministerial consent is not received by May 31, 2024, the company may terminate the asset sale and purchase agreement and, if terminated, the company will be required to return the deposit.

At Dec. 31, 2023, the New Zealand property was, in accordance with IFRS (international financial reporting standards), reclassified as assets held for sale.

In regard to the company's Romanian assets, the company and NIS remain in discussions in order to determine the path forward for the properties. All options remain under consideration, including a monetization event. The company is unable to comment on timelines to establish a path forward.

The company has been reviewing a number of opportunities in both oil and gas, and also other resource opportunities. The company is focused on closing the sale of its New Zealand assets and, once the sale has closed, the company will be in a better position to pursue other opportunities more aggressively.

At Dec. 31, 2023, the company had a strong cash position of $5,691,792, being just over six cents per share. With the effective date of the sale of the New Zealand assets being July 31, 2023, the company anticipates it will receive total cash proceeds from this sale of approximately $600,000 (U.S.). In addition, the company will, if contingent conditions are met, receive additional consideration of $350,000 (U.S.). On closing, a significant gain on sale will be realized due to the purchaser assuming all reclamation obligations.