Mr. Jim Hill reports

MCF ENERGY LTD. INCREASES ITS INTEREST IN UPCOMING WELCHAU-1 WELL FROM 20 per cent TO 25 per cent

MCF Energy Ltd. has increased its economic interest participation in the upcoming Welchau-1 well in Austria to 25 per cent from 20 per cent.

In early 2023, MCF Energy entered into an energy investment agreement (EIA) with ADX Energy Ltd. to finance half of the expenses for the Welchau-1 exploration well, initially capped at 3.8 million euros, thereby securing a 20-per-cent economic stake in the Welchau investment area.

ADX Energy as the operator of the Welchau-1 well has adhered strictly to stakeholder consultation, environmental protocols and essential predrilling measures, such as permits and comprehensive geotechnical surveys, evidencing ADX and MCF's dedication to environmental, social and governance (ESG) principles. These actions and increases in drilling costs have resulted in a total investment increase for the well to 5.1 million euros.

MCF and ADX have amended the EIA to outline MCF's commitment to financing 50 per cent of the Welchau-1 well expenses, up to 5.1 million euros, in exchange for increasing MCF's economic interest in the Welchau investment area to 25 per cent from 20 per cent. Upon reaching the revised well cost cap, MCF and ADX will cover their respective shares of 25 per cent and 75 per cent for the expenses related to the Welchau investment area.

The operator has confirmed that drilling will begin once the well site construction is finished by late January. This clears the way for the RED Drilling & Services GmbH (RED) E-202 rig to move to the Welchau-1 drilling location.

Jay Park K.C., executive chairman of MCF Energy, stated: "Today's announcement further solidifies MCF Energy's steadfast commitment to the Welchau-1 exploration project. By elevating our investment to 5.1 million euros and expanding our economic interest to 25 per cent, we reinforce our support for the Welchau project and unwavering ESG principles."

Welchau-1 Well operations

Construction at the Welchau-1 gas well site began on Dec. 15, 2023, after receiving environmental clearance from the Department of Nature Protection of the state government of Upper Austria. This clearance was the final regulatory step needed to start drilling on the Welchau prospect. Preceding this, the mining authority on behalf of the Ministry of Finance of the Republic of Austria issued the drilling permit.

Drilling operations at Welchau are slated to start in late January, 2024, once the well site is fully constructed and the RED Drilling & Services GmbH E-202 drilling rig is mobilized. Emphasizing safety, environmental protection and project execution, the operator has maximized local involvement, leveraging its strong record in these areas. The anticipated duration of the drilling is approximately 39 days.

About MCF Energy Ltd.

MCF Energy was established in 2022 by leading energy executives to strengthen Europe's energy security through responsible exploration and development of natural gas resources within the region. The company has secured interests in several significant natural gas exploration projects in Austria and Germany with additional concession applications pending.

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