Mr. Richard Gonzalez reports

PETRO-VICTORY ENERGY CORP. PROVIDES OPERATIONS UPDATE

Petro-Victory Energy Corp. has provided an operations update to the shareholders.

2024 advancement highlights:

• Sao Joao field, three-well, workover campaign was completed in April, 2024, total oil sales volumes for the three months ended June 30, 2024, was 5,814 barrels (bbl), up 99 per cent from prior quarter.
• Best estimate development-pending risked contingent gas resources located at the Sao Joao field added 50.1 billion cubic feet (1.4 billion cubic metres) of gas or 8.4 million barrels of oil equivalent (MMboe) and NPV10 $97.3-million (U.S.).
• The company updated its reserve report with 6.9 MMboe and NPV10 $257.7-million (U.S.) ($40.05 per boe) 2P reserves.
• The company announced a partnership with Azevedo Travassos Petroleo SA (ATP) to develop the Andorinha field and Block 281.

Partnership with Azevedo Travassos Petroleo

Block 281: Petro-Victory will re-enter and perform a workover on the CR-2 well in Block 281. The workover will commence in October as part of the ATP partnership. ATP will pay 100 per cent of the workover program and recover the cost through the net income generated by the production of the CR-2 well: 75 per cent ATP and 25 per cent PVE, after which, the two companies will split the net income generated by the production 50/50.

Andorinha field: Petro-Victory will drill two additional in-field wells at the Andorinha field beginning in December through the ATP partnership, ATP will pay 100 per cent of the drilling work program and recover cost through the net income generated by the production of the two wells: 75 per cent ATP and 25 per cent PVE, after which, the two companies will split the net income generated by the production 50/50.

Commercial outlook: Upon the completion of and based on the results of the CR-2 workover and the Andorinha drilling program, a new reserve report will be obtained and ATP will have the option to purchase 50-per-cent ownership in the Andorinha field and Block 281 at a price of $10 (U.S.) per proven barrel and $4 (U.S.) per probable barrel. The option to purchase must be exercised within nine months following the completion of the work program.

High impact exploration

Drilling Prospects: Six additional high-impact exploration drilling prospects have received environmental and drilling licenses. A new prospective resource report will be completed in September. The company is carefully evaluating all options for financing the high-impact exploration drilling prospects including but not limited to strategic partnerships or equity investments.

Acquisition of mature fields

Collaboration with international group: In August, Petro-Victory entered into an MOU (memorandum of understanding) collaboration with XP Group, an international oil and gas operator, to evaluate, acquire and enhance production in mature oil and gas fields in Latin America. This collaboration further strengthens Petro-Victory's position to increase production through the acquisition of mature producing fields across Latin America.

Message to shareholders

Richard F. Gonzalez, chief executive officer of Petro-Victory Energy, commented: "With the completion of the three-well workover program at the Sao Joao field, total oil sales volumes for the three months ended June 30, 2024, was 5,814 bbl, an increase of 99 per cent over the first quarter 2024 sales volumes. The Sao Joao field had no production, no reserve report and no facilities prior to Petro-Victory entering in April, 2020. The field has since produced more than 50,000 barrels of oil and has 1.9 MMboe in 2P reserves and best estimate development-pending risked contingent gas resources of 8.4 MMboe.

"Consolidated production from the Sao Joao, Andorinha and Trapia fields during the second quarter averaged 64 barrels of oil per day (bopd) and generated an average of $144,000 (U.S.) in oil revenues per month with an average netback per month in the quarter of $72,000 (U.S.) or $37.08 (U.S.) per barrel representing a 50-per-cent margin. In July and August, we have averaged 48 bopd.

"Production growth continues to be a priority for Petro-Victory and future production volumes are expected to increase disproportionately from production expense as the company executes on the development plan in the second half 2024 and beyond, thus decreasing the production cost per barrel and increasing operating netback margins.

"The company has focused on establishing strategic partnerships and joint ventures during the period with an emphasis on monetizing existing assets and reserves.

"The ATP partnership is progressing exceptionally well. The teams' combined experience and expertise are highly complementary. The synergies not only enhance our current projects but also opens up numerous opportunities for future growth. By leveraging our collective strengths, we can operate more effectively and drive greater value for both organizations.

"Furthermore, the company is also evaluating opportunities to increase production through the acquisition of mature fields in Brazil and LATAM which would be complementary to our existing high-growth portfolio."

Summary reserves and resources

As announced in the press release dated May 9, 2024, the company's independent reserve and resource report as of Dec. 31, 2023, and issued by GLJ Ltd. dated April 25, 2024, added development pending risked contingent resources of 8.4 MMboe. The GLJ report is summarized below.

The company holds 100-per-cent working interest in 38 concessions. Six of the 38 concessions have reserves included in the GLJ report. The company continues to invest geological and geophysical resources in further evaluation of the remaining 32 blocks. The additional 32 concession blocks are not included in the reserve figures below.

Proved (1P) reserves:

• 3,434,000 barrels of oil equivalent;
• Net present value before tax, discounted at 10 per cent (NPV10) is $130.5-million (U.S.) ($40.68 per boe) for 1P reserves.

Proved plus probable (2P) reserves:

• 6,873 Mboe;
• Before-tax NPV10 is $257.7-million (U.S.) ($40.05 per boe) for 2P reserves.

Proved plus probable plus possible (3P) reserves:

• 10,116 Mboe;
• Before-tax NPV10 is $368.5-million (U.S.) ($38.91 per boe) for 3P reserves.

Development-pending risked contingent resources -- best estimate:

• 8,359 Mboe;
• Before tax NPV10 is $97.3-million (U.S.).

Furthermore, the company has identified 16 opportunities across 12 of the other blocks. Of these, seven opportunities represent economically viable prospects. The company will have a prospective resources report completed in the coming weeks for the first four initial prospects.

About Petro Victory Energy Corp.

Petro Victory Energy is engaged in the acquisition, development and production of crude oil and natural gas resources in Brazil. The company holds 100-per-cent operating and working interests in 38 licences totalling 257,604 acres in two different producing basins in Brazil. Petro-Victory generates accretive shareholder value through disciplined investments in high-impact, low-risk assets.

We seek Safe Harbor.