Annual information form
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INTERNAL Annual Information Form For the Year Ended December 31, 2024 March 25, 2025
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 2 CONTENTS ABBREVIATIONS, CONVERSION, AND CONVENTIONS .................................................................................. 3 DEFINITIONS .............................................................................................................................................................. 4 PRESENTATION OF RESERVES AND RESOURCES INFORMATION ........................................................... 8 FORWARD-LOOKING STATEMENTS .................................................................................................................... 9 VALEURA ENERGY INC. ........................................................................................................................................ 13 GENERAL DEVELOPMENT OF THE BUSINESS ............................................................................................... 14 DESCRIPTION OF THE BUSINESS AND OPERATIONS ................................................................................. 17 SUSTAINABILITY OF THE BUSINESS ................................................................................................................. 19 STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION ..................................... 19 CONTINGENT AND PROSPECTIVE RESOURCES .......................................................................................... 21 DESCRIPTION OF CAPITAL STRUCTURE ......................................................................................................... 21 DIVIDENDS ................................................................................................................................................................ 22 PRIOR SALES ........................................................................................................................................................... 22 MARKET FOR COMMON SHARES ...................................................................................................................... 22 DIRECTORS AND EXECUTIVE OFFICERS ........................................................................................................ 23 AUDIT COMMITTEE ................................................................................................................................................. 24 RISK FACTORS ...................................................................................................................................................... 25 INDUSTRY CONDITIONS ....................................................................................................................................... 35 LEGAL AND REGULATORY PROCEEDINGS .................................................................................................... 37 INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS ........................................ 37 MATERIAL CONTRACTS ........................................................................................................................................ 37 TRANSFER AGENT AND REGISTRAR ................................................................................................................ 37 INTERESTS OF EXPERTS ..................................................................................................................................... 37 ADDITIONAL INFORMATION ................................................................................................................................. 37 APPENDIX A1 - FORM 51-101F1 – STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION .......................................................................................................................................................... 39 APPENDIX A2 – CONTINGENT RESOURCES DATA ....................................................................................... 47 APPENDIX A3 – FORM 51-101F2 – REPORT ON RESERVES DATA AND CONTINGENT RESOURCES DATA BY INDEPENDENT QUALIFIED RESERVES EVALUATOR OR AUDITOR ....................................... 50 APPENDIX A4 – FORM 51-101F3 – REPORT OF MANAGEMENT AND DIRECTORS ON OIL AND GAS DISCLOSURE ............................................................................................................................................................ 52 APPENDIX B – TERMS OF REFERENCE FOR THE AUDIT COMMITTEE ................................................... 53 CONTACT INFORMATION ................................................................................................................................... 61
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 3 ABBREVIATIONS, CONVERSION, AND CONVENTIONS In this Annual Information Form, the following abbreviations have the meanings set forth below. Oil and Natural Gas Liquids Natural Gas bbl barrel Mcf thousand cubic feet Mbbl thousand barrels MMcf million cubic feet bbl/d barrel per day Mcf/d thousand cubic feet per day NGLs natural gas liquids MMBtu million British Thermal Units Bcf billion cubic feet Bcf/d billion cubic feet per day Other BOE barrel of oil equivalent. BOE/d Mboe barrel of oil equivalent per day. thousand barrels of oil equivalent per day. M$ thousands of dollars. MM$ millions of dollars. McfGE thousand cubic feet of sales gas equivalent. NYMEX New York Mercantile Exchange. TL/m3 Turkish Lira per cubic metre. TL Turkish Lira. THB Thailand Baht. C$ Canadian dollars. Conversions The following table sets forth certain standard conversions between Standard Imperial Units and the International System of Units (or metric units) To convert to From Multiply by 1,000 cubic metres of gas Mcf 35.494 bbl cubic metres of oil 0.158 cubic metres of oil bbl 6.290 feet metres 0.305 metres feet 3.281 miles kilometres 1.609 kilometres miles 0.621 acres hectares 0.405 hectares acres 2.471 Conventions Unless otherwise indicated, references herein to “$” or “dollars” are to United States dollars. References herein to “C$” are to Canadian dollars.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 4 DEFINITIONS “Abandonment and reclamation costs” means all costs associated with the process of restoring a reporting issuer’s property that has been disturbed by oil and gas activities to a standard imposed by applicable government or regulatory authorities. “ABCA” means the Business Corporations Act (Alberta), together with any or all regulations promulgated thereunder, as amended from time to time. “Anti-Corruption Policy” means the Company’s anti-corruption policy. “Banarli Licences” or “Banarli Exploration Licences” mean, collectively, the two Banarli licences described under the heading “Description of the Business and Operations – Land Holdings”. “BJL” means Busrakham (Jasmine) Ltd., a wholly-owned affiliate of Valeura. “Board” means the board of directors of Valeura. “BOTAS” means Boru Hatlari ile Petrol Tasima Anonim Sirketi. “BVI” means British Virgin Islands. "Capex” means capital expenditure. “COGE Handbook” means the Canadian Oil and Gas Evaluation Handbook prepared jointly by The Society of Petroleum Evaluation Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy & Petroleum (Petroleum Society), as amended from time to time. “Common Shares” means the common shares in the capital of the Company. “Company” or “Valeura” means Valeura Energy Inc. and, where applicable, includes its subsidiaries and affiliates. “CRBV” means Corporate Resources B.V., a wholly-owned affiliate of Valeura. “Crude oil” or “oil” as described in the COGE Handbook means a mixture consisting mainly of pentanes and heavier hydrocarbons that exists in the liquid phase in reservoirs and remains liquid at atmospheric pressure and temperature. Crude oil may contain small amounts of sulphur and other non-hydrocarbons but does not include liquids obtained from the processing of natural gas. “Deep Gas Play” means the Company’s deep, unconventional gas play located in the Thrace Basin. “Development costs” means costs incurred to obtain access to reserves and to provide facilities for extracting, treating, gathering and storing the oil and gas from the reserves. More specifically, development costs, including applicable operating costs of support equipment and facilities and other costs of development activities, are costs incurred to: (a) gain access to and prepare well locations for drilling, including surveying and acquiring well locations for the purpose of determining specific development drilling sites, clearing ground, draining, road building, and relocating public roads, gas lines and power lines, to the extent necessary in developing the reserves; (b) drill and equip development wells, development type stratigraphic test wells and service wells, including the costs of platforms and of well equipment such as casing, tubing, pumping equipment and the wellhead assembly; (c) acquire, construct and install production facilities such as flow lines, separators, treaters, heaters, manifolds, measuring devices and production storage tanks, natural gas cycling and processing plants, and central utility and waste disposal systems; and (d) provide improved recovery systems. “Development well” means a well drilled inside the established limits of an oil or gas reservoir, or in close proximity to the edge of the reservoir, to the depth of a stratigraphic horizon known to be productive. “DMF” means the Department of Mineral Fuels of Thailand. “Equinor” means Equinor Turkey B.V., a wholly-owned affiliate of Equinor ASA. “ESG” means environmental, social and corporate governance. “Exploration costs” means costs incurred in identifying areas that may warrant examination and in examining specific areas that are considered to have prospects that may contain oil and gas reserves, including costs of drilling exploratory wells and exploratory type stratigraphic test wells. Exploration costs may be incurred both before acquiring the related property (sometimes referred to in part as
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 5 “prospecting costs”) and after acquiring the property. Exploration costs, which include applicable operating costs of support equipment and facilities and other costs of exploration activities, are: (a) costs of topographical, geochemical, geological and geophysical studies, rights of access to properties to conduct those studies, and salaries and other expenses of geologists, geophysical crews and others conducting those studies (collectively sometimes referred to as “geological and geophysical costs”); (b) costs of carrying and retaining unproved properties, such as delay rentals, taxes (other than income and capital taxes) on properties, legal costs for title defence, and the maintenance of land and lease records; (c) dry hole contributions and bottom hole contributions; (d) costs of drilling and equipping exploratory wells; and (e) costs of drilling exploratory type stratigraphic test wells. “Exploratory well” means a well that is not a development well, a service well or a stratigraphic test well. “Facility” has the meaning set forth under the heading “General Development of the Business 2022”. “field” means a defined geographical area consisting of one or more hydrocarbon pools. “Forecast prices and costs” means future prices and costs that are: (a) generally accepted as being a reasonable outlook of the future; and (b) if, and only to the extent that, there are fixed or presently determinable future prices or costs to which the Company is legally bound by a contractual or other obligation to supply a physical product, including those for an extension period of a contract that is likely to be extended, those prices or costs rather than the prices and costs referred to in paragraph (a). “Forward-looking statements” has the meaning set forth under the heading “Forward-Looking Statements”. "FPSO” means floating production storage and offloading vessel. "FSO” means floating storage and offloading vessel. “Future net revenue” means a forecast of revenue, estimated using forecast prices and costs or constant prices and costs, arising from the anticipated development and production of resources, net of the associated royalties, operating costs, development costs and abandonment and reclamation costs. “GDMPA” means the Republic of Türkiye’s General Directorate of Mining and Petroleum Affairs. “Gross” means: (a) in relation to the Company’s interest in production or reserves, its "company gross reserves", which are the Company’s working interest (operating or non-operating) share before deduction of royalties and without including any royalty interests of the Company; (b) in relation to wells, the total number of wells in which the Company has an interest; and (c) in relation to properties, the total area of properties in which the Company has an interest. “ICFR” or “internal controls over financial reporting” has the meaning set forth under the heading “Risk Factors – Internal controls over financial reporting”. “Kris Acquisition” has the meaning set forth under the heading “General Development of the Business 2022”. “M&A” means mergers and acquisitions. “MOPU” means mobile offshore production unit. “MOPU Purchase” has the meaning set forth under the heading “General Development of the Business 2022”. “Mubadala Acquisition” has the meaning set forth under the heading “General Development of the Business 2022”. “natural gas” means a naturally occurring mixture of hydrocarbon gases and other gases. “Natural gas liquids” means those hydrocarbon components that can be recovered from natural gas as a liquid including, but not limited to, ethane, propane, butanes, pentanes plus, and condensates.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 6 “Natural Gas Market Law” has the meaning set forth under the heading “Industry Conditions – Türkiye”. “Net” means: (a) in relation to the Company’s interest in production or reserves, the Company’s working interest (operating or non-operating) share after deduction of royalty obligations, plus the Company’s royalty interests in production or reserves; (b) in relation to the Company’s interest in wells, the number of wells obtained by aggregating the Company’s working interest in each of its gross wells; and (c) in relation to the Company’s interest in a property, the total area in which the Company has an interest multiplied by the working interest owned by the Company. “New Petroleum Law” means Türkiye’s Petroleum Law No. 6491 adopted in 2013. “NI 51-101” means National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities. “NSAI” means Netherland, Sewell and Associates Inc., independent reserves evaluators. “NSAI Reserves Report” means the independent engineering evaluation of the reserves attributable to the Company’s four licences in the offshore Gulf of Thailand prepared by NSAI, with a preparation date of February 13, 2025 effective December 31, 2024. “NSAI Resources Report” means the independent engineering evaluation of the contingent resources attributable to the Company’s four licences in the offshore Gulf of Thailand prepared by NSAI, with a preparation date of February 13, 2025 effective December 31, 2024. “Opex” or “operating costs” or “production costs” means costs incurred to operate and maintain wells and related equipment and facilities, including applicable operating costs of support equipment and facilities and other costs of operating and maintaining those wells and related equipment and facilities. “Option” means an option to acquire a Common Share pursuant to the Stock Option Plan. “OTCQX” means the marketplace for the over-the-counter (OTC) trading of stocks, operated by the OTC Markets Group. “Plan” means the performance and restricted share unit plan of the Company. “Preferred Shares” means the preferred shares in the capital of the Company. “production” means recovering, gathering, treating, field or plant processing (for example, processing gas to extract natural gas liquids) and field storage of oil and gas. “property” includes: (a) fee ownership or a lease, concession, agreement, permit, licence or other interest representing the right to extract oil or gas subject to such terms as may be imposed by the conveyance of that interest; (b) royalty interests, production payments payable in oil or gas, and other non-operating interests in properties operated by others; and (c) an agreement with a foreign government or authority under which a reporting issuer participates in the operation of properties or otherwise serves as “producer” of the underlying reserves (in contrast to being an independent purchaser, broker, dealer or importer). A property does not include supply agreements, or contracts that represent a right to purchase, rather than extract, oil or gas. “Property acquisition costs” means costs incurred to acquire a property (directly by purchase or lease, or indirectly by acquiring another corporate entity with an interest in the property), including: (a) costs of lease bonuses and options to purchase or lease a property; (b) the portion of the costs applicable to hydrocarbons when land including rights to hydrocarbons is purchased in fee; and (c) brokers’ fees, recording and registration fees, legal costs and other costs incurred in acquiring properties. “Proved property” means a property or part of a property to which reserves have been specifically attributed. "PSU” or “Performance Share Unit” means the right of a grantee to receive a Common Share pursuant to the Plan as described under the heading “Description of Capital Structure”. “reservoir” as described in the COGE Handbook means a subsurface rock unit that contains an accumulation of petroleum.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 7 "RSU” or “Restricted Share Unit” means the right of a grantee to receive a Common Share pursuant to the Plan as described under the heading “Description of Capital Structure”. “Service well” means a well drilled or completed for the purpose of supporting production in an existing field. Wells in this class are drilled for the following specific purposes: gas injection (natural gas, propane, butane or flue gas), water injection, steam injection, air injection, salt-water disposal, water supply for injection, observation, or injection for combustion. “Shareholders” means the holders of Common Shares and “Shareholder” means any one of them. “South Thrace Lands” means, collectively, the lands comprising the South Thrace Production Leases. “South Thrace Production Leases” means, collectively, the 11 South Thrace production leases previously held by the TBNG JV comprising 170,735 acres in the Thrace Basin. “SRB” or “Special Remuneratory Benefit” has the meaning set forth under the heading “Industry Conditions – Thailand”. “Stock Option Plan” means the stock option plan of the Company as described under the heading “Description of Capital Structure”. “Stratigraphic test well” means a drilling effort, geologically directed, to obtain information pertaining to a specific geologic condition. Ordinarily, such wells are drilled without the intention of being completed for hydrocarbon production. They include wells for the purpose of core tests and all types of expendable holes related to hydrocarbon exploration. Stratigraphic test wells are classified as: (a) “Exploratory type” if not drilled into a proved property; or (b) “Development type”, if drilled into a proved property. Development type stratigraphic wells are also referred to as “evaluation wells”. “Support equipment and facilities” means equipment and facilities used in oil and gas activities, including seismic equipment, drilling equipment, construction and grading equipment, vehicles, repair shops, warehouses, supply points, camps, and division, district or field offices. “TBNG” means Thrace Basin Natural Gas Türkiye Corporation, a wholly-owned affiliate of Valeura. “TBNG JV” means the joint venture formed between CRBV, TBNG and PTI. “TBNG JV Lands” means the South Thrace Lands and the West Thrace Lands. “TBNGL” means Thrace Basin Natural Gas Limited, a private company. “Thrace Basin” means an area of land in the northwest region of Türkiye, located west of Istanbul and extending to the Greek and Bulgarian borders. “TSX” means the Toronto Stock Exchange. “TTA” means Thoresen Thai Agencies Public Company Limited. “Turkish Regulations” has the meaning set forth under the heading “Industry Conditions – Turkish Petroleum Law Regime”. “Türkiye” means the Republic of Türkiye, which in 2021, via the United Nations changed the spelling from Turkey. “U.S.” or “United States” means the United States of America, its territories and possessions, any state of the United States, and the District of Columbia. “VEA” means Valeura Energy Asia Pte. Ltd., a wholly-owned affiliate of Valeura. “VENBV” means Valeura Energy (Netherlands) B.V., a wholly-owned affiliate of Valeura. “VET” means Valeura Energy (Thailand) Ltd., a wholly-owned affiliate of Valeura. “well abandonment costs” means costs of abandoning a well (net of salvage value) and of disconnecting the well from the surface gathering system. These costs do not include costs of abandoning the gathering system or reclaiming the wellsite. “West Thrace Lands” means, collectively, the lands comprising the West Thrace Licence and the West Thrace Production Leases. “West Thrace Licence” or “West Thrace Exploration Licence” means, the one West Thrace licence described under the heading “Description of the Business and Operations – Licence Term and Commitments”. “West Thrace Production Leases” means, collectively, the three West Thrace production leases described under the heading “Description of the Business and Operations – Licence Term and Commitments”.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 8 PRESENTATION OF RESERVES AND RESOURCES INFORMATION All oil and natural gas reserves and resources information contained in this Annual Information Form has been prepared and presented in accordance with NI 51-101 and the COGE Handbook. The reserves and prospective resource estimates provided in this Annual Information Form are estimates only. Actual reserves and prospective resources and future production from such resources may be greater than or less than the estimates provided herein. Numbers in the reserves and resources tables and other oil and gas information contained in this Annual Information Form may not add due to rounding. DEFINITIONS With respect to the reserves and resources data contained herein, the following terms have the meanings indicated: “Chance of commerciality” is defined as the product of the chance of discovery and the chance of development. “Chance of development” is the estimated probability that, once discovered, a known accumulation will be commercially developed. “Chance of discovery” is the estimated probability that exploration activities will confirm the existence of a significant accumulation of potentially recoverable petroleum. “Contingent resources” are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies are conditions that must be satisfied for a portion of contingent resources to be classified as reserves and that is: (a) specific to the project being evaluated; and (b) expected to be resolved within a reasonable timeframe. “Developed” reserves are those reserves that are expected to be recovered from existing wells and installed facilities or, if facilities have not been installed, that would involve a low expenditure (e.g. when compared to the cost of drilling a well) to put the reserves on production. “Developed non-producing” reserves are those reserves that either have not been on production, or have previously been on production, but are shut-in, and the date of resumption of production is unknown. “Developed producing” reserves are those reserves that are expected to be recovered from completion intervals open at the time of the estimate. These reserves may be currently producing or, if shut-in, they must have previously been on production, and the date of resumption of production must be known with reasonable certainty. “Low estimate” when probabilistic methods are used, there should be at least a 90 percent probability that the quantities actually recovered will equal or exceed the low estimate. “Best estimate” when probabilistic methods are used, there should be at least a 50 percent probability that the quantities actually recovered will equal or exceed the best estimate “High estimate” when probabilistic methods are used, there should be at least a 10 percent probability that the quantities actually recovered will equal or exceed the high estimate. “Possible” reserves are those additional reserves that are less certain to be recovered than probable reserves. It is unlikely that the actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves. “Probable” reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves. “Prospective resources” are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective resources have both an associated chance of discovery and a chance of development. “Proved” reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves. “Reserves” are estimated remaining quantities of oil and natural gas and related substances anticipated to be recoverable from known accumulations, as of a given date, based on: (a) analysis of drilling, geological, geophysical, and engineering data; (b) the use of established technology; and (c) specified economic conditions, which are generally accepted as being reasonable and shall be disclosed. Reserves are classified according to the degree of certainty associated with the estimates.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 9 “Resources” are petroleum quantities that originally existed on or within the earth’s crust in naturally occurring accumulations, including discovered and undiscovered (recoverable and unrecoverable) plus quantities already produced. Total resources is equivalent to total petroleum initially-in-place. “Undeveloped” reserves are those reserves expected to be recovered from known accumulations where a significant expenditure (e.g., when compared to the cost of drilling a well) is required to render them capable of production. They must fully meet the requirements of the reserves classification (proved, probable, possible) to which they are assigned and expected to be developed within a limited time. Certain other terms used herein but not defined herein are defined in NI 51-101 and, unless the context otherwise requires, shall have the same meanings herein as in NI 51-101. USE OF UNRISKED ESTIMATES The unrisked estimates of contingent resources as of December 31, 2024 referred to in this Annual Information Form have not been risked for the chance of development. See “Appendix A-2 – Contingent Resources Data” for details regarding risked estimates. There is uncertainty that it will be commercially viable to produce any portion of the contingent resources. BOEs A BOE is determined by converting a volume of natural gas to barrels using the ratio of 6 Mcf to one barrel. BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf:1 BOE is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Further, a conversion ratio of 6 Mcf:1 BOE assumes that the gas is very dry without significant natural gas liquids. Given that the value ratio based on the current price of oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilising a conversion on a 6:1 basis may be misleading as an indication of value. FORWARD-LOOKING STATEMENTS Certain information contained in this Annual Information Form constitutes forward-looking statements and forward-looking information (collectively, “forward-looking statements”) under applicable securities legislation. Such forward-looking statements are included for the purpose of providing information about management’s current expectations and plans relating to the future. Readers are cautioned that reliance on such forward-looking statements may not be appropriate for other purposes, such as making investment decisions. Forward-looking statements typically include words such as “anticipate”, “believe”, “expect”, “plan”, “intend”, “estimate”, “target”, “goal”, “propose”, “project” or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking statements in this Annual Information Form include, but are not limited to, statements with respect to: • operating costs; • the Thailand and Türkiye fiscal regimes; • marketing and pricing in Thailand and Türkiye; • the Company’s objectives with respect to ESG and sustainability including plans to publish an updated sustainability report; • the expectation to develop drilling locations in the NSAI Reserves Report; • Valeura’s contingent resources; • potential for infill drilling to more fully develop certain oil-bearing reservoir sands that have been identified; • the Company’s farm-out process for the Deep Gas Play; • water management in Thailand and Türkiye; • utilisation of tax losses in Thailand; • demand for liquid hydrocarbons; • decommissioning obligations; • the ability to extend the production period beyond the licences current expiry dates; • the ability to extend the Banarli and West Thrace Exploration Licences for two further two-year periods; • the focus on targets that could provide near-term production and cash flow plus the opportunity for re-investment to generate further value through growth and the potential to generate material value for stakeholders; • the potential of a Deep Gas Play in the Thrace Basin; • the ability to execute a successful M&A strategy;
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 10 • the ability to continually minimise direct impact to climate change from Valeura’s operations; • plans for further appraisal and exploration work, including within the Nong Yao D discovery area; • targeting FID (defined below) on the Wassana field redevelopment project in early Q2 2025; • the intention to drill further infill development wells in part to follow up on appraisal drilling successes in January and February 2025; • the ability to target sweet spots in the Deep Gas Play and the extent of the play; • Valeura’s commitment to safety, environmental responsible practices and optimising operational and administrative functions; • Valeura’s business strategy and outlook; • Valeura’s forecast of average 2025 full year oil production; • Valeura’s guide for realisations; • Valeura’s planned total capex and planned exploration drilling in 2025; • Adjusted opex guidance, including lease expenses; • the ability to execute and agree with partners on work programmes (and the nature and extent of such work programmes) and budgets, which are subject to change based on, amongst other things, the actual results of drilling and related activity, the availability of equipment and service providers, unexpected delays and changes in market conditions; • the ability to obtain approvals and permits for drilling programmes or high-pressure stimulation programmes; • the ability to finance future developments and/or inorganic growth; • tying-in other new wells and getting these on-stream; • results of future seismic programmes; • future production rates and associated cash flow; • continued operations of and approvals forthcoming from upstream regulators in a manner consistent with past conduct; • future economic conditions; • future currency and exchange rates; • future community investment; • the Company’s continued ability to obtain and retain qualified staff, and equipment and services in a timely and cost-efficient manner; • technical decision making; • the resumption of the non-productive acreage return programme; • the ability to obtain necessary government approvals (including future approvals for the Company’s increase of additional 11% working interest in licence G10/48 (containing the Wassana field); • the ability to obtain necessary stock exchange approvals; • the amount and timing of future asset retirement obligations; • future liquidity, creditworthiness and financial capacity; • future interest rates; • future exploration, development and other expenditures; and • future costs, expenses and royalty rates. Statements related to “reserves”, “prospective resources” or “contingent resources” are deemed to be forward-looking information as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and prospective resources can be profitably produced in the future. Specifically, forward-looking information contained herein regarding “reserves”, “prospective resources” or “contingent resources” may include: • estimated volumes and value of Valeura’s oil and natural gas reserves; • estimated volumes of Valeura’s resources; and • the ability to finance future developments.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 11 Forward-looking statements are based on a number of factors and assumptions which have been used to develop such statements but which may prove to be incorrect. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, undue reliance should not be placed on forward-looking statements because the Company can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this Annual Information Form, assumptions have been made regarding and are implicit in, among other things: • the ability to fully identify and execute infill drilling opportunities its fields; • the ability to achieve regulatory and partner approvals for a new development plan in the Wassana field; • the accuracy of the NSAI Reserves Report and the NSAI Resources Report; • the ability to successfully pursue further opportunities in Thailand and achieve synergies including utilisation of tax losses; • the ability to extend the Thrace Basin exploration licences beyond their current expiry dates; • the ability to identify attractive M&A opportunities to support growth; • the Company’s ability to operate the properties in a safe, environmentally responsible, efficient and effective manner; • future sources of funding; • future economic conditions; • the ability to manage costs related to inflation; • the ability of the Company to execute its strategy; • the Company’s ability to effectively manage growth; • political stability of the areas in which Valeura is operating and completing transactions; • the success of the Deep Gas Play; • the ability of the Company to satisfy the drilling and other requirements under its licences and leases; • continued operations of and approvals forthcoming from the governments and regulators in a manner consistent with past conduct; • future seismic and drilling activity on the required/expected timelines; • the prospectivity of the Company’s assets; • the continued favourable pricing and operating netbacks across its business; • future production rates and associated operating netbacks and cash flow; • the ability to reach agreement with partners; • the ability of the Company to maintain its directors, senior management team and employees with relevant experience; • the ability of the Company to successfully manage the political and economic risks inherent in pursuing oil and gas opportunities in Thailand and Türkiye; • field production rates and decline rates; • the ability of the Company to secure adequate product transportation; • the impact of increasing competition in or near the Company’s plays; • the ability of the Company to obtain qualified staff, equipment and services in a timely and cost-efficient manner to develop its business and execute work programmes; • the timing and costs of pipeline, storage and facility construction and expansion; • future oil and natural gas prices; • currency, exchange and interest rates; • the ability of the Company to maintain effective internal controls over financial reporting; • the regulatory framework regarding royalties, taxes and environmental matters; • the ability of the Company to successfully market its oil and natural gas products; • the ability to successfully manage the political and economic risks inherent in pursuing oil and gas opportunities in foreign countries; • the state of the capital markets; and • the ability of the Company to obtain financing on acceptable terms.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 12 Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used. In addition, Valeura’s work programmes and budgets are in part based upon expected agreement among joint venture partners and associated exploration, development and marketing plans and anticipated costs and sales prices, which are subject to change based on, among other things, the actual results of drilling and related activity, availability of drilling, high-pressure stimulation, offshore storage and offloading facilities and other specialised oilfield equipment and service providers for onshore and offshore operations, changes in partners’ plans and unexpected delays and changes in market conditions. Although Valeura believes the expectations and assumptions reflected in such forward-looking information are reasonable, they may prove to be incorrect. Forward-looking statements involve significant known and unknown risks and uncertainties. Exploration, appraisal, and development of oil and natural gas reserves are speculative activities and involve a significant degree of risk. A number of factors could cause actual results to differ materially from those anticipated by the Company including, but not limited to: • risks associated with management of growth; • risks associated with acquisitions, dilution and availability of debt; • risks associated with capital requirements; • risks associated with liquidity risk; • risks associated with the Company is dependence on its directors, senior management team and employees with relevant experience; • risks associated with management of key local relationships; • risks associated with variations in foreign exchange rates and interest rates, and hedging; • risks associated with the impacts of rising inflationary pressures; • risks associated with estimates of reserves; • risks associated with estimates of resources; • risks associated with the value of the Deep Gas Play; • risks associated with counterparty and partner risk; • risks associated with reliance on third party service providers; • risks associated with operational risk with aging assets; • risks associated with internal controls over financial reporting; • risks associated with the use of foreign subsidiaries by the Company may affect the Company’s ability to pay dividends or make distributions; • risks associated with income tax; • risks associated with public health crises, including a pandemic, which could adversely affect the Company’s business; • risks associated with dependence on other operators of assets and joint venture partners; • risks associated with the geopolitical situation in Eastern Europe; • risks associated with the failure to realise transactions and anticipated benefits related to M&A, the Kris Acquisition and the Mubadala Acquisition; • risks associated with exploration, development and production risks; • risks associated with offshore operational risks relating to Thailand; • risks associated with the availability of drilling, hydraulic stimulation and other equipment and access; • risks associated with price volatility, markets and marketing; • risks associated with revocation or expiration of exploration licences, production leases and other licences, leases and permits; • risks associated with the Company’s insurance and indemnities may not adequately cover all risks or expenses; • risks associated with the Company’s operations may be harmful to the environment and the Company may be subject to compliance, clean-up and other costs; • risks associated with Compliance with environmental laws and regulations may prevent the Company from commercially developing its operations; • risks associated with climate change legislation; • risks associated with title to assets; • risks associated with the oil and gas industry being subject to a number of laws and governmental regulations, compliance with which
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 13 may be burdensome; • risks associated with access to debt and equity markets; • risks associated with competition; • risks associated with the Company’s activities being subject to operational risks, hazards and unexpected disruptions, including damage to property or injury to persons, some of which are beyond its control; • risks associated with foreign operations; • risks associated with government rules and regulations; • risks associated with bribery and corrupt practices; • risks associated with potential volatility in the value of an investment in Common Shares and the market price for Common Shares may fluctuate; • risks associated with substantial future sales of Common Shares, or the perception that such sales might occur, or additional offerings of Common Shares could depress the market price of Common Shares; • risks associated with the Company not currently intending to pay dividends and its ability to pay dividends in the future may be limited; and • risks associated with if the Company is wound up, distributions to Shareholders will be subordinated to the claims of creditors. The forward-looking statements contained herein are expressly qualified by this cautionary statement. The forward-looking statements contained herein are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. VALEURA ENERGY INC. Valeura is a Canada-based public company engaged in the exploration, development and production of petroleum and natural gas in Thailand and in Türkiye, and is pursuing further inorganic growth in Southeast Asia. The Common Shares are listed and posted for trading on the TSX under the symbol “VLE” and also trade on the OTCQX under the symbol “VLERF”. The head office of Valeura is located at 111 Somerset Road, #09-31, Singapore 238164, and its registered and records office is located at 4600, 525 – 8th Avenue SW, Calgary, Alberta, T2P 1G1. Valeura was incorporated under the ABCA. INTER-CORPORATE RELATIONSHIPS The following diagram describes the inter-corporate relationships among the Company and each of its subsidiaries as of the date hereof: Valeura Energy Inc. (Alberta) 100%Valeura Energy (SEA) Ltd(Singapore) 99.99%Valeura Energy (Chaiyaphruek) Ltd(Thailand) 100%VE Varuna Ltd.(Mauritius)100%VE Holdings Ltd. (BVI)100%Valeura Energy Asia Pte. LTd.(Singapore) 100%Valeura Energy Marine B.V.(Netherlands) 100%Valeura Energy (Thailand) Holdings Ltd.(BVI) 99.99%Busrakham Oil (Thailand) Ltd.(Thailand)99.99%Jasmine Venture Limited (Mauritius)99.99%Busrakham Manora Ltd.(Thailand)99.99%Busrakham G11 Ltd.(Thailand)99.99%Busrakham Nong Yao Ltd.(Cayman) 100%Busrakham Nong Yao Ltd.(Thai Branch) 99.99%Busrakham Jasmine Ltd.(Thailand)99.99%Valeura Energy (Thailand) Ltd.(Thailand) 100%Valeura Energy (Gulf of Thailand) Ltd.(Cayman) 100%Valeura Energy (Gulf of Thailand) Ltd.(Thai Branch) 100%Valeura (BVI) Holdings Ltd.(BVI) 100%Northern Hunter Energy Inc.(Alberta)100%Valeura Energy Netherlands BV(Netherlands) 100%Valeura Energy Netherlands BV(Turkish Branch)
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 14 GENERAL DEVELOPMENT OF THE BUSINESS Valeura’s operations are focused on the offshore Gulf of Thailand. As of December 31, 2024, Valeura held working interests in four(1) licences offshore Thailand, all operated by the Company. In addition, the Company holds an interest in six production leases and exploration licences in Türkiye. The Company’s Thailand interests include a 100% operated working interest in Licence B5/27, containing the Jasmine and Ban Yen fields, a 100% interest in Licence G10/48(1), containing the Wassana field, a 90% operated working interest in Licence G11/48, containing the Nong Yao field (partner Palang Sophon Ltd), and a 70% operated working interest in Licence G1/48, containing the Manora field (partner Avenir Energy (Thailand) Pty Ltd. The Company’s Türkiye interests, which are held by VENBV, include a 63% working interest in the deep rights for three production leases and one exploration licence in the West Thrace Lands and a 100% working interest in the deep rights in the Banarli Licences. These lands contain the Deep Gas Play in over-pressured formations below approximately 2,500 metres, which has been drilled down to approximately 4,900 metres. 2022 • During 2022, Valeura collected the full $2.5 million deferred consideration in respect of the disposition of its Turkish producing shallow conventional gas business, which had been sold in 2021, and continued pursuing its growth-oriented strategy. • On April 28, 2022, Valeura announced that it had entered into a sale and purchase agreement with KrisEnergy (Asia) Ltd. to acquire all of the shares of KrisEnergy International (Thailand) Holdings Ltd. (the “Kris Acquisition”), which held an interest in two operated licences in the offshore Gulf of Thailand for total initial cash consideration of $4.1 million, plus certain contingent payments of up to a further $7.0 million relating to future development milestones. Separately, Valeura agreed to purchase an onsite MOPU from Nora Limited, for consideration of $9.2 million, with the purchase price to be phased over approximately 14 months (the “MOPU Purchase”). Valeura also announced the formation of VEA, which would serve as the buyer entity for both the Kris Acquisition and the MOPU Purchase. • On June 13, 2022, Valeura announced the results of an independent third-party reserves and resources assessment prepared for Valeura by NSAI in respect of the Kris Acquisition. • On June 15, 2022, Valeura announced the closing of the Kris Acquisition, resulting in VEA holding an 89% operated working interest in Licence G10/48 containing the Wassana field and a 43% operated working interest in Licence G6/48 containing the Rossukon field. • On September 1, 2022, the Company announced that Gordon Begg, Vice President, Commercial would cease to be an executive officer of the Company and would continue to support the Company in a part-time consulting role. • On October 4, 2022, Valeura announced that it had agreed with Petrovietnam Drilling and Well Service Corporation to charter the PV Drilling I jack-up drilling rig to support its Gulf of Thailand operations in 2023. • On November 11, 2022, Valeura announced, among other things, that it had entered into a facility arrangement and commercial contract with Trafigura Pte. Ltd. (“Trafigura”) comprised of an agreement for advances in support of Wassana operations and a commercial contract related to Wassana’s crude oil production (the “Facility”). The Facility provides for advances in discrete tranches, up to an initial maximum capacity of $30 million, subject to the satisfaction of a number of conditions precedent. • On November 30, 2022, Valeura announced that it had entered into an agreement with PT Samudra Alam Transport to charter a crude oil tanker (to be named the MT Jaka Tarub) to store oil produced from the Wassana field. • On December 6, 2022, Valeura announced that VEA had entered into an agreement to acquire the Thailand upstream oil producing portfolio of Busrakham Oil and Gas Ltd., a subsidiary of Mubadala Energy, for consideration of $10.4 million plus up to an additional $50 million, contingent upon certain upside price scenarios (the “Mubadala Acquisition”). The Mubadala Acquisition consists of operated interests in three offshore licences in the Gulf of Thailand that include the Nong Yao, Jasmine/Ban Yen and Manora fields. • On December 6, 2022, Valeura announced that a drawdown of up to $50 million is advanceable to VEA from Trafigura, which is in addition to the initial potential maximum capacity of discrete drawdowns of up to $30 million, under the Facility, subject to the satisfaction of certain conditions precedent. 2023 • On January 24, 2023, Valeura announced that it had increased its ownership stake in VEA from 85% to 87.5% and that it had received formal notification of the recertification of its Wassana field MOPU (the Ingenium) thereby enabling its ongoing use as the production and processing facility for crude oil from the Wassana oil field. • On January 31, 2023, Valeura announced that it had entered into an agreement for a bought deal basis, private placement of 3,937,000 Common Shares of the Company at a price of C$2.54 per Common Share for aggregate gross proceeds to the Company of approximately C$10 million, and subsequently announced closing on February 8, 2023. • On March 21, 2023, the Company announced that it would acquire the 12.5% ownership in VEA held by minority shareholders for (1) On April 28, 2023, the Company announced an 11% working interest increase in its Licence G10/48 (containing the Wassana field) from 89% to 100%. Completion of this increase is pending government approval.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 15 consideration of 9.5 million Common Shares in Valeura, thereby increasing Valeura’s interest in VEA to 100%. The Company also announced that select individuals in the minority shareholder group would be engaged by the Company, to serve in senior leadership roles. • On March 21, 2023, Valeura announced the completion of modifications to the MT Jaka Tarub crude oil storage vessel, thereby making it compatible with the Wassana field’s infrastructure and capable of tandem crude oil loading/offloading. • On March 22, 2023, Valeura announced completion of the Mubadala Acquisition. • On March 31, 2023, along with its announcement of financial and operating results for the three-month period and year ended December 31, 2022, Valeura announced that an event during start-up preparations at the Wassana oil field had resulted in damage to certain offloading components at the field. • On April 28, 2023, Valeura announced the re-start of oil production from the Wassana oil field and an 11% increase in its working interest in Licence G10/48 (containing the Wassana field) from 89% to 100%. Completion of the 11% working interest increase in licence G10/48 is pending government approval. In addition, the Company announced the divestment of its interest in Licence G6/48 (containing the Rossukon field) for contingent cash consideration of $5 million, payable at first oil from the Rossukon oil field, and a further 4.65% overriding royalty associated with the Company’s 43% working interest from the field thereafter. The divestment of Licence G6/48 was completed on February 26, 2025, with the signing of a Supplementary Petroleum Concession by the Minister of Energy. • On May 12, 2023, along with its announcement of financial and operating results for the three month period ended March 31, 2023, Valeura announced changes to its executive leadership team, being 1) Yacine Ben-Meriem appointed as Chief Financial Officer effective May 15, 2023, 2) Kelvin Tang appointed as Executive Vice President of Corporate, General Counsel, and Corporate Secretary, 3) Ian Warrilow appointed as Thailand Country Manager, and 4) Heather Campbell, incumbent Chief Financial Officer, leaving to seek new opportunities outside Valeura effective May 15, 2023. • On June 1, 2023, Valeura announced the extension, to the end of 2028, of two contracts relating to the Jasmine oil field, being 1) charter of the field’s floating production storage and offloading vessel (“FPSO”), and 2) a contract for provision of operating and maintenance services for the vessel. • On June 13, 2023, Valeura announced the successful completion of its Nong Yao field infill drilling campaign, comprised of two horizontal infill wells, and resulting in aggregate oil production rates from the Company’s portfolio averaging 23,700 bbls/d (working interest share). • On July 7, 2023, the Company announced a temporary suspension of production operations at the Wassana oil field following an event whereby the field’s oil storage vessel deviated from its intended position and contacted certain offloading components. • On July 17, 2023, Valeura announced 1) the appointment of Greg Kulawski as Chief Operating Officer, effective July 17, 2023, 2) the retirement of Ron Royal from the board of directors and the appointment of Lina Lee to the board, effective August 1, 2023, and 3) the appointment of Deloitte & Touche LLP (Singapore) as auditors of the Company, replacing KPMG Canada. • On July 31, 2023, OTC Markets Group Inc. announced that Valeura had qualified to trade on the OTCQX Best Market, and that trading in its shares had begun on OTCQX under the symbol “VLERF.” • On September 18, 2023, Valeura announced the results of two appraisal wells drilled on the flanks of the Wassana oil field which confirmed the presence of oil deeper than previously proven. • On September 20, 2023, Valeura announced the departure from its board of directors of independent director, Kimberley Wood, effective September 18, 2023. • On October 6, 2023, Valeura announced the full repayment of the Facility. • On November 9, 2023, Valeura announced that it had acknowledged a reported shareholding by TTA of a 10.14% interest in its Common Shares. • On December 11, 2023, Valeura announced the re-start of oil production at the Wassana field, offshore Gulf of Thailand, as of December 8, 2023. • On December 21, 2023, Valeura announced the successful completion of an infill drilling campaign at its Nong Yao oil field, with three development wells having encountered targets in line with pre-drill expectations and brought online as producers, and one appraisal well having confirmed approximately 50’ of new net oil pay over several intervals. 2024 • On January 2, 2024, Valeura announced the appointment of Anna Green as independent director, effective January 1, 2024. • On February 13, 2024, Valeura announced 1) that it had mobilised the TSeven Shirley MOPU vessel to the Nong Yao field in preparation for development of the Nong Yao C accumulation; 2) that it had exercised a purchase option to acquire the Nong Yao field’s FSO Aurora, which it had previously leased; and 3) that it had opted to expand the scope of a drilling programme on the Wassana field in light of favourable initial results. • On February 20, 2024, Valeura announced the results of a third-party independent reserves and resources evaluation effective December 31, 2023, indicating an increase in both 1P and 2P reserves and their associated Net Present Values. • On April 15, 2024, Valeura announced that it had made three oil discoveries in the Gulf of Thailand, including Nong Yao D on the G11/48 concession as well as Niramai and Wassana North on the G10/48 concession. • On May 9, 2024, along with its Q1 2024 results, Valeura announced that it had successfully installed the TSeven Shirley MOPU at
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 16 the Nong Yao C accumulation. • On May 17, 2024, Valeura announced the release of its inaugural sustainability report, providing baseline sustainability data for the year ended December 31, 2023 (the “2024 Sustainability Report”). • On May 28, 2024, Valeura announced the successful completion of an infill drilling campaign at the Nong Yao A installation, comprised of two horizontal development wells which were brought on stream as producers. The Company also announced the start of development drilling operations at the Nong Yao C field extension. • On June 12, 2024, Valeura announced that it had completed its acquisition of the Nong Yao field’s FSO Aurora for $19 million, effective June 11, 2024. • On June 27, 2024, Valeura announced that it had suspended production at its Wassana field as a precautionary measure while investigating a structural anomaly on the field’s production facility, the MOPU Ingenium. Thereafter, on August 2, 2024, the Company announced that the anomaly was determined to be superficial, and that it had begun the process of restarting production. • On August 8, 2024, along with its Q2 2024 results, Valeura announced that it had completed drilling operations at the Nong Yao C field extension, and had achieved mechanical completion of the Nong Yao C production facility. • On August 15, 2024, Valeura announced first oil from the Nong Yao C field extension, and on August 27, 2024 announced the successful ramp-up of oil production rates, resulting in 13.4 mbbls/d (12.1 mbbls/d net to the Company’s 90% working interest) from the greater Nong Yao complex, over the preceding seven-day period. • On October 4, 2024, Valeura was notified that the expiry date for its licences and leases in Türkiye had been gazetted with a new expiry date of June 27, 2025, and thereafter on February 12, 2025 was notified of a further extension to June 27, 2026. • On November 5, 2024, Valeura announced completion of an internal restructuring of its Thailand subsidiary companies, such that all three of its Thai III concessions became held by the same entity, creating the potential to optimise various operational and financial aspects of the assets including the pooling of future costs and historical tax loss carry-forwards. • On November 12, 2024, Valeura announced that it had received TSX approval of a Normal Course Issuer Bid, through which it would be permitted to repurchase up to 10% of the public float of the Company’s Common Shares between November 14, 2024 and November 13, 2025. • On November 27, 2024, Valeura announced the successful completion of an infill drilling campaign at the Jasmine field, comprised of two infill development wells on the Jasmine A platform, and three infill development wells on the Jasmine D platform, all which were successful and brought online as producers while also successfully appraising several additional reservoir intervals. OUTLOOK On January 8, 2025, the Company announced its guidance outlook for 2025. Valeura forecasts average 2025 full year oil production of 23,000 – 25,500 bbls/d (working interest share, before royalties), based on continuing production operations at its four Gulf of Thailand licences and an active drilling programme throughout the year. The Company continues to guide for price realisations approximately in line with the Brent crude oil benchmark price. The Company is planning total Adjusted Capex(3) of $125 – 150 million in 2025, in addition to approximately $11 million in planned exploration drilling. Approximately 85% of the Company’s capex plus exploration spending is directed toward drilling, and is based on the plan of having one drilling rig on contract for the full year. The balance of planned capex is related to certain brownfield developments. Capex guidance does not include any post Final Investment Decision (“FID”) costs for the Wassana redevelopment, and will be updated should the FID be approved. Adjusted Opex(2) guidance in 2025 is $215 – 245 million, which equates to approximately $26/bbl(2), based on the mid-point of the Company’s production guidance range. This includes the cost of leasing certain vessels as part of its ongoing operations, including the Nong Yao C MOPU, the Jasmine field’s FPSO vessel, as well as FSO vessels at the Manora and Wassana fields, and a warehouse. Such leases are expected to total approximately $33 million. Full Year 2025 Guidance Range Average Daily Oil Production(1) (bbls/d) 23,000 – 25,500 Price realisations ($/bbl) Approx. equivalent to the Brent crude oil benchmark Adjusted Opex(2) ($ million) 215 – 245 Adjusted Capex(3) ($ million) 125 – 150 Exploration expense ($ million) Approx. 11 Notes: (1) Working interest share production, before royalties. (2) Represents adjusted Opex which is a non-IFRS financial measure – see “Non-IFRS Financial Measures and Ratios” section in the Annual MD&A. (3) Represents Adjusted Capex which is a non-IFRS financial measure – see “Non-IFRS Financial Measures and Ratios” section in the Annual MD&A The Company intends to fund its 2025 spending through cash on hand plus cash flow generated from ongoing operations, and estimates that these sources will also continue to strengthen the Company’s balance sheet. Valeura’s financial position provides capacity for ongoing shareholder returns through share buybacks and for inorganic growth.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 17 DESCRIPTION OF THE BUSINESS AND OPERATIONS Valeura is a Canadian public company engaged in the exploration, development and production of petroleum in Thailand and is pursuing further growth in Southeast Asia. In addition, the Company holds a potentially large tight gas play in Türkiye. CORPORATE STRATEGY Valeura is pursuing a disciplined strategy to create value through growth, predicated on the following priorities: 1. Organic growth within its portfolio, intended to sustain strong cash flows by re-investing to replace reserves and to develop underexploited opportunities. 2. Inorganic growth within the Asia Pacific region, focussing on value and operationally accretive merger and acquisition targets, with a preference for opportunities that provide current or near-term production and cash flow. 3. Operational excellence across its organisation, drawing upon the expertise of a proven international team to maintain a relentless focus on operational efficiency and margins while also aspiring to be a responsible corporate citizen in everything it does. In addition, Valeura continues to hold an operated, high working interest position in a potentially large Deep Gas Play in the Thrace basin of Türkiye, which it believes could be a source of significant value in the longer-term. The Company intends to farm out a portion of its interest in the play in order to jointly pursue the next phase of appraisal work. PERSONNEL As at December 31, 2024, Valeura had nine full-time employees in its head office in Singapore, plus 178 at its offices in Thailand and two elsewhere, worldwide. LAND HOLDINGS The following tables set forth Valeura’s licence interests (land holdings) as at December 31, 2024: Thailand Gross Area (Acres) WI Net Area (Acres) VLE Owner Licence B5/27 (Jasmine and Ban Yen fields) 477,220 100% 477,220 BJL Licence G10/48 (Wassana field) 32,667 100%(1) 32,667 VET Licence G11/48 (Nong Yao field) 95,929 90% 86,336 VET Licence G1/48 (Manora field) 42,475 70% 29,732 VET Total Thailand 648,291 625,955 Note: (1) On April 28, 2023, the Company announced an 11% working interest increase in its Licence G10/48 (containing the Wassana field) from 89% to 100%. Completion of this increase is pending government approval. Türkiye Lease / Licence Count Gross Area (Acres) Valeura Deep Rights WI Net Area (Acres) VLE Owner West Thrace Production Leases 3 13,578 63% 8,554 VENBV Banarli Exploration Licences 2 133,840 100% 133,840 VENBV West Thrace Exploration Licence 1 88,434 63% 55,713 VENBV Total Türkiye 6 235,852 198,108 Valeura holds only the deep rights in its Türkiye licences and leases which is defined as 2,500 metres or a pressure gradient of 0.6 psi/ft (1.39 SG), whichever is shallower. On April 28, 2023, the Company announced the divestment of its interest in Licence G6/48. The divestment of Licence G6/48 was completed on February 26, 2025, with the signing of a Supplementary Petroleum Concession by the Minister of Energy.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 18 LICENCE TERM AND COMMITMENTS Thailand Licence B5/27 (which contains the Jasmine and Ban Yen fields) is held under the terms of a 30-year production licence which expires on August 8, 2031. As of December 31, 2024, production operations were underway, and average production for the year ended December 31, 2024 was 7,792 bbls/d. While there are no further work commitments on the licence, the Company envisages further infill drilling within the Jasmine and Ban Yen fields and additional exploration drilling within the broader licence area. Licence G11/48 (which contains the Nong Yao oil field) is held under the terms of a 20-year production licence which expires on February 12, 2036. As of December 31, 2024, production operations were underway, and average production for the year ended December 31, 2024 was 8,543 bbls/d. There are no further work commitments on the licence, however Valeura is planning additional infill development wells from all three production facilities on the field, and is also planning further appraisal and exploration work elsewhere on the licence, including within the Nong Yao D discovery area. Licence G10/48 (which contains the Wassana oil field) is held under the terms of a 20-year production licence which expires on December 7, 2035. As of December 31, 2024, production operations were underway, with full average production for the year ended December 31, 2024 of 3,921 bbls/d. There are no further work commitments on the licence, however, the Company is currently engaged in front end engineering and design studies to potentially redevelop the field with an aim to achieve higher production rates and longer field life, while also providing an opportunity to develop satellite accumulations both to the north and to the south of the main Wassana field. Valeura is targeting readiness for FID on the Wassana field redevelopment project in early Q2 2025. Licence G1/48 (which contains the Manora oil field) is held under the terms of a 20-year production licence which expires on December 7, 2035. As of December 31, 2024, production operations were underway, and average production for the year ended December 31, 2024 was 2,605 bbls/d. There are no further work commitments, however the Company intends to drill further infill development wells in part to follow up on appraisal drilling successes in January and February 2025. For all four licences, concessionaires may apply to extend the production period beyond the licence expiry date by up to 10 years. The following table sets forth the current expiration dates for Valeura’s Thailand licences and working interests as of December 31, 2024. Licence (field) Operated Working interest as of Dec 31, 2024 Gross Area (Acres) Current Phase End of Current Phase Licence B5/27 (Jasmine/Ban Yen) Yes 100% 477,220 Production Aug 8, 2031 Licence G10/48 (Wassana) Yes 100%(1) 32,667 Production Dec 7, 2035 Licence G11/48 (Nong Yao) Yes 90% 95,929 Production Feb 12, 2036 Licence G1/48 (Manora) Yes 70% 42,475 Production Dec 7, 2035 Note: (1) On April 28, 2023, the Company announced an 11% working interest increase in its Licence G10/48 (containing the Wassana field) from 89% to 100%. Completion is pending government approval. Türkiye As part of the first extension work commitment, the Banarli and West Thrace Exploration Licences require a well to be drilled on each of the three licences, to a minimum depth of 1,500 metres. These commitments can be fulfilled by either Valeura or the owner of the licences’ shallow rights, TBNGL. Two such wells have been drilled, and Valeura is awaiting approval of a location license to drill the third commitment well on the Banarli Exploration Licences. There are no work commitments associated with the West Thrace Production Leases. The Banarli and West Thrace Exploration Licences have been extended to a new expiry date of June 27, 2026, and the Company has engaged in discussions with the government in relation to another two-year Appraisal Period extension thereafter. The following table sets forth the current expiration dates for Valeura’s Türkiye leases and licences and working interest as of December 31, 2024. Working Interest Lands Block Operated Working interest as of Dec 31, 2024 Gross Area (Acres) Current Phase End of Current Phase West Thrace Production Leases 2926 Yes 63%(1) 12,429 Second Extension Feb 16, 2030 3659 Yes 63%(1) 709 First Extension Jun 8, 2027 5122 Yes 63%(1) 440 Initial Production Nov 15, 2029 West Thrace Exploration Licence F18-d1,d2,d4 Yes 63%(1) 88,434 Second Extension Jun 27, 2026 Banarli Exploration Licences F180c1,c2,c3,c4 Yes 100% 88,197 Second Extension Jun 27, 2026 F19-d1,d4 Yes 100% 45,643 Second Extension Jun 27, 2026 Note: (1) Deep rights only.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 19 OPERATIONS Thailand The Company completed the Kris Acquisition in 2022 and the Mubadala Acquisition in March 2023, and undertook various commercial transactions thereafter, resulting in the Company holding a high working-interest operated portfolio in Thailand comprised of four producing licences. Valeura’s portfolio is in the offshore Gulf of Thailand, with two licences in the northern portion of the Pattani basin (containing the Jasmine/Ban Yen and Manora fields) and two licences further to the south in the same basin (containing the Wassana and Nong Yao fields). In aggregate, the Thailand licences comprise approximately 0.65 million gross acres (0.63 million net acres). As at December 31, 2024, Valeura had 161 producing conventional wells on a gross basis (152 net), producing light/medium and heavy crude oil in Thailand. Total oil production in 2024 from the assets averaged 22,825 bbls/d. The Company has infrastructure in place at each of its fields including several fixed platforms and two MOPUs which each serve as wellhead and/or oil processing facilities. Where a licence has more than one installation, facilities are interconnected through sea floor pipelines. Oil production from each field is stored in moored floating vessels, where it is periodically offloaded by tanker for sale to international and domestic end buyers. During 2024, Valeura drilled wells at each of its licences, in aggregate totalling 21 gross (19.7 net) development wells, 1 gross (0.9 net) exploration wells, and 4 gross (3.4 net) appraisal wells. Türkiye Deep Gas Play Between 2017 and 2020, the Company undertook a large exploration and appraisal campaign of the Deep Gas Play in partnership with Equinor. Equinor exited the Deep Gas Play in Q2 2020, and Valeura retained all the assets associated with the play thereafter. As of December 31, 2024, the Company held operatorship and deep rights ownership of six exploration licences and production leases in the Thrace Basin comprising approximately 0.23 million gross acres / 0.19 million net acres. Valeura intends to farm out a portion of its interest in the Deep Gas Play to secure a partner with technical and commercial expertise suited to a tight gas appraisal play of this magnitude as a precursor to resuming appraisal drilling on the play. During 2024 and as of the date hereof, Valeura had no active oil and gas operations in Türkiye. SUSTAINABILITY OF THE BUSINESS Valeura is dedicated to integrating sustainability throughout its business. To Valeura this means considering, as part of every strategic decision, how a potential outcome would contribute to the sustainability of the business, whether part of a contemplated organic or inorganic growth endeavour, or part of a continuous drive toward operational excellence in ongoing operations. Valeura generates value by exploring for, developing, and producing petroleum and natural gas, which is ultimately sold as unrefined (crude) petroleum to buyers for further processing, refining, or blending. The Company recognises that across this upstream oil and gas value chain, there are opportunities to tailor its actions to best support the long-term sustainability of the business, by considering the dimensions of environmental, social, and governance imperatives. The Company intends to publish an annual sustainability report to articulate its priorities and to comment on its performance across various ESG dimensions. Valeura’s overarching aim is enhance the transparency of how it fosters the sustainability of its business, while pursuing its strategy to generate value. STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION As at December 31, 2024, Valeura had oil gas reserves associated with its four licences in the offshore Gulf of Thailand. The Company engaged NSAI to review its reserves and associated future net revenues for the period ended December 31, 2024. The reserves on the properties described herein are estimates only. Actual reserves on these properties may be greater or less than those estimated. All reserves and future net revenue estimates are presented on a gross working interest basis. The net reserves shown below represent Valeura’s revenue entitlement. All of the Company’s crude oil and natural gas reserves are located in offshore Gulf of Thailand. Set out below is a summary of the crude oil and natural gas reserves and the value of future net revenue of Valeura as at December 31, 2024 as evaluated by NSAI in the NSAI Reserves Report. The reserves evaluated by NSAI in the NSAI Reserves Report are summarised in Appendix A-1. The report on the reserves data by NSAI (in Form 51-101F2) and the report of the Company’s management and Board on such reserves data (in Form 51-101F3) are included in this Annual Information Form as Appendices A-3 and A-5, respectively. The following is a summary of the NSAI Reserves Report which is qualified in its entirety by the Company’s Statement of Reserves Data and Other Oil and Gas Information attached as Appendix A-1 hereto.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 20 OIL RESERVES BASED ON FORECAST PRICES AND COSTS Reserves By Field Gross (Before Royalties) Reserves, Working Interest Share (Mbbls) Jasmine (Light/Medium) Manora (Light/Medium) Nong Yao (Light/Medium) Wassana (Heavy) Total Proved Developed Producing 5,268 1,370 6,541 2,894 16,073 Developed Non-Producing 703 433 153 242 1,531 Undeveloped 4,713 705 3,742 5,490 14,650 Total Proved (1P) 10,684 2,509 10,436 8,626 32,255 Total Probable (P2) 6,108 848 6,500 4,296 17,753 Total Proved + Probable (2P) 16,792 3,357 16,936 12,923 50,008 Total Possible (P3) 3,647 718 4,297 1,027 9,689 Total Proved + Probable + Possible (3P) 20,440 4,075 21,233 13,950 59,697 Reserves By Field Net (After Royalties) Reserves, Working Interest Share (Mbbls) Jasmine (Light/Medium) Manora (Light/Medium) Nong Yao (Light/Medium) Wassana (Heavy) Total Proved Developed Producing 4,610 1,302 6,137 2,727 14,776 Developed Non-Producing 615 409 145 228 1,398 Undeveloped 4,124 667 3,461 5,175 13,426 Total Proved (1P) 9,349 2,378 9,743 8,130 29,600 Total Probable (P2) 5,345 800 6,047 4,049 16,241 Total Proved + Probable (2P) 14,693 3,178 15,790 12,179 45,841 Total Possible (P3) 3,191 677 3,930 968 8,767 Total Proved + Probable + Possible (3P) 17,885 3,856 19,720 13,147 54,608 NET PRESENT VALUES OF FUTURE NET REVENUE BASED ON FORECAST PRICES AND COSTS Before Deducting Income Taxes Discounted At 0% (M $) 5% (M $) 10% (M $) 15% (M $) 20% (M $) Proved Developed Producing (404,951) (264,326) (166,751) (97,482) (47,321) Developed Non-Producing 109,178 96,609 86,419 78,044 71,076 Undeveloped 688,022 546,563 441,009 360,777 298,770 Total Proved (1P) 392,249 378,846 360,676 341,338 322,525 Total Probable (P2) 851,399 692,511 573,252 482,465 412,327 Total Proved + Probable (2P) 1,243,648 1,071,356 933,928 823,804 734,852 Total Possible (P3) 595,565 486,743 405,126 342,969 294,868 Total Proved + Probable + Possible (3P) 1,839,212 1,558,100 1,339,054 1,166,773 1,029,720
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 21 See notes that follow the table titled “Reconciliation of the Company’s Gross Reserves by Principal Product Type Based on Forecast Prices and Costs” in Appendix A-1 CONTINGENT AND PROSPECTIVE RESOURCES The contingent resources attributable to the Company’s offshore properties in Thailand evaluated by NSAI in the NSAI Resources Report are summarised in Appendix A-2. The report on the contingent resources data by NSAI (in Form 51-101F2) and the report from the Company’s management and the Board on such contingent resources data (in Form 51-101F3) are included in this Annual Information Form as Appendices A-4 and A-5, respectively. DESCRIPTION OF CAPITAL STRUCTURE Valeura is authorised to issue an unlimited number of Common Shares and an unlimited number of Preferred Shares. As at December 31, 2024 were 106,650,213 Common Shares and nil Preferred Shares outstanding. As the date hereof, there were 106,229,243 Common Shares and nil Preferred Shares outstanding. The Company is authorised to issue an unlimited number of Common Shares. The holders of the Common Shares are entitled to dividends, if, as and when declared by the Board, to one vote per Common Share at meetings of the Shareholders and, upon liquidation, to receive such assets of the Company as are distributable to the holders of the Common Shares. PREFERRED SHARES The Company is authorised to issue an unlimited number of Preferred Shares, issuable in series. Each series of Preferred Shares will have such designations, rights, privileges, restrictions and conditions as the Board may from time to time determine before issuance. The holders of each series of Preferred Shares will be entitled, in priority to holders of Common Shares, to be paid ratably with holders of each other series of Preferred Shares the amount of dividends, if any, specified as being payable preferentially to the holders of such series and, upon liquidation, dissolution or winding-up of the Company, in priority to holders of Common Shares, to be paid ratably with holders of each other series of Preferred Shares the amount, if any, specified as being payable preferentially to holders of such series. Equity Compensation Awards The Company has an equity compensation programme for its executives and employees. Executives are given equity compensation grants that vest based on a recipient’s good performance and continued employment. In the case of Performance Share Units (“PSUs”), the number of units that vest is dependent upon the achievement of specific key performance measures. The Company’s equity compensation awards outstanding as at December 31, 2024, include PSUs, Restricted Share Units (“RSUs”), and Options. PERFORMANCE SHARE UNITS Under the Plan, awards are subject to continued employment and to certain performance conditions being met. The PSUs will vest after three years based wholly or partly on a calculation of comparative total shareholder return (TSR) relative to a peer group of international oil and gas companies. As at December 31, 2024, Valeura had an aggregate of 1,316,913 awards of PSUs outstanding. RESTRICTED SHARE UNITS Under the Plan, awards to executives are subject to continued employment. The awards which vest over three years as to one-third each year. As at December 31, 2024, Valeura had an aggregate of 737,233 RSUs outstanding. After Deducting Income Taxes Discounted At 0% (M $) 5% (M $) 10% (M $) 15% (M $) 20% (M $) Proved Developed Producing (413,288) (271,762) (173,449) (103,569) (52,893) Developed Non-Producing 107,600 95,142 85,051 76,764 69,876 Undeveloped 694,915 552,970 446,984 366,366 304,014 Total Proved (1P) 389,227 376,351 358,585 339,561 320,996 Total Probable (P2) 539,076 458,125 393,645 342,224 300,949 Total Proved + Probable (2P) 928,302 834,476 752,230 681,785 621,945 Total Possible (P3) 317,475 273,450 237,961 209,453 186,432 Total Proved + Probable + Possible (3P) 1,245,777 1,107,926 990,191 891,238 808,377
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 22 STOCK OPTIONS Option holders have the right to buy Common Shares of Valeura at an exercise price equal to the market value at the date of grant. There were 1,941,664 Options outstanding as at December 31, 2024. As the date hereof, there were 1,528,330 Options outstanding. DIVIDENDS Valeura does not currently pay cash dividends on the Common Shares. Any decision to pay cash dividends on the Common Shares in the future will be made by the Board on the basis of Valeura’s earnings and financial requirements as well as other conditions existing at such time. Unless Valeura commences the payment of dividends, holders of Common Shares will not be able to receive a return on their Common Shares unless they sell them. PRIOR SALES The following table summarises the issuance of Common Shares and securities convertible into Common Shares during the year ended December 31, 2024. Date of Issue/Grant Number and Designation of Securities Issue/Exercise Price (C$) April 4, 2024 642,781 PSUs granted 5.14 April 4, 2024 353,695 RSUs granted 5.14 May 1, 2024 29,782 PSUs granted 5.61 May 1, 2024 16,036 RSUs granted 5.61 August 19, 2024 3,519 RSUs granted 4.89 MARKET FOR COMMON SHARES The Common Shares are listed and posted for trading on the TSX under the symbol “VLE” and also trade on the OTCQX under the symbol “VLERF”. The following table sets forth the price ranges and traded volume of Common Shares on the TSX in 2024 as reported by the TSX. TSX High (C$/share) Low (C$/share) Volume January 3.62 2.65 7,828,435 February 4.47 3.19 9,039,963 March 5.05 3.66 7,756,774 April 6.10 4.89 13,300,280 May 5.84 4.73 7,365,158 June 5.70 4.1 8,098,137 July 4.67 3.98 6,387,993 August 5.55 4.12 7,530,935 September 5.02 3.98 4,883,958 October 5.01 4.06 5,616,789 November 6.23 4.52 8,000,064 December 7.32 5.92 9,622,537
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 23 DIRECTORS AND EXECUTIVE OFFICERS DIRECTORS AND EXECUTIVE OFFICERS The following table sets forth the names, province or state and country of residence, present positions with Valeura and principal occupations during the past five years of the current directors and executive officers of Valeura. The term of office for each director is from the date of the annual meeting at which they are elected until the next annual meeting or until their successor is elected or appointed. Name and Residence Position(s) with Valeura Principal Occupation(s) During the Past Five Years Dr. Timothy R. Marchant(3) (4) Calgary, Alberta, Canada Chairman since 2018 Director since 2015 • Adjunct Professor of Strategy and Energy Geopolitics, Haskayne School of Business, University of Calgary. • Director of Vermilion since 2010. • Director of Cub Energy Inc. from 2013 to 2022. • Director of Transglobe Energy Corporation from 2020 to 2022. • Director of Vaalco Energy, Inc. from 2022 to 2023. Russell Hiscock(1) (2) Montreal, Quebec, Canada Director since 2018 • Member of the Board of Governors from 2023 and member of the Board of the Research Institute from 2000 of McGill University Health Centre. • Member of the Invest Committees of Hewitt, Joddes and Baylis family offices from 2018. James D. McFarland(1) (3) (4) Calgary, Alberta, Canada Director since 2010 • Director of MEG Energy Corp since 2010. • Director of Pengrowth Energy Corporation from 2010 to 2020. • Director of Arrow Exploration Corp from 2018 to 2020. Timothy Chapman(2) (3) (4) London, United Kingdom Director since 2020 • Founder of Geopoint Advisory Limited since 2015. Lina Lee(1) (2) Hong Kong Director since 2023 • CFO & VP Strategy (Global Petrochemicals) of BP Plc from 2018 to 2021. • Chief Executive Officer for China Trading & Shipping of BP Plc from 2021 to 2022. Anna Green(1) (4) Singapore Director since 2024 • Chief Enterprise Services Officer, Toll Group since 2023. • Head of SME and ISV segments, Asia Pacific Japan, Amazon Web Services from 2020 to 2023. • Chief Executive Officer, ANZ Banking Group, Philippines from 2017 to 2020. Dr. W. Sean Guest Singapore President and Chief Executive Officer Director since 2018 • President of Valeura since October 2017 and Chief Executive Officer of Valeura since January 2018. • Chief Operating Officer of Valeura May 2017 to December 2017. • Chief Executive Officer of Bukit Energy from February 2014 to May 2017. Yacine Ben-Meriem Singapore Chief Financial Officer • Chief Financial Officer of Valeura since May 2023 • Co-founder of Panthera Energy from 2021 to 2023. • Head of APAC Energy, Corporate Finance at ABN AMRO from 2018 to 2021. Dr. Grzegorz Kulawski Singapore Chief Operating Officer • Chief Operating Officer of Valeura since July 2023. • Special advisor in Shell from 2022 to 2023. • Deputy Chairman and Production Director of Sakhalin Energy Investment Co. Ltd. From 2020 to 2022. • Vice President Safety of Shell from 2016 to 2020. Kelvin Tang Singapore Executive Vice President, General Counsel & Corporate Secretary • Executive Vice President, General Counsel, Corporate Secretary since February 2023. • Vice President, Business Development of Hibiscus Petroleum Bhd from February 2022 to Jan 2023. • Consultant to KrisEnergy Netherlands Holdings from June 2021 to February 2022. • Director of KrisEnergy Ltd from November 2017 to October 2021. • Chief Executive Officer of KrisEnergy Ltd from August 2017 to June 2021. Notes: (1) Member of the Governance and Compensation Committee. (2) Member of the Audit Committee. (3) Member of the Reserves Committee (4) Member of the Health, Safety and Sustainability Committee. As of the date hereof, the directors and executive officers of Valeura, as a group, beneficially own, directly or indirectly, 7,103,144 Common Shares representing approximately 6.7% of the issued and outstanding Common Shares. As of the date hereof, the directors and executive officers of Valeura, as a group, beneficially own, directly or indirectly 866,666 Options. If all such Options were exercised, the directors and executive officers of Valeura, as a group, would hold approximately 7.5% of the then issued and outstanding Common Shares (on a fully diluted basis).
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 24 CORPORATE CEASE TRADE ORDERS OR BANKRUPTCIES To the knowledge of management, no director or executive officer of Valeura (nor any personal holding company of any of such persons) is, or has been, within the past 10 years before the date hereof, a director, chief executive officer or chief financial officer of any issuer (including Valeura) that: (1) while that person was acting in that capacity was subject to a cease trade, an order similar to a cease trade order or an order that denied the issuer access to any exemption under securities legislation (collectively, an “Order”) that was in effect for a period of more than 30 consecutive days; or (ii) was subject to an Order that was issued, after the person ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer. Save as disclosed and to the knowledge of management, no director or executive officer of Valeura or a Shareholder holding a sufficient number of securities of Valeura to affect materially the control of Valeura (nor any personal holding company of any of such persons) is, or has been, within the past 10 years before the date hereof, a director or executive officer of any issuer (including Valeura) that, while that person was acting in that capacity or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets. Mr. Kelvin Tang was the Chief Executive Officer and Director of KrisEnergy Ltd from August 2017 to June 2021 and November 2017 to October 2021 respectively. KrisEnergy Ltd filed for liquidation and winding up in the Grand Court of the Cayman Islands in June 2021. PERSONAL BANKRUPTCIES To the knowledge of management, no director or executive officer of Valeura or a Shareholder holding a sufficient number of securities of Valeura to affect materially the control of Valeura (nor any personal holding company of any of such persons) has, within the 10 years before the date hereof, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold such person’s assets. PENALTIES OR SANCTIONS To the knowledge of management, no director or executive officer of Valeura or a Shareholder holding a sufficient number of securities of Valeura to affect materially the control of Valeura (nor any personal holding company of any of such persons) has been subject to: (i) any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or (ii) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable investor in making an investment decision. CONFLICTS OF INTEREST Circumstances may arise where Board members are directors or officers of companies which are in competition to the interests of Valeura. No assurances can be given that opportunities identified by such Board members will be provided to Valeura. Pursuant to the ABCA, directors who have an interest in a proposed transaction upon which the Board is voting are required to disclose their interests and refrain from voting on the transaction. AUDIT COMMITTEE COMPOSITION OF THE AUDIT COMMITTEE The Audit Committee of the Board operates under written terms of reference that set out its responsibilities and composition requirements. A copy of the terms of reference is attached to this Annual Information Form as Appendix B. The key responsibilities of the Audit Committee include: reviewing and recommending for approval to the Board financial information that will be made publicly available; reviewing: (i) the appropriateness of accounting policies and financial reporting practices used by the Company; (ii) any significant proposed changes in financial reporting and accounting policies and practices to be adopted by the Company; (iii) any new or pending developments in accounting and reporting standards that may affect the Company; (iv) with management, the external auditors and, if necessary, legal counsel, any litigation, claim or contingency, including tax assessments, that could have a material effect upon the financial position of the Company, and the manner in which these matters may be, or have been, disclosed in the financial statements; and (v) accounting, tax and financial aspects of the operations of the Company as the Audit Committee considers appropriate; reviewing and obtaining reasonable assurance that the risk management, internal control and information systems are operating effectively to produce accurate, appropriate and timely management and financial information; reviewing the planning and results of external audit activities and the ongoing relationship with the external auditor; establishing and periodically reviewing implementation of procedures for: (i) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters; and (ii) the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters; and reviewing the adequacy of the Anti-Corruption Policy and reporting on its implementation and matters arising thereunder to the Board. The Audit Committee is comprised of Mr. Russell Hiscock (Chair), Mr. Timothy Chapman, and Ms. Lina Lee. All members of the Audit Committee are independent and financially literate as such terms are defined by National Instrument 52-110 – Audit Committees. The Audit Committee holds in camera meetings, without management present, at every regularly scheduled meeting of the Audit Committee, and meets in camera with the Company’s independent compensation consultant. The Audit Committee meets at least four times annually. The Audit Committee has the authority to communicate with the external auditors as it deems appropriate to consider any matter that the
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 25 Audit Committee or auditors determine should be brought to the attention of the Board or Shareholders. The Audit Committee has the authority to engage independent counsel and other advisors as it determines necessary to carry out its duties and to determine the compensation of such advisors. The following sets out the education and experience of each director relevant to the performance of his or her duties as a member of the Audit Committee. The chair of the Audit Committee, Mr. Russell Hiscock, holds a Chartered Financial Analyst designation as well as a Certified Management Accountant designation and has accounting and financial experience as a result of his role as President and Chief Executive Officer of the CN Investment Division. Mr. Timothy Chapman graduated from Earth Sciences at Oxford University. His career includes 25 years in investment banking roles with large financial institutions including JP Morgan Chase, CIBC World Markets, and finally RBC Capital Markets where he was head of international oil & gas. Mr. Chapman’s career has focused on corporate strategy and valuation. Ms. Lina Lee is a Chartered Financial Analyst and holds a Master of Business Administration from the Kelley School of Business at Indiana University, Bloomington in the U.S. She specialises in energy and finance, most recently serving as CFO & VP Strategy of BP’s Global Petrochemicals business with experience developing and executing strategies focused on Asia, Europe, and the Middle East. AUDITORS’ FEES On July 17, 2023, Valeura announced that Deloitte & Touche LLP have been appointed as auditors of the Company, replacing KPMG LLP. Fees paid to Deloitte & Touche LLP and KPMG LLP for the years ended December 31, 2024 and 2023 are detailed below. Fee (US$) For the year ended December 31, 2024 For the year ended December 31, 2023 Deloitte Deloitte KPMG Audit Fees(1) $441,975 $440,000 $454,660 Audit-Related Fees(2) $124,250 $60,000 Tax Fees(3) - - - All Other Fees - - - Total $566,225 $500,000 $454,660 Notes: (1) “Audit Fees” include the aggregate professional fees paid to the external auditors for the audit of the annual consolidated financial statements and other annual regulatory audits and filings. (2) “Audit-Related Fees” include the aggregate fees paid to the external auditors for services related to the audit services, including reviewing quarterly financial statements and management’s discussion thereon and consulting with the Board and Audit Committee regarding financial reporting and accounting standards. (3) “Tax Fees” include the aggregate fees paid to external auditors for tax compliance, tax advice, tax planning and advisory services, including preparation of tax returns. All permissible categories of non-audit services require pre-approval by the Audit Committee, subject to certain statutory exemptions. RISK FACTORS RISKS RELATING TO THE COMPANY’S BUSINESS The Company has an Enterprise Risk Management Policy and Framework that are overseen by the Board to identify and manage risks impacting the Company. Management of growth Valeura may be subject to growth-related risks including capacity constraints and pressure on its internal systems and controls. The ability of Valeura to manage growth effectively and other acquired assets or companies, will require it to continue to implement and improve its operational and financial systems and to expand, train and manage its employee base. The potential inability of Valeura to deal with this growth could have a material adverse impact on its business, operations and prospects, particularly since Valeura has announced a strategy of growing through M&A in the near to mid-term and the closing of the Kris Acquisition and potential Mubadala Acquisition. This strategy may involve M&A in a different country than the Company operates in, which would present further risks, including but not limited to risks regarding finding key personnel and establishing relationships with regulators, government officials and other key stakeholders. Acquisitions, dilution and availability of debt Valeura may have difficulty accessing any debt needed to develop its properties and any properties acquired pursuant to the Mubadala Acquisition or future acquisitions. This may result in the inability of Valeura to complete certain drilling activities or future acquisitions. Future acquisitions may be financed partially or wholly with debt, which may increase debt levels above industry standards. Depending on future exploration and development plans, Valeura may require additional equity and/or debt financing that may not be available or, if available, may not be available on favourable terms. Neither Valeura’s articles nor its by-laws limit the amount of indebtedness that it may incur. The level of Valeura’s indebtedness from time to time could impair its ability to obtain additional financing in the future on a timely basis to take
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 26 advantage of business opportunities that may arise. Capital requirements Valeura may in future require capital expenditures beyond its current cash position. Valeura’s cash flow from its assets may not be sufficient to fund its ongoing activities at all times. If Valeura’s revenues decrease as a result of lower oil and natural gas prices or otherwise, it will affect Valeura’s ability to expend the necessary capital to replace its reserves or to maintain its production, and it may have limited ability to acquire or expend the capital necessary to undertake or complete future drilling programmes. From time to time, Valeura may require additional financing in order to carry out its oil and gas, exploration, development and acquisition activities. Failure to obtain such financing on a timely basis could cause Valeura to forfeit its interest in certain properties, reduce or terminate its operations and miss certain acquisition opportunities. If cash flow from operations is not sufficient for Valeura to satisfy its capital expenditure requirements, there can be no assurance that additional debt or equity financing will be available to meet these requirements or available on terms acceptable to Valeura. There can be no assurance that debt or equity financing or cash generated by operations will be available or sufficient to meet these requirements or for other corporate purposes or, if debt or equity financing is available, that it will be on terms acceptable to Valeura. The potential inability of Valeura to access sufficient capital for its operations could have a material adverse effect on Valeura’s financial condition, results of operations or prospects. Liquidity risk The Company has significant commitments and capital expenditure requirements. If the Company requires financing, it would be subject to the financial markets, economic conditions for the oil and gas industry, and volatility in the debt and equity markets. These factors have made, and will likely continue to make, it challenging to obtain cost-effective funding. There is no assurance financing will be available. In the event the Company is not successful in securing financing arrangements, obtaining additional funding or of obtaining funding on terms that are acceptable to the Company, this will significantly impact the Company’s ability to develop its oil and gas properties and enable them to become producing or continue production. The Company maintains and monitors a certain level of cash which is used to finance opex and capex. The Company is dependent on its directors, senior management team and employees with relevant experience The Company is reliant on a number of key personnel. International exploration and development activities such as those the Company is engaged in require specialised skills and knowledge in the areas of petroleum engineering, geology, geophysics and drilling. In addition, specific knowledge and expertise relating to local laws (including regulations relating to land tenure, exploration, development, production, marketing, transportation, the environment, royalties and taxation) and market conditions is required to compete with other international oil and gas entities. The success of Valeura will depend in large measure on certain key personnel and management. The Company also relies on certain key personnel in-country with the ability to work in the local language and report to management in Canada. The loss of the services of such key personnel could have a material adverse effect on Valeura. Valeura does not have key person insurance in effect for members of management. The competition for qualified personnel in the oil and natural gas industry, particularly the international oil and gas industry in which Valeura operates, can be intense and there can be no assurance that Valeura will be able to attract and retain all personnel necessary for the development and operation of its business. The loss of one or more of its key personnel could have an adverse impact on the business of the Company. Furthermore, it may be particularly difficult for the Company to attract and retain suitably qualified and experienced people, given the competition from other industry participants and the relative size of the Company. In addition, the success of the Company’s M&A strategy relies in part on the expertise of the directors and senior management in assessing new business and new country entry, which is specialised knowledge. The business relationships of directors and management can be helpful in pursuing this strategy. There is no assurance that the Company will successfully continue to retain existing specialised personnel and senior management or attract additional experienced and qualified senior management and/or oil and gas personnel required to successfully execute and implement the Company’s business plan, which will be particularly important as the Company expands. Competition for such personnel is intense. The loss of such personnel and the failure to successfully recruit replacements in a timely manner, or at all, would have a material adverse effect on its business, prospects, financial condition and results of operations. Management of key local relationships Failure to manage relationships with local communities, government and non-government organisations could adversely impact Valeura’s business in the jurisdictions in which it operates. Negative community reaction to operations could have an adverse impact on profitability, the ability to finance or even the viability of Valeura. This reaction could lead to disputes that may damage the Company’s reputation and could lead to potential disruption of projects or operations. Variations in foreign exchange rates and interest rates, and hedging The Company’s drilling, completion and production operations in Thailand and related contracts are based in U.S. Dollars. The Company’s functional currency in subsidiary operations in Thailand is U.S. Dollars and future revenue streams will be based on U.S. Dollar revenue for oil sales. General and administrative expenses as well as payments related to income tax, value added tax, withholding tax and other government payments including royalties are denominated and paid in THB. An increase in the value of the THB could result in an increase
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 27 in the cost of operations. The Company’s drilling and completion operations in Türkiye and related contracts are based in U.S. Dollars. The Company’s functional currency in its subsidiary operations in Türkiye is TL. Any future revenue stream in Türkiye is expected to be based on TL revenue for natural gas and U.S. Dollar based revenue for crude oil translated into TL. The majority of costs will be incurred in U.S. Dollars for capital expenditures and TL for operating expenditures. Decreases in the value of the TL could result in decreases in revenue. Increases in the value of the TL could result in increases in the cost of operations. To the extent that the Company engages in risk management activities related to foreign exchange rates, there is a credit risk associated with counterparties with which the Company may contract. Valeura continues to assess its exposure to all foreign currencies. Recent volatility and weakness in the value of the TL may impair the ability of the Company to manage this exposure. As regards its Turkish operations, given that any future natural gas sales and revenues in Türkiye are expected to be priced in TL, Valeura from time to time may enter into agreements to fix the exchange rate of U.S. Dollars to the TL in order to offset the risk of revenue losses due to the weakening of the TL. Valeura may similarly seek to fix the exchange rate between the TL and the U.S. Dollar to offset the risk of a relative strengthening of the U.S. Dollar, which is the currency basis for large portion of the capital expenditures in Türkiye. As regards its Thai operations, given that future payments for taxes may be large and will be denominated in THB, Valeura from time to time may enter into agreements to fix the exchange rate of U.S. Dollars to the THB in order to offset the risk of increased costs due to the strengthening of the THB. The Facility carries an interest rate with a fixed margin over the secured overnight financing rate (SOFR), which is a broad measure of the cost of borrowing cash. This rate varies and increases to this rate will increase Valeura’s cost of borrowing and operations. The Company is impacted by rising inflationary pressures Inflation rates in jurisdictions that the Company operates in have remained high over the last several years. A significant portion of the upward pressure on prices has been attributed to the rising costs of labour, energy, food, motor vehicles and housing, overall challenges involved in reopening and managing the economy throughout the COVID-19 pandemic, continuing global supply-chain disruptions and the impact of the Russian invasion of Ukraine. Inflation increases may or may not be transitory. However, any sustained upward trajectory in the inflation rate could have an impact on the Company’s results by applying upward pressure on the Company’s costs in future periods. The Company’s potential inability to manage costs resulting from inflation may impact project returns and future development decisions, which could have a material adverse effect on its financial performance and funds from operations. The cost or availability of oil and gas field equipment may adversely affect the Company’s ability to undertake future projects. The oil and gas industry is cyclical in nature and is prone to shortages of supply of equipment and services including drilling rigs, geological and geophysical services, engineering and construction services, major equipment items for infrastructure projects and construction materials generally. These materials and services may not be available when required at reasonable prices. A failure to secure the services and equipment necessary to Valeura’s operations for the expected price, on the expected timeline, or at all, may have an adverse effect on the Company’s financial performance and funds from operations. The Company continues to monitor inflationary pressures in the jurisdictions in which it operates and assess any potential effects on the Company’s operations. Estimates of reserves Reserves and estimated future net revenue to be derived from reserves are estimates and have been independently evaluated by NSAI. The estimation of reserves is a complex process and requires significant judgment. Actual production and ultimate reserves will vary from those estimates and these variations may be material. Assumptions incorporated into the estimation of reserves are based on information available when the estimate was prepared. These assumptions are subject to change and many are beyond the Company's control. These assumptions include: initial production rates; production decline rates; ultimate recovery of reserves; timing and amount of capital expenditures; marketability of production; future prices of crude oil and natural gas; operating costs; well abandonment costs; royalties, taxes, and other government levies that may be imposed over the producing life of the reserves. In addition, estimates of reserves that may be developed and produced in the future are often based on methods other than actual production history, including: volumetric calculations, probabilistic methods, and upon analogy to similar types of reserves. Estimates based on these methods are generally less reliable than those based on actual production history. Subsequent evaluation of the same reserves based upon production history will result in variations, which may be material, in the estimated reserves. As such, reserve estimates may require revision based on actual production experience. The present value of estimated future net revenue referred to in this Annual Information Form should not be construed as the fair market value of estimated crude oil and natural gas reserves attributable to the Company's properties. The estimated discounted future revenue from reserves is based upon price and cost estimates which may vary from actual prices and costs and such variance could be material. Actual future net revenue will also be affected by factors such as the amount and timing of actual production, supply and demand for crude oil and natural gas, curtailments or increases in consumption by purchasers and changes in governmental regulations and taxation. Estimates of resources Information regarding quantities of contingent resources included in Appendix A-2 hereto are estimates only. References to “contingent resources” do not constitute, and should be distinguished from, references to “reserves”. The same uncertainties inherent in estimating quantities of reserves apply to estimating quantities of contingent resources. In addition, there are contingencies that prevent resources from being classified as reserves. There is no certainty that it will be commercially viable to produce any portion of the contingent resources due to one or more contingencies. Contingencies may include factors such as economic, legal, environmental, political and regulatory matters or a lack of markets. Actual results may vary significantly from these estimates and such variances may be material. The resources estimates in the NSAI Resources Report are estimates only. There is uncertainty that it will be commercially viable to produce
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 28 any portion of the contingent resources. Readers are cautioned that the quantities presented are estimates only and should not be construed as being exact quantities. The resources estimates presented in the NSAI Resources Report have been classified as contingent resources. The resources estimates in the NSAI Resources Report are estimates only. There is no certainty that any portion of the contingent resources will be developed. Readers are cautioned that the quantities presented are estimates only and should not be construed as being exact quantities. Value of the Deep Gas Play in Türkiye A portion of the Company’s potential future value is estimated to be associated with the Deep Gas Play discovered with the Yamalik-1 exploration well. The Deep Gas Play is still in the early phase of exploration and appraisal with large uncertainties and risk. While there are now 11 wells around the basin that all are interpreted to have encountered high-pressure gas at depth, the current well density within the Thrace Basin and this play is still very low. Additionally, only three of these wells have been fracture stimulated and production tested. There are large uncertainties laterally across Valeura’s land interests, and vertically in the target Kesan Formation, as to the presence of gas, the pressure of any gas, the amount of condensate in the gas and the commercial producibility of these hydrocarbons. Regional drilling data and 3D seismic interpretation indicate that the target Kesan Formation reservoir should be more than 2,000 metres thick with a high net/gross reservoir sand but these interpretations need to be proven with drilling across the basin. Further, the porosity of the rock is very low and decreases with depth. The location of any sweet spots with high porosity increased gas saturation is also still to be demonstrated both vertically and laterally. The above factors primarily affect the gas initially in place (GIIP). The ability to flow and recover gas commercially is still to be demonstrated. Most of the historic wells were drilled prior to high-pressure fracture stimulation being a commonly accepted technique and none achieved a commercial flow rate using the perforation and testing techniques available at the time. Yamalik-1, Inanli-1 and Devepinar-1, have all been subjected to varying degrees of high-pressure fracture stimulation on a number of intervals, however at this point none have demonstrated a clearly commercial flow rate. Longer duration testing of the zones is required. It is not uncommon for new gas developments to experience unexpected problems and delays during construction, commissioning and production start-up, or indeed for such projects to fail. Counterparty and partner risk Valeura may also be exposed to counter-party risk through contractual arrangements with current or future joint venture partners, farm-in partners, marketers of its petroleum and natural gas production and other parties. In the event of a misalignment of strategy, a dispute or such entities fail to meet their contractual obligations, such failures could have a material adverse effect on Valeura and its cash flow from operations. Reliance on third party service providers The Company is reliant on a number of third party services, and is largely unable to direct or control activities of the third party contractors. There is no assurance that third party supply provision of facilities, equipment, personnel and services may be available at the planned time and cost. Any delay in timing or higher cost could have a material adverse effect on Valeura and its operations. Operational risk with aging assets The assets (including equipment and facilities) acquired by the Company from the Mubadala Acquisition and Kris Acquisition are mature and require additional asset integrity management. Operational risks associated with the use of such aging assets include: pipeline and hose leaks; the breakdown or failure of equipment, pipelines and facilities, information systems or processes; the compromise of information and control systems; the performance of equipment at levels below those originally intended (whether due to misuse, unexpected degradation or design, construction or manufacturing defects); spills associated with the loading and unloading of crude oil onto tankers; failure to maintain adequate supplies of spare parts; operator error; inability to obtain classification certificates and extensions thereof from the relevant classification societies, and other similar events, many of which are beyond the control of the Company. Valeura may also be exposed from time to time, to additional operational risks not stated in the immediately preceding sentences. The occurrence or continuance of any of these events could have a material adverse effect on Valeura and its operations. Internal controls over financial reporting Valeura has established internal controls over financial reporting (“ICFR”) which include policies and procedures that pertain to the maintenance of financial records, the preparation of accurate financial statements, controls over bank accounts and the prevention or timely detection of unauthorised acquisition, use or disposition of the Company’s assets or funds. Valeura has delegation of authority policies approved by the respective boards of directors of the parent company and each subsidiary, which policies delineate how various corporate and financial matters must be approved and the authority levels of management and employees (including in-country managers in Thailand and Türkiye). Valeura has the right and periodically conducts audits of the records and expenditures of its operating partners. While management has determined that Valeura maintains effective ICFR, Valeura cannot be certain errors or failures will not occur related to financial processes and reporting. Failure to properly implement existing controls, or difficulties encountered in their implementation, could impact the Company’s results of operations or cause it to fail to meet its reporting obligations. If the Company or its independent auditors discover a material weakness, the disclosure of that fact, even if quickly remedied, could reduce the market’s confidence in the Company’s financial statements and reduce the trading price of the Common Shares. At the operational level in the jurisdictions in which the Company operates, the Company relies upon certain local managers and employees and its operating partners. A large portion of the business and contracts in the local language and the Company must rely on certain key personnel in-country who work in such languages and report to management. A major disruption in the flow of information or obtaining inaccurate information from these local employees and partners, could adversely impact the accuracy of financial reporting and management information.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 29 The use of foreign subsidiaries by the Company may affect the Company’s ability to pay dividends or make distributions The Company’s ability to pay dividends on the Common Shares is reliant on the ability of its subsidiaries operating in Thailand to generate cash flow and pay dividends or make other distributions to the Company through the corporate structure. The ability of subsidiaries to make payments to the Company may be constrained by, among other things: (i) the level of taxation, particularly corporate profits and withholding taxes; (ii) the introduction of exchange controls; and (iii) local law requirements in relation to the payments of dividends and distributions. The Company conducts its operations in Türkiye at the Thrace Basin through its wholly owned subsidiary VENBV. The Company’s ability to pay dividends on the Common Shares is reliant on the ability of VENBV to generate cash flow and pay dividends or make other distributions to the Company. The ability of VENBV to make payments to the Company may be constrained by, among other things: (i) the level of taxation, particularly corporate profits and withholding taxes; (ii) the introduction of exchange controls; and (iii) local law requirements in relation to the payments of dividends and distributions. Income tax Valeura has filed, and will file, all required income tax returns. However, such returns are subject to reassessment by the applicable taxation authority. In the event of a successful reassessment of Valeura, whether by re- characterisation of exploration and development expenditures or otherwise, such reassessment may have an impact on current and future taxes payable. Public health crises, including a pandemic, could adversely affect the Company’s business Potential material adverse impacts of pandemics, epidemics, infectious disease outbreaks or other threats to public health could include, but are not limited to operational and supply chain delays and disruptions (including as a result of government regulation and prevention measures), labour shortages and shutdowns, breach of material contracts, government or regulatory actions or inactions, increased insurance premiums, decreased demand or the inability to sell oil and natural gas, declines in the price of oil and natural gas, capital markets volatility, or other unknown but potentially significant impacts. Dependence on other operators of assets and joint venture partners To the extent that Valeura is not the operator of its oil and gas properties, Valeura will be dependent on such operators for the timing of activities related to such properties, subject to any influence Valeura can bring to bear in operating committee and technical committee meetings under joint venture agreements or other regular communications, and will largely be unable to direct or control the activities of the operators. The ability of Valeura management to influence other operators, as necessary, to protect its interests will be an important determinant of success. To the extent that Valeura has joint venture partners related to its oil and gas properties, Valeura is dependent on the need to work cooperatively with those partners. If a misalignment of goals between Valeura and its joint venture partners exists, it may result in delays or disruptions to joint venture operations. Geopolitical situation in Eastern Europe On February 24, 2022, Russian began a military operation in Ukraine. The UN General Assembly overwhelmingly condemned the invasion and has called for Russia to immediately and completely withdraw its troops. The United States, the European Union, the United Kingdom, Canada, Australia, Japan, Switzerland, and other countries have imposed new financial and trade sanctions against Russia, including prohibitions or restrictions from doing business anywhere in the world with listed Russian individuals or companies. The outcome of these events is uncertain at this time and may impact the peace and stability of the region and the world and could affect the global economy including regions and markets in which the Company operates. Any subsequent oil and gas supply shortages or volatile commodity prices could have adverse impacts on the world economy and the Company’s business. To date these events have not impacted the Company’s ability to carry on business and there have been no security issues affecting the Company’s operations, offices, or personnel, nor do the enacted sanctions affect the Company’s business. If these events continue to escalate, they could have a material adverse effect on Valeura’s business, financial condition or results of operations. Information Systems (“IT”) and Cybersecurity Threats The Company’s operations depend, in part, on how well the Company and any third parties that the Company does business with protect networks, equipment, IT systems and software against damage from threats, including, but not limited to, cable cuts, damage to physical plants, natural disasters, terrorism, fire, power loss, hacking, phishing schemes, computer viruses, vandalism, fraud and theft. While the Company has certain preventative measures in place, there can be no assurances that the Company will not be subject to external attacks, leaking of the Company’s confidential information, wire payment fraud, misappropriation of funds or erroneous payments. Any of these and other events could result in information systems failures, delays, increases in capital expenses and/or otherwise negatively impact the Company’s ability to operate. The failure of information systems or a component of information systems could, depending on the nature of any such failure, adversely impact the Company’s reputation and results of operations. The Company’s risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As a result, cyber security and the continued development and enhancement of controls, processes and practices designed to protect systems, computers, software, data and networks from attack, damage or unauthorized access remain a priority. As cyber threats continue to evolve, the Company may be required to expend additional resources to continue to modify or enhance protective measures or to investigate and remediate any security vulnerabilities.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 30 RISKS RELATING TO THE COMPANY’S INDUSTRY Exploration, development and production risks Oil and natural gas operations involve many risks that even a combination of experience, knowledge and careful evaluation may not be able to overcome. The long-term commercial success of Valeura will depend on its ability to find, acquire, develop and commercially produce oil and natural gas reserves. Without the continual addition of new reserves, any existing reserves Valeura may have at any particular time and the production therefrom will naturally decline over time as such existing reserves are produced and depleted. A future increase in Valeura’s reserves will depend not only on its ability to explore and develop any properties it may have from time to time, but also on its ability to select and acquire suitable producing properties or prospects. Future oil and natural gas exploration may involve unprofitable efforts, not only from dry wells, but also from wells that are productive but do not produce sufficient net revenues to return a profit after drilling, operating and other costs. Completion of a well does not assure a profit on the investment or recovery of drilling, completion and operating costs. In addition, drilling hazards or environmental damage could greatly increase the cost of operations, and various field operating conditions may adversely affect the production from successful wells. These conditions include delays in obtaining governmental approvals or consents, shut-ins of connected wells resulting from extreme weather conditions, insufficient storage or transportation capacity or other geological and mechanical conditions. No assurance can be given that Valeura will be able to continue to locate satisfactory properties for acquisition or participation. Moreover, if such acquisitions or participations are identified, Valeura may determine that current markets, terms of acquisition and participation or pricing conditions make such acquisitions or participations uneconomic. There is no assurance that further commercial quantities of oil and natural gas will be discovered or acquired by Valeura. While diligent well supervision and effective maintenance operations can contribute to maximising production rates over time, natural declines as reserves are depleted and production or sales delays cannot be eliminated and can be expected to adversely affect revenue and cash flow levels to varying degrees. Oil and natural gas exploration, development and production operations are subject to all the risks and hazards typically associated with such operations, including hazards such as fire, explosion, blowouts, cratering, sour gas releases and spills, each of which could result in substantial damage to oil and natural gas wells, production facilities, other property and the environment or in personal injury. In accordance with industry practice, Valeura will not be fully insured against all of these risks, nor are all such risks insurable. Although Valeura will maintain liability insurance in an amount that it considers consistent with industry practice, the nature of these risks is such that liabilities could exceed policy limits, in which event Valeura could incur significant costs that could have a material adverse effect upon its financial condition. Oil and natural gas production operations are also subject to all the risks typically associated with such operations, including encountering unexpected formations or pressures, premature decline of reservoirs and the invasion of water into producing formations. Offshore operational risks relating to Thailand Valeura’s Thailand operations are subject to all the operational risks inherent to offshore exploration, development and production of hydrocarbons and the drilling of wells, including, unsatisfactory performance of service providers engaged to carry out operations required for the drilling and analysis of wells, natural disasters, encountering unexpected formations or pressures, premature declines of reservoirs, invasion of water into producing formations, formations with abnormal pressures, mechanical problems with equipment, potential for substantial environmental damage, blow-outs, cratering, fires and spills, all of which could result in personal injuries, loss of life and damage to the property of the Company and others. The Company believes that governments throughout the world could implement stricter regulations on environmental protection, risk prevention and other forms of restrictions to drilling and other well operations. These new regulations and legislation, as well as evolving practices, could increase the cost of compliance and may also require changes to the Company’s drilling operations, exploration, development and production plans and may lead to higher costs of operations. The Company will be actively exploring for, developing and producing hydrocarbons in the Gulf of Thailand. Offshore operations involve different risks than onshore operations due in part to the remoteness of operations. Oil and natural gas exploration, development and production involve many risks that even a combination of experience, knowledge and careful evaluation may not be able to overcome. Fires and explosions on drilling rigs, offshore installations or marine vessels are more likely to result in personal injury, loss of life and damage to property due to the remote locations, confined spaces and time required for rescue personnel to get to the location. Blow-outs and spills are more likely to result in significant environmental damage to the marine environment and can be difficult to contain and difficult and expensive to remediate. Also, offshore operations are subject to marine perils, including severe storms and other adverse weather conditions and vessel collisions, as well as interruptions or termination by governmental authorities based on safety, environmental and other considerations. There can be no assurance that these risks can be avoided. Failure to manage these risks could result in injury or loss of life, damage to property, environmental damage, and could result in regulatory action, legal liability, loss of revenues and damage to the Company’s reputation and could have a material adverse effect on the Company’s operations, project returns or financial condition. Availability of drilling, hydraulic workover and other equipment and access Oil and natural gas exploration, development and production activities are dependent on the availability of drilling, hydraulic workover and other related equipment in the particular areas where such activities will be conducted, in addition to suitable marine vessels relating to the transport of such equipment, as well as the movement of personnel and production. Suitable equipment and vessels are available in the jurisdictions in which the Company operates, however from time to time, strong demand for such equipment or disruptions in the normal operations of supply chains may affect the availability of such equipment to Valeura and may delay exploration, development and production activities. Price volatility, markets and marketing The marketability and price of oil and natural gas that may be acquired or discovered by Valeura will be affected by numerous factors beyond its control. Valeura’s revenues, profitability, future growth and the carrying value of its oil and gas properties, provided such properties yield production, are substantially dependent on prevailing prices of oil and gas. Valeura’s ability to borrow and to obtain additional capital on attractive terms is also substantially dependent upon oil and gas prices. Prices for oil and gas are subject to large fluctuations in response to relatively minor changes in the supply of and demand for oil and gas, market uncertainty and a variety of additional factors beyond the control
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 31 of Valeura. These factors include economic conditions in the United States, Canada, Thailand, and Türkiye, the actions of the Organization of Petroleum Exporting Countries, governmental regulation, and political instability in the Middle East and elsewhere, the foreign supply of oil and gas, the price of foreign imports and the availability of alternative fuel sources. In Thailand, individual cargoes of crude oil are tendered for sale, and as such, prices are effectively set by market forces. In Türkiye, natural gas prices for domestic sales are effectively set by the government, which are indirectly affected by these market forces as well. Any substantial and extended decline in the price of oil and gas would have an adverse effect on Valeura’s carrying value of its oil and natural gas reserves, borrowing capacity, revenues, profitability and cash flows from operations. The exchange rate between the U.S. Dollar, THB, and TL also affects the profitability of Valeura. Volatile oil and gas prices make it difficult to estimate the value of producing properties for acquisition and often cause disruption in the market for oil and gas producing properties, as buyers and sellers have difficulty agreeing on such value. Price volatility also makes it difficult to budget for and project the return on acquisitions and development and exploitation projects. A sustained material decline in prices from historical average prices could reduce Valeura’s borrowing capacity, therefore reducing the credit available to the Company. Such a decline in prices may also cause Valeura to be unable to meet the covenants under its Facility, which could cause drawdowns under the Facility to be unavailable and could cause all amounts owing under the Facility to become immediately due and payable. Revocation or expiration of exploration licences, production leases and other licences, leases and permits Valeura’s properties are held in the form of exploration licences, production leases and other licences, leases and permits and working interests in such licences. If Valeura, or any other holder of a licence in which Valeura has an interest, fails to meet the specific requirement of a licence, the licence may be revoked or may terminate or expire. Whilst Valeura monitors the status and expiry of all of its current licences, there can be no assurance that any of the obligations required to maintain such licences will be met. The revocation, termination or expiration of any of its licences or the working interests relating to a licence may have a material adverse effect on Valeura’s results of operations and business. To the extent such licences are subsequently suspended or revoked, Valeura may be curtailed or prohibited from proceeding with planned exploration, development or operation of its projects. Failure to comply with permitting and legal requirements may result in enforcement actions, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions which could have an adverse effect on Valeura’s business, financial condition or operations. The Company’s insurance and indemnities may not adequately cover all risks or expenses Valeura’s involvement in the exploration for, development, and production of oil and natural gas properties may result in it becoming subject to liability for pollution, blow-outs, property damage, personal injury or other hazards. Although Valeura carries insurance in accordance with industry standards to address certain of these risks, such insurance has limitations on liability that may not be sufficient to cover the full extent of such liabilities. In addition, such risks may not in all circumstances be insurable or, in certain circumstances, Valeura may elect not to obtain insurance to deal with specific risks due to the high premiums associated with such insurance or other reasons. The payment of such uninsured liabilities would reduce the funds available to Valeura. The occurrence of a significant event that Valeura is not fully insured against, or the insolvency of the insurer of such event, could have a material adverse effect on Valeura’s financial position, results of operations or prospects. The Company’s operations may be harmful to the environment and the Company may be subject to compliance, clean-up and other costs All phases of the oil and natural gas business present environmental risks and hazards and are subject to environmental regulation pursuant to a variety of regulations. Environmental legislation provides for, among other things, restrictions and prohibitions on spills, releases or emissions of various substances produced in association with oil and natural gas operations. In addition, all of the Company’s near-term production operations in Thailand are offshore, and hence, considered an environmentally sensitive setting. Further, many areas of the Thrace Basin in Türkiye are designated as prime agricultural land requiring land use approvals from both Agricultural and Energy and Natural Resources Ministries in Türkiye. Currently, there are no restrictions on the hydraulic stimulation of wells in either jurisdiction. However, a number of global jurisdictions have temporarily or permanently banned hydraulic fracturing, a form of high-pressure stimulation, of wells and there is a risk that these restrictions may spread to other. High pressure stimulation is a normal oil field practice, and in the case of tight gas formations (such as those in the Deep Gas Play), is critical to achieving commercial production. Any future restrictions could have a material adverse effect on Valeura’s business. The legislation in Türkiye and Thailand also requires that wells and facility sites be operated, maintained, abandoned and reclaimed to the satisfaction of applicable regulatory authorities. Compliance with such legislation can require significant expenditures and a breach may result in the imposition of fines and penalties, some of which may be material. Environmental legislation is evolving in a manner expected to result in stricter standards and enforcement, larger fines and liability and potentially increased capital expenditures and operating costs. The discharge of oil, natural gas or other pollutants into the air, soil or water may give rise to liabilities to governments and third parties and may require Valeura to incur costs to remedy such discharge. Although Valeura believes it is in material compliance with current applicable environmental and land use regulations, no assurance can be given that environmental laws or agricultural land use requirements will not result in a curtailment of production or a material increase in the costs of production, development or exploration activities or otherwise adversely affect Valeura’s financial condition, results of operations or prospects. The Company’s projects are subject to various environmental laws. The Company intends to conduct its activities in an environmentally responsible manner and in accordance with all applicable laws. Compliance with environmental laws and regulations may prevent the Company from commercially developing its operations The cost and complexity of complying with the applicable environmental laws and regulations may prevent the Company from being able to
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 32 develop potentially economically viable oil and gas operations. Although the Company believes that it is in compliance in all material respects with all applicable environmental laws and regulations, there are certain risks inherent to its activities, such as accidental spillages, leakages or other unforeseen circumstances, which could subject the Company to extensive costs and liability. A violation of health and safety and/or environmental laws relating to oil and gas exploration, at a processing plant or in the course of transportation of hazardous materials, or a failure to comply with the instructions of the relevant authorities, could lead to, among other things, a temporary shutdown of all or a portion of the Company’s exploration, processing or logistics operations, a loss of the Company’s right to develop, exploit, operate a processing plant or transport products, or the imposition of costly compliance measures, criminal sanctions and/or monetary penalties. The Company will establish various committees, will implement safety and environmental compliance plans and contract officers and staff to oversee inspections and identify necessary corrective action. However, there can be no assurance that the Company’s programmes will be effective, will comply with applicable laws or that costs of implementation will not increase significantly. If health and safety and/or environmental authorities were to require the Company to shut down all or a portion of its exploration, processing or logistics operations, or the more stringent enforcement of existing laws and regulations, such measures could have a material adverse effect on the Company’s business, results of operation, financial condition and the price of the Common Shares. There can be no assurances that new environmental laws, regulations or stricter enforcement policies, once implemented, will not oblige the Company to incur significant expenses and undertake significant investments in such respect, which could have a material adverse effect on the Company’s business, financial condition and results of operations. Climate change legislation Governments around the world have become increasingly focused on addressing the impacts of anthropogenic global climate change, particularly in the reduction of gases with the potential to contribute to greenhouse gas levels in the atmosphere. The oil and natural gas industry is subject to stringent environmental regulations. The political climate appears to favour new programmes for environmental laws and regulation, particularly in relation to the reduction of emissions or emissions intensity, and there is a risk that any such programmes, laws or regulations, if proposed and enacted, will contain emission reduction targets which may result in operating restrictions or compliance costs to avoid a breach of applicable legislation. In some jurisdictions governments are applying carbon taxes that increase costs unless mitigated by emissions reductions or traded credits. Climate change policy is emerging and quickly evolving at regional, national and international levels, and political and economic events may significantly affect the scope and timing of climate change measures that are ultimately put in place. Implementation of strategies by any level of government within Thailand, Türkiye, or countries in which the Company may operate in the future, and whether to meet international agreed limits, or as otherwise determined, for reducing greenhouse gases could have a material impact on the operations and financial condition of the Company. In addition, concerns about climate change have resulted in a number of environmental activists and members of the public opposing the continued exploitation and development of hydrocarbons. Given the evolving nature of the debate related to climate change and the control of greenhouse gases and resulting requirements, it is not possible to predict the impact on the Company, its operations, its financial condition and its ability to raise capital and its cost of capital. It is also not possible at this time to predict whether any proposed legislation relating to climate change will be adopted, and whether any such regulations could result in operating restrictions or compliance costs. In addition to risks related to climate change legislation, Valeura also faces transition risks and physical risks in relation to climate change. Transition risks are risks that relate to the transition to a lower-carbon economy. Transition risks impact the volatility of oil and gas prices (as consumer demand for oil and gas may decrease); environmental legislation and hydraulic fracturing regulations (which may delay or restrict the development of oil and gas); the ability to obtain additional financing (as sources of financing for oil and gas development may become more restricted); and the reliance on key personnel, management, and labour (as the workforce may transition to other sources of energy development). Practices and disclosures relating to environmental matters, including climate change, are attracting increasing scrutiny by stakeholders. Valeura’s response to addressing environmental matters can impact the Company’s reputation and affect the Company’s ability to hire and retain employees; to compete for reserve acquisitions, exploration leases, licences and concessions; and to receive regulatory approvals required to execute operating programs. Physical risks relate to the physical impact of climate change, which can be event driven (acute) or longer-term shifts (chronic) in climate patterns. Physical risks can have financial implications for the Company, such as direct damage to assets and indirect impacts from production disruptions. Physical risks may also increase Valeura’s operating costs. Title to assets Title to oil and natural gas interests is often not capable of conclusive determination without incurring substantial expense. While it is the practice of Valeura, in acquiring significant oil and gas licences or interest in oil and gas licences to fully examine the title to the interest under the licence, this should not be construed as a guarantee of title. There may be title defects that affect lands comprising a portion of Valeura’s properties. To the extent title defects do exist, it is possible that Valeura may lose all or a portion of its right, title, estate and interest in and to the properties to which the title relates. The oil and gas industry is subject to a number of laws and governmental regulations, compliance with which may be burdensome The oil and natural gas industry in Thailand and in Türkiye is subject to controls and regulations governing its operations imposed by legislation enacted by local governments and with respect to pricing and taxation of oil and natural gas by agreements, all of which should be carefully considered by investors in the oil and gas industry. The Company’s activities are affected in varying degrees by government regulations relating to the oil and gas industry and foreign investment. Operations may be affected in varying degrees by government regulations with respect to price controls, export controls, foreign exchange controls, income taxes, value-added taxes, expropriation of property, production restrictions and environmental legislation. It is not expected that any of these controls or regulations will affect the Company’s operations in a manner materially different than they would affect other oil and gas companies of similar size operating in these jurisdictions.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 33 Access to debt and equity markets In addition, evolving decarbonisation policies of institutional investors, lenders and insurers could affect the Company’s ability to access capital pools. Additionally, the Company may, from time to time, not meet the investment criteria or characteristics of a particular institutional or other investor, including institutional investors who are not willing or able to hold securities of oil and gas companies for reasons unrelated to financial or operational performance. Any changes in market-based factors or investor strategies or responsible investing criteria/rankings (for example, social impact or environmental scores), the implementation of new financial market regulations and fossil fuel divestment initiatives undertaken by governments, pension funds and/or other institutional investors, may adversely affect the Company’s access to capital pools. Competition Oil and gas exploration and production is intensely competitive in all its phases and involves a high degree of uncertainty with respect to the impact of such competition. Valeura will compete with numerous other participants in the search for, and the acquisition of, oil and natural gas properties and in the marketing of oil and natural gas. The Company’s competitors may include companies that have more significant financial resources, staff and facilities than those of the Company. Competitive factors in the distribution and marketing of oil and natural gas include price and methods and reliability of delivery. Valeura may also be subject to competition from the alternative fuel industry or fuel substitution by its customers. The Company’s activities are subject to operational risks, hazards and unexpected disruptions, including damage to property or injury to persons, some of which are beyond its control The Company’s planned oil and gas operations are subject to a number of operational risks and hazards, some of which are beyond its control. These risks and hazards include unexpected maintenance or technical problems, natural disasters, industrial accidents, power or fuel supply interruptions, water supply interruptions and shortages, machinery and equipment failure, malfunction and breakdowns of information management systems, fires, and unusual or unexpected variations in mineralisation, geological conditions, hazards associated with oil and gas exploration and development. The operations of the Company may be disrupted by a variety of risks and hazards which are beyond the control of the Company, including environmental hazards, industrial accidents, technical failures, labour disputes, unusual or unexpected rock formations, flooding and extended interruptions due to inclement or hazardous weather conditions, fire, explosions, and other incidents beyond the control of the Company. Other factors affecting the production and sale of oil and natural gas that could result in decreases in profitability include: (i) expiration or termination of permits, licences or leases, or sales price redeterminations or suspension of deliveries; (ii) future litigation; (iii) the timing and amount of insurance recoveries; (iv) work stoppages or other labour difficulties; (v) worker vacation schedules and related maintenance activities; and (vi) changes in the market and general economic conditions. Weather conditions, equipment replacement or repair, fires, amounts of rock and other natural materials and other geological conditions can have a significant impact on operating results. These risks and hazards could also result in damage to, or destruction of, production facilities, personal injury, environmental damage, business interruption, monetary losses and possible legal liability. While the Company currently intends to maintain insurance within ranges of coverage consistent with industry practice, no assurance can be given that the Company will be able to obtain such insurance coverage at reasonable rates (or at all), or that any coverage it obtains will be adequate and available to cover any such claims. The Company is committed to providing a healthy and safe environment for its personnel, contractors and visitors. Exploration and production activities have inherent risks and hazards. The Company provides appropriate instructions, equipment, preventative measures, first aid information, and training to all employees and contractors through its occupational, health and safety management systems. RISKS RELATING TO FOREIGN OPERATIONS Foreign operations Valeura currently has all of its assets in Thailand and in Türkiye and expects to continue to have all of its operations outside of Canada. Exploration, development and operating activities in both countries are subject to the risks normally associated with the conduct of business in countries with less developed or emerging economies. As such, the Company’s operations, financial condition and operating results could be significantly affected by risks over which it has no control. These risks may include risks related to economic, social or political instability or change, terrorism, hyperinflation, currency non-convertibility or instability and changes of laws affecting foreign ownership, interpretation or renegotiation of existing contracts, government participation, taxation policies, including royalty and tax increases and retroactive tax claims, and investment restrictions, working conditions, rates of exchange, exchange control, exploration licensing, production leasing, petroleum and export licensing and export duties, government control over domestic oil and gas pricing, currency fluctuations, devaluation or other activities that limit or disrupt markets and restrict payments or the movement of funds, the possibility of being subject to exclusive jurisdiction of foreign courts in connection with legal disputes relating to licences to operate and concession rights in countries where Valeura currently operates, and difficulties in enforcing Valeura’s rights against a governmental agency because of the doctrine of sovereign immunity and foreign sovereignty over international operations. Problems may also arise due to the quality or failure of equipment or technical support, which could result in failure to achieve expected target dates for exploration and development operations or result in a requirement for greater expenditure. Valeura will operate in such a manner as to minimise and mitigate its exposure to these risks. However, there can be no assurance that Valeura will be successful in protecting itself from the impact of all of these risks and the related financial consequences. Government rules and regulations Valeura’s operations are subject to various levels of government controls and regulations in the countries where it operates. Oil and gas exploration and production is a sensitive political issue and as a result there is a relatively higher risk of direct government intervention in
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 34 respect of laws and regulations that can affect the property rights and title to assets. Such intervention can extend, in certain jurisdictions, to nationalisation, expropriation or other actions that effectively deprive companies of their assets. Existing laws and regulations include matters relating to land tenure, drilling, production practices including hydraulic stimulating of wells, environmental protection, agricultural land use, marketing and pricing policies, royalties, various taxes and levies including income tax, foreign trade and investment and government approval of lease and licence transfers, certain corporate transactions and other regulatory approvals that are subject to change from time to time. Current legislation is generally a matter of public record and Valeura cannot predict what additional legislation or amendments may be proposed that will affect Valeura’s operations or when any such proposals, if enacted, might become effective. There is no certainty regarding obtaining government approvals. Changes in government policy or laws and regulations could adversely affect Valeura’s results of operations and financial condition. Failure to comply with applicable laws, regulations and legal requirements may result in enforcement actions thereunder, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions which could have an adverse effect on Valeura’s business, financial condition or operations. Bribery and corrupt practices The Company maintains anti-bribery policies, anti-corruption training programmes, codes of conduct, procedures and other safeguards designed to prevent the occurrence of fraud, bribery and corruption. Valeura has established a Code of Business Conduct and Ethics which includes policies and procedures covering anti-bribery and anti-corruption of foreign public officials, including regular reporting to management and the Board. While management believes these policies are adequate, and despite careful establishment and implementation, there can be no assurance that these or other anti-bribery or anti-corruption policies and procedures are or will be sufficient to protect against corrupt activity. Wherever the Company operates it always needs to be aware of the potential risk of fraud, bribery and corruption. Instances of fraud, bribery and corruption, and violations of laws and regulations could have a material adverse effect on the Company’s reputation, business, results of operations, financial condition and the price of the Common Shares. The Company has engaged a number of consultants and contractors in connection with its past and would expect to do the same in its future operations. Although the Company targets to enter these agreements on arm’s length commercial terms and seeks appropriate comfort from consultants and contractors, as well as requiring its consultants and contractors to adhere to the high standards in line with the Company’s policies, there is a risk that agents or other persons or representatives acting on behalf of the Company may engage in corrupt activities without the knowledge of the Company. In particular, Valeura, in spite of its best efforts, may not always be able to prevent or detect corrupt practices by employees, or third parties, such as sub-contractors or its operating partners, which may result in reputational damage, civil and/or criminal liability being imposed on Valeura, which could have an adverse effect on Valeura’s business, financial condition or operations. RISKS RELATING TO COMMON SHARES There may be volatility in the value of an investment in Common Shares and the market price for Common Shares may fluctuate The market price for the Common Shares may be volatile and subject to wide fluctuations in response to numerous factors, many of which are beyond the Company’s control, including the following: (i) actual or anticipated fluctuations in the Company’s results of operations; (ii) actual or anticipated changes in the capital markets; (iii) recommendations by securities research analysts; (iv) changes in the economic performance or market valuations of other companies that investors deem comparable to the Company; (v) addition or departure of the Company’s executive officers and other key personnel; (vi) sales or perceived sales of additional Common Shares; (vii) significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving the Company or its competitors; (viii) changes in laws, rules and regulations applicable to the Company and its operations; (ix) general economic, political and other conditions; (x) the Company’s involvement in any litigation or dispute, or threat of any litigation or dispute; and (xi) news reports relating to trends, concerns, technological or competitive developments, regulatory changes and other related issues in the Company’s industry or target markets. Financial markets have experienced significant price and volume fluctuations in the last several years that have particularly affected the market prices of equity securities of companies and that have, in many cases, been unrelated to the operating performance, underlying asset values or prospects of such companies. Accordingly, the market price of the Common Shares may decline even if the Company’s operating results, underlying asset values or prospects have not changed. Additionally, these factors, as well as other related factors, may cause decreases in asset values that are deemed to be other than temporary, which may result in impairment losses. Also, certain institutional investors may base their investment decisions on consideration of the Company’s environmental, governance and social practices and performance against such institutions’ respective investment guidelines and criteria, and failure to meet such criteria may result in a limited or no investment in the Common Shares by those institutions, which could adversely affect the trading price of the Common Shares. There is no assurance that continuing fluctuations in the price and volume of publicly traded equity securities will not occur. If such increased levels of volatility and market turmoil continue, the Company’s operations could be adversely impacted and the trading price of the Common Shares may be adversely affected. Substantial future sales of Common Shares, or the perception that such sales might occur, or additional offerings of Common Shares could depress the market price of Common Shares The Company cannot predict what effect, if any, future sales of Common Shares, or the availability of Common Shares for future sale, or the offer of additional Common Shares in the future, will have on the market price of Common Shares. Sales or an additional offering of substantial numbers of Common Shares in the public market, or the perception or any announcement that such sales or an additional offering could occur, could adversely affect the market price of Common Shares and may make it more difficult for Shareholders to sell their Common Shares at a time and price which they deem appropriate and could also impede the Company’s ability to raise capital through the issue of equity securities.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 35 The Company does not currently intend to pay dividends and its ability to pay dividends in the future may be limited The Company has never declared or paid any dividends on the Common Shares. The Company currently intends to retain future earnings, if any, for future operations, expansion and debt repayment, if necessary. Therefore, at present, there is no intention to pay dividends and a dividend may never be paid. Any decision to declare and pay dividends will be made at the discretion of the Board and will depend on, among other things, the Company’s results of operations, financial condition and solvency and distributable reserves tests imposed by corporate law and such other factors that the Board may consider relevant. In addition to the foregoing, the Company’s ability to institute and pay dividends now or in the future is or may be limited by covenants contained in any debt facilities or other agreements governing any indebtedness that the Company may incur in the future, including the terms of any credit facilities the Company may enter into with third party lenders. It is not uncommon that credit facilities will prevent a borrower from declaring or paying any dividends to any of its shareholders or returning any capital (including by way of dividend) to any of its Shareholders. As a result of the foregoing factors, purchasers of the Common Shares may not receive any return on an investment in the Common Shares unless they sell such Common Shares for a price greater than that which they paid for them. If the Company is wound up, distributions to Shareholders will be subordinated to the claims of creditors On a winding-up of the Company, holders of the Common Shares will be entitled to be paid a distribution out of the assets of the Company available to its Shareholders only after the claims of all creditors of the Company have been met. INDUSTRY CONDITIONS The oil and natural gas industry in Thailand and in Türkiye is subject to controls and regulations governing its operations imposed by legislation enacted by local governments and with respect to pricing and taxation of oil and natural gas by agreements, all of which should be carefully considered by investors in the oil and gas industry. The Company’s activities are affected in varying degrees by government regulations relating to the oil and gas industry and foreign investment. Operations may be affected in varying degrees by government regulations with respect to price controls, export controls, income taxes, value-added taxes, expropriation of property, production restrictions and environmental legislation. It is not expected that any of these controls or regulations will affect the Company’s operations in a manner materially different than they would affect other oil and gas companies of similar size operating in these jurisdictions. Outlined below are some of the principal aspects of the regulatory and fiscal systems in Valeura’s areas of operation. THAILAND Regulator and legislation DMF is the key agency within the Thailand Ministry of Energy charged with overseeing oil and gas exploration and production activities in the country. It is responsible for the award of concessions and for monitoring upstream oil and gas activity in Thailand. Through formal licensing rounds, the DMF grants licences in accordance with Thailand’s 1971 Petroleum Act, which provide concessionaires with the right to explore for, produce, store, transport and sell petroleum. Fiscal Thailand’s historical concession-based licence approach entails fiscal terms comprised primarily of royalties and taxes. In 2018, Thailand launched a licencing round for expiring contracts, based on a production sharing contract arrangement, however pre-existing licence arrangements were not changed retroactively to the new regime. All existing licences continue to be held under the concession structure, with specific terms as defined upon the licences’ original award. A 10% withholding tax is imposed on dividends paid to non-residents of Thailand, unless otherwise reduced under a tax treaty. Terms Licence G1/48, G10/48, and G11/48 are governed by a particular set of fiscal terms known as Thai III. Royalties are calculated between 5-15% based on a sliding scale linked to production and levied on gross revenue. A windfall profits tax known as the SRB is calculated at a rate of 0-75% with the rate based on drilling activity and geological complexity, and levied on a unique profit calculation which entails deduction of royalties, operating costs, and certain capital expenditures and associated uplifts. Petroleum income tax is 50% on net profits, with deductions for royalties, SRB, operating costs and depreciation. Tax losses may be carried forward for up to 10 years. Ring fencing for taxation purposes is at the company level, with tax loss carry-forwards potentially applicable against taxes payable for assets with the same fiscal terms and held by the same company. Licence B5/27 is governed by a particular set of fiscal terms known as Thai I. Royalties are calculated based on 12.5% of income from sale or disposal of petroleum, which may be treated as a tax credit. Unlike Thai III, Thai I licences are not subject to SRB. Petroleum income tax is 50% on net profits, with deductions for royalties, operating costs and depreciation. Tax losses may be carried forward for up to 10 years. Exploration tenure Licence exploration periods and relinquishment schedules are defined within the specific fiscal regime for each licence. Under Thai III terms, licences generally entail an exploration period of six years, plus an optional three-year extension, subject to negotiation. The exploration period requires spending and work obligations to be completed, in accordance with commitments made in the licence bid round. Thai III licences require partial acreage relinquishments at various points throughout the exploration period, such that after the end of the sixth year,
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 36 no more than 25% of the original acreage is remaining under the licence. Under Thai I terms, licenses granted generally entail an exploration period of eight years, plus an optional four-year extension, for a total exploration period of 12 years. Production licences Upon a commercial discovery, operators may apply for a production licence. The production period under a Thai III production licence is 20 years from the end of the exploration period, plus an optional one-time 10-year extension. Upon grant of a production licence, operators can retain up to a 12.5% portion of the original licence as a reserve area on which to conduct further exploration for up to five years. The production period under a Thai I production licence is 30 years from the end of the exploration period, plus an optional one-time 10-year extension. Marketing and pricing Crude oil marketing in Thailand requires that oil is tendered for sale on a spot or term basis. Pricing is generally referenced to the Dubai crude oil benchmark, with actual prices influenced by market conditions for particular crude specifications. Export of crude oil must be approved by the DMF, on a tender-by-tender basis. Decommissioning Decommissioning of wells and facilities is the responsibility of the operator. Prior to the end of life of an oil field (once 60% of reserves have been produced or when there are five years remaining on the licence, whichever is sooner) operators must submit and agree a field decommissioning plan complete with cost estimate with the DMF. At that time, and subject to a financial test of the estimated remaining cash flow of the field, including its starting cash balance as a multiple of the estimated total decommissioning cost after tax utilization, operators are required to pledge financial security to the government in respect of their eventual decommissioning obligations, allocated into tranches and over a schedule, to be agreed with the regulator. Such financial security may be provided in the form of cash, letter of credit, bond, or other instrument as agreed with regulators. Decommissioning costs are deductible against future income taxes. TÜRKIYE Regulator and legislation Hydrocarbon resource rights in Türkiye are governed by the New Petroleum Law and Regulation on Implementation of Turkish Petroleum (“Turkish Regulations”), which are administered by Türkiye’s Ministry of Energy and Natural Resources and Türkiye’s General Directorate of Mining and Petroleum Affairs. Petroleum exploration licences and production leases are granted by the GDMPA, based on an application and gazetting process, whereby potential competing participants are selected based on (a) their technical and financial capability; (b) compliance of the application with relevant law; and (c) the “work and investment programme” bid covering the minimum work obligations to be performed in the licence area during the initial five year term of the exploration licence. Exploration tenure Through the application and gazetting process, successful operators obtain a “petroleum exploration licence” which permits them to explore and develop hydrocarbons in the designated licence area, and with discovery success, a “production lease” to produce hydrocarbons from the reservoir area carved out from the predecessor exploration licence. The term of an onshore exploration licence is five years and it may be renewed at the election of the holder, subject to GDMPA consent, up to two times for up to an additional two years for each renewal. The operator must submit a new work and investment programme covering the extended term of the licence (which should at least include drilling of one well) and a work and investment bond in the amount equal to 2% of the total monetary commitment of the new programme. The overall term of an exploration licence may not exceed total nine years. Production licences The granting of a production lease is subject to a commercial discovery within the predecessor exploration licence area and submission of a work and investment programme commitment. A production lease area shall be carved out from the predecessor exploration licence area based on the commercial reservoir assessment of the applicant which is approved by the GDMPA. The remainder of the exploration licence will continue to be in effect until the end of its term. The initial term of a production lease is 20 years and it may be renewed, subject to the GDMPA consent, up to two times for up to an additional 10 years for each renewal. Renewals shall be granted only if commercial production from the lease area is maintained continuously. With each renewal, the lease holder must submit a new work programme covering the renewed term. A production lease grants its owner the right to produce hydrocarbons (crude oil, natural gas or both if available) from the lease area. The lease holder can also perform exploration activities within the lease area if it considers that unexplored reservoirs are available. Fiscal Türkiye’s fiscal regime for oil and gas operations is presently comprised of royalties and income tax. Royalties are 12.5% of the value of production and the corporate income tax rate is 25%. A 15% withholding tax is applied on dividends distributed to foreign entities. However, the withholding tax may be reduced to 10% depending on the bilateral treaties signed between Türkiye and the home country of the petroleum rights holder.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 37 Marketing and pricing BOTAS owns and operates Türkiye’s national crude oil pipeline grid and national gas pipeline grid. The organisation sets the price for natural gas in Türkiye and regularly posts reference prices for use in various types of natural gas sales transactions – power generation, wholesale, etc. In turn, BOTAS’ reference prices influence the price available to domestic producers, translated into TL, at some discount. The marketing of natural gas in Türkiye is subject to Natural Gas Market Law No. 4646, adopted as of April 18, 2001 (as amended) and its associated regulations (“Natural Gas Market Law”). The Natural Gas Market Law covers the import, transmission, distribution, storage, marketing, trade and export of natural gas. Producing companies, provided that they hold a wholesale licence, may market gas to wholesale companies, import companies, distribution companies or free consumers. The generation companies are allowed to sell such amount directly to consumers. Decommissioning At the expiry or cancellation of the lease, the lease holder must comply with and fully satisfy abandonment obligations defined under the New Petroleum Law and Turkish Regulations, which entails restoring affected lands to their original condition by abandoning wellsites and facilities upon completion of operations. In most instances, this entails restoring lands to their original agricultural use. LEGAL AND REGULATORY PROCEEDINGS Valeura is not a party to any legal proceeding nor was it a party to, nor is or was any of its property the subject of, any legal proceeding during the year ended December 31, 2024, which involve a claim for damages, exclusive of interest and costs, that may exceed 10 percent of the current assets of Valeura, nor is Valeura aware of any such contemplated legal proceedings. During the year ended December 31, 2024, there were no: (i) penalties or sanctions imposed against the Company by a court relating to securities legislation or by a securities regulatory authority; (ii) penalties or sanctions imposed by a court or regulatory body against the Company that would likely be considered important to a reasonable investor in making an investment decision; or (iii) settlement agreements the Company entered into before a court relating to securities legislation or with a securities regulatory authority. INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS No director, officer or person or company that beneficially owns, or controls or directs, directly or indirectly, more than 10 percent of any class or series of Valeura’s outstanding securities, nor any affiliate or associate of such a person or company, has or has had any material interest, direct or indirect, in any transaction within the three most recently completed financial years or during the current financial year that has materially affected or is reasonably expected to materially affect Valeura. MATERIAL CONTRACTS Except for contracts entered into in the ordinary course of business, Valeura has not entered into any material contracts within the most recently completed financial year, or before the most recently completed financial year which are still in effect. TRANSFER AGENT AND REGISTRAR Computershare Trust Company of Canada, at its principal office in Calgary, Alberta, is the transfer agent and registrar for the Common Shares. INTERESTS OF EXPERTS The auditors of the Company, Deloitte & Touche LLP, are independent with respect to the Company, in accordance with the Rules of Professional Conduct of the Institute of Chartered Professional Accountants of Alberta. ADDITIONAL INFORMATION Additional information, including information as to directors’ and officers’ remuneration and indebtedness, principal holders of the Company’s securities and securities authorised for issuance under equity compensation plans is contained in the Proxy Statement and Information Circular of the Company prepared in connection with the most recent annual meeting of Shareholders that involved the election of directors. Additional financial information is provided in the Company’s financial statements and management discussion and analysis for the year ended December 31, 2024. Copies of this Annual Information Form, any interim financial statements of the Company subsequent to the annual financial statements, the
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 38 Company’s Proxy Statement and Information Circular and other additional information relating to the Company are available on SEDAR+ at www.sedarplus.ca.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 39 APPENDIX A1 - FORM 51-101F1 – STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION (Capitalised terms not specifically defined in this Appendix A-1 have the meaning ascribed to them in the Annual Information Form to which this Appendix A-1 is attached) The Company engaged NSAI to prepare a report relating to the Company’s reserves in Thailand as at December 31, 2023. The reserves on the properties in Thailand described herein are estimates only. Actual reserves on these properties may be greater or less than those estimated. All reserve and future net revenue estimates are presented on a working interest basis. Set out below is a summary of the crude oil reserves and the value of future net revenue of the Company as at December 31, 2024 as evaluated by NSAI in the NSAI Reserves/Resources Report. The pricing used in the forecast price evaluations is set forth in the notes to the tables. The NSAI Reserves/Resources Report was prepared using assumptions and methodology guidelines outlined in the COGE Handbook and in accordance with NI 51-101. The estimated future net revenues contained in the following tables do not necessarily represent the fair market value of the Company’s reserves. There is no assurance that the forecast price and cost assumptions contained in the NSAI Reserves/Resources Report will be attained and variances could be material. Other assumptions and qualifications relating to costs and other matters are included in the NSAI Reserves/Resources Report. The recovery and reserves estimates on the Company’s properties described herein are estimates only. OIL AND GAS RESERVES BASED ON FORECAST PRICES AND COSTS Light and Medium Crude Oil Heavy Crude Oil Conventional Natural Gas Natural Gas Liquids Total Oil Equivalent Gross (Mbbl) Net (Mbbl) Gross (Mbbl) Net (Mbbl) Gross (MMcf) Net (MMcf) Gross (Mbbl) Net (Mbbl) Gross (Mboe) Net (Mboe) Proved Developed Producing 13,180 12,048 2,894 2,727 - - - - 16,073 14,776 Proved Developed Non-Producing 1,289 1,170 242 228 - - - - 1,531 1,398 Proved Undeveloped 9,160 8,252 5,490 5,175 - - - - 14,650 13,426 Total Proved 23,629 21,470 8,626 8,130 - - - - 32,255 29,600 Total Probable 13,457 12,192 4,296 4,049 - - - - 17,753 16,241 Total Proved Plus Probable 37,086 33,661 12,923 12,179 - - - - 50,008 45,841 Total Possible 8,662 7,799 1,027 968 - - - - 9,689 8,767 Total Proved Plus Probable Plus Possible 45,748 41,460 13,950 13,147 - - - - 59,697 54,608 NET PRESENT VALUES OF FUTURE NET REVENUE BASED ON FORECAST PRICES AND COSTS(1) Before Deducting Income Taxes Discounted At After Deducting Income Taxes(5) Discounted At 0% (M US$) 5% (M US$) 10% (M US$) 15% (M US$) 20% (M US$) 0% (M US$) 5% (M US$) 10% (M US$) 15% (M US$) 20% (M US$) Proved Developed Producing -404,951 -264,326 -166,751 -97,482 -47,321 -413,288 -271,762 -173,449 -103,569 -52,893 Proved Developed Non-Producing 109,178 96,609 86,419 78,044 71,076 107,600 95,142 85,051 76,764 69,876 Proved Undeveloped 688,022 546,563 441,009 360,777 298,770 694,915 552,970 446,984 366,366 304,014 Total Proved 392,249 378,846 360,676 341,338 322,525 389,227 376,351 358,585 339,561 320,996 Total Probable 851,399 692,511 573,252 482,465 412,327 539,076 458,125 393,645 342,224 300,949 Total Proved Plus Probable 1,243,648 1,071,356 933,928 823,804 734,852 928,302 834,476 752,230 681,785 621,945 Total Possible 595,565 486,743 405,126 342,969 294,868 317,475 273,450 237,961 209,453 186,432 Total Proved Plus Probable Plus Possible 1,839,212 1,558,100 1,339,054 1,166,773 1,029,720 1,245,777 1,107,926 990,191 891,238 808,377
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 40 TOTAL FUTURE NET REVENUE (UNDISCOUNTED) BASED ON FORECAST PRICES AND COSTS(1) YE24 Revenue (M US$) Development Cost (M US$) Abandonment and Reclamation Cost (M US$) Operating Cost (M US$) Operating Cost (Special Remuneratory Benefit) (M US$) Royalties (M US$) Future Net Revenue Before Income Taxes (M US$) Income Taxes(5) (M US$) Future Net Revenue After Income Taxes(5) (M US$) Total Proved 2,471,069 513,130 184,829 1,279,005 34,454 67,403 392,249 3,022 389,227 Total Proved Plus Probable 3,901,025 678,986 190,736 1,613,331 68,338 105,986 1,243,648 315,345 928,302 Total Proved Plus Probable Plus Possible 4,658,884 685,084 192,949 1,685,831 126,551 129,256 1,839,212 593,435 1,245,777 FUTURE NET REVENUE BY PRODUCT TYPE BASED ON FORECAST PRICES AND COSTS(1) Future Net Revenue Before Income Taxes(5) (Discounted at 10%/Year) Production Group (M US$) US$/boe(4) US$/Mcfe(4) Total Proved(2) Light and medium crude oil 273,687 12.75 - Heavy crude oil 86,990 10.70 - Conventional natural gas - - - Total Proved(2) 360,676 12.19 - Probable(3) Light and medium crude oil 460,966 37.81 - Heavy crude oil 112,286 27.73 - Conventional natural gas - - Total Probable 573,252 35.30 - Total Proved Plus Probable Light and medium crude oil 734,653 21.82 - Heavy crude oil 199,276 16.36 - Conventional natural gas - - Total Proved Plus Probable 933,928 20.37 - Possible Light and medium crude oil 349,039 44.76 - Heavy crude oil 56,087 57.94 - Conventional natural gas - - Total Possible 405,126 - Total Proved Plus Probable Plus Possible Light and medium crude oil 1,083,692 26.14 - Heavy crude oil 255,362 19.42 - Conventional natural gas - - Total Proved Plus Probable Plus Possible(2)(3)(4) 1,339,054 24.52 - (1) The pricing assumptions used in the NSAI Reserves/Resources Report with respect to net values of future net revenue (forecast) as well as the cost escalation rates used for operating and capital costs are set forth in the preceding table titled “Forecast Prices & Cost Escalation Rates Used in NSAI Reserves/Resources Report”. The forecast prices & cost escalation rates were developed by NSAI as at December 31, 2024 and reflect the then current year forecast prices and cost escalation rates. (2) Including solution gas and other by-products associated with oil production. (3) Including non-associated gas by-products but excluding solution gas. (4) Reference to M US$, US$/bbl, US$/Mcf, US$/boe and US$/Mcfe are stated in United States dollars. Reference to M$, $/bbl, $/Mcf, $/boe and $/Mcfe are stated in Canadian dollars. (5) Income taxes are Thailand income taxes. The pricing assumptions used in the NSAI Reserves/Resources Report with respect to net present values of future net revenue (forecast) as well as the cost escalation rates used for operating and capital costs are set forth below. FORECAST PRICES & COST ESCALATION RATES USED IN NSAI RESERVES/RESOURCES REPORT The Thailand oil price forecast included in the NSAI Reserves/Resources Report is based on the average December 31, 2024 NYMEX Brent Crude price forecasts of three Canadian consultants. From 2026 on, a 2% per year escalation is applied to costs. From 2029 on, a 2% per year escalation is applied to oil prices. The resultant Brent crude oil forecast prices that formed the basis for the revenue projections and net present value estimates in the NSAI Reserves/Resources Report are shown below. These prices apply to all of Valeura’s fields, whether heavy crude (in the case of the Wassana field) or light/medium crude (in the case of the Jasmine, Manora, and Nong Yao fields). A price differential was applied by NSAI to further
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 41 refine estimates for realised prices in respect of each fields’ crude quality. Brent Crude Oil Inflation Year ($/bbl) (%/yr) Historical 2019 64.35 2.00 2020 41.75 0.75 2021 70.70 3.40 2022 100.80 6.80 2023 82.45 3.90 2024 80.50 2.40 Forecast 2025 75.58 0.00 2026 78.51 2.00 2027 79.89 2.00 2028 81.82 2.00 2029 83.46 2.00 2030 85.13 2.00 2031 86.84 2.00 2032 88.57 2.00 2033 90.31 2.00 2034 92.09 2.00 2035 93.93 2.00 Thereafter +2.0%/year 2.00 The Company realised an average selling price of $81.3/bbl for the year ended December 31, 2024. RECONCILIATION OF THE COMPANY’S GROSS RESERVES BY PRINCIPAL PRODUCT TYPE BASED ON FORECAST PRICES AND COSTS The following table sets forth a reconciliation of the changes in the Company’s working interest share, before royalties, of light and medium crude oil, heavy crude oil, conventional natural gas, natural gas liquids and oil equivalent reserves as at December 31, 2024 against such reserves as at December 31, 2023: Light and Medium Crude Oil Heavy Crude Oil Gross Proved (Mbbl) Gross Probable (Mbbl) Gross Proved Plus Probable (Mbbl) Gross Proved (Mbbl) Gross Probable (Mbbl) Gross Proved Plus Probable (Mbbl) At December 31, 2023 18,528 6,446 24,974 11,345 1,569 12,914 Extensions and improved recovery 3,485 4,959 8,444 1,304 1,367 2,670 Technical Revisions 5,658 607 6,265 -1,337 1,585 248 Discoveries 884 136 1,020 0 0 0 Acquisitions 0 0 0 0 0 0 Dispositions 0 0 0 0 0 0 Resource Transfers 2,881 1,406 4,287 -1,250 -225 -1,475 Economic Factors -889 -96 -985 0 0 0 Production -6,919 0 -6,919 -1,435 0 -1,435 At December 31, 2024 23,629 13,457 37,086 8,626 4,296 12,923
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 42 Conventional Natural Gas Natural Gas Liquids Gross Proved (MMcf) Gross Probable (MMcf) Gross Proved Plus Probable (MMcf) Gross Proved (Mbbl) Gross Probable (Mbbl) Gross Proved Plus Probable (Mbbl) At December 31, 2023 0 0 0 0 0 0 Extensions and improved recovery 0 0 0 0 0 0 Technical Revisions 0 0 0 0 0 0 Discoveries 0 0 0 0 0 0 Acquisitions 0 0 0 0 0 0 Dispositions 0 0 0 0 0 0 Economic Factors 0 0 0 0 0 0 Production 0 0 0 0 0 0 At December 31, 2024 0 0 0 0 0 0 Oil Equivalent Gross Proved (Mboe) Gross Probable (Mboe) Gross Proved Plus Probable (Mboe) At December 31, 2023 29,872 8,015 37,888 Extensions and improved recovery 4,788 6,326 11,114 Technical Revisions 4,321 2,192 6,513 Discoveries 884 136 1,020 Acquisitions 0 0 0 Dispositions 0 0 0 Resource Transfers 1,631 1,181 2,812 Economic Factors -889 -96 -985 Production -8,354 0 -8,354 At December 31, 2024 32,255 17,753 50,008 Proved Undeveloped Reserves In the NSAI Reserves/Resources Report as of December 31, 2024, proved undeveloped reserves have been attributed as below. Light and Medium Crude Oil (Mbbl) Heavy Crude Oil (Mbbl) Conventional Natural Gas (MMcf) Natural Gas Liquids (Mbbl) Oil Equivalent (Mboe) December 31, 2024 9,160 5,490 0 0 14,650 December 31, 2023 8,474 10,048 0 0 18,522 December 31, 2022 0 1,976 0 0 1,976 In the NSAI Reserves/Resources Report as of December 31, 2024, there are a total of 82 drilling locations assigned proved undeveloped reserves. The Company expects to develop these over the next five years. The pace of development of these reserves can be influenced by many factors, including but not limited to, changing technical conditions, partner and regulatory approval, changes in product pricing, capital allocation priorities and the results of yearly drilling and reservoir evaluations. As new information becomes available these reserves are reviewed and drilling plans are revised accordingly.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 43 Probable Undeveloped Reserves In the NSAI Reserves/Resources Report as of December 31, 2024, probable undeveloped reserves have been attributed as below. Light and Medium Crude Oil (Mbbl) Heavy Crude Oil (Mbbl) Conventional Natural Gas (MMcf) Natural Gas Liquids (Mbbl) Oil Equivalent (Mboe) December 31, 2024 7,902 3,406 0 0 11,308 December 31, 2023 1,843 1,390 0 0 3,233 December 31, 2022 0 2,528 0 0 2,528 In the NSAI Reserves/Resources Report as of December 31, 2024, there are a total of 28 drilling locations assigned probable undeveloped reserves. These drill locations are scheduled beyond the first five years and the Company expects to develop these reserves over the next eight years. The pace of development of these reserves can be influenced by many factors, including but not limited to, changing technical conditions, partner and regulatory approval, changes in product pricing, capital allocation priorities and the results of yearly drilling and reservoir evaluations. As new information becomes available these reserves are reviewed and drilling plans are revised accordingly. Significant Factors or Uncertainties Affecting Reserves Data There are a number of factors that could result in delayed or cancelled development of the Company’s proved and probable undeveloped reserves, including the following: (i) partner and regulatory approvals; (ii) availability of equipment; (iii) product pricing; (iv) currency exchange rates; (v) well performance; and (vi) availability of financing in the future. All of the drilling locations assigned proved undeveloped reserves (82 locations) and assigned probable undeveloped reserves (28 locations) are oil reservoirs located in the B5/27, G1/48, G10/48 and G11/48 blocks. The Company expects that the process to achieve routine drilling location approvals from the Thailand Department of Minerals and Fuels could take longer than experienced in the past. The process of evaluating reserves is inherently complex. It requires significant judgments and decisions based on available geological, geophysical, engineering and economic data. These estimates may change substantially as additional data from ongoing development activities and production performance becomes available and as economic conditions impacting oil and gas prices, currency exchange rates and costs change. The reserve estimates contained herein are based on current production forecasts, prices and economic conditions and other factors and assumptions that may affect the reserve estimates and the present worth of future net revenue there from. These factors and assumptions include, among others: (i) historical production in the area compared with production rates from analogous areas; (ii) initial production rates; (iii) production decline rates; (iv) ultimate recovery of reserves; (v) success of future development activities; (vi) marketability of production; (vii) effect of government regulations; and (viii) other government levies imposed over the life of the reserves. As circumstances change and additional data becomes available, reserve estimates also change. Estimates are reviewed and revised, either upward or downward, as warranted by the new information. Revisions are often required due to changes in well performance, prices, currency exchange rates, economic conditions, and government restrictions. Revisions to reserve estimates can arise from changes in forecast prices, currency exchange rates, reservoir performance and geological conditions or production. These revisions can be either positive or negative. While the Company does not anticipate any significant economic factors or significant uncertainties will affect any particular component of the reserve data, the reserves can be affected significantly by fluctuations in product pricing, currency exchange rates, capital expenditures, operating costs, royalty regimes and well performance that are beyond the Company’s control. Future Development Costs The following table sets forth the development costs deducted in the estimation of future net revenue attributable to each of the following reserves categories contained in the NSAI Reserves/Resources Report: Total Proved Estimated Using Forecast Prices and Costs (M US$) Total Proved Plus Probable Estimated Using Forecast Prices and Costs (M US$) 2025 122,067 122,067 2026 81,413 81,413 2027 104,267 118,904 2028 107,046 105,557 2029 91,579 79,392 2030 2,208 94,085 2031 2,252 66,034 2032 2,297 9,189 2033 - 2,343 Remainder 0 0 Total for all years undiscounted 513,130 678,986
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 44 The Company’s primary source of liquidity to fund its estimated future development costs, as outlined in the above table, is derived from one of or a combination of the Company’s internally-generated cash flow, cash on hand, debt financing when deemed appropriate and as available and new equity issues if made on favourable terms. Oil and Gas Properties and Wells As at December 31, 2024, the Company held operatorship and deep rights on six exploration licences and production leases in the Thrace Basin comprising approximately 0.23 million gross acres and 0.19 million net acres and approximately 0.67 million gross acres and 0.64 million net acres in the Gulf of Thailand. A listing of the Company’s wells as of December 31, 2024 is shown below: Oil Wells Natural Gas Wells Standing & Other Wells Gross(1) Net(2) Gross(1) Net(2) Gross(1) Net(2) Producing - Thailand 161 152 0 0 31 28.3 Non-producing - Turkey 0 0 0 0 3 2.6 Non-producing - Thailand 25 24.1 0 0 4 4 Total 186 176.1 - - 38 34.9 (1) “Gross Wells” are the total number of wells in which the Company has an interest. (2) “Net Wells” are the number of wells obtained by aggregating the Company’s working interest in each of its Gross Wells. Properties with No Attributed Reserves The following table sets out the Company’s undeveloped land position effective December 31, 2024: Undeveloped Acreage Shallow Acreage (surface to a depth of 2,500 metres) Deep Acreage (a depth of 2,500 metres and deeper) Gross(1) Net(2) Gross(1) Net(2) Thrace Basin 0 0 225,859 188,114 Total 0 0 225,859 188,114 (1) “Gross” means the total number of acres in which the Company has a working interest. (2) “Net” means the number of acres obtained by aggregating the Company’s working interest in each of its acreage positions. Valeura’s licences and leases comprising the Thrace Basin exploration acreage have been extended into their second extension term, with an expiry of June 27, 2026. The Company has engaged in discussions with the regulator (GDMPA) in relation to another two-year Appraisal Period extension thereafter. Significant Factors or Uncertainties Relevant to Properties with No Attributed Reserves At this time the Company has not completed an independent evaluation of its undeveloped acreage in Turkey. Forward Contracts As at December 31, 2024, the Company had no outstanding commodity price derivative positions. Tax Horizon The Company is subject to income taxes in Canada, Mauritius, Singapore, the Netherlands, Thailand and Turkey. Currently, the Company is only expected to pay income tax in Thailand, the Netherlands and Mauritius. However, this may change subject to changes in regulation and the Company's business model. Costs Incurred The following table summarises the capital expenditures made by the Company on oil and natural gas properties in Turkey and Thailand for the year ended December 31, 2024. Property Acquisition Costs (M$) Exploration Costs (M$) Development Costs (M$) Proved Properties Unproved Properties Türkiye - - - - Thailand - - 8,002 136,001 Total - - 8,002 136,001
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 45 Exploration and Development Activities The Company successfully drilled 26 wells in 2024, out of which 21 were drilled as oil development wells that were immediately put on production afterwards and contributed significantly to the 2024 actual production. Four were appraisal wells drilled across multiple assets to test additional new accumulations or the extent of existing reservoirs All wells were successful in fulfilling the planned objectives and the Company believes the well results largely indicate the potential for further development activities in the fields. Exploratory wells Development wells Gross Net Gross Net Oil wells 1 0.9 21 19.7 Gas wells - - - - Standing & other wells - - 4 3.4 Dry holes - - - - Total wells 1 0.9 25 23.1 On June 27, 2024, production on the Wassana field was temporarily suspended as a precautionary measure, to enable the Company to undertake further inspection and analysis of a crack identified within one of the mobile offshore production unit Ingenium (the “MOPU”) weldment joints between its leg and support plate. This was done out of the abundance of caution, and in keeping with its strict standards for safety. Through advanced underwater inspection, including magnetic particle inspection, the Company, with input and support from class society and third party engineering consultants, concluded that the observed anomaly (a crack within a weld) is superficial, and accordingly does not constitute a risk to the structural integrity of the facility. Production was restarted on August 2, 2024. Production Estimates The following table sets forth the volume of working interest daily production, before royalties, estimated for the year ended December 31, 2025 which is reflected in the estimate of future net revenue disclosed in the tables of reserve information in respect of gross proved and probable reserves in Thailand. Light and Medium Crude Oil (bbl/d) Heavy Crude Oil (bbl/d) Conventional Natural Gas (Mcf/d) Natural Gas Liquids (bbl/d) Total (bbl/d) Proved Developed Producing 14,415 2,396 0 0 16,812 Proved Developed Non-Producing 611 254 0 0 865 Proved Undeveloped 2,854 - 0 0 2,854 Total Proved 17,880 2,651 0 0 20,531 Total Probable 1,755 373 0 0 2,128 Total Proved Plus Probable 19,635 3,024 0 0 22,659 In the estimate of future net revenue, two of the Company’s fields individually account for more than 20% of the Total Proved Plus Probable production, before royalties, estimated for the year ended December 31, 2025. These are (1) the Nong Yao field at approximately 40% and (2) the Jasmine field at approximately 35%. Production History The following table sets forth certain information in respect of production, sales volumes, prices received, royalties paid, production costs and netbacks received by the Company, by product type, for each quarter of the year ended December 31, 2024. In 2024, the Company’s operations were located in Thailand only.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 46 Total Company Q1 2024 Q2 2024 Q3 2024 Q4 2024 Average gross daily production volume Light Crude Oil and Medium Crude Oil (bbl/d) 17,903 16,360 19,463 21,848 Heavy Crude Oil (bbl/d) 3,979 4,708 2,746 4,261 Conventional Natural Gas (Mcf/d) 0 0 0 0 Sales Volumes Light Crude Oil and Medium Crude Oil (bbl/d) 15,892 16,815 15,360 28,173 Heavy Crude Oil (bbl/d) 3,506 3,739 3,825 3,870 Conventional Natural Gas (Mcf/d) 0 0 0 0 Prices received Light Crude Oil and Medium Crude Oil ($/bbl) 84.0 87.3 78.1 76.4 Heavy Crude Oil ($/bbl) 87.5 89.3 82.3 78.9 Conventional Natural Gas ($/Mcf) 0.0 0.0 0.0 0.0 Royalties paid Light Crude Oil and Medium Crude Oil ($/bbl) 11.7 10.5 10.9 10.1 Heavy Crude Oil ($/bbl) 5.2 5.6 5.1 5.1 Conventional Natural Gas ($/Mcf) 0.0 0.0 0.0 0.0 Production Costs Light Crude Oil and Medium Crude Oil ($/bbl) 22.9 24.7 20.4 20.8 Heavy Crude Oil ($/bbl) 41.2 40.9 68.0 32.6 Conventional Natural Gas ($/Mcf) 0.0 0.0 0.0 0.0 Netback Light Crude Oil and Medium Crude Oil ($/bbl) 49.4 52.1 46.7 45.5 Heavy Crude Oil ($/bbl) 41.1 42.8 9.2 41.1 Conventional Natural Gas ($/Mcf) 0.0 0.0 0.0 0.0
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 47 APPENDIX A2 – CONTINGENT RESOURCES DATA Capitalised terms not specifically defined in this Appendix A-2 have the meaning ascribed to them in the Annual Information Form to which this Appendix A-2 is attached) The Company engaged NSAI to prepare a report relating to the Company’s contingent resources attributable to its offshore properties in the B5/27, G1/48, G10/48 and G11/48 licences on the Company’s lands in Thailand as at December 31, 2024. The NSAI Reserves/Resources Report was prepared using the guidelines outlined in the COGE Handbook and in accordance with NI 51-101. All resources estimates are presented on a working interest acquired basis of VEA. Valeura’s ownership stake in VEA increased from 85.0% to 87.5% on January 24, 2023 and from 87.5 to 100% on March 21, 2023. Contingent resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies are conditions that must be satisfied for a portion of contingent resources to be classified as reserves that are: (a) specific to the project being evaluated; and (b) expected to be resolved within a reasonable timeframe. Contingent resources are further categorised according to the level of certainty associated with the estimates and may be sub-classified based on a project maturity and/or characterised by their economic status. There are three classifications of contingent resources: • low estimate (1C) – this is considered to be a conservative estimate of the quantity that will actually be recovered. It is likely that the actual remaining quantities recovered will exceed the low estimate. If probabilistic methods are used, there should be at least a 90 percent probability that the quantities actually recovered will equal or exceed the low estimate. • best estimate (2C) – this is considered to be the best estimate of the quantity that will be actually recovered. It is equally likely that the actual remaining quantities recovered will be greater or less than the best estimate. If probabilistic methods are used, there should be at least a 50 percent probability that the quantities actually recovered will equal or exceed the best estimate. • high estimate (3C) – this is considered to be an optimistic estimate of the quantity that will actually be recovered. It is unlikely that the actual remaining quantities recovered will exceed the high estimate. If probabilistic methods are used, there should be at least a 10 percent probability that the quantities actually recovered will equal or exceed the high estimate. The project maturity subclasses for contingent resources include: (1) development pending, (2) development on hold, (3) development unclarified, and (4) development not viable. All of the contingent resources disclosed herein are classified as development unclarified or development not viable. Development unclarified is defined as a contingent resource that requires further appraisal to clarify the potential for development and has been assigned a lower chance of development until commercial considerations can be clearly defined. Development not viable is defined as a contingent resource where there is less than a reasonable chance of economics of development to be positive in the foreseeable future. Chance of development is the likelihood that an accumulation will be commercially developed. The contingent resources disclosed herein are estimates only and the actual quantities of recoverable crude oil may be greater or less than those estimated. Estimates of contingent resources involve additional risks as compared to estimates of reserves. There is uncertainty that it will be commercially viable to produce any portion of the contingent resources disclosed herein. Readers should also review the “Risk Factors” section in the Annual Information Form for a broader discussion of the risks and uncertainties facing the Company. The following tables summarises the Company’s contingent resources as contained in the NSAI Reserves/Resources Report for the B5/27, G1/48, G10/48 and G11/48 Licence as at December 31, 2024, on an unrisked and risked basis. Resources Project Maturity Subclass Light and Medium Crude Oil (Development Unclarified) Chance of Development (%) Unrisked Risked Gross (Mbbl) Net (Mbbl) Gross (Mbbl) Net (Mbbl) Contingent Low Estimate (1C) Development Unclarified 8,267 7,334 3,108 2,742 38% Contingent Best Estimate (2C) Development Unclarified 14,178 12,538 4,227 3,728 30% Contingent High Estimate (3C) Development Unclarified 21,072 18,644 5,289 4,673 25% Resources Project Maturity Subclass Heavy Crude Oil (Development Unclarified) Chance of Development (%) Unrisked Risked Gross (Mbbl) Net (Mbbl) Gross (Mbbl) Net (Mbbl) Contingent Low Estimate (1C) Development Unclarified 7,807 7,358 4,045 3,812 52% Contingent Best Estimate (2C) Development Unclarified 10,641 10,029 5,325 5,018 50% Contingent High Estimate (3C) Development Unclarified 14,524 13,689 6,560 6,182 45%
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 48 Resources Project Maturity Subclass Light and Medium Crude Oil (Development Not Viable) Chance of Development (%) Unrisked Risked Gross (Mbbl) Net (Mbbl) Gross (Mbbl) Net (Mbbl) Contingent Low Estimate (1C) Development Not Viable 10,121 9,476 1,518 1,421 15% Contingent Best Estimate (2C) Development Not Viable 18,455 17,267 2,021 1,891 11% Contingent High Estimate (3C) Development Not Viable 27,353 25,583 1,789 1,675 7% Resources Project Maturity Subclass Heavy Crude Oil (Development Not Viable) Chance of Development (%) Unrisked Risked Gross (1) (Mbbl) Net (Mbbl) Gross (Mbbl) Net (Mbbl) Contingent Low Estimate (1C) Development Not Viable 2,069 1,950 310 293 15% Contingent Best Estimate (2C) Development Not Viable 2,055 1,936 308 290 15% Contingent High Estimate (3C) Development Not Viable 2,517 2,372 378 356 15% Resources Project Maturity Subclass Light and Medium Crude Oil (Development On Hold) Chance of Development (%) Unrisked Risked Gross (Mbbl) Net (Mbbl) Gross (Mbbl) Net (Mbbl) Contingent Low Estimate (1C) Development On Hold 1,173 1,026 176 154 15% Contingent Best Estimate (2C) Development On Hold 3,084 2,699 1,631 1,428 53% Contingent High Estimate (3C) Development On Hold 6,150 5,381 3,574 3,127 58% Resources Project Maturity Subclass Heavy Crude Oil (Development On Hold) Chance of Development (%) Unrisked Risked Gross (Mbbl) Net (Mbbl) Gross (Mbbl) Net (Mbbl) Contingent Low Estimate (1C) Development On Hold 0 0 0 0 - Contingent Best Estimate (2C) Development On Hold 36 34 33 31 90% Contingent High Estimate (3C) Development On Hold 486 458 437 412 90% Chance of Development Contingent oil resources are classified by NSAI for B5/27, G1/48, G10/48 and G11/48 Licenses under ‘Extension’, ‘Additional Recovery’, or ‘Additional Reservoirs’ categories. Resource volumes categorised as ‘Extension’ are the volumes associated with the developed reservoirs for which volumes have been estimated that are beyond economic limit to technical volume limit and field economic limit beyond concession life. These Extension resources fall under the development not viable maturity subclass and carry an assessed chance of development ranging from 15% to 90%. Resource volumes categorised as ‘Additional Recovery’ are additional volumes associated with future drilling locations within developed reservoirs that are either not economic or has pending final investment decision. The Additional Recovery resources associated with assigned target locations fall under the development unclarified maturity subclass and carry an assessed chance of development of 60%. The Additional Recovery resources associated with unassigned target locations fall under the development not viable or development unclarified maturity subclass and carry an assessed chance of development ranging from 10% to 60%. Resource volumes categorised as ‘Additional Reservoirs’ are the volumes associated with future drilling locations within undeveloped reservoirs in existing fields for which reserves were not estimated. The Additional Reservoirs resources fall under the development unclarified maturity subclass. Additional Reservoirs resources associated with assigned target locations carry an assessed chance of development ranging from
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 49 47%. Additional Reservoirs resources associated with unassigned target locations carry an assessed chance of development ranging from 10% to 17%. These accumulations provide a future opportunity to access additional hydrocarbon volumes on the B5/27, G1/48, G10/48 and G11/48 licences. Contingencies Conversion of the contingent resources disclosed herein is dependent upon: (1) collection of additional technical data to be gathered through the drilling of additional wells (2) improved economic conditions; (3) finalization and approval of a plan to develop the resources; and (4) a final investment decision and commitment of the licence partners to develop the resources. If these contingencies are successfully addressed, some portion of the contingent resources disclosed herein may be reclassified as reserves. The contingent resources disclosed herein have been risked, using the chance of development, to account for the possibility that the contingencies are not successfully addressed. Significant Positive and Negative Factors Relevant to the Resource Estimate The major positive factors relevant to the estimate of the contingent resources disclosed herein are: (1) the successful evaluation of resources encountered in appraisal wells drilled to date; (2) the successful track record to date in generating additional infill drilling opportunities in multi-layered reservoirs; (3) increased or sustained high oil prices; and (4) favourable application of reservoir optimization technologies. The major negative factors relevant to the estimate of the contingent resources disclosed herein are: (1) current economic conditions do not support certain resource development; (2) the requirement for additional drilling to reduce resource uncertainties prior to development; and (3) the outstanding requirement for a definitive plan, final investment decision and commitment of joint venture partners in the execution of development plans. If these contingencies are successfully addressed, some portion of these contingent resources may be reclassified as reserves.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 50 APPENDIX A3 – FORM 51-101F2 – REPORT ON RESERVES DATA AND CONTINGENT RESOURCES DATA BY INDEPENDENT QUALIFIED RESERVES EVALUATOR OR AUDITOR
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 51 APPENDIX A3 (continued)
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 52 APPENDIX A4 – FORM 51-101F3 – REPORT OF MANAGEMENT AND DIRECTORS ON OIL AND GAS DISCLOSURE Management of Valeura Energy Inc., (the “Company”) are responsible for the preparation and disclosure of information with respect to the Company’s oil and gas activities in accordance with securities regulatory requirements. This information includes reserves data and includes other information such as contingent resources data. An independent qualified reserves evaluator has evaluated the Company’s reserves data and contingent resources data. The reports of the independent qualified reserves evaluator will be filed with securities regulatory authorities concurrently with this report. The Reserves Committee of the board of directors of the Company has: • reviewed the Company’s procedures for providing information to the independent qualified reserves evaluator; • met with the independent qualified reserves evaluator to determine whether any restrictions affected the ability of the independent qualified reserves evaluator to report without reservation; and • reviewed the reserves data and contingent resources data with management and the independent qualified reserves evaluator. The Reserves Committee of the board of directors of the Company has reviewed the Company’s procedures for assembling and reporting other information associated with oil and gas activities and has reviewed that information with management. The board of directors of the Company has, on recommendation of the Reserves Committee, approved: the content and filing with securities regulatory authorities of Form 51-101F1 containing reserves data, contingent resources data and other oil and gas information; • the filing of Form 51-101F2 which is the report of the independent qualified reserves evaluator on the reserves data or the contingent resources data; and • the content and filing of this report. Because the reserves data and the contingent resources data are based on judgments regarding future events, actual results will vary and the variations may be material. March 25, 2025 (signed) “Sean Guest” (signed) “Timothy Chapman” Sean Guest President and Chief Executive Officer Timothy Chapman Director and Chairman of Reserves Committee (signed) “Jim McFarland” (signed) “Timothy Marchant” Jim McFarland Director and Member of Reserves Committee Timothy Marchant Director and Member of Reserves Committee
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 53 APPENDIX B – TERMS OF REFERENCE FOR THE AUDIT COMMITTEE I. PURPOSE The primary function of the Audit Committee (the “Committee”) is to assist the Board in fulfilling its oversight responsibilities by reviewing: A. the financial information that will be provided to the shareholders and others; B. the systems of internal controls, management and the Board of Directors have established; and C. all audit processes; and D. the effectiveness of the Corporation’s financial risk management and compliance practices, including commodity price risks, credit risks and information technology, cybersecurity and data security risks. E. Primary responsibility for the financial reporting, information systems, risk management and internal controls of the Corporation is vested in management and is overseen by the Board. II. COMPOSITION AND OPERATIONS A. The Committee shall be composed of not fewer than three directors and not more than five directors, all of whom are independent2 directors of the Corporation. B. All Committee members shall be “financially literate”3 and at least one member shall have “accounting or related financial expertise”. The Committee may include a member who is not financially literate, provided he or she attains this status within a reasonable period of time following his or her appointment and providing the Board has determined that including such member will not materially adversely affect the ability of the Committee to act independently. C. The Committee shall operate in a manner that is consistent with the Committee Guidelines outlined in the Board Manual. D. The Corporation’s external auditor shall be advised of the names of the Committee members and will receive notice of and be invited to attend meetings of the Committee, and to be heard at those meetings on matters relating to the external auditor’s duties. E. The Committee has the authority to communicate with the external auditor as it deems appropriate to consider any matter that the Committee or external auditor determine should be brought to the attention of the Board or shareholders. F. The Committee shall meet as often as necessary to fulfil its mandate and responsibilities described herein and, in any event, shall meet at least four times each year. The Chair may call additional meetings as required. III. Duties and Responsibilities Subject to the powers and duties of the Board, the Committee will perform the following duties: A. Financial Statements and Other Financial Information The Committee will review and recommend for approval to the Board financial information that will be made publicly available. This includes: i. review and recommend approval of the Corporation’s annual financial statements and management’s discussion and analysis and report to the Board before the statements are approved by the Board; ii. review and approve for release the Corporation’s quarterly financial statements, management’s discussion and analysis and press release; iii. satisfy itself that adequate procedures are in place for the review of the public disclosure of financial iv. information extracted or derived from the Corporation’s financial statements, other than the public disclosure referred to in items (i) and (ii) above, and periodically assess the adequacy of those procedures; v. review the annual information form and any prospectus/private placement memorandums; vi. review the treatment for financial reporting purposes of any significant transactions which are not a normal part of the Corporation’s financial statements; and vii. review other financial information included in any public disclosure to ensure that it is consistent with the Board’s knowledge of the affairs of the Corporation and is unbiased and non-selective. Review and discuss: i. the appropriateness of accounting policies and financial reporting practices used by the Corporation; ii. the use of any “pro forma” or “adjusted” information not in accordance with IFRS; 2 Independence requirements are described in the Appendix to Tab 5, Board Operating Guidelines. 3 The Board has adopted the NI 52-110 definition of “financial literacy”, which is an individual is financially literate if he or she has the ability to read and understand a set of financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the issuer’s financial statements.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 54 iii. issues regarding accounting principles and financial statement presentations, including any significant proposed changes in financial reporting and accounting policies and practices to be adopted by the Corporation; iv. any new or pending developments in accounting and reporting standards that may affect the Corporation; v. any problems, difficulties or differences encountered in the course of the audit work including any disagreements with management or restrictions on the scope of the external auditor’s activities or on access to requested information and management’s response thereto; vi. the effect of regulatory and accounting initiatives, as well as any off-balance sheet structures on the financial statements of the Corporation and other financial disclosures; vii. any reserves, accruals, provisions or estimates that may have a material effect upon the financial statements of the Corporation; viii. the use of special purpose entities and the business purpose and economic effect of off-balance sheet transactions, arrangements, obligations, guarantees and other relationships of the Corporation and their impact on the reported financial results of the Corporation; ix. review with management, the external auditor and, if necessary, legal counsel, any litigation, claim or contingency, including tax assessments, that could have a material effect upon the financial position of the Corporation, and the manner in which these matters may be, or have been, disclosed in the financial statements; and x. review accounting, tax and financial aspects of the operations of the Corporation as the Committee considers appropriate. B. Risk Management, Insurance and Disclosure The Committee will, in collaboration with the other committees of the Board, review and assist the Board in ensuring that the risk management and information systems are operating effectively. The Committee will have responsibility for advising the Board on the principal financial, audit and certain other designated risks to the Corporation and making recommendations to the Board regarding its oversight and management of such risks, including under the Corporation’s insurance program. The Committee will: i. review and evaluate commodity price risks, credit and counterparty risks, financial risks, tax and fiscal regime risks, market risks, repatriation and central banking risks, information technology, cybersecurity and data security risks, and ensure such risks are being properly identified and addressed under the Corporation’s Enterprise Risk Management Policy, Enterprise Risk Management Framework and Risk Register; ii. review and evaluate the Corporation’s insurable risks in collaboration with the other committees of the Board to ensure such insurable risks are being properly identified and addressed under the Corporation’s Enterprise Risk Management Policy, Enterprise Risk Management Framework and Risk Register and evaluate the cost/insurance benefits associated with such risks; iii. review and evaluate the Corporation’s annual insurance program, including the risk retention philosophy, potential exposure and corporate liability protection programs; and iv. in collaboration with the other committees of the Board, review and evaluate the Corporation’s disclosure of principal risks and whether such risks are being properly described. The Committee will make recommendations to the Board regarding such matters. i. review the Corporation’s risk management controls and policies; ii. obtain reasonable assurance that the information systems are reliable and the systems of internal controls are properly designed and effectively implemented through discussions with and reports from management, the internal auditor and external auditor; and iii. review management steps to implement and maintain appropriate internal control procedures including a review of policies. C. Internal Controls The Committee will oversee, review and approve, as required: i. processes adopted by management for establishing effective internal control over financial reporting (“ICFR”) and disclosure controls and procedures (“DC&P”); ii. the adequacy and effectiveness of the Corporation’s accounting, ICFR and DC&P policies and procedures; iii. changes to the Corporation’s ICFR and DC&P policies and procedures; iv. management’s certification of ICFR and DC&P; and v. spending authority and approval limits. D. Information Systems The Committee will obtain reasonable assurance that the Corporation’s information systems are reliable and are properly designed and effectively implemented through discussions with and reports from management, the internal auditor and external auditor.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 55 E. Cyber Security The Committee will review, on a regular basis: i. a system status update with respect to the Corporation’s IT systems; ii. the Corporation’s cyber security programs and their effectiveness; and and the Committee shall ensure that any breaches of cyber security or potential cyber threats will be reported to the Board in accordance with best governance practices. F. External Audit The external auditor is required to report directly to the Committee, which will review the planning and results of external audit activities and the ongoing relationship with the external auditor. This includes: i. review and recommend to the Board, for shareholder approval, engagement of the external auditor; ii. review and approve compensation for the external auditor; iii. review and approve the annual external audit plan, including but not limited to the following: a. engagement letter; b. objectives and scope of the external audit work; c. procedures for quarterly review of financial statements; d. materiality limit; e. areas of audit risk; f. staffing; g. timetable; and h. approve fees; iv. meet with the external auditor, without management being present, to discuss (A) the external auditor’s judgment about the quality, integrity and appropriateness of the Corporation’s accounting principles and financial disclosure practices as applied in its financial reporting; (B) the Corporation’s quarterly and annual financial statements; and (C) the external auditor’s report including the appropriateness of accounting policies and underlying estimates v. maintain oversight of the external auditor’s work and advise the Board, including but not limited to: a. the resolution of any disagreements between management and the external auditor regarding financial reporting; b. any significant accounting or financial reporting issue; c. any material issues or potentially material issues, either specific to the Corporation or to the financial reporting environment in general, identified by the external auditor; d. the external auditor’s evaluation of the Corporation’s system of internal controls, procedures and documentation; e. the post audit or management letter containing any findings or recommendation of the external auditor, including management’s response thereto and the subsequent follow-up to any identified internal control weaknesses; f. any other matters the external auditor brings to the Committee’s attention; and g. assess the performance and consider the annual appointment or re-appointment of the external auditor for recommendation to the Board ensuring that such external auditor is a participant in good standing pursuant to applicable regulatory laws; vi. review the external auditor’s report on all material subsidiaries; vii. annually request and review a report from the external auditor regarding (A) the external auditor’s internal quality control procedures; (B) any material issues raised by the most recent internal quality control review, Canadian Public Accountability Board or Public Company Accounting Oversight Board or other available peer review of the external auditor, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues; viii. review and discuss with the external auditor all significant relationships that the external auditor and its affiliates have with the Corporation and its affiliates in order to determine the external auditor’s independence, including, without limitation: a. requesting, receiving and reviewing, on a periodic basis, a formal written statement from the external auditor delineating all relationships that may reasonably be thought to bear on the independence of the external auditor with respect to the Corporation; b. discussing with the external auditor any disclosed relationships or services that the external auditor believes may affect the objectivity and independence of the external auditor; and c. recommending that the Board take appropriate action in response to the external auditors’ report to satisfy itself of the external auditors’ independence; ix. review and pre-approve any non-audit services to be provided by the external auditor’s firm or its affiliates (including estimated fees), and consider the impact on the independence of the external audit;
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 56 x. review and discuss with management and the external auditor any accounting adjustments that were not adopted (as immaterial or otherwise) and management or internal control letters issued or proposed to be issued by the external auditor and management’s response to such letters; xi. review with management and the external auditor any significant complaints received related to disclosure, financial controls, fraud or other matters; and xii. meet in-camera at each meeting of the Committee with the external auditor without management present. G. Compliance The Committee shall: i. ensure that the external auditor’s fees are disclosed by category in the annual information form in compliance with regulatory requirements; ii. disclose any specific policies or procedures the Corporation has adopted for pre-approving non-audit services by the external auditor including affirmation that they meet regulatory requirements iii. assist the Governance, Nomination and Compensation Committee with preparing the Corporation’s governance disclosure by ensuring it has current and accurate information on: a. the independence of each Committee member relative to regulatory requirements for audit committees; b. the state of financial literacy of each Committee member, including the name of any member(s) currently in the process of acquiring financial literacy and when they are expected to attain this status; and c. the education and experience of each Committee member relevant to his or her responsibilities as Committee member; iv. disclose if the Corporation has relied upon any exemptions to the requirements for Audit Committees under regulatory requirements. H. Other The Committee shall: i. establish and periodically review implementation of procedures for: a. the receipt, retention and treatment of complaints received by the Corporation regarding accounting, internal accounting controls, or auditing matters; and b. the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters, fraud, corruption, or financial, audit or accounting matters that could negatively impact the Corporation, including violations of the Corporation’s Code of Business Conduct and Ethics that relate to such matters; ii. review and approve the Corporation’s hiring policies regarding partners, employees and former partners and employees of the present and former external auditor; iii. review insurance coverage of significant business risks and uncertainties; iv. review material litigation and its impact on financial reporting; v. review policies and procedures for the review and approval of officers’ expenses and perquisites; vi. review policies and practices concerning the expenses and perquisites of the Chairman, including the use of the assets of the Corporation; vii. review with external auditor any corporate transactions in which directors or officers of the Corporation have a personal interest; viii. review the terms of reference for the Committee annually and make recommendations to the Board as required; ix. oversee and monitor compliance with the Anti-Corruption Policy, and periodically review and recommend revisions to the Board related thereto, including reporting to the Board on the adequacy of the policy and the implementation of matters thereunder; x. review and approve the list of gifts and entertainment expenses and other matters contemplated under the Anti-Corruption Policy of the Corporation (the “Anti-Corruption Policy”); and xi. meet in-camera with the CFO as desired. IV. Outside experts and advisors The Committee may retain, and set and pay the compensation to, any outside expert or advisor, including but not limited to audit and accounting matter experts and advisors, and legal, accounting, financial or other consultants, at the Corporation’s expense, in order to permit the Committee to carry out its duties and responsibilities hereunder. The Committee will assure itself as to the independence from management of any outside expert or advisor. The Committee will notify the Chairman of the Board prior to the engagement of any outside expert or advisor hereunder. V. ACCOUNTABILITY The Committee Chair has the responsibility to make periodic reports to the Board, as requested, on financial matters relative to the
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 57 Corporation. v. The Committee shall report its discussions to the Board by maintaining minutes of its meetings and providing an oral report at the next Board meeting VI. COMMITTEE TIMETABLE The timetable on the following pages outlines the Committee’s schedule of activities.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 58 Task Meeting(1) Q1 Q2 Q3 Q4 A. Financial Statements and Other Financial Information i. Review and recommend approval of the annual financial statements, MD&A and press release. X ii. Review and recommend approval of the quarterly financial statements, MD&A and press release. X X X iii. Review public disclosure of financial information. X X X X iv. Review the annual information form. X v. Review any prospectus/private placement memorandums. As applicable vi. Review the treatment for financial reporting purposes of any significant transactions which are not a normal part of the Corporation’s financial statements. As applicable vii. Review other financial information included in any public disclosure to ensure that it is consistent with the Board’s knowledge of the affairs of the Corporation. X X X X viii. Review and discuss accounting policies and financial reporting practices. X X X X ix. Review the use of any “pro forma” or “adjusted” information not in accordance with IFRS. X X X X x. Review and discuss changes in financial reporting and accounting policies and practices. As applicable xi. Review and discuss developments in accounting and reporting standards. As applicable xii. Review the effect of regulatory and accounting initiatives and any off-balance sheet structures on the financial statements. As applicable xiii. Review the use of special purpose entities and off-balance sheet transactions, obligations, guarantees and other relationships and their impact on the reported financial results. As applicable xiv. Review with management, the external auditor and, if necessary, legal counsel, any litigation, claim or contingency, including tax assessments, that could have a material effect upon the financial position of the Corporation. As applicable B. Risk Management, Insurance and Disclosure i. Review and evaluate commodity price risks, credit and counterparty risks, financial risks, tax and fiscal regime risks, market risks, repatriation and central banking risks, information technology, cybersecurity and data security risks, and ensure such risks are being properly identified and addressed under the ERM Policy, Framework and Risk Register. X X X X ii. Review and evaluate the Corporation’s insurable risks in collaboration with the other committees of the Board to ensure such insurable risks are being properly identified and addressed under the Corporation’s ERM Policy, Framework and Risk Register and evaluate the cost/insurance benefits associated with such risks. X X X X iii. Review and evaluate the Corporation’s annual insurance program, including the risk retention philosophy, potential exposure and corporate liability protection programs. X X iv. In collaboration with the other committees of the Board, review and evaluate the Corporation’s disclosure of principal risks and whether such risks are being properly described. X X X X Internal Controls i. Review and approve ICFR and DC&P. X X X X ii. Review and approve the adequacy and effectiveness of the Corporation’s accounting, ICFR and DC&P. X X X X iii. Review and approve changes to the Corporation’s ICFR and DC&P. As applicable iv. Review and approve management’s certification of ICFR and DC&P. X X X X v. Review and approve spending authority and approval limits. X C. Cyber Security i. Review system status update with respect to the Corporation’s IT systems. X X X X ii. Review Corporation’s cyber security programs and their effectiveness. X X X iii. Review updates on the Corporation’s compliance program for cyber threats and security. As applicable D. External Audit i. Review external auditor engagement. X X ii. Review and approve compensation for the external auditor. X iii. Review and approve external audit plan including: X a. engagement letter; X b. objectives and scope; X c. procedures for quarterly review of financial statements; X d. materiality limit; X
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 59 Task Meeting(1) Q1 Q2 Q3 Q4 e. areas of audit risk; X f. staffing; X g. timetable; and X h. approve fees. X iv. Meet auditor to discuss annual & quarterly financial statements and auditor’s report. X X X X v. Maintain oversight of the external auditor’s work and advise the Board. X X X X a. resolution of any disagreements between management and external auditor; X X X X b. any significant accounting or financial reporting issue; X X X X c. any material issues or potentially material issues, either specific to the Corporation or to the financial reporting environment in general, identified by the external auditor; As applicable d. auditor's evaluation of internal controls, procedures and documentation; X X X X e. post audit recommendation of the external auditor; X X X X f. other matters the external auditor brings to the Committee’s attention; and X X X X g. assess performance of external auditor. X X X X vi. Review auditor’s report on all material subsidiaries X X X X vii. Annually request and review a report from the external auditor regarding (A) the external auditor’s internal quality control procedures; (B) any material issues raised by the most recent internal quality control review, Canadian Public Accountability Board or Public Company Accounting Oversight Board or other available peer review of the external auditor, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues. X viii. Review and receive assurances on independence of external auditor. X X X X ix. Review non-audit services to be provided by the external auditor’s firm or its affiliates. As applicable x. Review and discuss with management and the external auditor any accounting adjustments that were not adopted and management or internal control letters issued or proposed by the external auditor and management’s response. As applicable xi. Review with management and the external auditor any significant complaints received related to disclosure, financial controls, fraud or other matters. As applicable xii. Meet in-camera with the external auditor without management present. X X X X E. Compliance i. Disclose external auditor’s fees (in annual information form). X ii. Disclose specific policies or procedures for pre-approving non-audit services by the external auditor (in annual information form). X iii. Assist Governance, Compensation and Nominating Committee with preparing governance disclosure: X a. independence of each Committee member; X b. state of financial literacy of each Committee member; and X c. education and experience of each Committee member. X iv. Disclose any exemptions to the requirements for Audit Committees. X F. Other i. Establish and review implementation of procedures X a. receipt, retention and treatment of complaints; and X b. submission of employees’ concerns. X ii. Review and approve hiring policies of present and former external auditor. X
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 60 Task Meeting(1) Q1 Q2 Q3 Q4 iii. Review insurance coverage of significant business risks and uncertainties. X X iv. Review material litigation and its impact on financial reporting. As applicable v. Review policies and procedures for review and approval of officers’ expenses and perquisites. X vi. Review terms of reference for Audit Committee and make recommendations to the Board. X vii. Review the adequacy of the Anti-Corruption Policy and report on its implementation and matters arising thereunder to the Board. As applicable X viii. Review list of gifts and entertainment expenses and other matters contemplated under the Anti-Corruption Policy. X X X X ix. Meet in-camera with the CFO as desired. X X X X (1) Pursuant to the Terms of Reference for the Audit Committee, the Committee is required to meet at least four times annually. (2) Deadline for TSX annual filings is 90 days after year-end and for quarterly filings is 45 days after quarter-end.
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Annual Information Form | For the Year Ended December 31, 2024 Valeura Energy PAGE 61 CONTACT INFORMATION Head Office 111 Somerset Road #09-31 Singapore 238164 Key Spokespersons Sean Guest, President and CEO Yacine Ben-Meriem, CFO General Inquiries: Contact@valeuraenergy.com Capital Markets / Investor Inquiries Robin James Martin, Vice President, Communications and Investor Relations Phone: +1 403 975 6752 (Canada) / +44 7392 940495 (UK) Investor Inquiries: IR@valeuraenergy.com
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