CLOSING OF HARMATTAN ACQUISITION
Petrus is pleased to announce the closing of its previously announced Acquisition of oil-weighted Cardium light oil assets in the Harmattan area of central Alberta from a third-party for total consideration of approximately $33.4 million, subject to customary adjustments and the assumption by Petrus of certain pre-estimated post-closing obligations of the Vendor. For further details on the Acquisition, see Petrus' press release dated February 4, 2026.
CLOSING OF EQUITY FINANCINGS
Petrus is also pleased to announce the closing of its previously announced upsized bought-deal private placement and concurrent non-brokered private placement of an aggregate of 11,814,285 common shares of Petrus ("Common Shares") at a price of $1.75 per Common Share for gross proceeds of approximately $20.7 million (the "Equity Offerings"), which includes the full exercise of the over-allotment option granted to Haywood Securities Inc. ("Haywood") as sole underwriter of the bought-deal private placement. Petrus used the net proceeds from the Equity Offerings to repay indebtedness incurred to fund the purchase price for the Acquisition. Petrus also issued 85,714 Common Shares to Haywood as partial payment of its advisory fee in connection with the Acquisition.
2026 CAPITAL BUDGET AND GUIDANCE
In 2026, Petrus intends to execute a disciplined, returns-focused capital program aimed at sustaining production levels, increasing exposure to higher-margin liquids, improving capital efficiencies and generating free funds flow.
The Board of Directors of the Company has approved a capital budget of $50 million to $60 million for 2026. The majority of capital will be directed toward operated developmental drilling in the Company's core Ferrier area, with additional investment allocated to the recently acquired Harmattan Cardium assets. The remaining capital will support facility and infrastructure projects and land acquisitions. The budget is based on price assumptions of USD$65.00/bbl WTI for oil, CAD$2.50/GJ AECO for natural gas and a USD/CAD exchange rate of $0.73.
Through the execution of this capital program, Petrus expects to:
Deliver average 2026 production of 11,000 to 12,000 boe1 per day, comprised of approximately 40% oil and liquids and 60% natural gas
Generate $60 million to $65 million in funds flow2 (approximately $0.40 per share)
Maintain its monthly dividend of $0.01 per share, annually this represents approximately 7% of the current share price
Exit 2026 with net debt3 of approximately $75 million to $80 million, or 1.2x to 1.3x net debt to funds flow4
The 2026 capital program incorporates the Harmattan assets and integrates the Acquisition into the Company's 2026 plan. Relative to Petrus' outlook prior to closing the Acquisition, 2026 production increases by approximately 20% and projected funds flow increases by approximately 19%. The addition of oil-weighted Cardium production increases corporate liquids weighting and shifts the Company's commodity mix toward higher-value barrels, resulting in a more balanced production profile. Net debt to funds flow remains within Petrus' targeted range of approximately 1.2x to 1.3x, underscoring the disciplined structure of the transaction.
Given ongoing commodity price volatility, the Company will retain flexibility within its capital program and will adjust spending levels as appropriate to maintain balance sheet strength and optimize returns. Prior to closing the Acquisition, Petrus had hedged approximately 57% of its forecasted 2026 production at an average price of $2.88/GJ for natural gas and CAD $86.22/bbl for oil. Petrus intends to enter into additional hedging contracts to align hedged volumes associated with the acquired production with the Company's internal risk management strategy of maintaining a minimum of 50% of forecasted production hedged on a boe basis over the next 12-month period.
Following the completion of the Acquisition, Petrus enters 2026 with greater scale, improved liquids exposure and a strong balance sheet. The Company remains focused on executing its development program, maintaining financial strength and delivering sustainable returns to shareholders.
About Petrus Petrus is a public Canadian oil and gas company focused on property exploitation, strategic acquisitions and risk-managed exploration in Alberta.
For further information, please contact:Ken Gray, P.Eng.President and Chief Executive OfficerT: (403) 930-0889E: [email protected]
ADVISORIESBasis of PresentationAll amounts in this press release are stated in Canadian dollars unless otherwise specified.
Non-GAAP and Other Financial Measures
This press release refers to the terms "funds flow", "net debt" and "net debt to funds flow". These non-GAAP and other financial measures are not recognized measures under GAAP (IFRS) and do not have a standardized meaning prescribed by GAAP (IFRS). Accordingly, the Company's use of these terms may not be comparable to similarly defined measures presented by other companies. These non-GAAP and other financial measures should not be considered to be more meaningful than GAAP measures which are determined in accordance with IFRS as indicators of our performance. Management uses these non-GAAP and other financial measures for the reasons set forth below.
Funds Flow
Funds flow is a common non-GAAP financial measure used in the oil and natural gas industry that evaluates the Company's profitability at the corporate level. Management believes that funds flow provides information to assist a reader in understanding the Company's profitability relative to current commodity prices. The most directly comparable financial measure that is disclosed in the Company's primary ...
