ShaMaran Reports First Quarter 2026 Results

• Event: ShaMaran Petroleum Corp. reported First Quarter 2026 financial and operating results on May 6, 2026.
• Financials: Revenue increased 6% YoY to $38.0 million; Adjusted EBITDAX rose 15% to $28.1 million. However, net cash flow from operations declined 33% to $21.4 million.
• Operations: Total average gross daily production fell 45% to 35.9 Mbopd compared to Q1 2025. Crucially, both Atrush and Sarsang blocks have been shut-in since March 2, 2026, due to regional security concerns related to the Iran war.
• Incidents: An explosion occurred at a Sarsang processing facility on March 5, 2026, and another at a storage facility on April 1, 2026. No injuries reported, but operations remain suspended with no certainty on restart duration.
• Corporate Structure: Shareholders approved the move of primary listing from Toronto (TSXV) to Oslo (EGO) and incorporation change from Canada to Bermuda.
• Balance Sheet: Cash position is $40.7 million against gross debt of $143.8 million, resulting in net debt of $103.1 million as of May 6, 2026.

• Operational Risk Confirmed: The news confirms that the production shut-in announced on March 2 is indefinite ("no certainty regarding the duration"). This validates the negative operational outlook established in previous months but quantifies the financial resilience during the partial Q1 period (Jan-Feb).
• Financial Divergence: While revenue and EBITDAX appear positive, this is driven by pre-shut-in production (January/February) and higher price realizations. The 33% drop in operating cash flow signals deteriorating liquidity generation capability as production halts.
• Liquidity Concern: With $40.7 million in cash and net debt of $103.1 million, the company faces significant pressure if the shut-in extends beyond Q2. The previous Q4 2025 results showed strong cash flow ($69.1M for FY), but that relied on uninterrupted exports which are now halted.
• Market Reaction: The stock price has already declined from $0.24 in early March to a low of $0.18 following the initial shut-in announcement. This earnings report confirms the status quo without adding new catastrophic surprises, hence rated Routine - Negative rather than Material - Negative, as the primary risk was priced in during March.
• Corporate Restructuring: The listing move to Oslo is approved but pending regulatory conditions. While intended to improve liquidity and access to oil investors, it introduces execution risk and does not solve the immediate operational halt.

• Company: ShaMaran Petroleum Corp. is an oil and gas exploration and production company focused on the Kurdistan Region of Iraq (KRI).
• Flagship Projects:
  • Atrush Block: 50% working interest. Gross production capacity approx. 30 Mbopd prior to shut-in.
  • Sarsang Block: 18% working interest. Gross production capacity approx. 27 Mbopd prior to shut-in. Operator is HKN Energy Ltd.
• Development Status: Both blocks are currently shut-in due to regional security concerns (Iran war) and facility explosions. Export via Iraq-Türkiye pipeline resumed in September 2025 but exports are halted with production.