NG Energy International closes Sinu-9 transactions

Executive Summary

• NG Energy International Corp. has closed its transactions with Etablissements Maurel & Prom SA (M&P), resulting in M&P acquiring a 61% operating working interest and NG Energy retaining a 39% non-operating working interest in the Sinu-9 block.
• The transaction involves total cash consideration of $150 million (U.S.) from M&P for the sale of the interest, with revised payment terms including $25 million paid at closing and the remaining $110 million paid in two installments in 2026. Additionally, NG Energy acquired a collective 28% working interest from minority partners for approximately $24 million (U.S.).
• The company announced its 2026 development plan, which includes drilling six wells at Sinu-9 and one at Maria Conchita, with net capital expenditures anticipated at $50 million (U.S.). Concurrently, the company initiated a Normal Course Issuer Bid (NCIB) to purchase up to 10% of its public float and proposed new director nominees for its upcoming annual meeting.

Key Details

• Sinu-9 Transaction Structure:
  • M&P acquired a 40% operating working interest for $150 million (U.S.).
  • NG Energy acquired a collective 28% working interest from minority partners (together with M&P) for approximately $24 million (U.S.).
  • Post-closing ownership: M&P holds 61% (operating); NG Energy holds 39% (non-operating).
• Payment Terms (M&P):
  • Total consideration: $150 million (U.S.).
  • Initial payments already received: $40 million (U.S.).
  • Revised structure for remaining $110 million (U.S.):
    • $25 million (U.S.) paid at closing.
    • $42.5 million (U.S.) payable three months from closing (April 5, 2026).
    • $42.5 million (U.S.) payable six months from closing (July 5, 2026).
• Call Option: M&P retains an irrevocable right to purchase an additional 5% working interest in Sinu-9 until January 5, 2027, subject to adjustments for cash flows from February 1, 2025.
• 2026 Development Plan:
  • Drilling six wells at Sinu-9, starting with Hechicero-1X.
  • Drilling one additional well (Aruchara-5) at Maria Conchita.
  • Infrastructure expansion with Infraes SAS ESP; initial pipeline loop expected by Q2 2026, increasing capacity to 40 million cubic feet per day.
  • Net capital expenditures for 2026: ~$50 million (U.S.).
• Normal Course Issuer Bid (NCIB):
  • Filed revised notice to purchase up to 17,661,657 common shares (10% of public float).
  • Bid term: January 5, 2026, to January 5, 2027.
  • Broker: Haywood Securities Inc.
  • Purchase limit: Max 2% of issued and outstanding shares in any 30-day period.
• Corporate Governance / Director Nominees:
  • Annual General and Special Meeting scheduled for January 22, 2026.
  • Proposed slate of 7 directors:
    • Continuing: Brian Paes-Braga (Executive Chairman), Brian T. O'Neill, Don Sewell, Patricia Herrera Paba.
    • New Nominees: Keith Hill (Vice-Chairman), Paul Saad, Jorge Fonseca (CEO).
  • Not standing for re-election: Ronald Pantin, Humberto Calderon Berti.

Notable Quotes

• Brian Paes-Braga, Executive Chairman: "The completion of this landmark transaction with M&P represents a foundational milestone in our company's history. It delivers significant funding to fast-track development at Sinu-9 while allowing for maximum balance sheet flexibility... Partnering with a global operator like Maurel & Prom at Sinu-9 is transformative for NG Energy..."
• Jorge Fonseca, CEO: "With M&P as Sinu-9 operator and our aligned interests, we are well positioned to execute an aggressive drilling program in 2026... Maurel & Prom is a world-class operator with an extensive global track record in energy asset development and deep expertise in Colombia..."