Kelt provides 2026 financial, production guidance

Mr. David Wilson reports KELT PROVIDES 2026 FINANCIAL AND OPERATING GUIDANCE AND SETS ITS 2026 CAPITAL EXPENDITURE BUDGET AT $355 MILLION Kelt Exploration Ltd. has provided financial and operating guidance for 2026. The company expects to incur $355-million in capital expenditures during the year and is forecasting to generate $355-million in adjusted funds from operations in 2026. The following table outlines Kelt's forecasted average commodity price assumptions for 2026 with actual 2024 and forecasted 2025 commodity prices shown for comparative purposes. Financial and operating highlights forecasted for 2026 compared with 2025 forecasts are outlined in the table below. Kelt's board of directors has approved a capital expenditure program of $355-million in 2026. The company expects to spend $252-million (71 per cent) drilling 33.2 net wells and completing 37.2 net wells during the year. An estimated $96-million (27 per cent) is expected to be incurred equipping new wells and on other related infrastructure such as facilities and pipelines. The remaining budget of $7-million (2 per cent) is expected to be spent on land purchases and other miscellaneous. Production in 2026 is expected to average between 50,000 and 52,000 barrels of oil equivalent per day, up 26 per cent from average production forecasted for 2025. The product mix for 2026 average production is expected to be 38 per cent oil and NGLs (natural gas liquids) and 62 per cent gas. Adjusted funds from operations (AFFO) for 2026 is forecasted to be $355-million, 27 per cent higher than the company's 2025 forecast of $280-million. On Dec. 31, 2026, the company expects to have net debt of $170-million, or 0.5 times forecasted AFFO for 2026. In its Oak/Flatrock division, Kelt expects to drill nine development wells and one exploratory/delineation well during 2026. The company expects to complete 12 wells in 2026, including two DUCs (drilled but uncompleted wells) from the 2025 drilling program. In its Pouce Coupe/Progress/Spirit River division, during 2026, Kelt expects to drill seven wells and complete eight wells, including a DUC from 2025. In its Wembley/Pipestone division, Kelt expects to continue to be active during 2026. The company expects to drill 16 Montney wells and complete 17 wells during the year. Kelt continues to maintain financial flexibility with an anticipated net-debt-to-AFFO ratio of 0.5 times, forecasted at Dec. 31, 2026. Commodity price sensitivities to estimated AFFO for 2026 are as follows: A 10-per-cent change in Kelt's forecasted annual average net realized price for oil and NGL sales of $74.62 per barrel and $32.4 per barrel, respectively, would affect AFFO by $25.3-million. A 10-per-cent change in Kelt's forecasted annual average net realized price for gas sales of $3.63 per thousand cubic feet would affect AFFO by $19.4-million. Changes in forecasted commodity prices and variances in production estimates can have a significant impact on estimated funds from operations and earnings. The information set out herein is a "financial outlook" within the meaning of applicable securities laws. The purpose of this financial outlook is to provide readers with disclosure regarding Kelt's reasonable expectations as to the anticipated results of its proposed business activities for the calendar years 2025 and 2026. Readers are cautioned that this financial outlook may not be appropriate for other purposes. We seek Safe Harbor.