Tuktu to continue focusing on Monarch oil play in 2026

Executive Summary

• Tuktu Resources Ltd. announced its 2026 corporate strategy, which focuses exclusively on the Monarch oil play in the Alberta Deep basin, aiming to improve well targeting, derisk the Banff and Big Valley plays, and strengthen the balance sheet through cost-cutting and potential asset divestment.
• The company’s discovery well (4-20-010-24W4) continues to produce approximately 78 barrels per day, having produced over 107,000 bbl in aggregate since production began over a year ago.
• The offset horizontal well (16-20-010-24W4) remains shut in indefinitely after technical reviews determined it missed the reservoir pay zone due to drilling errors and inadequate logging, resulting in poor completion performance and pump malfunction.

Key Details

• 2026 Corporate Strategy:
  • Focus is streamlined solely on the Monarch oil play to derisk the Banff and Big Valley plays.
  • Plans include improving well targeting via seismic data, pursuing low-cost well workovers, and cutting overhead.
  • The company is evaluating the divestment of non-core assets to strengthen the balance sheet.
  • Technical initiatives include 2-D seismic review/interpretation, acquiring 3-D seismic data, and conducting core rock studies/petrophysical work to build geological models.
  • Operational goals include reducing general and administrative expenses, reducing operating costs, and broadening internal policies (EHS, ESG, internal controls).
• Operations Update – Discovery Well (4-20-010-24W4):
  • Located in the Alberta Deep basin.
  • Current production: Approximately 78 barrels per day.
  • Aggregate production: Over 107,000 barrels since being placed on production over a year ago.
  • Working Interest: 80%.
• Operations Update – Offset Horizontal Well (16-20-010-24W4):
  • Drilled in Q1 2025; currently shut in and likely to remain so indefinitely.
  • Performance Issues: The well missed the key pay zone (Banff porous interval) and drilled out of the reservoir.
  • Technical Causes:
    • Well was landed properly but drilled away from seismic control.
    • Drill cuttings showed only trace sandy siltstone with oil staining in the heel; the rest of the horizontal leg was siltstone with no oil stain.
    • Drilling was complicated by design and failure to use comprehensive logging tools (only gamma ray was used).
    • No gas detection outside the landing point/heel, indicating the well was out of zone.
  • Completion Failures:
    • Completion operations were ineffective (verified by tracer data and frack modeling).
    • Artificial lift (high-volume electric submersible pump) was improperly sized for the low inflow, leading to pump malfunction and shutdown.
• Banff Porous Play Review:
  • Geoscience review indicates the horizontal well missed the Upper Banff porous oil zone.
  • Initial findings suggest stratigraphic control that could be mapped by seismic data.
  • In-house 2-D seismic is being used to identify the trap and map the clastic reservoir extent; 3-D seismic and well data will be used to create a depositional model and exploration play trend map.
• Previous Optimization:
  • As of Nov. 20, 2025, an optimization program stabilized average production at approximately 490 barrels of oil equivalent per day (60% natural gas, 40% crude oil).

Notable Quotes

• No direct quotes from management were included in the provided text.