Petro-Victory Energy Corp. Announces Private Placement and Provides Corporate Update

Executive Summary

• Petro-Victory Energy Corp. announced a non-brokered private placement of up to US$2.3 million at CAD$1.50 per share, with closing expected around September 26, 2025.
• The company reported the first commercial discovery of the Açu-3 zone at the AND-5 well, yielding approximately 42 bopd under cased hole formation testing, with a progressing cavity pump (PCP) now installed for production testing.
• The previously announced business combination with Azevedo & Travassos Energia (ATE) is delayed as ATE failed to meet capital raise conditions; the company is negotiating modifications to continue the transaction.

Key Details

• Private Placement:
  • Structure: Non-brokered private placement of common shares.
  • Price: CAD$1.50 per share.
  • Gross Proceeds: Up to US$2,300,000.
  • Use of Proceeds: General working capital and capital expenditures for existing field development.
  • Closing Date: Expected on or about September 26, 2025, subject to TSXV acceptance.
• AND-5 Well Operations (Açu-3 Discovery):
  • Drilling: Appraisal well 3-AND-5-RN drilled to 1,165 meters.
  • Logging: Halliburton CBL/VDL confirmed cement integrity; Carbon-Oxygen cased-hole logging identified four prospective zones in the Açu Formation.
  • Testing: Interval 853m – 858m (Açu-3) underwent cased-hole formation test with downhole pressure gauges.
  • Results: Confirmed oil presence with potential initial flow rate of ~42 bopd in absolute open flow.
  • Completion: Well completed with a progressing cavity pump (PCP) on September 3, 2025; production test underway at Andorinha Field gathering station.
• Business Combination Update (ATE):
  • Status: Azevedo & Travassos Energia (ATE) did not meet conditions precedent related to the capital raise.
  • Action: Company and special committee are evaluating modifications to the MOU or alternative structures to facilitate the business combination.
• Promissory Notes Extension:
  • Total Amount: US$4,400,000 in short-term promissory notes extended.
  • New Maturity: July 14, 2026.
  • Interest Rate: 14% per annum.
  • Lenders and Amounts:
    • Arm's length third party: US$1,600,000.
    • 579 Max Ltd (controlled by Director T. Lynn Bryant): US$1,450,000.
    • Arm's length third party: US$575,000.
    • Thomas C. Cooper (Director): US$375,000.
    • Richard Gonzalez (Chairman/CEO): US$300,000.
    • Fifteen Talents LP (controlled by Director Charles Cotter): US$50,000.
    • Arm's length third party: US$50,000.
  • Bonus Warrants Issued: New bonus warrants granted to lenders with expiration on July 14, 2026.
    • 579 Max Ltd: 1,514,724 warrants (mixed exercise prices: C$1.25, C$0.86, C$1.49).
    • Thomas C. Cooper: 546,812 warrants (mixed exercise prices: C$0.70, C$1.25, C$1.49, C$0.86).
    • Richard Gonzalez: 288,934 warrants (mixed exercise prices: C$0.86, C$1.49).
    • Fifteen Talents LP: 48,292 warrants (C$1.49).
    • Arm's length third parties: Various warrants totaling ~2,640,926 with exercise prices ranging from C$0.70 to C$1.49.
  • Regulatory: Transactions involving directors constitute related party transactions under MI 61-101; exemptions from formal valuation and minority shareholder approval were relied upon as values did not exceed 25% of market capitalization. Subject to TSXV acceptance.

Notable Quotes

• None explicitly quoted in the text, though the release states the Company "is pleased to announce" the private placement and provides updates on the well and business combination.