TENAZ ENERGY CORP. ANNOUNCES 2025 FOURTH QUARTER AND YEAR-END RESULTS

Executive Summary

• Tenaz Energy Corp. reported a strong turnaround in Q4 2025 and full‑year 2025, delivering net income of $315.6 M ($11.18/share) versus a loss in 2024 and funds flow from operations (FFO) of $120.4 M – nearly five times the prior year.
• Major growth drivers were the acquisitions of NAM Offshore B.V. (renamed Tenaz Energy Netherlands B.V.) and Hansa Hydrocarbons Ltd., which added significant production, reserves (PDP up 839% to 32.3 MMboe) and cash flow.
• Production surged to an average 15,556 boe/d in Q4 2025 (up 32% QoQ) and 9,609 boe/d for the year (up 257% YoY). Net debt rose to $345.2 M, primarily due to acquisition financing, but remains covered by FY‑2026 cash flow.

Key Details

• Acquisitions
• May 2025 – NAM Offshore B.V.; cash consideration $9.2 M plus contingent earn‑out tied to free cash flow, exploration success and gas pricing.

• Oct 2025 – Hansa Hydrocarbons Ltd. (GEMS project); purchase price US$244 M ($339 M CAD) comprised of $232 M cash, $12 M common shares, plus contingent consideration.

• Production

• Q4 2025 average: 15,556 boe/d (↑32% QoQ).

• FY 2025 total: 9,609 boe/d (↑257% YoY), driven by GEMS assets and TEN workovers/drilling.

• Financial Performance

• Q4 2025 FFO: $62.1 M ($2.12/share) vs. $40.2 M in Q3 2025.
• FY 2025 FFO: $120.4 M (≈5× 2024).
• Net income Q4 2025: $107.6 M ($3.67/share); FY 2025 net income: $315.6 M ($11.18/share).
• Net debt end‑2025: $345.2 M (up from $55.0 M Q3 2025).

• Net debt/FFO ratio Q4 2025: 1.4× (vs. 0.3× Q3 2025).

• Financing Activity

• Issued additional senior unsecured notes (Nov 2024 series) – gross proceeds $178.9 M at 9.5% effective rate.

• New revolving credit facility: $115 M (National Bank, CIBC, Goldman Sachs); upsized to $150 M on Mar 6 2026 with DNB Bank ASA added.

• Share Repurchases

• FY 2025: 336,000 shares at $18.25 avg. price.
• FY 2026 YTD (through Mar 11): 43,600 shares at $35.84 avg. price.

• Total NCIB repurchases since Aug 2022: 2.5 M shares at $5.45 avg.

• Capital Expenditure

• Q4 2025 capex $84.2 M (barge workovers, drilling on TEN, non‑operated GEMS/L10).

• FY 2025 total capex $117.4 M (above guidance range $101.7–$111.7 M) due to advanced OBN seismic payment.

• 2026 Outlook

• Planned D&D budget: $250‑$275 M.
• Canadian program: three horizontal wells (2.6 net).
• TEN program: 3‑4 gross operated wells, continued workover campaign.

• Non‑operated GEMS: four gross wells (1.4 net) by ONE‑Dyas; L10: one new well (0.2 net) by Eni Netherlands.

• Reserves & Resources (independent McDaniel evaluation, effective 31 Dec 2025)

• PDP reserves: 32.3 MMboe (↑839% YoY).
• Total proved (1P): 57.4 MMboe (↑499%).
• Proved + Probable (2P): 91.7 MMboe (↑472%).
• FD&A cost: $16.76/boe (PDP); recycle ratio 2.8×.

• Reserve life indices – PDP 5.7 yr, 1P 10.1 yr, 2P 16.2 yr.

• Contingent & Prospective Resources (North Sea)

• Contingent resources (best‑estimate 2C): 38 MMboe risked; NPV (risked) $375 M at 10% discount.

• Prospective resources (mean estimate): 101 MMboe risked; NPV (risked) $1.57 B at 10% discount.

• Management Change

• Kyle Preston appointed Vice President of Investor Relations, succeeding retiring David Burghardt.

Notable Quotes

“We will do all we can to increase supplies of energy, particularly natural gas in Europe, during this time of war‑induced shortage.” – Anthony Marino, President & CEO

Materiality: Material – Positive (substantive earnings upside, major acquisitions, reserve expansion, and forward‑looking capital plan).