Greenfire Resources Ord Shs T.GFR

Q1/2024: FREE CASH FLOW (FCF): NEGATIVE $ 6.860M

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- 5 out of the 10 DOWNHOLE TEMPERATURE SENSOR FAILURES in the recently drilled REFILL wells at the EXPANSION Asset have DEPRESSED BOP by 1,341 bbls/d in April compared to the Q1/2024 AVERAGE

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Expansion Asset (75% Working Interest, Operator)

• Working Interest Bitumen Production at the Expansion Asset Averaged Approximately 16,020 bbls/d in April 2024: The Company's production in April was impacted by the previously disclosed failure of third-party downhole temperature sensors in five of the ten recently drilled Refill wells. The five Refill wells equipped with downhole temperature sensors that have not failed produced at an average of approximately 1,500 bbls/d per well, on a 100% working interest basis, in April 2024. Greenfire has replaced the failed downhole temperature sensors at three of five Refill wells and expects that the average productivity of these Refill wells will increase to align with the current average productivity of the remaining five Refill wells where temperature sensors have not failed.
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• Drilling Rig Redeployed to Maintain Redevelopment Drilling: In response to continued regulatory delays at the Demo Asset, Greenfire redeployed the drilling rig to focus on redevelopment activities at the Expansion Asset. This drilling program is anticipated to conclude in the third quarter of 2024, after which the Company plans to mobilize the drilling rig back to the Demo Asset to drill additional Refill wells.
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• NCG Co-injection Continues to Support Higher Reservoir Pressure: Reservoir pressure and well productivity continue to increase at the Expansion Asset as a result of sustained high rates of NCG co-injection following the Company's debottlenecking initiatives undertaken in the second half of 2023. Greenfire expects that targeted reservoir pressure will be restored at the Expansion Asset around mid-2024.

Demo Asset (100% Working Interest, Operator)

• Working Interest Bitumen Production at the Demo Asset Averaged Approximately 2,340 bbls/d in April 2024: The Company's production in April was impacted by Refill well drilling operations as well as the temporary shut-in of the disposal well.
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• Timing to Recommence Disposal Well Operations Impacted by Delayed Regulatory Approval: The disposal well at the Demo Asset has been temporarily shut-in since the beginning of October 2023. With required remediation work complete, the disposal well is awaiting regulatory approval to recommence operations.
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• Three Refill Wells Drilled; Drilling Rig Reallocated to the Expansion Asset: The Company successfully drilled three extended reach Refill wells with lateral lengths of approximately 2,300 meters, which is 700 meters longer than the Refills recently drilled by Greenfire at the Expansion Asset. A second disposal well was also drilled at the Demo Asset, which is awaiting regulatory approval to commence operations.

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- in other words, TEMPORARY SETBACKS of 5 downhole sensor failures and DELAYED REGULATOR
Y APPROVAL of the disposal well at the DEMO asset has SUPPRESSED BOP at BOTH the EXPANSION and DEMO assets

- furthermore; REALIZED hedging losses, BOP suppression and HIGH CAPEX have PREVENTED any FCF GENERATION in Q1/2024 

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