Fiddlehead Announces Listing on the TSX Venture Exchange

/THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

CALGARY, AB, Sept. 10, 2024 /CNW/ - Fiddlehead Resources Corp. ("Fiddlehead" or the "Company") is pleased to announce the listing of its common shares ("Common Shares") under the symbol "FHR" and warrants ("Warrants") under the symbol "FHR.WT", on the TSX Venture Exchange ("TSXV"). The Common Shares and Warrants were issued in connection with the Company's previously announced acquisition ("Acquisition") of the South Ferrier, Strachan area assets ("South Ferrier") in Alberta from a senior Canadian producer.

An updated investor presentation can be accessed on Fiddlehead's website at www.fiddleheadresources.com for interested investors and key shareholders.

Fiddlehead CEO, Brent Osmond stated, "This accomplishment is a result of the outstanding commitment of our leadership team and board of directors. Today's listing of common shares and warrants on the TSXV provides Fiddlehead with access to strategic capital that will support our continued development and consolidation within the Cardium Fairway. This milestone marks a key step in our strategy."

About Fiddlehead

Producing Assets and Land Positions in Cardium Fairway

• Undeveloped land position of 25,496 hectares (gross) / 14,213 hectares (net)
• Developed land position of 19,136 hectares (gross) / 11,227 hectares (net)
• Average working interest of approximately 77% of producing wells
• All land is held by production with no expiries
• Existing infrastructure has available capacity to handle growth production
• Strong liability management rating (LMR) of approximately 3.0x

Significant Reserves & Substantial Resource Development Upside

• Significant remaining PDP reserves of 3.7 million boe, valued at an NPV10% of $34.5 million1
• Substantial proved and probable (2P) reserves of 7.9 million boe, valued at an NPV10% of $69.2 million1
• 50+ identified development well drilling locations from existing acreage, many on existing well pads in defined Cardium fairway
• Significant upside and extensive drilling inventory across multi-stacked zones in the Belly River, Falher, Glauconitic, Mannville, Notikewin, Rock Creek and Viking
• Multi-well drilling campaign expected to commence in the months following the closing of the Acquisition, with an initial 2 Cardium horizontal wells

Free Cash Flow Production with Development Upside

• Free funds flow driven by low decline cash flow, and has liquids focused drilling upside
• High working interest and operatorship in South Ferrier by the Company ensures control over optimizing operating costs and capital expenditure schedule to control operating costs and grow margins

Acquisition Strategy of Upstream Assets

• Fiddlehead will acquire strategically positioned assets with strong risk adjusted cash flow and significant commodity price upside
• Capitalize on the opportunity to consolidate assets in the identified fairway, starting with South Ferrier with low decline, high netback production
• Pursue pipeline of accretive acquisition opportunities in the Western Canadian Sedimentary Basin

Experienced Leadership Team in Cardium Fairway

• Fiddlehead team has experience in the identified fairway, has worked on similar transactions, and has meaningful subject matter expertise in the focus basins
• Deep understanding of commodity marketing and will manage the product sales portfolio to mitigate downside risk, while capitalizing on the long-term upside potential in commodity prices

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Note Regarding Forward Looking Information

This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. Any statements that are contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "will", "estimates", "believes", "intends" "expects" and similar expressions which are intended to identify forward-looking information or statements. More particularly and without limitation, this press release contains forward looking statements and information concerning: financial and operating forecasts with respect to South Ferrier; the Company's intention to exploit the reservoirs and the Company's long term business strategy with respect to South Ferrier. Fiddlehead cautions that all forward-looking statements are inherently uncertain, and that actual performance may be affected by a number of material factors, assumptions and expectations, many of which are beyond the control of Fiddlehead, including expectations and assumptions concerning Fiddlehead, the Acquisition, the timely receipt of all required TSXV and regulatory approvals and exemptions (as applicable) and the satisfaction of other closing conditions in accordance with the terms of the Definitive Agreement. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Fiddlehead. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.

Statements relating to "reserves" are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and that the reserves can be profitably produced in the future. There are numerous uncertainties inherent in estimating quantities of crude oil, natural gas and NGL reserves and the future cash flows attributed to such reserves. The reserve and associated cash flow information set forth above are estimates only. In general, estimates of economically recoverable crude oil, natural gas and NGL reserves and the future net cash flows therefrom are based upon a number of variable factors and assumptions, such as historical production from the properties, production rates, ultimate reserve recovery, timing and amount of capital expenditures, marketability of oil and natural gas, royalty rates, the assumed effects of regulation by governmental agencies and future operating costs, all of which may vary materially. For these reasons, estimates of the economically recoverable crude oil, NGL and natural gas reserves attributable to any particular group of properties, classification of such reserves based on risk of recovery and estimates of future net revenues associated with reserves prepared by different engineers, or by the same engineers at different times, may vary. Fiddlehead and the Assets' actual production, revenues, taxes and development and operating expenditures with respect to their respective reserves will vary from estimates thereof and such variations could be material.

The forward-looking statements contained in this press release are made as of the date of this press release, and Fiddlehead does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by securities law.

Throughout this news release and in other materials disclosed by the Company, we employ certain measures to analyze financial performance, financial position and cash flow. These non-GAAP and other financial measures do not have any standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures provided by other issuers. Non-GAAP and other financial measures should not be considered to be more meaningful than GAAP measures which are determined in accordance with IFRS, such as net income (loss) and cash flow from operating activities as indicators of our performance.

The following are non-GAAP financial measures: capital expenditures, free funds flow, net operating income, net operating expenses and operating netback and operating netback. Where applicable, these non-GAAP financial measures are presented on a multiple, per boe or a per share basis resulting in non-GAAP financial ratios. These non-GAAP financial measures and ratios are not standardized financial measures under IFRS and might not be comparable to similar financial measures disclosed by other issuers.

Management feels net operating income is a key industry benchmark and measure of operating performance of the Company that assists management and investors in assessing the Company's profitability and is commonly used by other petroleum and natural gas producers. Net operating income is calculated as petroleum and natural gas revenue less royalties, transportation and operating expenses.

The Company calculates "Adjusted Purchase Price/PDP NPV10%" by dividing the Adjusted Purchase Price by the net present value of the proved developed producing reserves discounted at 10%, "Adjusted Purchase Price/Proven NPV10%" by dividing the Adjusted Purchase Price by the net present value of the proven reserves discounted at 10%, "Adjusted Purchase Price/Proven + Probable NPV10%" by dividing the Adjusted Purchase Price by the net present value of the proven and probable developed producing reserves discounted at 10%, "Adjusted Purchase Price/PDP" by dividing the Adjusted Purchase Price by the estimated proved developed producing reserves, "Adjusted Purchase Price/Proven" by dividing the Adjusted Purchase Price by the estimated proven reserves and "Adjusted Purchase Price/2P" by dividing the Adjusted Purchase Price by the estimated total proved plus probable reserves.

Oil and Gas Advisories

Reserves estimates in this press release in respect of the Acquisition are based on the evaluations prepared by GLJ Ltd., as independent qualified reserves evaluator, as set out in the Strachan/South Ferrier Report effective as at December 31, 2023, which was prepared in accordance with National Instrument 51-101 and the COGE Handbook ("COGEH"). The reserves or future net revenue were made assuming that development of each property in respect of which the estimate is made will occur, without regard to the likely availability to the reporting issuer of funding required for that development.

This press release contains estimates of the NPV of the Company's future net revenue from reserves associated with South Ferrier and assets acquired pursuant to previously completed acquisitions, as applicable. Such amounts do not represent the fair market value of such reserves. The recovery and reserve estimates provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. The NPV of the respective assets' base production is a snapshot in time and is based on the reserves evaluated using the applicable pricing assumptions described above. The NPV is calculated using a discount rate of 10%, on a before tax basis and is the sum of the present value of proved plus probable developed producing reserves based on the applicable pricing assumptions. It should not be assumed that the undiscounted or discounted NPV of future net revenue attributable to the respective assets represents the fair market value of those assets. The estimates for reserves for individual properties may not reflect the same confidence level as estimates of reserves for all properties due to the effects of aggregation. The recovery and reserve estimates of crude oil, NGL and natural gas reserves are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual reserves may be greater than or less than the estimates relied upon for NPV calculations, herein.

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THIS PRESS RELEASE, REQUIRED BY APPLICABLE CANADIAN LAWS, IS NOT FOR DISTRIBUTION TO U.S. NEWS SERVICES OR FOR DISSEMINATION IN THE UNITED STATES, AND DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO SELL ANY OF THE SECURITIES DESCRIBED HEREIN IN THE UNITED STATES. THESE SECURITIES HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS UNLESS REGISTERED OR EXEMPT THEREFROM.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction.

SOURCE Fiddlehead Resources Corp.

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