CLEARVIEW RESOURCES LTD. REPORTS THIRD QUARTER 2024 RESULTS

CALGARY, AB, Nov. 27, 2024 /CNW/ - Clearview Resources Ltd. ("Clearview" or the "Company") is pleased to announce its financial and operational results for the three and nine months ended September 30, 2024.

HIGHLIGHTS

• Increased oil production in the three and nine months ended September 30, 2024 by 38% and 6%, respectively, versus the comparative periods of 2023 primarily as a result of the previously disclosed acquisition completed in the second quarter of 2024;
• Disposed of certain undeveloped mineral rights in North Pembina area for $0.9 million;
• Generated adjusted funds flow⁽¹⁾ of $0.6 million ($0.05 per basic share⁽²⁾) in the three months ended September 30, 2024; and
• Further strengthened the Company's financial position with positive working capital of $0.4 million and cash on hand of $6.4 million as at September 30, 2024.

FINANCIAL and OPERATING HIGHLIGHTS

Financial

Production

Realized sales prices ⁽¹⁾

Netback analysis ⁽¹⁾

FINANCIAL and OPERATIONAL RESULTS

Production for the three months ended September 30, 2024 was down 4% to average 1,543 barrels of equivalent per day ("boe/d") versus the comparative quarter of 2023 at 1,599 boe/d.  The decrease in production was primarily due to lower natural gas production as a result of production downtime resulting from turnarounds at third party natural gas processing facilities, production shut-ins due to low natural gas prices and miscellaneous well downtime for a total of approximately 170 boe/d. Downtime due to unscheduled third-party turnarounds has continued into October and November. This decrease was partially offset by a full quarter of production from the new oil wells acquired in the second quarter of the year.  Production for the nine months ended September 30, 2024 decreased by 3% compared to the nine months ended September 30, 2023.  The decrease was a result of normal production declines and production downtime due to turnarounds and low natural gas prices.  The decrease was partially offset by the new well in Wilson Creek producing since late in the third quarter of 2023 and the oil wells acquired in the second quarter of 2024.

Revenues for the three months ended September 30, 2024 were lower by 7% from the comparative period as higher production volumes of oil in 2024 were more than offset by much lower realized prices for all products.  Revenues for the nine months ended September 30, 2024 were lower by 11% than the comparative period of 2023 primarily due to lower production volumes and lower prices for natural gas.  Lower revenues for the nine months ended September 30, 2024 were partially offset by higher realized gains on financial instruments and higher processing income than in the comparative period of 2023.  During the third quarter of 2024, the Company's operating costs per boe were $23.45.  The operating costs for the quarter included one-time costs of approximately $1.52 per boe and a higher than normal amount of equipment repairs and workovers.

Adjusted funds flow⁽¹⁾ for the nine months ended September 30, 2024 was $0.6 million ($0.05 per basic share⁽³⁾) and $4.6 million ($0.39 per basic share⁽³⁾).  Capital expenditures⁽²⁾ for the three months ended September 30, 2024 were $0.4 million and for the nine months ended September 30, 2024 were $1.3 million.  The expenditures were primarily incurred in Windfall on a waterflood expansion project and well reactivation/optimizations.

The Company had net earnings in the nine months ended September 30, 2024 of $4.2 million ($0.35 per basic share).

Clearview had no borrowings outstanding at September 30, 2024 and was in a net debt⁽¹⁾ surplus position of $5.6 million which included cash on hand of $6.4 million, a working capital surplus of $0.4 million and the Company's convertible debentures of $1.2 million.

Subsequent to the end of the third quarter, Clearview executed a credit agreement for a $5.0 million revolving operating facility with a credit union in Saskatchewan.  The credit facility bears interest at the lender's prime rate plus 2.50%.  The credit facility is secured by a general security agreement providing a security interest over all present and acquired property and a floating charge on all oil and natural gas assets.  The Company has received a full release and discharged from its previous lender. 

OPERATIONS

In the third quarter of 2024, Clearview disposed of 24 sections of certain mineral rights for proceeds of $0.9 million and retained a 1% overriding royalty on 13 of the sections. The Company had recently acquired these lands as part of an acquisition completed in the second quarter of 2024. Clearview had no plans for these rights and retained certain shallower uphole rights on these lands.

As a result of the previously disclosed disposition of certain underutilized infrastructure assets in the second quarter at its 100% owned Northville property in West Central Alberta for gross cash proceeds of $8.5 million plus a cash payment of $2.3 million (as settlement of a contract), the Company commenced infrastructure modifications in the third quarter for some of its natural gas production. This was the first of three projects for a low-pressure inlet to ensure Clearview's ability to produce natural gas to the facility.  The remaining two projects will be completed over the next several quarters.

The Company continued its abandonment and reclamation program for 2024.  Clearview's closure spending quota as mandated by the Alberta Energy Regulators Inventory Reduction Program is $0.6 million.  Expenditures on decommissioning projects in 2024 are expected to be approximately $0.8 million.

OUTLOOK

Clearview's strategy remains to provide liquidity for its shareholders. The Company is actively evaluating strategic acquisition opportunities, both marketed and unsolicited, and views these as potential paths to liquidity.  The infrastructure and undeveloped land dispositions Clearview has recently undertaken have significantly improved the Company's financial position, eliminating the Company's debt and building a strong cash position. In conjunction, Clearview continues to build relationships with capital providers, including closing a lower cost credit facility with its new lender. These initiatives further advance Clearview towards achieving the Company's strategy of executing an acquisition.  Clearview has submitted numerous bids to acquire various assets and companies in the past 15 months, including the successful acquisition in the second quarter. Although the Company has not yet closed on a transformative acquisition, Clearview continues to explore strategic growth opportunities, both internally and externally.

Clearview would like to thank its shareholders for their continued support as we evaluate our internal development plans and external opportunities to grow production volumes and adjusted funds flow towards providing liquidity for shareholders.

Clearview'sSeptember 30, 2024 interim financial statements and management discussion and analysis are available on the Company's website at www.clearviewres.com and SEDAR+ at www.sedarplus.ca.

FOR FURTHER INFORMATION PLEASE CONTACT:

CLEARVIEW RESOURCES LTD.

1350, 734 – 7th Avenue S.W. Calgary, Alberta T2P 3P8

Telephone: (403) 265-3503                                 Facsimile: (403) 265-3506
Email: info@clearviewres.com                           Website: www.clearviewres.com

ROD HUME                                                       BRIAN KOHLHAMMER
President & CEO                                               V.P. Finance & CFO                 

Note Regarding Forward-Looking Statements

This press release contains forward-looking statements and forward-looking information (collectively "forward-looking information") within the meaning of applicable securities laws relating to the Company's plans and other aspects of our anticipated future operations, management focus, strategies, financial, operating and production results, industry conditions, commodity prices and business opportunities. Specifically, this press release has forward looking information with respect to:  estimated decommissioning expenditures; internal development plans and external opportunities, including the evaluation of prospective acquisitions and other liquidity events and the cost, timing and intention to implement an overall growth strategy.  Forward-looking information typically uses words such as "anticipate", "believe", "project", "expect", "goal", "plan", "intend" or similar words suggesting future outcomes, statements that actions, events or conditions "may", "would", "could" or "will" be taken or occur in the future. 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 can be profitably produced in the future.

The forward-looking information is based on certain key expectations and assumptions made by our management, including expectations and assumptions concerning prevailing commodity prices and differentials, exchange rates, applicable royalty rates and tax laws; the impact government assistance programs will have on the Company; the impact on energy demands going forward and the inability of certain entities, including OPEC to agree on crude oil production output constraints; the impact on commodity prices, production and cash flow due to production shut-ins; the impact of regional and/or global health related events on energy demand; global energy policies going forward; our ability to execute our plans as described herein; global energy policies going forward; future exchange rates; future debt levels; the availability and cost of financing, labour and services; the impact of increasing competition and the ability to market oil and natural gas successfully and our ability to access capital. Although Clearview believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Clearview can give no assurance that they will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature such information involves inherent risks and uncertainties which could include the possibility that Clearview will not be able to execute some or all of its ongoing programs; general economic and political conditions in Canada, the U.S. and globally, and in particular, the effect that those conditions have on commodity prices and our access to capital; further fluctuations in the price of crude oil, natural gas liquids and natural gas; fluctuations in foreign exchange or interest rates; adverse changes to differentials for crude oil and natural gas produced in Canada as compared to other markets and worsened transportation restrictions. Our actual results, performance or achievement could differ materially from those expressed in, or implied by, the forward-looking information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking information will transpire or occur, or if any of them do so, what benefits that we will derive therefrom. Management has included the above summary of assumptions and risks related to forward-looking information provided in this press release in order to provide securityholders with a more complete perspective on our future operations and such information may not be appropriate for other purposes.

Readers are cautioned that the foregoing lists of factors are not exhaustive. These forward-looking statements are made as of the date of this press release and we disclaim any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

The actual results of Clearview and the resulting financial results will likely vary from the amounts set forth herein and such variation may be material. Clearview and its management believe that the future-oriented financial information ("FOFI") has been prepared on a reasonable basis, reflecting management's best estimates and judgments. However, because this information is subjective and subject to numerous risks, it should not be relied on as necessarily indicative of future results. Except as required by applicable securities laws, Clearview undertakes no obligation to update such FOFI. FOFI contained in this press release was made as of the date of this press release and was provided for purposes of providing further information about Clearview's anticipated future business operations. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein.

Non-IFRS Measures

Throughout this press release and other materials disclosed by the Company, Clearview uses certain measures to analyze financial performance, financial position and cash flow. These non-IFRS and other financial measures do not have any standardized meaning prescribed under IFRS and therefore may not be comparable to similar measures presented by other entities. The non-IFRS and other financial measures should not be considered alternatives to, or more meaningful than, financial measures that are determined in accordance with IFRS as indicators of Clearview's performance. Management believes that the presentation of these non-IFRS and other financial measures provides useful information to shareholders and investors in understanding and evaluating the Company's ongoing operating performance, and the measures provide increased transparency and the ability to better analyze Clearview's business performance.

Capital Management Measures

Adjusted Funds Flow

Adjusted funds flow represents cash provided by operating activities before changes in operating non-cash working capital and decommissioning expenditures. The Company considers this metric as a key measure that demonstrate the ability of the Company's continuing operations to generate the cash flow necessary to maintain production at current levels and fund future growth through capital investment, to repay debt and return capital to shareholders. Management believes that this measure provides an insightful assessment of the Company's operations on a continuing basis by eliminating the actual settlements of decommissioning obligations, the timing of which is discretionary. Adjusted funds flow should not be considered as an alternative to or more meaningful than cash provided by operating activities as determined in accordance with IFRS as an indicator of the Company's performance. Clearview's determination of adjusted funds flow may not be comparable to that reported by other companies. Clearview also presents adjusted funds flow per share whereby per share amounts are calculated using weighted average shares outstanding consistent with the calculation of earnings per share.  Please refer to Note 16(d) "Capital Management" in Clearview'sSeptember 30, 2024 interim financial statements for additional disclosure on Adjusted Funds Flow.

Net Debt

Clearview closely monitors its capital structure with a goal of maintaining a strong balance sheet to fund the future growth of the Company. The Company monitors net debt as part of its capital structure. The Company uses net debt (current assets, excluding financial derivatives, less current liabilities, excluding financial derivatives and lease liability, less convertible debentures) to assess financial strength, capacity to finance future development and to assist in assessing the liquidity of the Company. Please refer to Note 16(d) "Capital Management" in Clearview'sSeptember 30, 2024 interim financial statements for additional disclosure on Net Debt.

Non-IFRS Measures and Ratios

Capital Expenditures

Capital expenditures equals additions to property, plant & equipment and additions to exploration & evaluation assets.  Clearview considers capital expenditures to be a useful measure of adjusted funds flow used for capital reinvestment.  The most directly comparable IFRS measure to capital expenditures is additions to property, plant & equipment and additions to exploration & evaluation assets.

Net Capital Expenditures

Net capital expenditures equals capital expenditures plus acquisitions of property, plant & equipment and acquisition of exploration and evaluation assets less dispositions of property, plant & equipment and dispositions of exploration and evaluation assets. Clearview uses net capital expenditures to measure its total capital investment compared to the Company's annual capital budget expenditures. The most directly comparable IFRS measure to net capital expenditures is cash used in investing activities.

Cash Finance Costs

Cash finance costs is calculated as finance costs less accretion of decommission obligations and accretion of convertible debenture discount.  The most directly comparable IFRS measure to cash finance costs is finance costs. A reconciliation of cash finance costs to finance costs is set out below:

Cash Finance Costs per boe

Cash finance costs per boe is calculated by dividing cash finance costs by total production volumes sold in the period.  Management considers cash finance costs per boe an important measure to evaluate the Company's cost of debt financing relative to the Company's corporate netback per boe.

Operating Netback per boe

Operating netback per boe is calculated by dividing operating netback by total production volumes sold in the period.  Operating netback equals oil and natural gas sales plus processing income, less royalties, transportation expenses and operating expenses. Management considers operating netback per boe an important measure to evaluate its operational performance as it demonstrates its field level profitability relative to current commodity prices.

Corporate Netback per boe

Corporate netback per boe is calculated as operating netback less general and administrative expenses and finance costs, plus/(minus) realized gains (losses) on financial instruments, minus(plus) other costs (income), plus accretion of decommissioning obligations and convertible debentures divided by total production volumes sold in the period.   Management considers corporate netback per boe an important measure to assist management and investors in assessing Clearview's overall cash profitability. 

Supplementary Financial Measures

Adjusted funds flow per share is comprised of adjusted funds flow divided by the basic weighted average common shares.

Adjusted funds flow per diluted share is comprised of adjusted funds flow divided by the diluted weighted average common shares.

Realized sales price – oil is comprised of light crude oil commodity sales from production, as determined in accordance with IFRS, before deduction of transportation costs and excluding gains and losses on financial instruments, divided by the Company's oil production.

Realized sales price - ngl is comprised of natural gas liquids commodity sales from production, as determined in accordance with IFRS, before deduction of transportation costs and excluding gains and losses on financial instruments, divided by the Company's ngl production.

Realized sales price – natural gas is comprised of natural gas commodity sales from production, as determined in accordance with IFRS, before deduction of transportation costs and excluding gains and losses on financial instruments, divided by the Company's natural gas production.

Realized sales price – total is comprised of oil and natural gas sales from production, as determined in accordance with IFRS, before deduction of transportation costs and excluding gains and losses on financial instruments, divided by the Company's total production on a boe basis.

Oil and Gas Advisories

This press release contains certain oil and gas metrics which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies and should not be used to make comparisons.  Such metrics have been included in this document to provide readers with additional measures to evaluate our performance however, such measures are not reliable indicators of our future performance and future performance may not compare to our performance in previous periods and therefore such metrics should not be unduly relied upon. Specifically, this press release contains the following metrics:

• Boe means barrel of oil equivalent on the basis of 6 mcf of natural gas to 1 bbl of oil. The term "boe" may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. In addition, given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6: 1, using a conversion on a 6: 1 basis may be misleading as an indication of value.

Abbreviations

SOURCE Clearview Resources Ltd.