Petrus Resources Ltd. — Audit Report / Information 2022

Mar 16, 2023

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CONSOLIDATED ANNUAL FINANCIAL STATEMENTS As at and for the years ended December 31, 2022 and 2021

INDEPENDENT AUDITOR’S REPORT

To the Shareholders of Petrus Resources Ltd.

Opinion

We have audited the consolidated financial statements of Petrus Resources Ltd. (the “Company”), which comprise the consolidated balance sheets as at December 31, 2022 and 2021, and the consolidated statements of net income and comprehensive income, consolidated statements of changes in shareholders’ equity and consolidated statements of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at December 31, 2022 and 2021, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with International Financial Reporting Standards (IFRS).

Basis for Opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of the consolidated financial statements of the current period. This matter was addressed in the context of the audit of the consolidated financial statements as a whole, and in forming the auditor’s opinion thereon, and we do not provide a separate opinion on this matter. For the matter below, our description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report, including in relation to this matter. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the consolidated financial statements. The results of our audit procedures, including the procedures performed to address the matter below, provide the basis for our audit opinion on the accompanying consolidated financial statements.

Key audit matter How our audit addressed the key audit matter

Impairment or Impairment Reversal of Property, Plant and Equipment (“PP&E”) and Exploration and Evaluation (“E&E”) Assets

As at December 31, 2022, the carrying values of PP&E and E&E assets were $315.8 million and $34.8 million, respectively. Refer to Note 7 and 6 of the consolidated financial statements for the Company’s PP&E and E&E disclosures, respectively, and Note 3 for Company’s policy on impairment assessment. Cash-generating units (“CGUs”) are assessed by management for indicators of impairment or impairment reversal at each reporting date. The Company concluded that no indicators of impairment or impairment reversal were present as at December 31, 2022.

Auditing the Company’s assessment of indicators of impairment or impairment reversal involved significant judgement due to forecast commodity prices and increase in the market interest rates.

To test the Company's assessment of indicators of impairment or impairment reversal, we performed the following procedures, among others:

• Evaluated the impact of the change in observable forecasted commodity prices relative to prices used in previous impairment test.

• Assessed the competency and objectivity of the Company’s external reserve engineer.

• Compared significant reserve report data to historical results, third party sources, and the Company’s development plan.

• We involved our valuation specialists to assist in evaluating discount rates and cash flow multiples for certain CGU’s based on observable market inputs and recent comparable transactions

• Assessed the market capitalization of the Company against its net book value and investigated any contrary information.

• Evaluated the adequacy of the disclosure included in Note 6 & 7 of the accompanying consolidated financial statements in relation to this matter.

Other Information

Management is responsible for the other information. The other information comprises:

• Management’s Discussion and Analysis

• Annual Report

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information, and in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

We obtained Management’s Discussion & Analysis and the Annual Report prior to the date of this auditor’s report. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact in this auditor’s report. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditor’s report is Ryan MacDonald.

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Ernst & Young LLP Chartered Professional Accountants Calgary, Canada March 14, 2023

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CONSOLIDATED BALANCE SHEETS

(Presented in 000’s of Canadian dollars)

As at	December 31, 2022	December 31, 2021
ASSETS
Current
Cash	40	4,928
Inventory_(note 24)_	1,197	—
Deposits and prepaid expenses_(note 25)_	1,862	950
Accounts receivable_(note 16)_	22,248	9,733
Risk management asset_(note 11)_	4,502	—
Total current assets	29,849	15,611
Non-current
Risk management asset_(note 11)_	619	—
Exploration and evaluation assets_(note 6)_	34,837	35,634
Property, plant and equipment_(note 7)_	315,752	239,247
Total non-current assets	351,208	274,881
Total assets	381,057	290,492
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Bank loan (note 8)	4,607	57,700
Accounts payable and accrued liabilities_(note 16)_	45,191	19,690
Risk management liability_(note 11)_	—	2,488
Decommissioning obligation_(note 10)_	1,357	—
Lease obligations_(note 9)_	240	217
Total current liabilities	51,395	80,095
Non-current liabilities
Long term debt_(note 8)_	25,000	—
Lease obligations_(note 9)_	363	603
Decommissioningobligation_(note 10)_	37,658	41,569
Total liabilities	114,416	122,267
Shareholders’ equity
Share capital_(note 12)_	492,241	455,908
Contributed surplus	29,061	27,846
Deficit	(254,661)	(315,529)
Total shareholders' equity	266,641	168,225
Total liabilities and shareholders' equity	381,057	290,492

Commitments and contingencies (note 20) Related party transactions (note 22) See accompanying notes to the consolidated financial statements

Approved by the Board of Directors,

(signed) “Don T. Gray”

(signed) “Donald Cormack”

Don T. Gray Chairman

Donald Cormack

Director

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CONSOLIDATED STATEMENTS OF NET INCOME AND COMPREHENSIVE INCOME

(Presented in 000’s of Canadian dollars, except per share amounts)

(Presented in 000’s of Canadian dollars, except per share amounts)
	Year ended	Year ended
	December 31, 2022	December 31, 2021
REVENUE
Oil and natural gas revenue(note 21)	152,350	81,268
Royalty expense	(24,161)	(10,361)
Loss on risk management activities_(notes 11 and 21)_	(6,029)	—
Net oil and natural gas revenue	122,160	70,907
Other income_(note 26)_	1,351	1,448
Netgain(loss)on financial derivatives_(note 11)_	6,008	(14,122)
Total income	129,519	58,233
EXPENSES
Operating_(note 14)_	20,665	12,914
Transportation	5,772	3,920
General and administrative_(note 15)_	3,389	4,274
Share-based compensation_(note 12)_	1,141	259
Finance_(note 18)_	4,667	8,778
Exploration and evaluation_(note 6)_	421	108
Depletion and depreciation_(note 7)_	33,277	22,992
Gain on sale of assets	(681)	(924)
Impairment(reversal) (notes 6 and 7)	—	(103,220)
Total expenses	68,651	(50,899)
INCOME BEFORE INCOME TAX	60,868	109,132
Income tax recovery (note 23)	—	(5,424)
NET INCOME AND COMPREHENSIVE INCOME	60,868	114,556
Net income per common share
Basic_(note 13)_	0.53	1.83
Diluted_(note 13)_	0.51	1.76

See accompanying notes to the consolidated financial statements

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CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Presented in 000’s of Canadian dollars)
	Share	Contributed
	Capital	Surplus	Deficit	Total
Balance, December 31, 2020	430,119	9,596	(430,085)	9,630
Net income	—	—	114,556	114,556
Deferred Share Unit settlement	—	(223)	—	(223)
Issuance of common shares	25,900	18,119	—	44,019
Share issue costs	(111)	—	—	(111)
Share-based compensation	—	354	—	354
Balance, December 31, 2021	455,908	27,846	(315,529)	168,225
Net income	—	—	60,868	60,868
Common shares issued for property acquisition_(note 5)_	15,200	—	—	15,200
Common shares issued for rights offering_(note 12)_	20,003	—	—	20,003
Issuance of common shares_(note 12)_	1,427	(415)	—	1,012
Share issue costs_(note 12)_	(297)	—	—	(297)
Share-based compensation_(note 12)_	—	1,630	—	1,630
Balance, December 31, 2022	492,241	29,061	(254,661)	266,641

See accompanying notes to the consolidated financial statements

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CONSOLIDATED STATEMENTS OF CASH FLOWS

(Presented in 000’s of Canadian dollars)

(Presented in 000’s of Canadian dollars)
	Year ended	Year ended
	December 31, 2022	December 31, 2021
OPERATING ACTIVITIES
Net income	60,868	114,556
Adjust items not affecting cash:
Share-based compensation_(note 12)_	1,141	259
Unrealized (gain) loss on financial derivatives_(note 11)_	(7,609)	2,409
Non-cash finance expenses_(note 18)_	1,496	1,072
Non-cash term loan interest payment-in-kind_(note 18)_	—	2,573
Depletion and depreciation_(note 7)_	33,277	22,992
Impairment (reversal)(notes 6 and 7)	—	(103,220)
Exploration and evaluation expense_(note 6)_	421	108
Gain on sale of assets_(note 7)_	(681)	(924)
Recovery of income taxes on debt settlement_(note 23)_	—	(5,424)
Other income_(note 21)_	(1,060)	(373)
Decommissioningexpenditures_(note 10)_	(137)	(674)
Funds flow	87,716	33,354
Change in operatingnon-cash workingcapital_(note 19)_	12,891	(366)
Cash flows from operating activities	100,607	32,988
FINANCING ACTIVITIES
Deferred Share Unit payment_(note 12)_	—	(30)
Issuance of shares_(note 12)_	21,132	10,107
Repayment of revolving credit facility	(53,094)	(19,800)
Repayment of bank indebtedness	—	(32)
Transaction costs on debt	(518)	—
Repayment of lease liabilities_(note 9)_	(217)	(192)
Proceeds from long term debt_(note 8)_	25,000	—
Change in financingnon-cash workingcapital_(note 19)_	—	(179)
Cash flows used in financing activities	(7,697)	(10,126)
INVESTING ACTIVITIES
Property and equipment acquisitions_(note 7)_	243	—
Property and equipment dispositions_(note 7)_	—	148
Exploration and evaluation asset expenditures_(note 6)_	(1,645)	(621)
Petroleum and natural gas property expenditures_(note 7)_	(94,921)	(26,550)
Other capital expenditures	(175)	—
Change in investingnon-cash workingcapital_(note 19)_	(1,300)	9,089
Cash flows used in investing activities	(97,798)	(17,934)
Increase (decrease) in cash	(4,888)	4,928
Cash,beginningofyear	4,928	—
Cash, end ofyear	40	4,928
Cash interestpaid_(note 18)_	3,171	5,133

See accompanying notes to the consolidated financial statements

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the years ended December 31, 2022 and 2021

1. NATURE OF THE ORGANIZATION

Petrus Resources Ltd. (the “Company” or "Petrus") was incorporated under the laws of the Province of Alberta on November 25, 2015. The principal undertaking of Petrus is the investment in energy business-related assets. The operations of the Company consist of the acquisition, development, exploration and exploitation of these assets. These consolidated financial statements reflect only the Company’s proportionate interest in such activities and are comprised of the Company and its subsidiaries, Petrus Resources Corp. and Petrus Resources Inc.

The Company’s head office is located at 2400, 240 - 4th Avenue SW, Calgary, Alberta, Canada.

These consolidated financial statements, for the years ended December 31, 2022 and 2021, were approved by the Company’s Audit Committee and Board of Directors on March 14, 2023.

2. BASIS OF PRESENTATION

Statement of Compliance

These consolidated financial statements have been prepared by management in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).

Measurement Basis

These consolidated financial statements were prepared on the basis of historical cost except for financial derivatives which are measured at fair value. This method is consistent with the method used in prior years. These consolidated financial statements are presented in Canadian dollars.

Consolidation

These audited consolidated financial statements include the accounts of Petrus and its 100% owned subsidiaries, Petrus Resources Corp. and Petrus Resources Inc. Subsidiaries are consolidated from the date control is obtained until the date control ends. Control exists where the Company has power over the investee, exposure or rights to variable returns from the investee and the ability to use its power over the investee to affect returns. All intra-group balances and transactions are eliminated on consolidation.

Critical Accounting Estimates

The timely preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and reported amounts of assets and liabilities and income and expenses. Accordingly, actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Significant estimates and judgments made by management in the preparation of the financial statements are outlined below.

i. Depletion and reserve estimates

• Petroleum and natural gas assets are depleted on a unit of production basis at a rate calculated by reference to proved and probable reserves determined in accordance with National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities (“NI 51-101”). The calculation incorporates the estimated future cost of developing and extracting those reserves. Proved and probable reserves are estimated using independent reservoir engineering reports and represent the estimated quantities of crude oil, natural gas and natural gas liquids which geological, geophysical and engineering data demonstrate with a specified degree of certainty to be recoverable in future years from known reservoirs and which are considered commercially producible. Reserves estimates, although not reported as part of the Company’s financial statements, can have a significant effect on net income (loss), assets and liabilities as a result of their impact on depletion and depreciation, decommissioning liabilities, deferred taxes, asset impairments and business combinations. Independent reservoir engineers perform evaluations of the Company’s petroleum and natural gas reserves on an annual basis. The estimation of reserves is an inherently complex process requiring significant judgment. Estimates of economically recoverable petroleum and natural gas reserves are based upon a number of variables and assumptions such as geoscientific interpretation, production forecasts, commodity prices, costs and related future cash flows, all of which may vary considerably from actual results. These estimates are expected to be revised upward or downward over time, as additional information such as reservoir performance becomes available or as economic conditions change.

ii. Impairment indicators and cash-generating units

For purposes of impairment testing, exploration and evaluation assets and petroleum and natural gas assets are aggregated into cashgenerating units (“CGUs”), based on separately identifiable and largely independent cash inflows. The determination of the Company’s CGUs is subject to judgment.

The recoverable amounts of CGUs and individual assets have been determined based on the higher of the value-in-use calculations and fair value less costs of disposal. These calculations require the use of estimates and assumptions, including the discount rate, future petroleum and natural gas prices, expected production volumes and anticipated recoverable quantities of proved and probable reserves. These assumptions are subject to change as new information becomes available and changes in economic conditions take place. Changes may impact the estimated life of the field and economical reserves recoverable and may require a material adjustment to the carrying value of exploration and

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evaluation assets and petroleum and natural gas assets. The Company monitors internal and external indicators of impairment relating to its tangible assets.

iii. Technical feasibility and commercial viability of exploration and evaluation assets

The determination of technical feasibility and commercial viability, based on the presence of proved and probable reserves, results in the transfer of assets from exploration and evaluation assets to property, plant and equipment. As discussed above, the estimate of proved and probable reserves is inherently complex and requires significant judgment. Thus any material change to reserve estimates could affect the technical feasibility and commercial viability of the underlying assets.

iv. Financial instruments

Financial instruments are subject to valuations at the end of each reporting period. Generally the valuation is based on active and efficient markets. However, certain financial instruments may not be traded on an efficient market or the market may disappear or be subject to conditions that impede the efficiency of the market.

v. Decommissioning obligation

At the end of the operating life of the Company’s facilities and properties and upon retirement of its petroleum and natural gas assets, decommissioning costs will be incurred by the Company. This requires judgment regarding abandonment date, future environmental and regulatory legislation, the extent of reclamation activities, the engineering methodology for estimating cost, future removal technologies in determining the removal cost and discount rates to determine the present value of these cash flows.

vi. Income taxes

Tax provisions are based on enacted or substantively enacted laws. Changes in those laws could affect amounts recognized in income or loss both in the period of change, which would include any impact on cumulative provisions, and in future periods. Changes in tax laws in the jurisdictions in which the Company operates could limit the ability of the Company to obtain tax deductions in future periods. Income taxes are subject to measurement uncertainty. Significant judgment can be involved in the recognition of deferred tax assets.

vii. Measurement of share-based compensation

• Share-based compensation recorded pursuant to share-based compensation plans is subject to estimated fair values, forfeiture rates and the future attainment of performance criteria.

viii. Contingencies

By their nature, contingencies will only be resolved when one or more future events occur or fail to occur. The assessment of contingencies inherently involves the exercise of significant judgment and estimates of the outcome of future events.

Business Combinations

The acquisition method of accounting is used to account for acquisitions of entities and assets that meet the definition of a business under IFRS. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The excess of the cost of acquisition over the fair value of the identifiable assets acquired and liabilities and contingent liabilities assumed is recorded as goodwill. If the cost of the acquisition is less than the fair value of the net assets acquired, the difference is recognized immediately in profit or loss. Business combination associated transaction costs are expensed when incurred.

Within the IFRS Business Combinations guidance, there is an optional fair value concentration test. The concentration test is a simplified assessment that results in an asset acquisition if substantially all of the fair value of the gross assets is concentrated in a single identifiable asset or a group of similar identifiable assets. If an entity chooses not to apply the concentration test, or the test is failed, then the assessment focuses on the existence of a substantive process, and the acquisition is accounted for as a business combination. The cost of an acquisition that does not meet the definition of a business under IFRS and does not qualify as a business combination is measured as the fair value of the consideration given and liabilities incurred or assumed at the date of exchange. No goodwill arises on an asset acquisition and the cost of the assets acquired and liabilities assumed are allocated to the assets and liabilities on the basis of their relative fair values at the date of purchase. Asset acquisition associated transaction costs are capitalized as a cost of the acquisition.

3. SIGNIFICANT ACCOUNTING POLICIES

(a) Revenue recognition

Revenue from contracts with customers is recognized when or as Petrus satisfies a performance obligation by transferring a promised good or service to a customer. The transfer of control of oil, natural gas, natural gas liquids usually occurs at a point in time and coincides with title passing to the customer and the customer taking physical possession. The transaction price for variable price contracts is based on the commodity price, adjusted for quality, location and other factors. The amount of revenue recognized is based on the agreed transaction price with any variability in transaction price recognized in the same period.

(b) Exploration & evaluation assets

Capitalization

All costs incurred after the rights to explore an area have been obtained, such as geological and geophysical costs, other direct costs of exploration (drilling, testing and evaluating the technical feasibility and commercial viability of extraction) and appraisal and including any directly attributable general and administration costs and share-based payments, are accumulated and capitalized as exploration and evaluation assets. Certain costs incurred prior to acquiring the legal rights to explore are charged directly to net income (loss).

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Depletion & depreciation

Exploration and evaluation costs are not amortized prior to the conclusion of appraisal activities. At the completion of appraisal activities, if technical feasibility is demonstrated and commercial reserves are discovered, then the carrying value of the relevant exploration and evaluation asset will be reclassified as a property, plant and equipment asset into the CGU to which it relates, but only after the carrying value of the relevant exploration and evaluation asset has been assessed for impairment and, where appropriate, its carrying value adjusted. Technical feasibility and commercial viability are considered to be demonstrable when proved or probable reserves are determined to exist. If it is determined that technical feasibility and commercial viability have not been achieved in relation to the exploration and evaluation assets appraised, all other associated costs are written down to the recoverable amount in net income (loss).

Expired land leases included as undeveloped land in exploration and evaluation assets are recognized in exploration and evaluation cost in net income (loss) upon expiry and are considered prior to expiry. Management considers upcoming land lease expiries and may recognize the costs in advance of expiry.

Impairment

Indicators of impairment of exploration and evaluation assets are assessed at each reporting date which can include upcoming land lease expiries, third party land valuations and other information. When there are such indications, an impairment test is carried out and any resulting impairment loss is written off to net income (loss). The recoverable amount is the greater of fair value, less costs of disposal, or value-in-use.

(c) Property, plant and equipment

The Company’s property, plant and equipment is comprised of petroleum and natural gas assets and corporate assets.

Capitalization

Petroleum and natural gas assets are measured at cost less accumulated depletion and depreciation and accumulated impairment losses, if any. Petroleum and natural gas assets consist of the purchase price and costs directly attributable to bringing the asset to the location and condition necessary for its intended use. Petroleum and natural gas assets include developing and producing interests such as land acquisitions, geological and geophysical costs, facility and production equipment, including any directly attributable general and administration costs and share-based payments and the initial estimate of the costs of dismantling and removing an asset and restoring the site on which it was located.

Subsequent costs

Costs incurred subsequent to the determination of technical feasibility and commercial viability are recognized as developing and producing petroleum and natural gas interests when they increase the future economic benefits embodied in the specific asset to which they relate. Such capitalized petroleum and natural gas interests generally represent costs incurred in developing proved and/or probable reserves, and are accumulated on a field or geotechnical area basis. The cost of day-to-day servicing of an item of petroleum and natural gas assets is expensed in net income or net loss as incurred. Petroleum and natural gas assets are derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising from the disposal of an asset, determined as the difference between the net disposal proceeds and the carrying amount of the asset, is recognized in net income or loss.

Depletion and depreciation

The costs for petroleum and natural gas properties, including related pipelines and facilities, are depleted using a unit-of-production method based on the commercial proved and probable reserves.

Petroleum and natural gas assets are not depleted until production commences. This depletion calculation includes actual production in the period and total estimated proved and probable reserves attributable to the assets being depleted, taking into account total capitalized costs plus estimated future development costs necessary to bring those reserves into production. Relative volumes of reserves and production (before royalties) are converted at the energy equivalent conversion ratio of six thousand cubic feet of natural gas to one barrel of oil.

Proved and probable reserves are estimated using independent reservoir engineering reports and represent the estimated quantities of crude oil, natural gas and natural gas liquids which geological, geophysical and engineering data demonstrate with a specified degree of certainty to be recoverable in future years from known reservoirs and which are considered commercially producible.

Corporate assets are recorded at cost less accumulated depreciation. Depreciation is calculated on a declining balance method so as to write off the cost of these assets, less estimated residual values, over their estimated useful lives consistent with the treatment used for tax purposes.

Impairment

The assessment for impairment entails comparing the carrying value of the CGU with its recoverable amount: that is, the higher of fair value, less costs of disposal, and value in use. Petrus’ property, plant and equipment are grouped into CGUs based on separately identifiable and largely independent cash inflows considering geological characteristics, shared infrastructure and exposure to market risks. Estimates of future cash flows used in the calculation of the recoverable amount are based on reserve evaluation reports prepared by independent reservoir engineers.

The CGUs are reviewed quarterly for indicators of impairment. Indicators are events or changes in circumstances that indicate that the carrying amount may not be recoverable. If indicators of impairment exist, the recoverable amount of the CGU is estimated. If the carrying amount of the CGU exceeds the recoverable amount, the CGU is written down with an impairment recognized in net income (loss).

The recoverable amount is the higher of fair value, less costs of disposal, and the value-in-use. Fair value, less costs of disposal, is derived by estimating the discounted after-tax future net cash flows. Discounted future net cash flows are based on forecast commodity prices and costs over

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the expected economic life of the reserves and discounted using market-based rates to reflect a market participant’s view of the risks associated with the assets. Value-in-use is assessed using the expected future cash flows discounted at a pre-tax rate.

Impairments of property, plant and equipment are reversed when there is significant evidence that the impairment has been reversed, but only to the extent of what the carrying amount would have been had no impairment been recognized.

(d) Decommissioning obligations

The Company’s activities give rise to dismantling, decommissioning and reclamation requirements. Costs related to these abandonment activities are estimated by management in consultation with the Company’s engineers based on risk-adjusted current costs which take into consideration current technology in accordance with existing legislation and industry practices.

Decommissioning obligations are measured at the present value of the best estimate of expenditures required to settle the obligations at the reporting date. When the fair value of the liability is initially measured, the estimated cost, discounted using a risk-free rate, is capitalized by increasing the carrying amount of the related petroleum and natural gas assets. The increase in the provision due to the passage of time, or accretion, is recognized as a finance expense. Increases and decreases due to revisions in the estimated future cash flows are recorded as adjustments to the carrying amount of the related petroleum and natural gas assets.

Actual costs incurred upon settlement of the liability are charged against the obligation to the extent that the obligation was previously established. The carrying amount capitalized in petroleum and natural gas assets is depleted in accordance with the Company’s depletion policy. The Company reviews the obligation at each reporting date and revisions to the estimated timing of cash flows, discount rates and estimated costs will result in an increase or decrease to the obligations. Any difference between the actual costs incurred upon settlement of the obligation and recorded liability is recognized as an increase or reduction in income.

(e) Finance expenses

Finance expense may be comprised of interest expense on borrowings, acquisition related (transaction) costs, foreign exchange expenses and accretion of the discount on decommissioning obligations.

(f) Financial instruments

Financial instruments are recognized initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, financial instruments are measured based on their classification as described below:

• Fair value through profit or loss: Financial instruments under this classification include risk management assets and liabilities.

• Amortized cost: Financial instruments under this classification include cash, accounts receivable, deposits, bank indebtedness, accounts payable and long term debt.

(g) Share capital

Common shares are classified as equity. Incremental costs directly attributable to the issuance of common shares are recognized as a reduction in share capital, net of any tax effects.

(h) Flow-through shares

The resources expenditure deductions for income tax purposes related to exploratory activities funded by flow-through shares are renounced to investors in accordance with tax legislation. Upon issuance of a flow-through share, a liability is recognized representing the premium paid on flowthrough common shares over regular common shares. This liability is reduced as the expenditures are incurred and tax attributes are renounced.

(i) Income taxes

The Company’s income tax expense is comprised of current and deferred tax. Income tax expense is recognized through income or loss except to the extent that it relates to items recognized directly in equity, in which case the related income taxes are also recognized in equity.

Current tax is the expected tax payable on taxable income for the period, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax basis used in the computation of taxable income. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable income will be available against which those deductible temporary differences can be utilized. Assessing the recoverability of deferred tax assets requires management to make significant estimates related to expectations of future taxable income. Estimates of future taxable income are based on forecast cash flows from operations and the application of existing tax laws in the jurisdictions of Alberta and Canada. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable income will be available to allow all or part of the asset to be recovered.

(j) Joint arrangements

A portion of the Company’s exploration, development and production activities are conducted jointly with others through unincorporated joint operations. These financial statements reflect only the Company’s proportionate interest of these joint operations and the proportionate share of the relevant revenue and related costs.

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(k) Share-based compensation

Share-based compensation expense is determined based on the estimated fair value of shares on the date of grant. Forfeitures are estimated at the grant date and are subsequently adjusted to reflect actual forfeitures. The expense is recognized over the service period, with a corresponding increase to contributed surplus. The Company capitalizes the qualifying portion of share-based compensation expense directly attributable to the exploration and development activities of exploration and evaluation assets and petroleum and natural gas assets, with a corresponding decrease to share-based compensation expense. At the time the stock options or performance warrants are exercised, the issuance of common shares is recorded as an increase to shareholders’ capital and a corresponding decrease to contributed surplus.

For deferred share units (“DSUs”) that can be settled in cash or equity at the option of the Company, the fair value of the DSUs is recognized as stockbased compensation expense, with a corresponding increase in contributed surplus.

(l) Earnings per share

Earnings per share are presented for basic and diluted earnings. Basic per share information is computed by dividing the net income (loss) for the period attributable to equity owners of the Company by the weighted average number of common shares outstanding during the period. The weighted average number of shares for diluted earnings per share information is calculated using the treasury stock method whereby it is assumed that proceeds obtained upon exercise of performance warrants and stock options would be used to purchase common shares at the average market price during the period. The treasury stock method also assumes that the deemed proceeds related to unrecognized share-based payments expense are used to repurchase shares at the average market price during the period. Under the treasury stock method, stock options and share warrants have a dilutive effect only when the average market price of the common shares during the period exceeds the exercise price of the options or warrants (they are "inthe-money"). Exercise of in-the-money stock options and share warrants is assumed at the beginning of the year or date of issuance, if later. Should the Company have a loss for the period, stock options and share warrants would be anti-dilutive and therefore will have no effect on the determination of loss per share.

(m) Leases

At inception of a contract, the Company assesses whether a contract is, or contains a lease. A contract is, or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:

• the contract involves the use of an identified asset - this may be specified explicitly or implicitly, and should be physically distinct or represent substantially all of the capacity of a physically distinct asset. If the suppler has a substantive substitution right, the asset is not identified;

• the Company has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use; and

• the Company has the right to direct the use of the asset. The Company has this right when it has the decision-making rights that are most relevant to changing how and for what purpose the asset is used is predetermined, the Company has the right to direct the use of the asset if either:

• the Company has the right to operate the asset; or

• the Company designed the asset in a way that predetermines how and for what purpose it will be used.

This policy is applied to contracts entered into, or changed, on or after January 1, 2019.

i) As a lessee

The Company recognizes a right-of-use ("ROU") asset and a lease liability at the lease commencement date. The ROU asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The ROU asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the ROU asset or the end of the lease term. The estimated useful lives of ROU assets are determined on the same basis as those of property and equipment. In addition, the ROU asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the intrest rate implicit in the lease or, if that rate cannot be readily determined, the Company's incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate.

(n) Government grants

Government grants are recognized when there is reasonable assurance that the Company will comply with the conditions attaching to it, and that the grant will be received. Grants related to income are presented in the Consolidated Statement of Comprehensive Income and are deducted in reporting the related expense. Grants related to assets are presented in the Consolidated Balance Sheet by deducting the grant in arriving at the carrying amount of the asset or recognized as other income.

Carbon credits

Carbon credits that are held for sale in the ordinary course of business are recognized as inventory in the year credits are verified and are measured at the lower of cost or net realizable value. The cost of emission credits is determined at the market value of the credits in the year credits are verified.

Upon sale of the carbon credits, the carrying amount is derecognized from inventory on the Consolidated Balance Sheet, recording any gain or loss on the Statements of Net Income and Comprehensive Income.

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(o) New standards and interpretations

IFRS 17 Insurance Contracts

IFRS 17 requires insurance liabilities to be measured at a current fulfillment value and provides a more uniform measurement and presentation approach for all insurance contracts. These requirements are designed to achieve the goal of a consistent, principle-based accounting for insurance contracts. IFRS 17 supersedes IFRS 4 Insurance Contracts as of January 1, 2023.

Amendments to IAS 1

On October 31, 2022, the International Accounting Standards Board (IASB) published "Non-current Liabilities with Covenants (Amendments to IAS 1)" to clarify how conditions with which an entity must comply within twelve months after the reporting period affect the classification of a liability. The amendments are effective for reporting periods beginning on or after January 1, 2024.

The Company does not expect any impact to the financial statements due to these amendments.

4. DETERMINATION OF FAIR VALUES

A number of the Company’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

Petroleum and natural gas properties and equipment and exploration and evaluation assets

The fair value of petroleum and natural gas properties and equipment recognized in a business combination and for impairment testing, is based on market values. The market value of petroleum and natural gas properties and equipment is the estimated amount for which property, plant and equipment could be exchanged on the acquisition date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. The market value of oil and natural gas interests (included in petroleum and natural gas properties and equipment) and intangible exploration and evaluation assets is estimated with reference to the discounted cash flow expected to be derived from oil and natural gas production based on externally prepared reserve reports. The risk-adjusted discount rate is specific to the asset with reference to general market conditions. The fair value less costs of disposal value used to determine the recoverable amount of the impaired petroleum and natural gas properties are classified as Level 3 fair value measurements. Refer to “Financial Instruments” section below for fair value hierarchy classifications.

Derivatives

The fair value of commodity price risk management contracts is determined by discounting the difference between the contracted prices and published forward price curves as at the balance sheet date, using the remaining contracted oil and natural gas volumes and a risk-free interest rate (based on published government rates). The fair value of options is based on option models that use published information with respect to volatility, prices, interest rates and counter-party credit risks.

Share-based payments

The fair value of employee share-based payments is measured using a Black-Scholes option-pricing model. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility in share price (based on weighted average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based on historical experience and general option holder behavior), expected dividend yield, risk-free interest rate (based on government bonds) and estimated forfeiture rate at each reporting date.

Financial Instruments

The Company’s fair value measurements require disclosure about how the fair value was determined based on significant levels of inputs described in the following hierarchy:

• Level 1 - Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

• Level 2 - Pricing inputs are other than quoted prices in active markets included in Level 1. Prices in Level 2 are either directly or indirectly observable as of the reporting date. Level 2 valuations are based on inputs, including quoted forward prices for commodities, time value and volatility factors, which can be substantially observed or corroborated in the marketplace.

• Level 3 - Valuations in this level are those with inputs for the asset or liability that are not based on observable market data.

Assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the placement within the fair value hierarchy level. The Company’s risk management contracts are considered Level 2.

5. ACQUISITIONS

On March 14, 2022, Petrus completed the acquisition of certain oil and liquids rich natural gas weighted properties within its Ferrier core area from a privately owned limited partnership and its general partner. The acquired partnership was managed and directed by an officer and director of Petrus and two of Petrus' major shareholders owned or controlled, in aggregate, approximately 69.5% and 50% of the acquired partnership's units and shares, respectively.

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Given the close proximity of the acquired properties to the Company's existing assets and infrastructure, the acquired properties are synergistic to existing operations and complementary to current development plans. The assets were acquired for share consideration of $15.2 million (10 million common shares of Petrus at $1.52 per share on closing date). The Company applied the optional concentration test permitted under IFRS 3 to the acquisition which resulted in the acquired assets being accounted for as an asset acquisition. As such the purchase price was allocated to the identifiable assets and liabilities based on their relative fair values at the date of acquisition. Assets acquired in the transaction will be included in the Ferrier CGU. Asset acquisition transaction costs of $0.3 million were capitalized as a cost of the asset.

The amounts recognized on the date of acquisition to identifiable net assets were as follows:

$000s (except share and per share amounts)
Net assets acquired:
Cash & cash equivalents	434
Accounts receivable & other assets	496
Accounts payable & accrued liabilities	(406)
Property, plant and equipment	16,765
Decommissioningobligation	(2,089)
Net assets acquired	15,200
Purchase consideration:
Common shares issued to partners	10,000,000
Price of Petrus common shares($ per share)on close date	$1.52
Totalpurchase consideration	15,200

6. EXPLORATION AND EVALUATION ASSETS

The components of the Company’s exploration and evaluation ("E&E") assets are as follows:

$000s
Balance, December 31, 2020	17,568
Additions	401
Disposition	(18)
Exploration and evaluation expense	(108)
Capitalized G&A	220
Capitalized share-based compensation	24
Transfers to property, plant and equipment_(note 7)_	(5,093)
Impairment reversal	22,640
Balance, December 31, 2021	35,634
Acquisitions	1,349
Exploration and evaluation expense	(421)
Capitalized G&A	295
Capitalized share-based compensation_(note 12)_	122
Transfers toproperty, plant and equipment_(note 7)_	(2,142)
Balance, December 31, 2022	34,837

During the year ended December 31, 2022, the Company incurred exploration and evaluation expense of $0.4 million which relates to expired and nearly expired undeveloped, non-core land (year ended December 31, 2021 – $0.11 million).

During the year ended December 31, 2022, the Company capitalized $0.3 million of general and administrative expenses (“G&A”) (year ended December 31, 2021 – $0.2 million) and $0.12 million of non-cash share-based compensation directly attributable to exploration activities (year ended December 31, 2021 – $0.02 million).

During the year ended December 31, 2022, the Company transferred $2.1 million from E&E assets to PP&E assets, related to the Ferrier and North Ferrier Cash Generating Units ("CGUs").

At December 31, 2022, the Company did not identify any indicators of impairment or impairment reversals, related to its E&E assets, in any of its CGUs.

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2021 Impairment Reversal

Due to the increase in forward benchmark commodity prices during the year ended December 31, 2021, the Company identified indicators of impairment reversal in its Ferrier Cash Generating Unit ("CGU"). As a result, for the Ferrier CGU, the Company recorded an impairment reversal of $22.6 million on its E&E assets, as the recoverable amount exceeded the carrying value. The impairment reversal amount reflects all of the original impairment charges recorded on March 31, 2020 and December 31, 2014, less associated depletion. No impairment or impairment reversal for E&E assets was recorded on other CGUs of the Company.

7. PROPERTY, PLANT AND EQUIPMENT

The components of the Company’s property, plant and equipment ("PP&E") assets are as follows:

$000s	Cost	Accumulated DD&A	Net book value
Balance, December 31, 2020	835,583	(683,614)	151,969
Additions	25,593	—	25,593
Property dispositions	(14,495)	12,439	(2,056)
Capitalized G&A	658	—	658
Capitalized share based compensation	73	—	73
Transfer from exploration and evaluation assets_(note 6)_	5,093	—	5,093
Depletion & depreciation	—	(22,992)	(22,992)
Increase in decommissioning expenses	329	—	329
Impairment reversal	—	80,580	80,580
Balance, December 31, 2021	852,834	(613,587)	239,247
Additions	94,145	—	94,145
Property acquisition_(note 5)_	16,765	—	16,765
Property dispositions	(71)	—	(71)
Capitalized G&A	884	—	884
Capitalized share-based compensation_(note 12)_	367	—	367
Transfers from exploration and evaluation assets_(note 6)_	2,142	—	2,142
Depletion & depreciation	—	(33,277)	(33,277)
Changes in decommissioning provision_(note 10)_	(4,450)	—	(4,450)
Balance, December 31, 2022	962,616	(646,864)	315,752

At December 31, 2022, estimated future development costs of $519.8 million (December 31, 2021 – $343.5 million) associated with the development of the Company’s proved plus probable undeveloped reserves were included with the costs subject to depletion. During the year ended December 31, 2022, the Company capitalized $0.9 million of general and administrative expenses (“G&A”) (year ended December 31, 2021 – $0.7 million) and non-cash share-based compensation of $0.37 million (year ended December 31, 2021 – $0.07 million), directly attributable to development activities.

During the year ended December 31, 2022, the Company recorded a gain of $0.7 million on the disposition of certain PP&E assets in the Foothills and Central Alberta CGUs related to the disposal of ARO associated with these assets.

During the year ended December 31, 2022, the Company transferred $2.1 million from E&E assets to PP&E assets, related to the Ferrier and North Ferrier CGUs.

During 2022, Petrus recorded minor disposition transactions for petroleum and natural gas properties and equipment for total net cash consideration of $0.07 million.

At December 31, 2022, the carrying balance of the right of use asset was $0.5 million.

At December 31, 2022, the Company did not identify any indicators of impairment or impairment reversals, related to its PP&E assets, in any of its CGUs.

2021 Impairment Reversal

At December 31, 2021, in its Ferrier CGU, the Company identified an indicator of impairment reversal as a result of improved commodity prices. For the Kakwa CGU, the Company identified an indicator of impairment due to the decrease in proved and probable reserve values.

As a result of the above indicators, an impairment test on the Company’s PP&E assets was performed. For the Ferrier CGU, the Company recorded an impairment reversal of $84.3 million on its PP&E assets on December 31, 2021, as the recoverable amount exceeded the carrying amount. The impairment reversal amount reflects all of the original impairment charges recorded on March 31, 2020 and December 31, 2014, less associated depletion. In addition, for the Kakwa CGU, the Company recorded an impairment charge of $3.7 million on its PP&E assets.

For the North Ferrier, Central Alberta and Foothills CGUs, the Company did not identify any indicators of impairment or impairment reversal.

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The recoverable amount, a level 3 input on the fair value hierarchy, was estimated at its fair value less costs to dispose, using an after--tax discount rate of 11.6% to 13.1%. A 1% increase in the discount rate would have increased impairment by approximately $11.7 million. A 1% decrease in the discount rate would decrease impairment by approximately $0.2 million. The Company used the following forward commodity price estimates:

	Canadian Light Sweet
Year	$/Bbl	AECO $/MMbtu
2022	86.77		3.55
2023	81.25		3.25
2024	78.75		3.05
2025	80.33		3.13
2026	81.93		3.19
2027	83.57		3.26
2028	85.24		3.32
2029	86.95		3.39
2030	88.69		3.46
2031	90.46		3.52
2032	92.27		3.60

Escalation rate of 2.0% thereafter.

8. DEBT

At December 31, 2022, Petrus had two debt instruments outstanding; a reserve-based, secured operating revolving loan facility with an Alberta-based financial institution (the “Revolving Loan Facility” or “RLF”) and a second lien secured term facility (the "Second Lien Facility").

Revolving Loan Facility

At December 31, 2022, the RLF was comprised of a $30.0 million operating facility payable on demand by the lender. The amount of the RLF is subject to a borrowing base review performed on a semi-annual basis by the lender, based primarily on reserves and commodity prices estimated by the lenders as well as other factors. The next semi-annual review is due on May 31, 2023.

At December 31, 2022, the Company had a $0.6 million letter of credit outstanding against the RLF (December 31, 2021 – $0.6 million on the previous revolving credit facility) and had drawn $4.6 million against the RLF (December 31, 2021 – $57.7 million on the previous revolving credit facility).

Second Lien Facility

At December 31, 2022 the Company had $25.0 million outstanding on the $25 million Second Lien Facility. The Second Lien Facility is a three-year term facility (maturity date May 31, 2025 with an option to the borrower to extend by an additional two years) with a fixed interest rate of 11% per annum and can be repaid at the discretion of the Company after the first year. The Second Lien Facility is a related party transaction with a major shareholder who owns approximately 21% of the outstanding shares of the Company (see note 22). The total interest paid in 2022 to the major shareholder, related to the Second Lien facility, was $1.1 million.

Debt Settlement - Term Loan & Revolving Credit Facility

During 2022, the Company entered into agreements with new lenders to the Company, providing two new credit facilities, as described above, (the “New Credit Facilities”) totaling $55 million. The New Credit Facilities, together with the net proceeds of the Company's recently closed $20 million rights offering, were used to repay in full all amounts owing under the Company's previous revolving credit facility (the "Revolving Credit Facility" or "RCF"). The New Credit Facilities closed in May 2022.

Prior to December 31, 2021, Petrus had a subordinated secured term loan (the "Term Loan"). During the third quarter of 2021, the Company settled its Term Loan with a principal amount (carrying value) of $39.4 million in consideration for the issuance of $15.8 million (the settlement amount) of common shares of Petrus ("Common Shares") to the holders of the Term Loan at an issue price of $0.55 per share. The difference between the carrying value and the settlement amount of the debt was added to contributed surplus in the amount of $18.1 million (net of the recovery of income taxes of $5.4 million).

Financial Covenants

The Company's RLF is subject to certain financial covenants. The following definitions are used in the covenant calculations for the debt instrument:

Working Capital

Working Capital means Current Assets to Current Liabilities whereby Current Assets means on any date of determination, the current assets of Petrus that would, in accordance with IFRS, be classified as of that date as current assets plus any undrawn availability under the RLF, less any non-cash amount required to be included in current assets as the result of the application of IFRS including non-cash commodity and interest rate hedges assets and liabilities and whereby Current Liabilities means, on any date of determination, the liabilities of Petrus that would, in accordance with IFRS, be classified as of that date as current liabilities, excluding (a) non-cash obligations under IFRS including non-cash commodity and interest rate hedges assets and liabilities, and (b) the current portion of long-term debt.

Working Capital Ratio means the ratio of Current Assets to Current Liabilities as defined above.

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The key financial covenants as at December 31, 2022 are summarized in the following table. At December 31, 2022 the Company is in compliance with all financial covenants.

Financial Covenant Description	Required Ratio	As at December 31, 2022
Working Capital Ratio	Over 1.0	1.1

9. LEASES

The Company's lease obligations are as follows:

$000s
Balance, December 31, 2021	820
Finance expense	54
Leasepayments	(271)
Balance, December 31, 2022	603

The Company's future commitments associated with its lease obligations are as follows:

$000s
	As at December 31, 2022
Less than 1 year	277
1 to 3years	369
Total lease payments	646
Amounts representingfinance expense	(43)
Present value of lease obligation	603
Current portion of lease obligation	240
Non-currentportion of lease obligation	363

10. DECOMMISSIONING OBLIGATION

The decommissioning liability was estimated based on the Company’s net ownership interest in all wells and facilities, the estimated costs to abandon and reclaim the wells and facilities and the estimated timing of the costs to be incurred in future periods. The estimated future cash flows have been discounted using an average risk free rate of 3.31 percent and an inflation rate of 3.00 percent (1.66 percent and 2.0 percent, respectively, at December 31, 2021). Changes in estimates in 2021 and 2022 are due to the change in the risk free and inflation rates and changes in the estimated future cash flow to reclaim the wells and facilities. The Company has estimated the net present value of the decommissioning obligations to be $39.0 million as at December 31, 2022 ($41.6 million at December 31, 2021). The undiscounted, uninflated total future liability at December 31, 2022 is $41.7 million ($38.3 million at December 31, 2021). The payments are expected to be incurred over the operating lives of the assets.

The following table reconciles the decommissioning liability:

$000s
Balance, December 31, 2020	44,456
Property dispositions	(2,876)
Other adjustments	(373)
Liabilities incurred	489
Liabilities settled	(674)
Change in estimates	(160)
Accretion expense	707
Balance, December 31, 2021	41,569
Property acquisitions_(note 3)_	2,089
Property dispositions	(681)
Other adjustments	(441)
Liabilities incurred	1,231
Liabilities settled	(137)
Change in estimates	(5,681)
Accretion expense	1,066
Balance, December 31, 2022	39,015

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11. FINANCIAL RISK MANAGEMENT

The Company utilizes commodity contracts as a risk management technique to mitigate exposure to commodity price volatility. The following table summarizes the financial derivative contracts Petrus had outstanding as at December 31, 2022:

Contract Period	Type	Total Daily Volume (GJ)	Average Price (CDN$/GJ)
Natural Gas Swaps
Jan. 1, 2023 to Mar. 31, 2023	Fixed price	6,000	$6.67
Apr. 1, 2023 to Oct. 31, 2023	Fixed price	13,000	$4.35
Nov. 1, 2023 to Mar. 31, 2024	Fixed price	11,000	$4.91
Apr. 1, 2024 to Oct. 31, 2024	Fixed price	3,000	$3.52
Contract Period	Type	Total Daily Volume (Bbl)	Average Price (CDN$/Bbl)
Crude Oil Swaps
Jan 1, 2023 to Jun 30, 2023	Fixed price	600	$110.57
Jan. 1, 2023 to Dec 31 2023	Fixed price	200	$104.15
Jul. 1, 2023 to Dec 31 2023	Fixed price	500	$101.94
Oct. 1, 2023 to Dec 31, 2023	Fixed price	100	$102.15
Jan. 1 2024 to Jun 30, 2024	Fixed price	800	$99.83
Contract Period	Type	Total Daily Volume (Bbl)	Average Price (CDN$/Bbl)
Crude Oil Collars
Jan. 1 2023 to Dec 31, 2023	Costless collar	300	$90.00-120.95
The following table summarizes the physical	commodity contracts in place at December 31, 2022:
Contract Period	Type	Total Daily Volume (GJ)	Average Price (CDN$/GJ)
Natural Gas
Jan. 1, 2023 to Mar. 31, 2023	Fixed price	14,000	$4.25

During the year ended December 31, 2022, the Company realized a loss on risk management activities of $6.0 million (year ended December 31, 2021 - nil). Risk management asset and liability:

Risk management asset and liability:
$000s At December 31, 2022	Asset	Liability
Current commodity derivatives	4,502	—
Non-current commodityderivatives	619	—
	5,121	—
$000s At December 31, 2021
Current commodity derivatives	—	2,488
Non-current commodityderivatives	—	—
	—	2,488

Earnings impact of realized and unrealized gains (losses) on financial derivatives:

$000s	Year ended	Year ended
	December 31, 2022	December 31, 2021
Realized loss on financial derivatives	(1,601)	(11,713)
Unrealized gain (loss) on financial derivatives	7,609	(2,409)
Netgain (loss) on financial derivatives	6,008	(14,122)

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12. SHARE CAPITAL

Authorized

The authorized share capital consists of an unlimited number of common voting shares without par value and an unlimited number of preferred shares.

Issued and Outstanding

Common shares ($000s except number of shares)	Number of shares	Amount
Balance, December 31, 2021	96,707,912	455,908
Common shares issued for property acquisition	10,000,000	15,200
Common shares issued in a rights offering	14,817,347	20,003
Common shares issued on exercise of stock options	1,713,269	1,427
Share issue costs	—	(297)
Balance, December 31, 2022	123,238,528	492,241

Rights Offering

During the year ended December 31, 2022, the Company completed a rights offering (the “Offering”). Pursuant to the Offering, the Company issued 14.8 million common shares at $1.35 per share for aggregate gross proceeds to the Company of $20.0 million. The issuance costs were $0.3 million and the net proceeds of $19.6 million were utilized for debt repayment and towards working capital.

The Company entered into a standby purchase agreement with three investors (collectively, the "Stand-By Guarantors") who each own more than 20% of the outstanding shares of the Company. As a result of the exercise of the basic subscription privilege and additional subscription privilege by the holders of rights (including the Stand-By Guarantors), the Stand-By Guarantors did not acquire any Common Shares in connection with the Rights Offering pursuant to their stand-by commitments. The basic and additional subscriptions totaled 184% of the common shares of the Company available through the Rights Offering. The Company had approximately 121.7 million shares outstanding following the rights offering with the Stand-By Guarantors owning approximately 71% of the outstanding shares.

Property Acquisition

During the first quarter of 2022, the Company completed an asset acquisition. The assets were acquired for share consideration of $15.2 million (10 million common shares of Petrus at $1.52 per share on closing date).

SHARE-BASED COMPENSATION

Stock Options

The Company has a stock option plan in place whereby it may issue stock options to employees, consultants and directors of the Company. The aggregate number of shares that may be acquired upon exercise of all options granted pursuant to the plans shall, at any date or time of determination, be equal to ten percent (10%) of the number that is equal to (i) the number of the Company’s basic common shares then issued and outstanding; minus (ii) a number equal to five (5) times the number of common shares that are issuable upon exercise of the then outstanding Performance Warrants, if any, minus (iii) a number equal to fifty percent (50%) of the number of common shares that have previously been issued upon the exercise of Performance Warrants, if any.

At December 31, 2022, 8,519,709 (December 31, 2021 – 5,562,549) stock options were outstanding. The summary of stock option activity is presented below:

below:
	Number of stock	Weighted average
	options	exerciseprice
Balance, December 31, 2020	2,276,923	$0.40
Granted	4,637,500	$0.75
Forfeited	(623,513)	$0.36
Expired	(198,780)	$1.68
Exercised	(529,581)	$0.28
Balance, December 31, 2021	5,562,549	$0.67
Granted	4,677,500	$2.27
Expired	(7,071)	$0.74
Exercised	(1,713,269)	$0.60
Balance, December 31, 2022	**8,519,709 **	$1.56
Exercisable, December 31, 2022	498,958	$0.64

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The following table summarizes information about the stock options granted and currently outstanding:

Range of Exercise Price	Stock	Options Outstanding	Options Outstanding
	Number granted	Weighted average exercise price	Weighted average remaining life (years)
$0.23 - $0.50	392,204	$0.24	0.6
$0.51 - $0.80	2,653,335	$0.71	1.8
$0.81 - $0.89	796,670	$0.89	2.0
$1.78	1,020,000	$1.78	2.8
$2.25	2,602,500	$2.25	2.5
$2.81	1,055,000	$2.81	3.0
	**8,519,709 **	$1.56	2.3

During the year ended December 31, 2022, the Company granted 4,677,500 options which vest equally over three years, and upon vesting, expire 30 business days thereafter. The weighted average fair value of each option granted during the year ended December 31, 2022 of $0.91 was estimated on the date of grant using the Black-Scholes pricing model with the following weighted average assumptions:

date of grant using the Black-Scholes pricing model with the following weighted average assumptions:
2022	2021
Risk free interest rate 2.46% - 4.34% 0.15% - 0.49% Expected life (years) 1.08 - 3.25 1.08 - 3.08 Estimated volatility of underlying common shares (%) 100% to 113% 100% to 113% Estimated forfeiture rate 33 % 33 % Expected dividendyield (%) — % — %

Petrus estimated the volatility of the underlying common shares by analyzing the Company's volatility as well as the volatility of peer group public companies with similar corporate structure, oil and gas assets and size.

Deferred Share Unit ("DSU") Plan

The Company has a deferred share unit plan in place whereby it may issue deferred share units to directors of the Company. The aggregate number of shares that may be issued from treasury of Petrus pursuant to the plan shall not exceed: (i) five percent (5%) of the number of issued and outstanding common shares of the Company (on a non-diluted basis) at the date of issue; and (ii) ten percent (10%) of the number of issued and outstanding common shares of the Company (on a non-diluted basis) at the date of issue, less the aggregate number of common shares of the Company reserved for issuance under any other share compensation plan.

Each DSU entitles the participants to receive, at the Company's discretion, either shares of the Company or cash equal to the trading price of the equivalent number of shares of the Company. All DSUs granted vest and become payable upon retirement of the director.

The compensation expense was calculated using the fair value method based on the trading price of the Company's shares on the grant date. At December 31, 2022, 1,618,702 DSUs were issued and outstanding (December 31, 2021 – 1,618,702).

The following table summarizes the Company’s share-based compensation costs:

The following table summarizes the Company’s share-based compensation costs:
		Year ended	Year ended
$000s
		December 31, 2022	December 31, 2021
Expensed		1,141	259
Capitalized to exploration and evaluation assets		122	24
Capitalized toproperty, plant and equipment		367	73
Total share-based compensation		1,630	356

13. EARNINGS PER SHARE

Earnings per share amounts are calculated by dividing the net income for the period attributable to the common shareholders of the Company by the weighted average number of common shares outstanding during the period.

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	Year ended	Year ended
	December 31, 2022	December 31, 2021
Net income for the year ($000s)	60,868	114,556
Weighted average number of common shares – basic (000s)	115,189	62,557
Weighted average number of common shares – diluted(000s)	119,525	65,207
Net income per common share – basic	$0.53	$1.83
Net income per common share – diluted	$0.51	$1.76

In computing diluted earnings per share for the year ended December 31, 2022, 8,519,709 outstanding stock options and 1,618,702 DSUs were considered (December 31, 2021 – 5,562,549 and 1,618,702 respectively). 2,717,962 stock options and 1,618,702 DSUs were included in calculating the number of diluted common shares. There were 5,801,747 stock options that were anti-dilutive as the exercise price was higher than the average share price during the year ended December 31, 2022.

14. OPERATING EXPENSES

The Company’s operating expenses consisted of the following expenditures:

The Company’s operating expenses consisted of the following expenditures:
	Year ended	Year ended
$000s
	December 31, 2022	December 31, 2021
Fixed and variable operating expenses	16,954	11,134
Processing,gatheringand compression charges	4,853	2,719
Total gross operating expenses	21,807	13,853
Overhead recoveries	(1,142)	(939)
Total net operating expenses	20,665	12,914

15. GENERAL AND ADMINISTRATIVE EXPENSES

The Company’s general and administrative expenses consisted of the following expenditures:

The Company’s general and administrative expenses consisted of the following	expenditures:
	Year ended	Year ended
$000s
	December 31, 2022	December 31, 2021
Gross general and administrative expenses	6,715	5,830
Capitalized general and administrative expenses	(1,179)	(878)
Overhead recoveries	(2,147)	(678)
General and administrative expenses	3,389	4,274

16. FINANCIAL INSTRUMENTS

Risks associated with financial instruments

Credit risk

The Company’s accounts receivable are with customers and joint venture partners in the petroleum and natural gas business and are subject to normal credit risk. Concentration of credit risk is mitigated by marketing the majority of the Company’s production to reputable and financially sound purchasers under normal industry sale and payment terms. As is common in the petroleum and natural gas industry in western Canada, Petrus’ receivables relating to the sale of petroleum and natural gas are received on or about the 25th day of the following month. Of the $22.2 million of accounts receivable outstanding at December 31, 2022 (December 31, 2021 – $9.7 million), $15.3 million is owed from 2 parties (December 31, 2021 – $7.4 million from 3 parties), and the balances were received subsequent to December 31, 2022. At December 31, 2022, the Company had an allowance for doubtful accounts of $0.1 million (December 31, 2021 – $0.5 million). The Company considers accounts receivable outstanding past 120 days to be 'past due'. At December 31, 2022, 99.8% of Petrus’ accounts receivable were aged less than 120 days and 0.2% of Petrus' accounts receivable were aged greater than 120 days. The Company does not anticipate any material collection issues.

The Company’s risk management assets and cash are with chartered Canadian banks and the Company does not consider these assets to carry material credit risk.

Liquidity risk

At December 31, 2022, the Company had a $30.0 million RLF, of which $4.6 million was drawn (December 31, 2021 – $57.7 million on the previous RCF which has been repaid in full). For the year ended December 31, 2022, the Company generated cash flow from operating activities of $100.6 million.

During the year ended December 31, 2022, the Company entered into agreements with new lenders and repaid the previous RCF in full (see note 8).

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The following are the contractual maturities of financial liabilities as at December 31, 2022:

$000s	Total	< 1 year	1-5 years
Accounts payable and accrued liabilities	45,191	45,191	—
Bank indebtedness	4,606	4,606	—
Lease obligations (discounted)	603	240	363
Longterm debt	25,000	—	25,000
Total	75,400	50,037	25,363

Interest rate risk

Interest rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates. The Company’s cash, bank indebtedness and accounts receivable are not exposed to significant interest rate risk. The RLF is exposed to interest rate cash flow risk as the instrument is priced on a floating interest rate subject to fluctuations in market interest rates. The remainder of Petrus’ financial assets and liabilities are not exposed to interest rate risk. A 1% increase in the Canadian prime interest rate during the year ended December 31, 2022 would have decreased net income by approximately $0.3 million, which relates to interest expense on the average outstanding RLF, assuming that all other variables remain constant (December 31, 2021 – $0.8 million). A 1% decrease in the Canadian prime interest rate during the year would result in an opposite impact on net income for 2022 and 2021.

Commodity price risk

Commodity price risk is the risk that the fair value of future cash flows will fluctuate as a result of changes in commodity prices. A significant change in commodity prices can materially impact the Company’s borrowing base limit under its Revolving Credit Facility and may reduce the Company’s ability to raise capital. Commodity prices for petroleum and natural gas are not only influenced by Canadian and United States demand, but also by world events that dictate the levels of supply and demand.

The Company manages the risks associated with changes in commodity prices by entering into a variety of financial derivative contracts (see note 11). The Company assesses the effects of movement in commodity prices on net loss. When assessing the potential impact of these commodity price changes, the Company believes a $5/CDN WTI/bbl change in the price of oil and a $0.25/GJ change in the price of natural gas are reasonable measures.

As at December 31, 2022, it was estimated that a $0.25/GJ decrease in the price of natural gas would have increased net income by $1.4 million (December 31, 2021 – $0.2 million). An opposite change in commodity prices would result in an opposite impact on net income for the period. As at December 31, 2022, it was estimated that a $5.00/CDN WTI/bbl decrease in the price of oil would have increased net income by $3.1 million (December 31, 2021 – $0.3 million). An opposite change in commodity prices would result in an opposite impact on net income for the period.

17. CAPITAL MANAGEMENT

The Company’s general capital management policy is to maintain a sufficient capital base in order to manage its business to enable the Company to increase the value of its assets and therefore its underlying share value. In the management of capital, the Company includes share capital and total net debt, which is made up of debt and working capital (current assets less current liabilities). The Company manages its capital structure and makes adjustments in light of economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, Petrus may issue new equity, increase or decrease debt, adjust capital expenditures and acquire or dispose of assets.

18. FINANCE EXPENSES

The components of finance expenses are as follows:

The components of finance expenses are as follows:
	Year ended	Year ended
$000s
	December 31, 2022	December 31, 2021
Cash:
Interest and finance fees	2,175	4,108
Finance fees	993	1,025
Foreign exchange	3	—
Total cash finance expenses	3,171	5,133
Non-cash:
Deferred financing costs	430	365
Non-cash term loan interest payment-in-kind	—	2,573
Accretion on decommissioning obligations_(note 10)_	1,066	707
Total non-cash finance expenses	1,496	3,645
Total finance expenses	4,667	8,778

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19. SUPPLEMENTAL CASH FLOW INFORMATION

The following table reconciles the changes in non-cash working capital as disclosed in the statements of cash flows:

	Year ended	Year ended
$000s
	December 31, 2022	December 31, 2021
Source (use) in non-cash working capital:
Deposits and prepaid expenses	(362)	199
Transaction costs on debt	(518)	(178)
Inventory and others	(515)	—
Accounts receivable	(12,515)	(3,455)
Accountspayable and accrued liabilities	25,501	11,982
	11,591	8,548
Operating activities	12,891	(366)
Financing activities	—	(179)
Investingactivities	(1,300)	9,089

The following table reconciles the changes in liability resulting from financing activities:

$000s	Bank Indebtedness	Revolving Credit Facility	Term Loan	Total Liabilities from Financing Activities
Balance, December 31, 2021	—	57,700	—	57,700
Cash flows	—	(53,093)	—	(28,093)
Balance, December 31, 2022	—	4,607	—	29,607

20. COMMITMENTS AND CONTINGENCIES

COMMITMENTS

The commitments for which the Company is responsible are as follows:

$000s	Total	< 1 year	1-5 years	> 5 years
Firm service transportation	11,240	2,582	8,658	—

CONTINGENCIES

In the normal course of Petrus’ operations, the Company may become involved in, named as a party to, or be the subject of, various legal proceedings. The outcome of outstanding, pending or future proceedings cannot be predicted with certainty. Petrus does not anticipate that these claims will have a material impact on its financial position.

21. REVENUE

The following table presents Petrus' oil and natural gas revenue disaggregated by product type:

	Year ended	Year ended
$000s
	December 31, 2022	December 31, 2021
Production & royalty revenue
Oil and condensate sales	59,348	29,322
Natural gas sales	67,025	34,833
Natural gas liquids sales	25,267	16,793
Royaltyrevenue	710	320
Total oil and naturalgas revenue	152,350	81,268
Royalty expense	(24,161)	(10,361)
Loss on risk management activities	(6,029)	—
Net oil and naturalgas revenue	122,160	70,907

22. RELATED PARTY TRANSACTIONS

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The Company considers its directors and officers to be key management personnel. The following table outlines transactions with key management personnel:

personnel:
	Year ended	Year ended
$000s
	December 31, 2022	December 31, 2021
Salaries, consulting fees, benefits and director fees, gross	1,245	1,307
Share based compensation,gross	445	85
	1,690	1,392

During the year ended December 31, 2022, the Company completed its debt restructuring transactions, which included the Second Lien Facility in the form of a promissory note held by a major shareholder, owning approximately 21% of the outstanding shares of the Company (see note 8).

During the year ended December 31, 2022, the Company closed an asset acquisition that was considered a related party transaction (see note 5).

During the year ended December 31, 2022, the Company entered into a standby purchase agreement with three investors (collectively, the "Stand-By Guarantors") who each own more than 20% of the outstanding shares of the Company. The Company entered into a standby purchase agreement with each of Don Gray, Stuart Gray and Glen Gray (collectively, the "Stand-By Guarantors"). The Rights Offering was oversubscribed by 84% and as a result, the StandBy Guarantors did not acquire any Common Shares in connection with the Rights Offering pursuant to their stand-by commitments. The Company had approximately 121.7 million share outstanding following the Rights Offering with the Stand-By Guarantors owning approximately 71% of the outstanding shares.

During the third quarter of 2021, the Chairman of the Company acquired 15,636,364 Common Shares at an issue price of $0.55 per share for total proceeds of $8.6 million. An individual related to the Chairman of the Company acquired 2,545,455 Common Shares at an issue price of $0.55 per share for total proceeds of $1.4 million. Two individuals related to the Chairman of the Company settled their Term Loan with the Company for 28,727,273 Common Shares at an issue price of $0.55 per share.

23. DEFERRED INCOME TAXES

23. DEFERRED INCOME TAXES
	Year ended	Year ended
$000s
	December 31, 2022	December 31, 2021
Income before taxes	60,868	109,132
Combined federal and provincial tax rate	23.0 %	23.0 %
Computed “expected” tax recovery	14,000	25,100
Increase/(decrease) in taxes resulting from:
Permanent items	1	1
Share based payments	306	82
Share issuance costs	(80)	—
True up and other	1,059	1,615
Unrecognized deferred income tax asset	(15,286)	(32,222)
Deferred tax expense (recovery)	—	(5,424)
Effective tax rate	— %	(5) %

The components of the Company’s deferred tax position at December 31, 2022 and 2021 are as follows:

$000s
	2022	2021
Exploration and evaluation assets and property, plant and equipment	27,439	19,116
Asset retirement obligations	(8,661)	(9,561)
Share issuance costs	(184)	—
Non capital loss carry-forwards	(19,771)	(8,983)
Unrealized hedgingloss	1,178	(572)
Deferred tax liability	—	—

The company has unrecognized deductible temporary differences in the form of non-capital loss carry-forward of approximately $120.7 million (2021 - $224.8 million). The Company had non-capital losses of approximately $206.7 million (2021 – $263.9 million) which may be applied against future income for Canadian tax purposes. These non-capital losses expire in 2028 and onwards.

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At December 31, 2022, the Company has determined it is currently not probable that future taxable profits will be available against which the tax benefits will be utilized.

24. INVENTORY

The components of the Company’s inventory at December 31, 2022 and 2021 are as follows:

$000s
	2022	2021
Oil and gas equipment inventory	578	—
Carbon credits	619	—
Inventory	1,197	—

25. DEPOSITS AND PREPAID EXPENSES

The components of the Company’s deposits and prepaid expenses as at December 31, 2022 and 2021 are as follows:

$000s
	2022	2021
Prepaid interest and bank fees	229	150
Prepaid insurance	414	12
Prepaid operating expenses	19	18
Prepaid software	172	118
Deposits	1,028	652
Deposits andprepaid expenses	1,862	950

26. OTHER INCOME

The following table presents Petrus' other income by category:

	Year ended	Year ended
$000s
	December 31, 2022	December 31, 2021
Carbon credits	619	—
Government grant for decommissioning activities	441	—
Other	291	1,448
Other income	1,351	1,448

During the year ended December 31, 2021, the Company recorded $1.4 million as other income. The amount was related to the settlement of an outstanding dispute associated with the transportation and marketing of condensate volume in the Company's Ferrier area.

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CORPORATE INFORMATION

OFFICERS & VICE PRESIDENTS

OFFICERS

Ken Gray, P.Eng President and Chief Executive Officer

Mathew Wong, CPA, CFA, CPA (WA, USA) Chief Financial Officer

Matt Skanderup Chief Operating Officer

Lindsay Hatcher Vice President, Commercial & Corporate Development

DIRECTORS

DIRECTORS

Don T. Gray Chairman Scottsdale, Arizona

Ken Gray Calgary, Alberta

Patrick Arnell Calgary, Alberta

Donald Cormack Calgary, Alberta

Peter Verburg Calgary, Alberta

SOLICITOR

SOLICITOR

Burnet, Duckworth & Palmer LLP Calgary, Alberta

AUDITOR

Ernst & Young LLP Chartered Professional Accountants Calgary, Alberta

INDEPENDENT RESERVE EVALUATORS

InSite Petroleum Consultants Ltd. Calgary, Alberta

BANKERS

ATB Financial Calgary, Alberta

TRANSFER AGENT

Odyssey Trust Company Calgary, Alberta

HEAD OFFICE

2400, 240 – 4th Avenue S.W. Calgary, Alberta T2P 4H4 Phone: 403-984-9014 Fax: 403-984-2717

WEBSITE

www.petrusresources.com

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