Record Resources Inc. — Audit Report / Information 2020

May 19, 2021

SILK ROAD ENERGY INC. STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION (Form 51-101F1)

Part 1 - Date of Statement

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This statement of reserves data and other oil and gas information is dated October 9, 2020.

The effective date is September 30, 2020.

The preparation date is October 9, 2020.

Part 2 – Disclosure of Reserves Data

The following is a summary of the oil and natural gas reserves and the value of future net revenue of Silk Road Energy Inc. (the "Company") as evaluated by Chapman Petroleum Engineering Ltd. ("Chapman") as at September 30, 2020, and dated October 9, 2020 (the "Chapman Report"). Chapman is an independent qualified reserves evaluator and auditor.

All evaluations of future revenue are after the deduction of future income tax expenses, unless otherwise noted in the tables, royalties, development costs, production costs and well abandonment costs but before consideration of indirect costs such as administrative, overhead and other miscellaneous expenses. The estimated future net revenue contained in the following tables does not necessarily represent the fair market value of the Company's reserves. There is no assurance that the forecast price and cost assumptions contained in the Chapman Report will be attained and variances could be material. Other assumptions and qualifications relating to costs and other matters are included in the Chapman Report. The recovery and reserves estimates on the Company's properties described herein are estimates only. The actual reserves on the Company's properties may be greater or less than those calculated.

All monetary values presented in this document are expressed in terms of Canadian dollars.

SUMMARY OF OIL AND GAS RESERVES BASED ON FORECAST PRICES AND COSTS AS AT SEPTEMBER 30, 2020

					Company Reserves (1)
		Light and Medium Oil		Heavy Oil		Conventional Natural Gas (9)		Natural Gas Liquids
	Gross	Net	Gross	Net	Gross	Net	Gross	Net
Reserves Category	MSTB	MSTB	MSTB	MSTB	MMscf	MMscf	Mbbl	Mbbl
PROVED
Developed Producing (2)(6)		0	0		39	32	O
Developed Non-Producing (2)(7)
Undeveloped $(2)(8)$		Ω	O
TOTAL PROVED (2)		Ω	U	n	39	32
TOTAL PROBABLE(3)		0	0		14	11
TOTAL PROVED + PROBABLE (2)(3)			Ω		53	43

SUMMARY OF NET PRESENT VALUES BASED ON FORECAST PRICES AND COSTS AS AT SEPTEMBER 30, 2020

				Net Present Values of Future Net Revenue
			Before Income Tax					After Income Tax
			Discounted at					Discounted at
	$0\%$ /yr	$5\%$ /yr.	10%/yr.	15%/yr.	20%/vr.	$0\%$ /yr	$5\%$ /yr.	10%/yr.	15%/vr.	20%/vr.
Reserves Category	M\$	M\$	M\$	M\$	M\$	M\$	M\$	M\$	M\$	M\$
PROVED
Developed Producing (2)(6)		8	11	12	12	(5)	$\overline{c}$	6		8
Developed Non-
Producing $(2)(7)$	0	0	0	0	0	0	$\mathbf 0$	$\Omega$	0	0
Undeveloped $(2)(8)$		Ω	0	0	0	O	0	0	0	0
TOTAL PROVED(2)		8	11	12	12	(5)	2	6		8
TOTAL PROBABLE (3)	10	10	9		5	8	9		6	5
TOTAL PROVED +
PROBABLE (2)(3)	12	18	19	19	18		11	13	13	13

TOTAL FUTURE NET REVENUE (UNDISCOUNTED) BASED ON FORECAST PRICES AND COSTS AS AT SEPTEMBER 30, 2020

	Revenue (M5)	Royalties (M5)	Operating Costs (M\$)	Development Costs (M5)	Abandonment and Reclamation Costs (MS)	Future Net Revenue Before Income Taxes (M\$)	Income Taxes (M\$)	Future Net Revenue After Income Taxes (M5)
Total Proved (2) Total Proved Plus	92		44		-31			(5)
Probable $(2)(3)$	131	24	62		33	12

FUTURE NET REVENUE BY PRODUCT TYPE BASED ON FORECAST PRICES AND COSTS AS AT SEPTEMBER 30, 2020

Reserve Category	Product Type	Future Net Revenue Before Income Taxes (Discounted at $10\%$ /Year) (MS)
Total Proved (2)	Light and Medium Oil (including solution gas and other by-products)	0
	Heavy Oil (including solution gas and other by-products)	0
	Conventional Natural Gas (including by-products but not solution gas)	11
Total Proved Plus Probable (2)(3)	Light and Medium Oil (including solution gas and other by-products)	0
	Heavy Oil (including solution gas and other by-products)	0
	Conventional Natural Gas (including by-products but not solution gas)	19

OIL AND GAS RESERVES AND NET PRESENT VALUES BY PRODUCT TYPE BASED ON FORECAST PRICES AND COSTS AS AT SEPTEMBER 30, 2020

				Reserves			Net Present	Unit Values
		Conventional						@ 10%/yr
		Oil	Natural Gas (9)		NGL
Product Type by Reserve	Gross	Net	Gross	Net	Gross	Net	10%
Category	MSTB	MSTB	MMscf	MMscf	Mbbl	Mbbl	M\$
Conventional Natural Gas (Associated & Non-Associated)
Proved
Developed Producing	$\Omega$	0	39	32	0	0	11	0.33
Developed Non-Producing	0	0	0	0	0	O	0	N/A
Undeveloped		o	0	$\Omega$	0	0	0	N/A
Total Proved	o	0	39	32	0	0	11	0.33
Probable		O	14	11	0		9	0.76
Proved Plus Probable		0	53	43	٥		19	0.44

Notes:

• $1.$ "Gross Reserves" are the Company's working interest (operating or non-operating) share before deducting of royalties and without including any royalty interests of the Company. "Net Reserves" are the Company's working interest (operating or nonoperating) share after deduction of royalty obligations, plus the Company's royalty interests in reserves.
• "Proved" reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that $2.$ the actual remaining quantities recovered will exceed the estimated proved reserves.
• "Probable" reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely 3. that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves.
• "Possible" reserves are those additional reserves that are less certain to be recovered than probable reserves. It is unlikely $4.$ that the actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves.
• "Developed" reserves are those reserves that are expected to be recovered from existing wells and installed facilities or, if $5.$ facilities have not been installed, that would involve a low expenditure (e.g. when compared to the cost of drilling a well) to put the reserves on production.
• "Developed Producing" reserves are those reserves that are expected to be recovered from completion intervals open at the $6.$ time of the estimate. These reserves may be currently producing or, if shut-in, they must have previously been on production, and the date of resumption of production must be known with reasonable certainty.
• 1. "Developed Non-Producing" reserves are those reserves that either have not been on production, or have previously been on production, but are shut in, and the date of resumption of production is unknown.
• 1. "Undeveloped" reserves are those reserves expected to be recovered from known accumulations where a significant expenditure (for example, when compared to the cost of drilling a well) is required to render them capable of production. They must fully meet the requirements of the reserves classification (proved, probable, possible) to which they are assigned.
• Includes associated, non-associated and solution gas where applicable. 9.

Part 3 - Pricing Assumptions

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The following table details the benchmark reference prices for the regions in which the Company operated, as at September 30, 2020, reflected in the reserves data disclosed above under "Part 2 -Disclosure of Reserves Data". The forecast price assumptions assume the continuance of current laws and regulations and take into account inflation with respect to future operating and capital costs. There will be adjustments to field prices from the benchmarks below:

NATURAL GAS & BY-PRODUCTS HISTORICAL, CONSTANT, CURRENT AND FUTURE PRICES

October 1, 2020

		Alberta GRP [1]		AECO Spot Gas[2]	Henry Hub Gas[3]	Propane C3[4]	Butane C4[4]	Condensate (Pentanes Plus) $C5+[5]$
Date	\$CDN/MMBTU \$CDN/GJ			\$CDN/MMBTU	\$US/MMBTU	\$CDN/BBL	\$CDN/BBL	\$CDN/BBL
	HISTORICAL PRICES
2010		3.93	3.73	4.02	4.39	44.40	57.99	77.51
2011		3.46	3.28	3.63	3.99	50.17	70.93	97.21
2012		2.25	2.13	2.39	2.75	47.40	64.48	96.26
2013		2.98	2.82	3.17	3.73	50.09	91.43	100.72
2014		4.22	4.00	4.51	4.35	46.85	62.26	108.28
2015		2.62	2.48	2.71	2.76	6.17	36.81	59.14
2016		2.03	1.93	2.18	2.50	6.71	29.81	55.62
2017		2.05	1.94	2.50	2.96	25.55	39.62	67.15
2018		1.38	1.31	1.51	3.18	30.47	48.97	77.19
2019		1.31	1.24	1.81	2.57	14.98	21.39	70.46
2020	9 mos.	1.82	1.72	2.10	1.87	14.79	18.80	48.17
				CONSTANT PRICES (The average of the first-day-of-the-month price for the preceding 12 months-SEC)
		1.82	1.72	2.04	1.98	13.66	18.06	55.29
	FORECAST PRICES
2020		1.78	1.69	2.00	2.24	18.50	22.58	47.54
2021		2.05	1.94	2.30	2.54	21.62	31.70	53.13
2022		2.31	2.19	2.60	2.84	24.43	38.22	58.98
2023		2.36	2.24	2.65	2.89	26.54	42.08	63.34
2024		2.41	2.28	2.71	2.95	27.66	43.85	65.83
2025		2.46	2.33	2.76	3.00	28.75	45.58	68.32
2026		2.50	2.38	2.81	3.05	29.36	46.54	69.75
2027		2.55	2.42	2.87	3.11	29.98	47.52	71.21
2028		2.61	2.47	2.93	3.17	30.61	48.52	72.70
2029		2.66	2.52	2.99	3.23	31.25	49.53	74.22
2030		2.71	2.57	3.05	3.29	31.90	50.57	75.77
2031		2.77	2.62	3.11	3.35	32.57	48.45	77.35
2032		2.82	2.68	3.17	3.41	33.24	49.46	78.96
2033		2.88	2.73	3.23	3.47	33.94	50.49	80.61
2034		2.93	2.78	3.30	3.54	34.64	51.54	82.28
2035		2.99	2.84	3.36	3.60	35.34	52.58	83.93

Escalated 2% thereafter

Notes:

$[1]$ Alberta Gas Reference Price (GRP) represents the average of all system and direct (spot and firm) sales.

The AECO C Spot price, which is the Alberta gas trading price $[2]$

$[3]$ Henry Hub Spot is natural gas traded on the New York Mercantile Exchange (NYMEX).

$[4]$ Alberta average field price for Propane and Butane purchased at field locations.

$[5]$ Edmonton condensate from GMP First Energy. The Company's weighted average prices received this fiscal year are: \$0.00 /Mscf for conventional natural gas.

Part 4 - Reconciliation of Changes in Reserves

The following table sets forth a reconciliation of the changes in the Company's gross reserves as at September 30, 2020 against such reserves as at September 30, 2019 based on the forecast price and cost assumptions:

RECONCILIATION OF COMPANY GROSS
RESERVES BY PRINCIPAL PRODUCT TYPE
BASED ON FORECAST PRICES AND COSTS
AS AT SEPTEMBER 30, 2020

		Light and Medium Oil			Heavy Oil			Conventional Natural Gas (Associated and Non- Associated)
	Proved (Mbbl)	Probable (Mbbl)	Proved Plus Probable (Mbbl)	Proved (Mbbl)	Probable (Mbbl)	Proved Plus Probable (Mbbl)	Proved (MMscf)	Probable (MMscf)	Proved Plus Probable (MMscf)
At Sept. 30, 2019							46	15	61
Production(Sales)							(6)	0	(6)
Acquisitions
Dispositions
Discoveries
Extensions & Improved Recovery
Economic Factors
Technical Revisions							(1)	(1)	(2)
At Sept. 30, 2020							39	14	53

Part 5 - Additional Information Relating to Reserves Data

Undeveloped Reserves

The Company had no proved undeveloped reserve as at September 30, 2020, or in prior years.

Significant Factors or Uncertainties

The estimation of reserves requires significant judgment and decisions based on available geological, geophysical, engineering and economic data. These estimates can change substantially as additional information from ongoing development activities and production performance becomes available and as economic and political conditions impact oil and gas prices and costs change. The Company's estimates are based on current production forecast, prices and economic conditions. All of the Company's reserves are evaluated by Chapman Petroleum Engineering Ltd., an independent engineering firm.

As circumstances change and additional data becomes available, reserve estimates also change. Based on new information, reserves estimates are reviewed and revised, either upward or downward, as warranted. Although every reasonable effort has been made by the Company to ensure that reserves estimate are accurate, revisions may arise as new information becomes available. As new geological,

production and economic data is incorporated into the process of estimating reserves the accuracy of the reserve estimate improves.

Future Development Costs

The following table shows the development costs anticipated in the next five years, which have been deducted in the estimation of the future net revenues of the proved and probable reserves.

	Total Proved Estimated Using Forecast Prices and Costs (Undiscounted) (MS)	Total Proved Plus Probable Estimated Using Forecast Prices and Costs (Undiscounted) (MS)
2020
2021
2022
2023
2024
Total for five years
Remainder
Total for all years

The Company has been successful in raising its required capital through equity financings and plans to continue to do so for the development costs specified above. The effect of the costs of the expected funding would have no impact on the revenues or reserves currently being reported.

Part 6 – Other Oil and Gas Information

Oil and Gas Properties and Wells

The following table sets forth the number of wells in which the Company held a working interest as at September 30, 2020:

	Эi!		Conventional Natural Gas
	Gross (1)	Net (2)	Gross (1)	Net (2)
Bashaw Area	--------------------------------------		--------------------------------------
Producing				0.37
Non-producing

[1] Total number of wells in which the Company has a working interest.

[2] Total number of wells in which the Company has a working interest multiplied by the Company working interest in each well.

All of the Company's wells are onshore in Alberta and are producing through production facilities in developed gas fields.

Properties with No Attributed Reserves

The Company currently owns property in Thornbury, Alberta to which no reserves have been assigned because of the economic limit.

Forward Contracts

Currently, the Company has no forward contracts.

Tax Horizon

The Company is expected to be taxable under the proved and proved plus probable cash flows forecast in this report.

Costs Incurred

The following table summarizes the capital expenditures made by the Company on oil and conventional natural gas properties for the year ended September 30, 2020

Property Acquisition Costs (MS)		Exploration Costs (MS)	Development Costs (MS)
Proved Properties	Unproved Properties
	.

The Company also had no exploration costs on the project.

Exploration and Development Activities

The following table sets forth the number of exploratory and development wells which the Company completed during its 2020 financial year:

		Exploratory Wells	Development Wells
	Gross (1)	N PI (2)	Gross(1)	N ft (2)
Oil Wells
Gas Wells
Service Wells
Dry Holes
Total Completed Wells	_________	--------------------------------------	Program Andrew College College Andrew College Andrew College Andrew College Andrew College Andrew College Andrew College Andrew College Andrew College Andrew College Andrew College Andrew College Andrew College Andrew C _________

[1] Total number of wells in which the Company has a working interest.

[2] Total number of wells in which the Company has a working interest multiplied by the Company working interest in each well.

The Company did not drill or develop any additional reserves in the fiscal year.

Production Estimates

The following table sets forth the volume of production estimated by Chapman for the period between October 1, 2020 and December 31, 2021 (15 months).

TOTAL PROVED RESERVES

Light and Medium			Conventional	Natural Gas
AREA	Oil	Heavy Oil	Natural Gas	Liauids
	(Mbbl)	(Mbbl) --------------------------------------	(MMscf)	(Mbbl)
Bashaw Area
Total for all areas
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TOTAL PROVED PLUS PROBABLE RESERVES

AREA	Light and Medium Oil (Mbbl)	Heavy Oil (Mbbl)	Conventional Natural Gas (MMscf)	Natural Gas Liauids (Mbbl)
Bashaw Area	--------------------------------------
Total for all areas	PRODUCED AND CONTINUES OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A R	$\label{thm:main} For example, the number of the two subspaces are generated by the number of the two subspaces.$	--------------------------------------	- The Maria Construction of the Maria Construction of the Construction of the Construction of the Construction of the Construction of the Construction of the Construction of the Construction of the Construction of the Cons

These values are gross to Company's working interest before the deduction of royalties payable to others.

Production History

The following table sets forth certain information in respect of production, product prices received, royalties, production costs and netbacks received by the Company for each quarter of its most recently completed financial year:

	Three Months Ended December 31, 2019	Three Months Ended March 31, 2020	Three Months Ended June 30, 2020	Three Months Ended September 30, 2020
Average Daily Production
Light and Medium Oil (Bbl/d)
Conventional Natural Gas (Mscf/d)
Average Net Prices Received
Light and Medium Oil (\$/Bbl)
Conventional Natural Gas (\$/Mscf)
Royalties
Light and Medium Oil (\$/Bbl)
Conventional Natural Gas (\$/Mscf)
Production Costs
Light and Medium Oil (\$/Bbl)
Conventional Natural Gas (\$/Mscf)
Netback Received
Light and Medium Oil (\$/Bbl)
Conventional Natural Gas (\$/Mscf)

PRODUCTION VOLUMES IN 2020

	Light and Medium		Conventional Natural	Natural Gas
AREA	Oil (Mbbl)	Heavy Oil (Mbbl)	Gas (MMscf)	Liquids (Mbbl)
Bashaw Area		-------------------	_________	_________
Total for all areas	_________ www.communication.com/communication/communication/communication/communication/communication	_________ ---------------------------------------	--------------------------------------	--------------------------------------

ABBREVIATIONS AND CONVERSION

In this document, the abbreviations set forth below have the following meanings:

Oil and Natural Gas Liquids

Natural Gas

Bbl barrel Bbls barrels Mbbls thousand barrels MMbbls million barrels MSTB 1,000 stock tank barrels Bbls/d barrels per day NGLS natural gas liquids stock tank barrels of oil STB. STB/d stock tank barrels of oil per day	Mscf MMscf Mscf/d MMscf/d MMBTU Bscf GJ	thousand standard cubic feet million standard cubic feet thousand standard cubic feet per day million standard cubic feet per day million British Thermal Units billion standard cubic feet gigajoule
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------	--------------------------------------------------------------------------------	-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Other

AECO BIT AIT BOE.

Niska Gas Storage's natural gas storage facility located at Suffield, Alberta. Before Income Tax After Income Tax barrel of oil equivalent on the basis of 1 BOE to 6 Mscf of natural gas. BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 1 BOE for 6 Mscf is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

BOE/d m 3 \$M WTI.

barrel of oil equivalent per day cubic metres thousands of dollars West Texas Intermediate, the reference price paid in U.S. dollars at Cushing, Oklahoma for crude oil of standard grade