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Sunshine Oilsands Ltd. Proxy Solicitation & Information Statement 2026
50340_rns_2026-05-21_3cb0d075-79cf-453b-9ed8-169651e17408.pdf
Proxy Solicitation & Information Statement
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THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION
If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult a stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.
If you have sold or transferred all your shares in Sunshine Oilsands Ltd., you should at once hand this circular with the accompanying form of proxy to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.
This circular appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for the securities of the Company.
阳光油砂
SUNSHINE OILSANDS LTD.
陽光油砂有限公司*
(a corporation incorporated under the Business Corporation Act of the Province of Alberta, Canada with limited liability)
(HK stock code: 2012)
270, 333 24th Avenue SW
Calgary, AB, T2S 3E6
Canada
Telephone: 1-403-984-1450
ISSUE OF SHARES UNDER SPECIFIC MANDATE
AND
NOTICE OF SPECIAL MEETING
Meeting Date: June 24, 2026 at 11:30 a.m. (Hong Kong time) /
June 23, 2026 at 9:30 p.m. (Calgary time)
May 21, 2026
- for identification purpose only
TABLE OF CONTENTS
DEFINITIONS...1
NOTICE OF SPECIAL MEETING...3
LETTER FROM THE BOARD...7
APPENDIX - GENERAL INFORMATION...19
DEFINITIONS
In this circular, unless the context otherwise requires, capitalized terms used shall have the following meanings:
“associate(s)” has the meaning ascribed to it under the Listing Rules
“Board” the board of Directors
“Business Day” a day (except Saturday, and Sunday and public holiday) on which banks in Hong Kong are open for business
“CAD$” Canadian dollars, the lawful currency of Canada
“Completion” completion of the Placing in accordance with the terms and conditions of the Placing Agreement
“Completion Date” Completion of the Placing will take place on four business days immediately fulfill the Conditions Precedent to Completion of the Placing Agreement or such other date as the parties may agree
“connected person(s)” Has the meanings as ascribed thereto under the Listing Rules
“Sunshine” or “Company” Sunshine Oilsands Ltd., a corporation incorporated under the Business Corporations Act of the Province of Alberta, Canada, the Shares of which are listed on the Main Board of the Stock Exchange
“Director(s)” the Directors of the Company
“Group” the Company and its subsidiaries
“HK$” Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong” the Hong Kong Special Administrative Region of the People Republic of China
“independent third party(ies)” independent third parties who is/are not connected person(s) of the Company and is/are independent of and not connected with the Company and its Directors, chief executives and Substantial Shareholders of the Company or any of its subsidiaries or their respective associates
“Latest Practicable Date” May 20, 2026, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining the information contained therein
“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange
“Long Stop Date” July 31, 2026 (or such later date as may be agreed between the Company and the Placing Agent)
“Placee(s)” any individual(s), corporation(s) and/or institutional or professional investor(s) procured by or on behalf of the Placing Agents or its agent(s) to subscribe for any of the Placing Shares
| “Placing” | the placing of up to 114,280,000 Placing Shares on a best effort basis on and subject to the terms and conditions set out in the Placing Agreement |
|---|---|
| “Placing Agent” or “CUS” | Cheer Union Securities Limited, a licensed corporation to carry out business in type 1 (dealing in securities) regulated activity under the SFO |
| “Placing Agreement” | the conditional placing agreement dated December21, 2025 and entered into between the Company and the Placing Agent in relation to the Placing |
| “Placing Price” | HK$0.36 per Placing Share |
| “Placing Share(s)” | a maximum of up to 114,280,000 new Shares to be placed pursuant to the Placing Agreement |
| “SFO” | the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong) |
| “Share(s)” | the Class “A” Common Voting share(s) in the issued share capital of the Company |
| “Shareholder(s)” | holder(s) of the Class “A” Common Voting Share(s) |
| “SM” or “Special Meeting” | the special general meeting of the Company to be convened and held for the purposes of approving the Placing, the Specific Mandate and the transactions contemplated thereunder |
| “Specific Mandate” | a specific mandate to be sought from the Shareholders at the SM for the allotment and issuance of the Placing Shares to the Placee(s) |
| “Stock Exchange” | the Stock Exchange of Hong Kong Limited |
| “Substantial Shareholder(s)” “%” | has the meaning ascribed to it in the Listing Rules per cent. |
NOTICE OF SPECIAL MEETING
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this notice, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this notice.
阳光油砂
SUNSHINE OILSANDS LTD.
陽光油砂有限公司*
(a corporation incorporated under the Business Corporation Act of the Province of Alberta, Canada with limited liability)
(HK Stock Code: 2012)
NOTICE OF SPECIAL MEETING
TO BE HELD AT 11:30 A.M. ON JUNE 24, 2026 (HONG KONG TIME)
AND 9:30 P.M. ON JUNE 23, 2026 (CALGARY TIME)
NOTICE IS HEREBY GIVEN that a special meeting (the "SM", the "Special Meeting" or the "Meeting") of the holders (the "Shareholders") of Class "A" Common Voting Shares (the "Shares") of Sunshine Oilsands Ltd. ("Sunshine" or the "Company") will be held at 21st Floor, CMA Building, 64 Connaught Road Central, Hong Kong on June 24, 2026 at 11:30 a.m. (Hong Kong Time) / June 23, 2026 at 9:30 p.m. (Calgary Time), for the purpose of considering and, if thought fit, passing the following resolution(s) with or without amendments, as ordinary resolution(s) of the Company.
Capitalized terms used herein without definition shall have the same meanings as in the circular issued by the Company dated May 21, 2026 (the "Circular"), unless the context otherwise requires:
ORDINARY RESOLUTION(S)
- "BE IT RESOLVED THAT:
a) The Placing (as defined in the Circular) of up to 114,280,000 shares under the Placing Agreement (as defined in the Circular), a copy of the Placing Agreement has been produced at the Special Meeting of the Company marked “A” and signed by the Chairman of the Special Meeting for the purposes of identification, be and are hereby approved;
b) the execution of the Placing Agreement and any other agreements, documents and actions taken or to be taken in connection with the Placing (including the allotment and issuance by the Corporation of the Placing Shares) by any director of the Corporation ("Director"), notwithstanding any interest he/she may have in any matters in connection with the Placing, be and are hereby approved, confirmed and ratified;
*for identification purpose only
c) the board of Directors be and is hereby granted a specific mandate to exercise all the powers of the Company to allot and issue and deal with the Placing Shares, subject to and in accordance with the terms and conditions of the Placing Agreement; and
d) any one or more Director(s) be and is/are hereby authorised to implement and take all steps and do all acts and things and execute all such documents (including under seal, where applicable) which he/she/they consider(s) necessary, desirable or expedient to give effect to the Placing Agreement, and the transactions contemplated thereunder and to agree with such variation, amendment or waiver as, in the opinion of the Directors, in the interests of the Company and its shareholders as a whole.”
Time and venue of the Special Meeting
The Special Meeting will be held and started at 11:30 a.m. on June 24, 2026 (Hong Kong time) / at 9:30 p.m. on June 23, 2026 (Calgary time) at 21st Floor, CMA Building, 64 Connaught Road Central, Hong Kong.
Registered Shareholders
If you hold Shares in your own name, you are a registered shareholder of the Company (“Registered Shareholder”). As a Registered Shareholder, if you are unable to attend the Special Meeting in person and wish to ensure that your Shares are voted at the Special Meeting, you must complete, date and sign the enclosed form of proxy and deliver it in accordance with the instructions set out in the form of proxy and in the Circular. Such form of proxy is also published on the HKEX news’ website of the Hong Kong Exchanges and Clearing Limited at www.HKEXnews.hk and the website of the Company at www.sunshineoilsands.com.
Beneficial Shareholders
If your Shares are held in an account with a brokerage firm or an intermediary (i.e. a broker, investment firm, clearing house or a similar entity), you are a beneficial shareholder of the Company (“Beneficial Shareholder”). Beneficial Shareholders should follow the instructions set out in the voting instructions form or other form of proxy provided by your intermediaries to ensure that your Shares will be voted at the Special Meeting.
Record Date
All Registered Shareholders as at 4: 30 p.m. on June 5, 2026 (Hong Kong Time) and 4: 30 p.m. on June 5, 2026 (Calgary time), as the case may be (the “Record Date”), may vote in person at the Special Meeting or any adjournments thereof, or they (including a Beneficial Shareholder) may appoint another person (who need not be a Shareholder) as their proxy to attend and vote in their place.
4
5
Delivery of Proxy
Shareholders who receive this Circular and other accompanying meeting materials from the Company’s branch share registrar in Hong Kong, being Computershare Hong Kong Investor Services Limited, and who are unable to present at the Special Meeting are requested to date and sign the enclosed form of proxy and return it to Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong, in the enclosed envelope provided for that purpose.
Shareholders who receive this Circular and other accompanying meeting materials from the Company’s share registrar in Canada, being Odyssey Trust Company, and who are unable to present at the Special Meeting are requested to date and sign the enclosed form of proxy and return it to the Proxy Department of Odyssey Trust Company at Suite 1100 Trader’s Bank Building, 67 Yonge St, Toronto, ON M5E 1J8, in the enclosed envelope provided for that purpose.
In order to be valid, the Proxy must be completed, signed, dated and deposited, as applicable:
(a) if the Shareholder is on the Hong Kong register, at the office of the Company’s share registrar in Hong Kong, being Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong, during regular business hours, at least 48 hours before the Special Meeting (Hong Kong time) excluding Saturdays, Sundays and public holidays in Hong Kong (i.e. 11:30 a.m. on June 22, 2026 (Hong Kong time) prior to the time of the Meeting or any adjournment thereof) or, deposited with the Chairman of the Meeting on the day of the Meeting prior to the commencement of the Meeting; or
(b) if the Shareholder is on the Canada register, at the office of the proxy department of Odyssey Trust Company, at Suite 1100 Trader’s Bank Building, 67 Yonge St, Toronto, ON M5E 1J8, during regular business hours, by no later than 48 hours before the Special Meeting (Toronto time) excluding Saturdays, Sundays and public holidays in Toronto (i.e. 4:30 p.m. on June 19, 2026 (Toronto time)) prior to the time of the Meeting or any adjournment thereof.
Results of the Special Meeting
The votes to be taken at the Special Meeting will be taken by poll, the result of which will be published on the websites of the Company and the Stock Exchange after the Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
SUNSHINE OILSANDS LTD.
(signed) “Kwok Ping Sun”
Kwok Ping Sun
Executive Chairman
Calgary, Alberta, May 21, 2026
Hong Kong, May 21, 2026
Notes:
-
Any shareholder entitled to attend and vote at the Special Meeting is entitled to appoint another person as his/her/its proxy to attend and vote instead of his/her/it. A shareholder who is the holder of two or more Shares may appoint more than one proxy to attend on the same occasion. A proxy need not be a Shareholder of the Company but must be present in person at the Meeting to represent the Shareholder. Completion and return of the form of Proxy will not preclude a Shareholder from attending the Meeting and voting in person. In such event, his/her/its form of Proxy will be deemed to have been revoked.
-
The proxy must be dated and must be executed by the Shareholder or his attorney authorized in writing or, if the Shareholder is a body corporate, under its corporate seal or by an officer or attorney thereof duly authorized. A copy of such authorization should accompany the proxy. Persons signing as executors, administrators, trustees, etc. should so indicate. If this Proxy is not dated, it shall be deemed to bear the date on which it was mailed to the Shareholder by the Company.
-
Where there are joint holders of any Share, any one of such joint holders may appoint the chair of the Special Meeting to vote, in respect of such Share as if he/she/it was solely entitled thereto.
As at the date of this notice, the Board consists of Mr. Kwok Ping Sun and Ms. Gloria Pui Yun Ho as executive directors; Mr. Michael John Hibberd and Ms. Xijuan Jiang as non-executive directors; and Mr. Yi He, Mr. Guangzhong Xing and Ms. Jue Pang as independent non-executive directors.
6
LETTER FROM THE BOARD
阳光油砂
SUNSHINE OILSANDS LTD.
陽光油砂有限公司*
(a corporation incorporated under the Business Corporation Act of the Province of Alberta, Canada with limited liability)
(HK stock code: 2012)
270, 333 24th Avenue SW
Calgary, AB, T2S 3E6
Canada
Telephone: 1·403·984·1450
To the Shareholders
of the Company
May 21, 2026
Dear Sir / Madam,
ISSUE OF SHARES UNDER SPECIFIC MANDATE
AND
NOTICE OF SPECIAL MEETING
INTRODUCTION
Reference is made to the announcement dated December 21, 2025 (Hong Kong time) December 21, 2025 2025 (Calgary time), the Company entered into the Placing Agreement with the Placing Agent, pursuant to which the Placing Agent conditionally agrees, as agent of the Company, to procure on a best effort basis not less than six Places who and whose ultimate beneficial owner(s) (if applicable) shall be Independent Third Parties to subscribe for up to 114,280,000 Placing Shares at the Placing Price of HK$0.36 per Placing Share.
The purpose of this circular is to provide the Shareholders with (i) further information regarding the Placing and (ii) the notice of the SM to be convened for the purpose of considering and, if thought fit, approving the relevant resolution in connection with the Placing, the allotment and issue of the Placing Shares pursuant to the Specific Mandate and the transactions contemplated thereunder.
*for identification purpose only
Details of the Placing Agreement are set out below:
The Placing Agreement
DATE
December 21, 2025 (Hong Kong Time)
PARTIES
(i) the Company (as issuer); and
(ii) Cheer Union Securities Limited (as placing agent)
To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, the Placing Agent and its ultimate beneficial owner(s) are Independent Third Parties.
Placing commission
Pursuant to the terms of the Placing Agreement, The Placing Agent will be entitled to receive a commission of 2% of the amount equal to the Placing Price multiplied by the actual number of the Placing Shares successfully placed by the Placing Agent. The commission for the Placing was arrived at after arm's length negotiation between the Company and the Placing Agent with reference to the prevailing market practice.
The Directors consider that the terms of the Placing, including the placing commission, are fair and reasonable based on the current market conditions and the Placing is in the interests of the Company and the Shareholders as a whole.
Placees
The Placing Shares will be placed to not less than six Placees (who will be independent professional, institutional or other investors) who and whose ultimate beneficial owners are third parties (the "Placees") and independent of and not connected with the Company or its connected persons (as defined under the Listing Rule). Upon Completion, it is expected that none of the Placees will become a substantial Shareholder. Pursuant to the Placing Agreement, the Placing Agent will use its best endeavour to ensure that none of the Placees to be procured by the Placing Agent will, immediately upon Completion, become a substantial Shareholder (within the meaning of the Listing Rules).
As at the Latest Practicable Date, no Placee has been identified. As advised by the Placing Agent, they will approach their existing customer base and liaison network to identify potential Placees.
Placing Shares
Assuming no further issue of new Shares or repurchase of Shares (other than those failing to be issued upon full exercise of the share options), the number of Placing Shares represents approximately 16.07% of the existing issued share capital of the Company of 711,354,444 Shares as at the date of this circular and approximately 13.84% of the Company's issued share capital of 825,634,444 Shares as enlarged by the allotment and issue of the Placing Shares.
The maximum gross proceeds to be raised from the Placing (assuming the maximum number of the Placing Shares is placed) will be HK$41,140,800 (approximately CAD$ 7,286,071 (1)).
Note:1. Based on the Bank of Canada's nominal closing exchange rate (as at December 19, 2025) of CAD$1.00 = HK$5.6465.
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Placing Price
The Placing Price represents:
i. a discount of approximately 17.81% to the average closing price of approximately HK$0.438 per Share as quoted on the Hong Kong Stock Exchange for the last five consecutive trading days immediately prior to December 19, 2025 (being the last trading day immediately preceding the signing of the Placing Agreement);
ii. a discount of approximately 10.00% to the closing price of HK$0.400 per Share as quoted on the Hong Kong Stock Exchange on December 19, 2025;
iii. a theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) represented by a discount of approximately 2.46% of the theoretical diluted price of HK$0.4272 per Share to the benchmarked price of HK$0.438 per Share (as defined under Rule 7.27B of the Listing Rules, taking into account the higher of the closing price on the date of the announcement of HK$0.400 per Share and the average of the closing prices of the Shares as quoted on the Stock Exchange for the five (5) previous consecutive trading days prior to the date of the announcement of HK$0.438 per Share);
iv. a cumulative theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) in aggregation with the settlement dated April 28, 2025 and October 22, 2025 represented by a discount of approximately 3.62%, represented by the cumulative theoretical diluted price of approximately HK$0.424 per Share to the theoretical benchmarked price of HK$0.44 per Share in respect of the settlement dated April 28, 2025 and October 22, 2025.(as defined under Rule 7.27B of the Listing Rules);
v. a premium of approximately 9.09% to the closing price of HK$0.33 per Share as quoted on the Hong Kong Stock Exchange as of the Latest Practicable Date; and
vi. a premium of approximately 60.4% to the audited net asset value per Share of approximately HK$0.22, which is calculated based on the published audited consolidated net asset of the Company of approximately HK$ 159,596,820 (CAD$28,105,000(2)) as at December 31, 2025 divided by the total number of issued Shares as at the Latest Practicable Date.
The Placing Price was determined with reference to the prevailing market price of the Shares and was negotiated on an arm's length basis between the Company and the Placing Agent. The directors of the Company (the "Directors") consider that the terms of the Placing are on normal commercial terms and are fair and reasonable based on the current market conditions and the Placing is in the interests of the Company and its shareholders as a whole. In particular:
(i) The Placing Price represents a discount of approximately 10% to the Closing Price of the date of the execution of the Placing Agreement. It also represents a discount of approximately 19.97% to the 3-month average closing price immediately before the date of the execution of the Placing Agreement. The pricing discount is on the one hand within the historical discount range that the Company offered to its investors in the previous private equity placements; and on the other hand considered as attractive by the investors after considering the Company's upcoming business plan and trading volume of the Company's shares.
Ranking of the Placing Shares
The Placing Shares when issued pursuant to the Placing will be credited as fully paid and rank pari passu in all respects with the other existing Shares.
Note:2. Based on the Bank of Canada's nominal closing exchange rate (as at December 31, 2025) of CAD$1.00 = HK$5.6786.
10
Conditions Precedent to Completion of the Placing Agreement
Completion of the Placing is subject to the fulfillment or waiver (other than conditions (i) and (ii) below which cannot be waived) of the following conditions:
(i) Hong Kong Stock Exchange approving the listing of and dealing in the Placing Shares to be issued pursuant to the Placing Agreement on or before July 31, 2026, the Company will be required to seek another shareholder meeting should the grants for the shareholder fail to be completed prior to the Long Stop Date;
(ii) compliance of the Placing with the requirements under the Listing Rules; and
(iii) the receipt of all required documents as stipulated in the Placing Agreement.
If the foregoing conditions are not fulfilled on or prior to the Long Stop Date (or such later date as may be agreed between the Company and the Placing Agent), the Placing Agreement shall be terminated and none of the parties to the Placing Agreement shall have any claim against the other for any costs or losses.
As at the Latest Practicable Date, none of the above conditions have been fulfilled. Application will be made to the Stock Exchange for the listing of and permission to deal in the securities.
Completion
Completion of the Placing will take place on four business days (means any day excluding Saturday and Sunday on which commercial banks are generally open for business in Hong Kong) immediately upon fulfillment of the Conditions Precedent to Completion of the Placing Agreement or such other date as the parties may agree (the "Placing Completion Date").
The certificates representing the Shares placed for under the Placing will bear certain legends, as required under applicable Canadian securities laws.
Termination
The Placing Agent may terminate the Placing Agreement without liability to the Company by giving notice in writing to the Company at any time prior to 8:00a.m. on the Completion Date if:
(i) any breach of any of the representations, warranties and undertakings set out in the Placing Agreement;
(ii) the occurrence of any event, development or change (whether or not local, national or international or forming part of a series of events or changes occurring or continuing before, on and/or after the date of the Placing Agreement and including an event or change in relation to or a development of an existing state of affairs) of a political, military, industrial, financial, economic or other nature, whether or not sui generis with any of the foregoing, resulting in a material adverse change in, or which might be expected to result in a material adverse change in, political, economic or stock market conditions;
(iii) any suspension in dealings in or the listing of the Shares on the Hong Kong Stock Exchange for a period of more than seven trading days (other than in connection with the Placing);
(iv) the introduction of any new law or regulation or any change in existing laws or regulations or change in the interpretation or application thereof;
(v) any material adverse change in the business or in the financial or trading position or prospects of the Group as a whole;
(vi) any litigation or claim being instigated against any member of the Group, which has or may have an adverse effect on the business or financial position of the Group; or
(vii) any material change (whether or not forming part of a series of changes) in the market conditions.
In the event that the Placing Agent terminates the Placing Agreement pursuant to the above, all obligations of each of the parties under the Placing Agreement, shall cease and determine and no party shall have any claim against any other party in respect of any matter arising out of or in connection with the Placing Agreement except for any breach arising prior to such termination.
The Directors are not aware of the occurrence of any of the above events as at the Latest Practicable Date.
REASONS FOR AND BENEFITS OF THE PLACING
The Directors consider that the Placing represents an opportunity to raise capital for the Company at an important time for the Company. The maximum gross proceeds to be raised from the Placing will be HK$41,140,800 (approximately CAD$ 7,286,071(1)). Based on the estimated expenses of approximately HK$ 822,816 (approximately CAD$ 145,721(1)), the maximum net proceeds to be raised from the Placing will be approximately HK$ 40,317,984 (approximately CAD$7,140,350(1)). On this basis, the net price per Share under the Placing is approximately HK$ 0.3528.
The Company intends to apply the entire net proceeds of the Placing for general working capital purposes in order to meet its ongoing development and its existing operations and/or its business exploration. Details of the estimated fund allocation and timeline for utilization of the net proceeds are set out below:
| Use of proceeds | Estimated % of the net proceeds | Expected timing of utilization | |
|---|---|---|---|
| (i) | Repair and maintenance and settlement with critical vendors. The repair and maintenance work required by the AER includes, amongst other things, repair of tank with leakages and insufficient containment, manage vegetation to mitigate fire risk by reducing the availability of flammable fuels, repair of turbine steam generators and leak detection installation on pipelines. | 35% | Approximately 1 month after Completion. 1 month is for getting quotes from vendor and scheduling time to perform work on site |
| (ii) | Settlement of fees and taxes due to the Government of Alberta, Canada | 35% | Settlement in 2H 2026 after negotiation |
| (iii) | General working capital / For repayment of debt due within 1 year | 30% | - |
| Total | 100% |
The Board wishes to supplement that the above are rough estimates for reference only. It is hard to estimate the cost of the repair and maintenance because: 1) consultants need to be hired to determine the route for repair and the scope of repair could change based on their assessments; 2) most vendors are only interested to provide a quote after the Company pays up certain deposits especially for those which involve consultants or involve write-up of plans; 3) vendor quotation could be more aggressive during peak periods.
As of 31 March 2026, the existing borrowing level and maturity profile of the debts are as follows:
| CAD’000 | Less than 1 year | 1-3 years |
|---|---|---|
| Bond and Other Loan | 2,688 | 15,526 |
| Senior note | 11,151 | 265,958 |
| Shareholder/Related party Loan | - | 56,578 |
| Total Debt | 13,839 | 338,062 |
As of 31 March 2026, we have total debt of CAD$13,839,000 which is due within less than 1 year, including CAD$2.7 million consists of swap loan due to an independent Hong Kong-based investment holding company Zhengwei International Investment and Management Co., Limited and a bond issued to an independent third-party individual Ms. Chu Wai Man which shall be repaid with the net proceeds from the Placing. Meanwhile the Company intends to extend the CAD11.1 million of Senior Note.
The Directors (including the independent non-executive Directors) consider that the terms and conditions of the Placing Agreement are fair and reasonable and are on normal commercial terms and the Placing is in the interest of the Company and the Shareholders as a whole.
Note:1. Based on the Bank of Canada's nominal closing exchange rate (as at December 19, 2025) of CAD$1.00 = HK$5.6465.
CHANGE IN SHAREHOLDING STRUCTURE
As at the date of this circular, the Company has 711,354,444 Shares in issue.
The existing shareholding structure of the Corporation and the effect of the Placing on the shareholding structure of the Corporation immediately following the completion of the Placing (assuming there will be no other changes in the issued Shares between the date of the Latest Practicable Date and the completion) is set out below.
| Name of Shareholders | As at the Latest Practicable Date | Immediately after Completion of the Placing | ||
|---|---|---|---|---|
| Number of Shares | Approx. % of Shares | Number of Shares | Approx. % of Shares | |
| Kwok Ping Sun(1) | 170,962,591 | 24.03% | 170,962,591 | 20.71% |
| Placees | - | - | 114,280,000 | 13.84% |
| Other Public Shareholders | 540,391,853 | 75.97% | 400,391,853 | 65.45% |
| 711,354,444 | 100.00% | 825,634,444 | 100.00% |
Notes:
- Pursuant to an order of the High Court of the Hong Kong Special Administrative Region dated 29 April 2025, Messrs. So Man Chun and Jong Yat Kit of PricewaterhouseCoopers as interim receivers (the "Interim Receivers") were appointed (the "Order") and given, among others, the power to exercise the rights to which Mr. Sun as a holder of the shares or other securities registered in the name of Mr. Sun is entitled, including (i) rights to attend meetings and vote; and (ii) to direct nominees of Mr. Sun in whose name shares beneficially owned by Mr. Sun are registered to exercise all or any of such rights as the Interim Receivers may direct.
The Company's operation and financial position remained unchanged since the letter from PwC was received. There is no further action by PwC in attempt to interfere with the Company's daily operations, financial management and management structure. To date, PwC has taken no further action to interfere with the Company's daily operations, financial management, or management structure.
The Board believes that even once the Interim Receivers are appointed as receivers, the Company's structure, operation and financial position will remain unchanged. This is because 1) the appointment of the receivers in and of itself does not affect the shareholding structure of the Company; however, it does affect (i) rights to attend meetings and vote; and (ii) to direct nominees of Mr. Sun in whose name shares beneficially owned by Mr. Sun are registered to exercise all or any of such rights as the receivers may direct; 2) the confirmation of Mr. Sun of his continual support for the Group. Currently, Mr. Sun continues to lend money to the Company to cover its daily operating costs and will not demand repayment of the loan. In addition, the Company will also explore other independent means of financing, including equity fundraising, disposal of idle assets and external debt financing to finance its operations; and 3) the Order has no significant impact on business operation, financial conditions of the Group as the members of the Group are not a party to the Order or underlying proceedings.
-
Per the Company's announcement dated August 19, 2025 (Hong Kong time), the Company entered into the Equity Purchase Agreement with Nobao Energy Holding (China) Company Limited (the "Vendor") for which the Company agrees to purchase and the Vendor agrees to sell 51% equity interests in the Nobao Technology Co., Limited (the "Target Company") at the Consideration of HK $50,919,450. The Consideration will be satisfied by way of issuance and allotment of 56,983,240 Consideration Shares by the Company at the Issue Price of HK$0.895 per Consideration Share to the Vendor (the "Issuance"). The Target Company is 48.16% held by a company owned by Mr. Kwok Ping Sun, an executive chairman and controlling shareholder of the Company. Therefore, the transaction constitutes a non-exempt connected transaction for the Company under Chapter 14A of the Listing Rules. The Consideration Shares will be allotted and issued under the Specific Mandate to be approved by the Independent Shareholders at the SGM. As at the date of this circular, the said issuance of Shares has yet to be completed.
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Per the Company's announcement dated November 16, 2025 (Hong Kong time), the Company will issue 631,299,735 Convertible Bonds at the initial Conversation Price of HK$0.377 per share under the specific mandate to be granted by independent shareholders at the SGM. This issuance is to settle the total debt of HK$238,000,000 (approximately CAD$42,935,489) as stipulated in the subscription agreement. As at the date of this circular, the said issuance of Convertible Bonds has yet to be completed.
CAPITAL RAISINGACTIVITIES DURING THE PAST 12 MONTHS
Save as disclosed below, the Company has not conducted any other fund raising activities during the 12 months immediately preceding the Latest Practicable Date.
| Date of announcement | Fund raising activity | Approximate net proceeds raised | Intended use of the net proceeds | Actual use of the net proceeds |
|---|---|---|---|---|
| June 25, 2025 (Hong Kong time) | Private placement of Common Shares under the general mandate granted on 24 June 2025 (Hong Kong Time) /23 June 2025(Calgary Time) | HK$ 38,400,000 (approximately CAD$6,727,636^{(1)}) | For settlement with creditor | The entire amount of HK$ 38,400,000 (approximately CAD$ 6,727,636^{(1)}) used for Debt Settlement. There is no actual cash inflow into the Company as the issuance of shares was to settle the payable |
| July 30, 2025 (Hong Kong time) | Private placement of Common Shares under the general mandate granted on 24 June 2025 (Hong Kong Time) /23 June 2025(Calgary Time) | HK$ 4,087,015 (approximately CAD$ 716,869.26^{(2)}) | For settlement with creditor | The entire amount of HK$ 4,087,015 (approximately CAD$ 716,869.26^{(2)}) used for Debt Settlement. There is no actual cash inflow into the Company as the issuance of shares was to settle the payable |
| October 22, 2025 (Hong Kong time) | Private placement of Shares under specific mandate granted by Shareholders at the special meeting held on January 12, 2026 (Calgary time) / January 13, 2026(Hong Kong time) | HK$60,200,000 (approximately CAD$10,860,153^{(3)}) | For settlement with creditors | HK$60,200,000 (approximately CAD$10,860,153^{(3)}) used for Debt Settlement. There is no actual cash inflow into the Company as the issuance of shares was to settle the payable |
Notes:
1. Based on the Bank of Canada's nominal closing exchange rate (as at June 23, 2025) of CAD$1.00 = HK$5.7078.
2. Based on the Bank of Canada's nominal closing exchange rate (as at July 29, 2025) of CAD$1.00 = HK$5.7012.
3. Based on the Bank of Canada's nominal closing exchange rate (as at October 21, 2025) of CAD$1.00 = HK$5.5432.
4. Per the Company's announcement dated August 19, 2025 (Hong Kong time), the Company entered into the Equity Purchase Agreement with Nobao Energy Holding (China) Company Limited (the "Vendor") for which the Company agrees to purchase and the Vendor agrees to sell 51% equity interests in the Nobao Technology Co., Limited (the "Target Company") at the Consideration of HK $50,919,450. The Consideration will be satisfied by way of issuance and allotment of 56,983,240 Consideration Shares by the Company at the Issue Price of HK$0.895 per Consideration Share to the Vendor (the "Issuance"). The Target Company is 48.16% held by a company owned by Mr. Kwok Ping Sun, an executive chairman and controlling shareholder of the Company. Therefore, the transaction constitutes a non-exempt connected transaction for the Company under Chapter 14A of the Listing Rules. The Consideration Shares will be allotted and issued under the Specific Mandate to be approved by the Independent Shareholders at the SGM. As at the date of this circular, the said issuance of Shares has yet to be completed.
5. Per the Company's announcement dated November 16, 2025 (Hong Kong time), the Company will issue 631,299,735 Convertible Bonds at the initial Conversation Price of HK$0.377 per share under the specific mandate to be granted by independent shareholders at the SGM. This issuance is to settle the total debt of HK$238,000,000 (approximately CAD$42,935,489) as stipulated in the subscription agreement. As at the date of this circular, the said issuance of Convertible Bonds has yet to be completed.
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IMPLICATIONS UNDER THE LISTING RULES
The Placing Shares will be allotted and issued under Specific Mandate, which is subject to Shareholders’ approval at the SM. As at the Latest Practicable Date, to the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, save as disclosed herein, none of the Shareholders and their respective close associates has any material interest in the Placing Agreement, the allotment and issuance of the Placing Shares pursuant to the Specific Mandate and the transactions contemplated thereunder and hence, no Shareholder is required to abstain from voting at the SM to approve the relevant resolution(s) regarding the Placing Agreement, the allotment and issuance of Placing Shares pursuant to the Specific Mandate and the transactions contemplated thereunder.
The Placing will not result in a theoretical dilution effect of 25% or more on its own or when aggregated. As such, the theoretical dilution impact of the Placing is in compliance with Rule 7.27B of the Listing Rules.
SPECIAL MEETING
A notice convening the Special Meeting to be held at 21st Floor, CMA Building, 64 Connaught Road Central, Hong Kong on June 24, 2026 at 11:30 a.m. (Hong Kong time) / June 23, 2026 at 9:30 p.m. (Calgary time) is set out in this circular for the purpose of considering and, if thought fit, passing the ordinary resolution(s) in relation to the approving the Placing Agreement and the transaction contemplated thereunder, including allotment and issue of the Placing Shares, and grant of the Specific Mandate.
Full text of the ordinary resolutions to be proposed at the Special Meeting is set out in the “Notice of Special Meeting”, will be determined by way of poll by the Shareholders.
A form of Proxy for use at the Special Meeting is enclosed with this circular. You are requested to complete the enclosed form of Proxy in accordance with the instructions printed thereon and return the same as soon as possible to the Company’s principal share registrar in Canada, being Odyssey Trust Company, Proxy Department at Suite 1100 Trader’s Bank Building, 67 Yonge St, Toronto, ON M5E 1J8, or the Company’s branch share registrar in Hong Kong, being Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, during regular business hours and in any event not less than 48 hours (excluding Saturdays, Sundays and public holidays in Hong Kong and/or Toronto) before the time appointed for the holding of the Special Meeting or any adjournment thereof.
RECORD DATE
All Registered Shareholders as at 4:30 p.m. on June 5, 2026 (Hong Kong time) and 4:30 p.m. on June 5, 2026 (Calgary time), as the case may be, being the record date, should vote through submitting a proxy to appoint the chair of the Special Meeting or any adjournments thereof, as their proxy to attend and vote in their place.
GENERAL PROXY INFORMATION
(a) Solicitation of Proxies
This circular is furnished in connection with the solicitation of proxies by or on behalf of the management of the Company for use at the Special Meeting or any adjournments thereof for the purposes set out in the notice of SM accompanying this circular.
The cost of this solicitation of proxies is borne by the Company. It is expected that the solicitation will be primarily by mail, but proxies or votes or voting instructions may also be solicited personally or by telephone, facsimile, e-mail, or other means of communication by the Directors, officers and regular employees of the Company.
(b) Voting at the SM
Registered Shareholders should vote their Shares at the SM through appointing the chair of the SM to act as their proxy and vote in their place, as described below under the paragraph headed “Proxy Information for Registered Shareholders”.
Beneficial Shareholders must follow the procedures described below under the paragraph headed “Proxy Information for Beneficial Shareholders” to exercise their voting rights.
(c) Proxy Information for Registered Shareholders
If you hold Shares in your own name, you are a registered shareholder of the Company (“Registered Shareholder”). Such form of proxy is also published on the HKEx news’ website of the Stock Exchange at www.hkexnews.hk and the website of the Company at www.sunshineoilsands.com.
Appointment of Proxy Holder
A proxy is a document that authorizes someone else to attend the SM and cast the votes for a Registered Shareholder. The accompanying form of proxy (the “Proxy”) is the form proxying the chair of the SM to vote on behalf of the Registered Shareholder.
A Proxy must be in writing and must be executed by you as Registered Shareholder, or by your attorney authorized in writing, or if the Registered Shareholder is a Company or other legal entity, under its corporate seal or by an officer or attorney thereof duly authorized.
The chair at the SM (the “Proxy”) will vote the Shares represented thereby in accordance with your instructions on any ballot that may be called. If you specify a choice with respect to any matter to be acted upon, your Shares will be voted accordingly. The Proxy confers discretionary authority on the persons named therein with respect to:
(i) each matter or group of matters identified therein for which a choice is not specified;
(ii) any amendment to or variation of any matter identified therein; and
(iii) any other matter that properly comes before the SM.
In respect of a matter for which a choice is not specified in the Proxy, the persons named in the Proxy (the chair of the SM for this case) will vote the Shares represented by the Proxy for the approval of such matter.
Voting by Proxy Holder
Registered Shareholders who received this circular and other accompanying materials of the SM from the Company’s branch share registrar in Hong Kong, and who elect to submit a Proxy to do so by completing, dating and signing the accompanying Proxy and returning it to the Company’s branch share registrar in Hong Kong, being Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East Wan Chai, Hong Kong, ensuring that the Proxy is received during regular business hours at least 48 hours, excluding Saturdays, Sundays and public holidays in Hong Kong (i.e. 11:30 a.m. on June 22, 2026 (Hong Kong time)) before the SM, or any adjournment thereof, at which the Proxy is to be used.
Registered Shareholders who received this circular and other accompanying materials of the SM from the Company’s principal share registrar in Canada, and who elect to submit a Proxy to do so by completing, dating and signing the accompanying Proxy and returning it to the Company’s principal share registrar in Canada, being Odyssey Trust Company at Suite 1100 Trader’s Bank Building, 67 Yonge St, Toronto, ON M5E 1J8, ensuring that the Proxy is received during regular business hours at least 48 hours, excluding Saturdays, Sundays and public holidays in Toronto (i.e. 4:30 p.m. on June 19, 2026 (Toronto time)) before the SM, or any adjournment thereof, at which the Proxy is to be used.
(d) Proxy Information for Beneficial Shareholders
If your Shares are held in an account with a brokerage firm or an intermediary (i.e. a broker, investment firm, clearing house or a similar entity), you are a beneficial shareholder of the Company (“Beneficial Shareholder”). Beneficial Shareholders should follow the instructions set out in the voting instructions form or other form of proxy provided by your intermediaries to ensure that your Shares will be voted at the SM.
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The information set out in this section is of significant importance to many Shareholders, as a substantial number of Shareholders do not hold Shares in their own name. Beneficial Shareholders should note that the only proxies that can be recognized and acted upon at the SM are those deposited by Registered Shareholders.
Many Shareholders of the Company are Beneficial Shareholders because the Shares they own are not registered in their own names, but are instead registered in the name of the brokerage firm, bank, trust company or clearing house through which they purchased the Shares. Shares beneficially owned by a Beneficial Shareholder are registered either:
(i) in the name of an intermediary (an “Intermediary”) that the Beneficial Shareholder deals with in respect of the shares of the Company (Intermediaries include, among others, banks, trust companies, securities dealers, securities brokers and trustees or administrators of self-administered RRSPs, RRIFs, RESPs, TFSAs and similar plans); or
(ii) in the name of a clearing agency (such as The Canadian Depository for Securities Limited or HKSCC Nominees Limited) of which the Intermediary is a participant.
In accordance with applicable securities law requirements, the Company will have distributed copies of the notice of SM, this circular, and the Proxy (collectively, the “Meeting Materials”) to the clearing agencies and Intermediaries for distribution to Beneficial Shareholders.
Intermediaries are required to forward the Meeting Materials to Beneficial Shareholders unless a Beneficial Shareholder has waived the right to receive them. Intermediaries often use service companies to forward the Meeting Materials to Beneficial Shareholders. Every intermediary or service company has its own mailing procedures and provides its own return instructions to clients. Please note that the Company’s management does not intend to pay for Intermediaries to forward the Meeting Materials and voting instruction request forms to those Beneficial Shareholders who have objected to their Intermediary disclosing ownership information about them pursuant to Canadian securities legislation (“Objecting Beneficial Shareholders”). Consequently, if you are an Objecting Beneficial Shareholder, you will not receive these materials unless the Intermediary holding Shares on your account assumes the cost of delivery.
You should carefully follow the instructions of your broker or intermediary in order to ensure that your Shares are voted at the SM. The form of proxy supplied to you by your broker will be similar to the Proxy provided by the Company to its Registered Shareholders. However, its purpose is limited to instructing the intermediary on how to vote on your behalf.
In Canada, most brokers now delegate responsibility for obtaining instructions from clients to Broadridge Financial Solutions Inc. (“Broadridge”). Broadridge mails a voting instruction form in lieu of a Proxy provided by the Company. The voting instruction form will name the same persons as the Company’s Proxy to represent you at the SM. You have the right to appoint the chair of the SM to represent you at the SM. To exercise this right, you should complete the voting instruction form and then it must be returned to Broadridge by mail or facsimile or given to Broadridge by phone or over the internet, in accordance with Broadridge’s instructions. Broadridge then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of Shares to be represented at the SM. If you receive a voting instruction form from Broadridge, you cannot use it to vote Shares directly at the SM. The voting instruction form must be completed and returned to Broadridge, in accordance with its instructions, well in advance of the SM in order to have the Shares voted.
(a) Revocation of Proxy
A Shareholder who has submitted a Proxy may revoke it at any time prior to the exercise thereof. In addition to revocation in any other manner permitted by law, a Shareholder who has given a Proxy may revoke it by executing a Proxy bearing a later date or by executing a valid notice of revocation, either of the foregoing to be executed by the Shareholder or such person’s authorized attorney in writing or, if such person is a Company, under its corporate seal by an officer or attorney duly authorized, and by delivering the Proxy
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bearing a later date to the Company’s principal share registrar in Canada, being Odyssey Trust Company at Suite 1100 Trader’s Bank Building, 67 Yonge St, Toronto, ON M5E 1J8, or the Company’s branch share registrar in Hong Kong, being Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East Wan Chai, Hong Kong, as applicable, or at the address of the registered office of the Company at 270, 333 24th Avenue SW Calgary, AB, T2S 3E6, during regular business hours at least 48 hours, excluding Saturdays, Sundays and public holidays in Toronto (i.e. 4:30 p.m. on June 19, 2026 (Toronto time) or 11:30 a.m. on June 22, 2026 (Hong Kong time), as the case may be) before the SM, or any adjournment thereof, at which the Proxy is to be used, or to the chairman of the SM on the day of the SM or any reconvening thereof, or in any other manner provided by law.
A revocation of a Proxy will not affect a matter on which a vote is taken before the revocation.
INTERESTS OF CERTAIN PERSONS AND COMPANIES IN MATTERS TO BE ACTED UPON
Other than as disclosed in this circular, management of the Company is not aware of any material interest of any Director or executive officers or anyone who has held office as such since the beginning of the Company’s last financial year or any “informed person” of the Company (as defined under applicable Canadian securities laws) or of any associate or affiliate of any of the foregoing in any matter to be acted on at the SM.
RECOMMENDATION
The Directors are of the opinion that though the Issuance is not conducted in the ordinary and usual course of business of the Group, but is on normal and commercial terms, fair and reasonable so far as the Shareholders are concerned and in the interest of the Company and the Shareholders as a whole.
Accordingly, the Directors recommend the Shareholders to vote in favour of the ordinary resolution(s) set out in the notice of SM enclosed to this circular.
GENERAL
Your attention is also drawn to the Letter from the Board and the additional information set out in the appendix to this circular and the notice of SM.
Additional information relating to the Company is available on the System for Electronic Document Analysis and Retrieval at www.sedar.com.
Financial information is provided for in the Company’s financial statements and management’s discussion and analysis for the year ended December 31, 2025. Documents affecting the rights of security holders, along with other information relating to the Company, may be found on the Company’s website at www.sunshineoilsands.com.
DIRECTORS
As at the Latest Practicable Date, the Board consists of Mr. Kwok Ping Sun and Ms. Gloria Pui Yun Ho as executive directors; Mr. Michael John Hibberd and Ms. Xijuan Jiang as non-executive directors; and Mr. Yi He, Mr. Guangzhong Xing and Ms. Jue Pang as independent non-executive directors.
RESPONSIBILITY STATEMENT
This Circular, for which the Directors of the Company collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this Circular is accurate and complete in all material respects and is not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this document misleading.
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MISCELLANEOUS
The English text of this circular shall prevail over the Chinese text for the purpose of interpretation.
The Placing is conditional upon satisfaction of its conditions in the Placing Agreement. Accordingly, the Placing may or may not proceed. Shareholders and potential investors are advised to exercise caution when dealing in the Shares.
DIRECTORS' APPROVAL
The contents and sending of this circular have been approved by the Board.
BY ORDER OF THE BOARD OF DIRECTORS
SUNSHINE OILSANDS LTD.
(signed) “Kwok Ping Sun”
Kwok Ping Sun
Executive Chairman
Calgary, Alberta, May 21, 2026
Hong Kong, May 21, 2026
APPENDIX
GENERAL INFORMATION
1. SHARE CAPITAL
The Company’s authorised share capital is as follows:
- an unlimited number of Class “A” and Class “B” voting common shares without par value; and
- an unlimited number of Class “C”, Class “D”, Class “E” and Class “F” non-voting common shares without par value; and
- an unlimited number of Class “G” and Class “H” non-voting preferred shares.
The issued share capital of the Company as at the Latest Practicable Date:
Issued and fully paid Shares: CAD$
711,354,444 Shares $ 41,221,567 (1)
Common Shares consist of fully paid Class “A” common shares, which have no par value, carry one vote per share and carry a right to dividends.
Note: (1) Based on the Bank of Canada’s nominal closing exchange rate as at May 19, 2026, being the last bank working day up to the Latest Practicable Date of CAD$ 1.00 = HK$5.6948
All the issued Shares in the capital of the Company rank pari passu with each other in all respects including the rights as to voting, dividends and return of capital.
Each Share carries the right to one vote at any meeting of the Shareholders. As at the Latest Practicable Date, there are no classes of shares of the Company, other than the Shares, entitled to vote at the SM.
No part of the share capital or any other securities of the Company is listed or dealt in on any stock exchange other than the Stock Exchange and no application is being made or is currently proposed or sought for the Shares or any other securities of the Company to be listed or dealt in on any other stock exchange.
Save as disclosed in this circular and apart from the options granted and to be granted under the Company’s Share Option Scheme, the Company did not have any other options, warrants and other convertible securities or rights affecting the Shares and no capital of any member of the Group is under option, or agreed conditionally or unconditionally to be put under option as at the Latest Practicable Date.
2. MATERIAL ADVERSE CHANGES
On May 12, 2025, the Company received a letter notice from the AER requiring the Company to submit a project abandonment plan on its West Ells project as the Company failed to meet their maintenance requirements. The Company also received legal documents from the Orphan Well Association (“OWA”), a delegated body under the AER, seeking to take over the Company’s project as a result of the AER’s letter notice. After consulting legal Advice, the order is not final and conclusive, and is subject to appeal. The Company has already filed an appeal and stay application of the order.
The appeal and stay application has been filed on 15 May 2025 and the application was accepted in 24 June 2025. The appeal procedure involves filing an application to AER to apply for an appeal and a stay of the order within 7 days after receipt of the order letter. AER has accepted the application and the hearing panel has already been established by AER internally. Meanwhile the hearing process is being set. The AER has also issued a notice for hearing to involving parties in order to set the hearing
process. The commissioner will hear substantive issues of the case. A decision will be made within 90 days after the end of the hearing. If the appeal party is not satisfied with the AER decision, it can appeal to the Court of Appeal and pursue further. A hearing is expected to be scheduled and convened by the end of May 2026. It may be adjourned further as the Company has still not received the formal letter from the Court to discuss the plan for Sunshine including but not limited to financing progress and fund deployed for repair and maintenance work required. It is expected that the discussion will include a plan for the Company to pay up the outstanding fees, which are estimated to be CAD2.6 million due to the Government and plan for restart. The outstanding fees which shall be repaid with the net proceeds from the Placing. The Company will await any result of the hearing before determining the need and timing for drawing up a project abandonment plan.
As at 31 March 2026, the balance due to AER's certain industry fund and levy was approximately CAD 4 million. The Company intend to resolve arrears by instalments and shall ramp up payments once production is resumed.
Should the placing activities prove successful, the Company expects that the associated repair and maintenance costs will be fully covered. The repair work is targeted to commence one month upon receipt of the required funding.
As of December 31, 2025, the Company has carried out the following repair and maintenance: a) Replacement of leaking steam valves; b) Engaged consultants to perform a pipeline engineering assessment and valve failure analysis and develop a solution to ensure proper pipeline maintenance according to AER's established pipeline management guidelines; c) Developed a reasonable care plan to prevent impairment or damage of the wells, pipelines, facilities, and sites meanwhile.
The repair and maintenance work required by the AER includes, amongst other things, repair of tank with leakages and insufficient containment, manage vegetation to mitigate fire risk by reducing the availability of flammable fuels, repair of turbine steam generators and leak detection installation on pipelines. It could be hard to estimate the actual cost of the repair and maintenance as: 1) consultants need to be hired to determine the route for repair and the scope of repair could change based on their assessments; 2) most vendors are only interested to provide a quote after the Company pays up certain deposits especially for those which involve consultants or involve write-up of plans. The repair and maintenance work required by the AER is roughly estimated at approximately CAD 2.35 million.
Upon completion of the repairs, the AER will conduct an inspection. Upon AER's satisfactory inspection and approval. The Company will be permitted to resume production.
Given the timing of the hearing, the estimated time for resumption of production is 4Q26. However, our estimate is subject to external factors e.g. that our estimate is subject to uncertainty due to uncontrollable factors, e.g. market condition for capital raise, schedules of R&M vendors, weather conditions, road conditions, pace of and result of the appeal, etc.
Currently, the Board do not foresee any impediments in appealing against the order.
As at the Latest Practicable Date, the Company has yet to be resumed production. The Company will issue further announcement(s) as and when appropriate and necessary.
Save as disclosed, the Directors are not aware of any material adverse change in the financial or trading position of the Group since December 31, 2025, being the date to which the latest published audited financial statements of the Group have been made up.
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