Spartan Delta Corp. Announces Closing of previously announced Upsized Equity Offering and Updated Guidance for 2025

Calgary, Alberta – January 30, 2025 – Spartan Delta Corp. (“Spartan” or the “Company”) (TSX:SDE) is pleased to announce the closing of its previously announced upsized bought deal equity financing, including the full exercise of the over-allotment option (the “Equity Offering”). Pursuant to the Equity Offering, the Company issued a total of 25,589,800 common shares (“Common Shares”) of Spartan at a price of $3.82 per Common Share for gross proceeds of approximately $97.8 million (including the $12.8 million over-allotment).

Spartan will use the net proceeds from the Equity Offering to fund the acceleration of the development program in the Duvernay as the Company targets Duvernay production growth to 25,000 BOE/d and for general corporate purposes. The acceleration of the Duvernay will deliver significant growth in oil and liquids production and material accretion to Adjusted Funds Flow per share.

The Equity Offering was underwritten by a syndicate of underwriters led by National Bank Financial Inc., as lead underwriter and sole bookrunner.

Certain directors, officers, and insiders of the Company participated in the Equity Offering for an aggregate subscription of 6,858,000 Common Shares, which is considered a “related party transaction” pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements provided under sections 5.5(a) and 5.7(1)(a) of MI 61-101 on the basis that the fair market value of the aggregate participation of the insiders in the Equity Offering does not exceed 25% of the market capitalization of the Company, as determined in accordance with MI 61-101.

The Equity Offering has been conditionally approved by the Toronto Stock Exchange (“TSX”) and remains subject to the Company fulfilling all of the listing requirements of the TSX.

UPDATED 2025 GUIDANCE

Spartan has updated its 2025 guidance to reflect the closing of the Equity Offering, including the full exercise of the over-allotment.

As previously announced, Spartan’s Board has approved an initial capital budget of $300 to $325 million for 2025 to drill 35 (32 net) wells, targeting estimated annualized production of approximately 40,000 BOE/d, a 5% increase compared to 2024 guidance. Additionally, Spartan forecasts its 2025 crude oil and condensate production to increase by approximately 75% compared to 2024 guidance.

In the Duvernay, Spartan is allocating approximately $200 to $215 million of capital, targeting an annualized production growth rate of 180%. Spartan anticipates drilling 16 (14 net) wells and completing and bringing on-stream 17 (15 net) wells in the Duvernay in 2025. Additionally, the Company continues to allocate capital to expand its water infrastructure to accommodate future growth as Spartan targets production growth to 25,000 BOE/d in the Duvernay.

In the Deep Basin, Spartan is allocating approximately $100 to $110 million of capital, focusing on liquids-rich targets in the first half of 2025. The Company anticipates drilling, completing, and bringing on-stream 19 (18 net) wells in the Deep Basin in 2025. Additionally, Spartan is preserving the versatility to increase the capital budget in the second half of 2025 in response to improvements in natural gas prices.

Based on forecast average commodity pricing of US$72.00/bbl WTI crude oil and $2.20/GJ AECO natural gas,

Spartan expects to generate:

⦁ Adjusted Funds Flow of approximately $223 million in 2025, an increase of 39% compared to 2024 guidance.

⦁ Adjusted Funds Flow per Share accretion of 22% in 2025 compared to 2024 guidance.

⦁ Operating Netback, before hedging of $18.39/BOE in 2025, an increase of 61% compared to 2024 guidance, as a result of growing crude oil and condensate production by 75%.

⦁ Net Debt of $148 million in 2025, a decrease of 5% compared to 2024 guidance, on a 91% larger capital program compared to 2024 guidance.

⦁ Net Debt to Adjusted Funds Flow ratio of approximately 0.7x in 2025.

ANNUAL GUIDANCE (1) Updated Previous Variance
Year ending December 31, 2025 Guidance Guidance Amount %
Average Production (BOE/d) 39,000 – 41,000 39,000 – 41,000 – –

% Liquids 38% 38% – –
Natural gas (mmcf/d) 148 148 – –

NGLs (bbls/d) 9,700 9,700 – –
Crude oil and condensate (bbls/d) 5,600 5,600 – –
Benchmark Average Commodity Prices
WTI crude oil price (US$/bbl) 72.00 72.00 – –

AECO 7A natural gas price ($/GJ) 2.20 2.20 – –
Average exchange rate (US$/CA$) 1.43 1.43 – –

Operating Netback, before hedging ($/BOE) (2 18.39 18.39 – –
Adjusted Funds Flow ($MM) (2) 223 219 4 2
Adjusted Funds Flow per share ($/sh) (2) 1.12 1.17 (0.05) (4)
Capital Expenditures, before A&D ($MM) (2) 300 – 325 300 – 325 – –
Net Debt, end of year ($MM) (2) 148 197 (49) (25)
Common shares outstanding, end of year (MM) 199 187 12 6

(1) The financial performance measures included in the Company’s previous guidance for 2025 is based on the midpoint of the average production forecast.

(1) “Operating Netback”, “Adjusted Funds Flow”, “Capital Expenditures, before A&D”, “Free Funds Flow” and “Net Debt” do not have standardized meanings under IFRS Accounting Standards, see “Readers Advisories – Non-GAAP Measures and Ratios”.

ABOUT SPARTAN DELTA CORP.

Spartan is committed to creating value for its shareholders, focused on sustainability both in operations and financial performance. The Company’s culture is centered on generating Free Funds Flow through responsible oil and gas exploration and development. The Company has established a portfolio of high-quality production and development opportunities in the Deep Basin and the Duvernay. Spartan will continue to focus on the execution of the Company’s organic drilling program across its portfolio, delivering operational synergies in a respectful and responsible manner to the environment and communities it operates in. The Company is well positioned to continue pursuing optimization in the Deep Basin, participate in the consolidation of the Deep Basin fairway, and continue growing and developing its Duvernay asset.

FOR ADDITIONAL INFORMATION PLEASE CONTACT:

Fotis Kalantzis
Spartan Delta Corp.

President and Chief Executive Officer

1600, 308 – 4th Avenue SW

Calgary, Alberta, Canada T2P 0H7

Email: IR@SpartanDeltaCorp.com

www.spartandeltacorp.com

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