Spartan Delta Corp. Announces Preliminary 2025 Guidance, Acceleration of Duvernay Development Program, and $50 Million Equity Offering

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Calgary, Alberta – January 13, 2025 – Spartan Delta Corp. (“Spartan” or the “Company”) (TSX:SDE) is pleased to announce its preliminary guidance for 2025, an accelerated West Shale Basin Duvernay (the “Duvernay”) development program, and a $50.0 million bought deal equity financing led by National Bank Financial Inc., as lead underwriter and sole bookrunner (the “Equity Offering”).

2025 BUDGET AND PRELIMINARY GUIDANCE

Spartan is pleased to provide its preliminary financial and operating guidance for 2025, focused on delivering significant growth in oil and liquids production and Adjusted Funds Flow per Share.

For 2025, Spartan’s Board has approved an initial capital budget of $300 to $325 million 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.

DUVERNAY

In 2024, Spartan brought on-stream 4.0 (3.4 net) wells at an average peak IP30 rate of 1,132 BOE/d (87% liquids) in the Willesden Green Duvernay (“Willesden Green”), significantly exceeding internal expectations and exhibiting top tier regional performance. In December 2024, the Company’s Duvernay position exceeded 250,000 net acres and production exceeded 5,000 BOE/d (77% liquids).

Building off the success achieved in 2024, Spartan is allocating approximately $200 to $215 million of capital in the Duvernay in 2025, 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.

DEEP BASIN

In 2025, 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.

2025 GUIDANCE

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 $219 million in 2025, an increase of 37% compared to 2024 guidance.
• Adjusted Funds Flow per Share accretion of 27% in 2025 compared to 2024 guidance, inclusive of the Equity Offering.
• Operating Netback, before hedging of $18.39/BOE, an increase of 61% compared to 2024 guidance, as a result of growing crude oil and condensate production by 75%.
• Spartan has hedged 78,362 GJ/d of its 2025 natural gas production at an average price of $2.22/GJ and 2,450 bbl/d of its 2025 crude oil and condensate production at an average price of $99.59/bbl.

ANNUAL GUIDANCE 2024 2025 Variance (1)
Guidance Guidance (1) Amount %
Average Production (BOE/d) 38,000 39,000 – 41,000 2,000 5
% Liquids 33% 38% 5 15
Natural gas (mmcf/d) 154 148 (6) (4)

NGLs (bbls/d) 9,200 9,700 500 5
Crude oil and condensate (bbls/d) 3,200 5,600 2,400 75

Benchmark Average Commodity Prices
WTI crude oil price (US$/bbl) 75.00 72.00 (3.00) (4)
AECO 7A natural gas price ($/GJ) 1.35 2.20 0.85 63
Average exchange rate (US$/CA$) 1.37 1.43 0.06 4

Operating Netback, before hedging ($/BOE) (2) 11.43 18.39 6.95 61
Adjusted Funds Flow ($MM) (2) 160 219 59 37
Adjusted Funds Flow per Share ($/sh) (2) 0.92 1.17 0.25 27
Capital Expenditures, before A&D ($MM) (2) 164 300 – 325 149 91
Net Debt, end of year ($MM) (2) 156 197 41 26
Common shares outstanding, end of year (MM) 174 187 13 7

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

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

EQUITY OFFERING

Spartan has entered into an agreement with a syndicate of underwriters (the “Underwriters”) led by National Bank Financial Inc., as lead underwriter and sole bookrunner, pursuant to which the Underwriters have agreed to purchase for resale to the public, on a bought deal basis, 13,090,000 common shares (“Common Shares”) of Spartan at a price of $3.82 per Common Share for aggregate gross proceeds of approximately $50.0 million. The Underwriters will have an option to purchase up to an additional 15% of the Common Shares issued under the Equity Offering at a price of $3.82 per Common Share to cover over allotments exercisable in whole or in part at any time until 30 days after the closing of the Equity Offering. It is anticipated that certain directors, officers, and employees of the Company will subscribe for approximately $5.4 million of the Equity Offering.

The Common Shares offered in the Equity Offering will be offered by way of short form prospectus in all provinces of Canada except Quebec. The Common Shares may also be placed privately in the United States to Qualified Institutional Buyers (as defined under Rule 144A under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”)), pursuant to an exemption under Rule 144A, and may be distributed outside Canada and the United States on a basis which does not require the qualification or registration of any of the Company’s securities under domestic or foreign securities laws. The completion of the Equity Offering is subject to customary closing conditions, including the receipt of all necessary regulatory approvals, including approval of the Toronto Stock Exchange (“TSX”). Closing of the Equity Offering is expected to occur on or around January 30, 2025 (the “Closing Date”).

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 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.

Stikeman Elliott LLP is acting as legal counsel to Spartan in respect of the Equity Offering. Burnet, Duckworth & Palmer LLP is acting as legal counsel to the Underwriters in respect of the Equity Offering.

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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