Altura Energy Inc. announces the closing of an asset disposition and provides a corporate update

ASSET DISPOSITION

Altura has amended the timing of the second transaction in the December 4, 2019 definitive agreement (the “Amending Agreement”) with a private company (“PrivateCo”) for the sale of a 5.5% working interest in the Corporation’s production, wells, lands and facilities for cash of $3.5 million (the “Second Transaction”) as follows:

The cash proceeds outlined above will further strengthen Altura’s balance sheet during this period of commodity price volatility. The December 4, 2019 agreement included a drilling commitment related to the Second Transaction (“Commitment Well”), whereby Altura committed to the drilling of a horizontal well in either the Entice area or the Leduc-Woodbend area on or before December 31, 2020. Given the current environment, drilling risk profile and capital efficiency in each of the areas, the parties have agreed the well will be drilled at Leduc-Woodbend at a time when commodity prices support well economics. Given that the parties have agreed for the Commitment Well to be drilled in the Leduc-Woodbend area, the optional third funding transaction contemplated by the December 4, 2019 agreement will not occur.

CREDIT FACILITY RENEWAL

Altura and its lender have agreed to further extend the credit facility renewal from June 30, 2020 to July 31, 2020. This extension provides Altura and its lender with additional time to assess current dynamic market conditions as well as the proposed federal support programs being initiated through the Export Development Bank of Canada and the Business Development Bank of Canada.

OPERATIONAL UPDATE

Altura is continuing to monitor commodity prices and implement production curtailments and operating cost saving measures and has halted all discretionary capital expenditures during this period of economic uncertainty. Following a complete production shut-in during the month of May, the Corporation has returned production volumes in June to approximately 550 boe per day.  Provided that oil pricing remains close to current levels, the Corporation plans to return production volumes to full capability of approximately 1,200 boe per day throughout the months of July and August. Altura has one well in Leduc-Woodbend that is drilled but uncompleted on an existing pad that can be completed and brought on production at a time when commodity prices support the well economics.

ABOUT ALTURA ENERGY INC.

Altura is a junior oil and gas exploration, development and production company with operations in central Alberta. Altura predominantly produces from the Rex member in the Upper Mannville group and is focused on delivering per share growth and attractive shareholder returns through a combination of organic growth and strategic acquisitions.