Gear Energy Ltd. announces operational update, guidance for 2020 and extension of borrowing base redetermination

Production/Guidance

With recent improvement in oil prices supporting positive economic returns, Gear has initiated a gradual production re-start across the majority of the asset base. After initiating shut ins through April, corporate production was restricted by almost 80 per cent in May with approximately 1,300 boe/d delivered to market. Current estimates are for June production to be approximately 3,700 boe/d, July to be approximately 5,000 boe/d and August to be approximately 6,000 boe/d. With minimal capital expenditures currently forecast for the remainder of 2020, production is expected to decline slightly through to December, providing an annual average of 5,200 – 5,300 boe/d. (57% Heavy Oil, 28% Light & Medium Oil, 3% NGL’s, and 12% Gas)

Annual guidance is as follows:

Borrowing Base Redetermination Extension

Gear’s lenders have agreed to extend the re-determination of the semi-annual borrowing base to July 10, 2020 to allow for additional time to finalize negotiations and to obtain required approvals. Borrowings will remain capped at $75 million during this period.