HIGHWOOD ASSET MANAGEMENT LTD. PROVIDES OPERATIONAL UPDATE AND APPOINTS RAY KWAN TO BOARD OF DIRECTORS

Canada NewsWire

CALGARY, AB, Oct. 31, 2024

/NOT FOR DISSEMINATION IN THE U.S. OR THROUGH U.S. NEWSWIRES/

CALGARY, AB, Oct. 31, 2024 /CNW/ - Highwood Asset Management Ltd., ("Highwood" or the "Company") (TSXV: HAM) is pleased to announce an operational update and appointment of Ray Kwan to the Board of Directors.

Operational Update

   -- Highwood drilled its first well within the Basal Belly River horizon at 
      Brazeau, which is analogous to the company's activities at Wilson Creek. 
      Highwood is encouraged with the early results from the well, which has 
      been onstream for approximately 60 days and is currently producing in 
      excess of 350 bbls/d of light oil. Furthermore, the success of this drill 
      is expected to validate an additional twenty five drilling locations 
      (unbooked) in the predictable Belly River shoreface horizon. These 
      locations are not booked in Highwood's independent third party 
      engineering report. 
 
   -- Highwood's production for the third quarter of 2024 averaged 
      approximately 5,600 boe/d and current production exceeds 6,300 boe/d. 
 
   -- Highwood reiterates its 2024 guidance with capital expenditures of 
      $60--65 million, 2024 average & exit production guidance of 5,500 - 5,700 
      boe/d (8% increase at midpoint) and 6,400--6,500 boe/d (19% increase at 
      midpoint), respectively. Depending on timing of capital in late December, 
      the company expects to end the year with a 2024 Net Debt / 2024 Exit 
      EBITDA ratio of between 0.8 - 0.9x. Over the 12-month period ended 
      December 2024, Highwood expects to have grown production per share by 
      over 50%.(1)(2) 
 
(1)  See "Caution Respecting Reserves Information" and 
      "Non-GAAP and other Specified Financial Measures" 
      below. 
(2)  Based on Management's projections (not Independent 
      Qualified Reserves Evaluators' forecasts) and applying 
      the following pricing assumptions: WTI: US$75.00/bbl; 
      WCS Diff: US$14.00/bbl; MSW Diff: US$3.75/bbl; AECO: 
      C$2.00/GJ; 0.73 CAD/USD . Management projections are 
      used in place of Independent Qualified Reserves Evaluators' 
      forecasts as Management believes it provides investors 
      with valuable information concerning the liquidity 
      of the Company. 
 

The Company plans to announce its third quarter results on November 14, 2024.

Independent Director Appointment

The Board of Directors is pleased to have appointed Mr. Ray Kwan to the Company's Board of Directors as an Independent Director and Chairman of the Audit Committee. Mr. Kwan brings over 20 years of experience in the energy sector and capital markets and currently the founder and managing partner of AXO Capital Corp, an energy focused family holding company. Mr. Kwan holds a BSc in Chemical Engineering from the University of Alberta and also is a CFA charterholder.

ADVISORIES

Forward-Looking Information

Certain information contained in the press release may constitute forward-looking statements and information (collectively, "forward-looking statements") within the meaning of applicable securities legislation that involve known and unknown risks, assumptions, uncertainties and other factors. Forward-looking statements may be identified by words like "anticipates", "estimates", "expects", "indicates", "intends", "may", "could" "should", "would", "plans", "target", "scheduled", "projects", "outlook", "proposed", "potential", "will", "seek" and similar expressions. Forward-looking statements in this press release include statements regarding, among other things: Highwood's business, strategy, objectives, strengths and focus; the Company's expectations regarding production, efficiency and operations of the recently stimulated well; the Company's drilling plans and expectations; and the performance and other characteristics of the Company's properties and expected results from its assets. Such statements reflect the current views of management of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions that could cause results to differ materially from those expressed in the forward-looking statements. With respect to forward-looking statements contained in this press release, the Company has made assumptions regarding, among other things: future pricing; commodity prices; future exchange and interest rates; supply of and demand for commodities; inflation; the availability of capital on satisfactory terms; the availability and price of labour and materials; the impact of increasing competition; conditions in general economic and financial markets; access to capital; the receipt and timing of regulatory, exchange and other required approvals; the ability of the Company to implement its business strategies and complete future acquisitions; the Company's long term business strategy; and effects of regulation by governmental agencies.

Factors that could cause actual results to vary from forward-looking statements or may affect the operations, performance, development and results of the Company's businesses include, among other things: assumptions concerning operational reliability; risks inherent in the Company's future operations; the Company's ability to generate sufficient cash flow from operations to meet its future obligations; increases in maintenance, operating or financing costs; the realization of the anticipated benefits of future acquisitions, if any; the availability and price of labour, equipment and materials; competitive factors, including competition from third parties in the areas in which the Company intends to operate, pricing pressures and supply and demand in the oil and gas industry; fluctuations in currency and interest rates; inflation; risks of war, hostilities, civil insurrection, pandemics, political and economic instability overseas and its effect on commodity pricing and the oil and gas industry (including ongoing military actions between Russia and Ukraine and the crisis in Israel and Gaza); severe weather conditions and risks related to climate change, such as fire, drought and flooding; terrorist threats; risks associated with technology; changes in laws and regulations, including environmental, regulatory and taxation laws, and the interpretation of such changes to the management team's future business; availability of adequate levels of insurance; difficulty in obtaining necessary regulatory approvals and the maintenance of such approvals; general economic and business conditions and markets; and such other similar risks and uncertainties. The impact of any one assumption, risk, uncertainty or other factor on a forward-looking statement cannot be determined with certainty, as these are interdependent and the Company's future course of action depends on the assessment of all information available at the relevant time. For additional risk factors relating to Highwood, please refer to the Company's annual information form and management discussion and analysis for the year ended December 31, 2023, as well as the Company's discussion and analysis for the period ended June 30, 2024, which are available on the Company's SEDAR+ profile at www.sedarplus.ca. The forward-looking statements contained in this press release are made as of the date hereof and the parties do not undertake any obligation to update or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Short Term Results. References in this press release to production test rates, initial test production rates, 7-day initial production rates, 30-day initial production rates and other short-term production rates are useful in confirming the presence of hydrocarbons, however such rates are not determinative of the rates at which such wells will commence production and decline thereafter and are not indicative of long term performance or of ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for Highwood. A pressure transient analysis or well-test interpretation has not been carried out in respect of all wells. Accordingly, the Company cautions that the test results should be considered to be preliminary.

The final day of production for the IP30 presented in this press release (October 29, 2024) is a field estimate only. Each day of well production is verified, through sales, one or two days after fluids are produced to surface.

FOFI Disclosure. This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about Highwood's prospective results of operations and production, and components thereof, all of which are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the above paragraphs. FOFI contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about Highwood's anticipated future business operations. The Company disclaims any intention or obligation to update or revise any FOFI contained in this press release, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein. All FOFI contained in this press release complies with the requirements of Canadian securities legislation, including Canadian Securities Administrators' National Instrument 51-101 -- Standards of Disclosure for Oil and Gas Activities.

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