Pantheon Resources : Netherland, Sewell & Associates Updated Independent Expert Report - Contingent Resource Estimates of the Kodiak project

April 8, 2024

Mr. Patrick Galvin Pantheon Resources plc Golden Cross House

8 Duncannon Street London WC2N 4JF

Dear Mr. Galvin:

In accordance with your request, we have estimated the gross (100 percent) contingent resources, as of April 1, 2024, for discoveries located in the Kodiak acreage, North Slope, Alaska. We completed our evaluation on or about the date of this letter. Contingent resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations by the application of development project(s) not currently considered to be commercial owing to one or more contingencies. The resources shown in this report are contingent upon (1) acquisition of additional technical data that demonstrate producing rates and volumes sufficient to sustain economic viability across the acreage; (2) approval of a field development plan and regulatory permits;

1. demonstration of viable gas and water utilization or disposal methods; (4) demonstration of ability to market oil and natural gas liquids (NGL); and (5) commitment to fund and complete the development project. If these contingencies are successfully addressed, some portion of the contingent resources estimated in this report may be reclassified as reserves; our estimates have not been risked to account for the possibility that the contingencies are not successfully addressed. The project maturity subclass for these contingent resources is development unclarified. We did not perform an economic analysis on these resources; as such, the economic status of these resources is undetermined. The estimates in this report have been prepared in accordance with the definitions and guidelines set forth in the 2018 Petroleum Resources Management System (PRMS) approved by the Society of Petroleum Engineers (SPE); definitions are presented immediately following this letter.

We estimate the gross (100 percent) contingent resources for these discoveries, as of April 1, 2024, to be:

		Gross (100%) Contingent Resources
		Oil		NGL		Residue Gas(1)
Category		(MMBBL)		(MMBBL)		(BCF)
Low Estimate (1C)	168.5	299.9	2,175.4
Best Estimate (2C)	425.8	782.1	5,396.3
High Estimate (3C)	1,029.7	1,811.6	11,748.6

1. Residue gas volumes are after shrinkage to account for the extraction of NGL volumes.

The oil volumes shown include crude oil and condensate. Oil and NGL volumes are expressed in millions of barrels (MMBBL); a barrel is equivalent to 42 United States gallons. Residue gas volumes are expressed in billions of cubic feet (BCF) at standard temperature and pressure bases.

The contingent resources shown in this report have been estimated using probabilistic methods. Once all contingencies have been successfully addressed, the probability that the quantities of contingent resources actually recovered will equal or exceed the estimated amounts is 90 percent for the low estimate, 50 percent for the best estimate, and 10 percent for the high estimate. The estimates of contingent resources included herein have not been adjusted for development risk.

For the purposes of this report, we did not perform any field inspection of the properties, nor did we examine the mechanical operation or condition of the wells and facilities. We have not investigated possible environmental liability related to the properties.

The resources shown in this report are estimates only and should not be construed as exact quantities. Estimates may increase or decrease as a result of market conditions, future operations, changes in regulations, or actual reservoir performance.

For the purposes of this report, we used technical data including, but not limited to, well logs, geologic maps, Pantheon Resources plc's proprietary seismic data, production data from analogous properties, pressure-volume- temperature (PVT) reports, and well test data. The resources in this report have been estimated using probabilistic methods; these estimates have been prepared in accordance with generally accepted petroleum engineering and evaluation principles set forth in the Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information promulgated by the SPE (SPE Standards). We used standard engineering and geoscience methods, or a combination of methods, including performance analysis, volumetric analysis, analogy, and reservoir modeling, that we considered to be appropriate and necessary to classify, categorize, and estimate volumes in accordance with the 2018 PRMS definitions and guidelines. These resources are for undeveloped locations; such resources are based on estimates of reservoir volumes and recovery efficiencies along with analogy to properties with similar geologic and reservoir characteristics. As in all aspects of oil and gas evaluation, there are uncertainties inherent in the interpretation of engineering and geoscience data; therefore, our conclusions necessarily represent only informed professional judgment.

The data used in our estimates were obtained from Pantheon Resources plc, public data sources, and the nonconfidential files of Netherland, Sewell & Associates, Inc. and were accepted as accurate. Supporting work data are on file in our office. We have not examined the titles to the properties or independently confirmed the actual degree or type of interest owned. The technical persons primarily responsible for preparing the estimates presented herein meet the requirements regarding qualifications, independence, objectivity, and confidentiality set forth in the SPE Standards. We are independent petroleum engineers, geologists, geophysicists, and petrophysicists; we do not own an interest in these properties nor are we employed on a contingent basis.

Sincerely,

NETHERLAND, SEWELL & ASSOCIATES, INC.

Texas Registered Engineering Firm F-2699

By:

Richard B. Talley, Jr., P.E.

Chairman and Chief Executive Officer

By:	By:
Alexander V. Karpov, P.E. 105042	Zachary R. Long, P.G 11792
Vice President	Vice President
Date Signed: April 8, 2024	Date Signed: April 8, 2024
AVK:LAZ

PETROLEUM RESERVES AND RESOURCES CLASSIFICATION AND DEFINITIONS

Excerpted from the 2018 Petroleum Resources Management System (PRMS), version 1.03

Approved by the Society of Petroleum Engineers (SPE) Board of Directors

This document contains information excerpted from definitions and guidelines prepared by the Oil and Gas Reserves Committee of the Society of Petroleum Engineers (SPE) and reviewed and jointly sponsored by the SPE, World Petroleum Council, American Association of Petroleum Geologists, Society of Petroleum Evaluation Engineers, Society of Exploration Geophysicists, Society of Petrophysicists and Well Log Analysts, and European Association of Geoscientists & Engineers.

Preamble

Petroleum resources are the quantities of hydrocarbons naturally occurring on or within the Earth's crust. Resources assessments estimate quantities in known and yet-to-be-discovered accumulations. Resources evaluations are focused on those quantities that can potentially be recovered and marketed by commercial projects. A petroleum resources management system provides a consistent approach to estimating petroleum quantities, evaluating projects, and presenting results within a comprehensive classification framework.

This updated PRMS provides fundamental principles for the evaluation and classification of petroleum reserves and resources. If there is any conflict with prior SPE and PRMS guidance, approved training, or the Application Guidelines, the current PRMS shall prevail. It is understood that these definitions and guidelines allow flexibility for entities, governments, and regulatory agencies to tailor application for their particular needs; however, any modifications to the guidance contained herein must be clearly identified. The terms "shall" or "must" indicate that a provision herein is mandatory for PRMS compliance, while "should" indicates a recommended practice and "may" indicates that a course of action is permissible. The definitions and guidelines contained in this document must not be construed as modifying the interpretation or application of any existing regulatory reporting requirements.

1.0 Basic Principles and Definitions

1. A classification system of petroleum resources is a fundamental element that provides a common language for communicating both the confidence of a project's resources maturation status and the range of potential outcomes to the various entities. The PRMS provides transparency by requiring the assessment of various criteria that allow for the classification and categorization of a project's resources. The evaluation elements consider the risk of geologic discovery and the technical uncertainties together with a determination of the chance of achieving the commercial maturation status of a petroleum project.
2. The technical estimation of petroleum resources quantities involves the assessment of quantities and values that have an inherent degree of uncertainty. These quantities are associated with exploration, appraisal, and development projects at various stages of design and implementation. The commercial aspects considered will relate the project's maturity status (e.g., technical, economical, regulatory, and legal) to the chance of project implementation.
3. The use of a consistent classification system enhances comparisons between projects, groups of projects, and total company portfolios. The application of PRMS must consider both technical and commercial factors that impact the project's feasibility, its productive life, and its related cash flows.

1.1 Petroleum Resources Classification Framework

1. Petroleum is defined as a naturally occurring mixture consisting of hydrocarbons in the gaseous, liquid, or solid state. Petroleum may also contain non-hydrocarbons, common examples of which are carbon dioxide, nitrogen, hydrogen sulfide, and sulfur. In rare cases, non-hydrocarbon content can be greater than 50%.
2. The term resources as used herein is intended to encompass all quantities of petroleum naturally occurring within the Earth's crust, both discovered and undiscovered (whether recoverable or unrecoverable), plus those quantities already produced. Further, it includes all types of petroleum whether currently considered as conventional or unconventional resources.
3. Figure 1.1 graphically represents the PRMS resources classification system. The system classifies resources into discovered and undiscovered and defines the recoverable resources classes: Production, Reserves, Contingent Resources, and Prospective Resources, as well as Unrecoverable Resources.
4. The horizontal axis reflects the range of uncertainty of estimated quantities potentially recoverable from an accumulation by a project, while the vertical axis represents the chance of commerciality, Pc, which is the chance that a project will be committed for development and reach commercial producing status.

Definitions - Page 1 of 10

PETROLEUM RESERVES AND RESOURCES CLASSIFICATION AND DEFINITIONS

Excerpted from the 2018 Petroleum Resources Management System (PRMS), version 1.03

Approved by the Society of Petroleum Engineers (SPE) Board of Directors

1.1.0.5 The following definitions apply to the major subdivisions within the resources classification:

1. Total Petroleum Initially-In-Place (PIIP) is all quantities of petroleum that are estimated to exist originally in naturally occurring accumulations, discovered and undiscovered, before production.
2. Discovered PIIP is the quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations before production.
3. Production is the cumulative quantities of petroleum that have been recovered at a given date. While all recoverable resources are estimated, and production is measured in terms of the sales product specifications, raw production (sales plus non-sales) quantities are also measured and required to support engineering analyses based on reservoir voidage (see Section 3.2, Production Measurement).

1.1.0.6 Multiple development projects may be applied to each known or unknown accumulation, and each project will be forecast to recover an estimated portion of the initially-in-place quantities. The projects shall be subdivided into commercial, sub-commercial, and undiscovered, with the estimated recoverable quantities being classified as Reserves, Contingent Resources, or Prospective Resources respectively, as defined below.

1. 1. Reserves are those quantities of petroleum anticipated to be commercially recoverable by application of development projects to known accumulations from a given date forward under defined conditions. Reserves must satisfy four criteria: discovered, recoverable, commercial, and remaining (as of the evaluation's effective date) based on the development project(s) applied.
2. 1. Reserves are recommended as sales quantities as metered at the reference point. Where the entity also recognizes quantities consumed in operations (CiO) (see Section 3.2.2), as Reserves these quantities must be recorded separately. Non- hydrocarbon quantities are recognized as Reserves only when sold together with hydrocarbons or CiO associated with petroleum production. If the non-hydrocarbon is separated before sales, it is excluded from Reserves.
   2. Reserves are further categorized in accordance with the range of uncertainty and should be sub-classified based on project maturity and/or characterized by development and production status.
3. Contingent Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations, by the application of development project(s) not currently considered to be commercial owing to one or more contingencies. Contingent Resources have an associated chance of development. Contingent Resources may include, for example, projects for which there are currently no viable markets, or where commercial recovery is dependent on technology under development, or where evaluation of the accumulation is insufficient to clearly assess commerciality. Contingent Resources are further categorized in accordance with the range of uncertainty associated with the estimates and should be sub-classified based on project maturity and/or economic status.
4. Undiscovered PIIP is that quantity of petroleum estimated, as of a given date, to be contained within accumulations yet to be discovered.
5. Prospective Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective Resources have both an associated chance of geologic discovery and a chance of development. Prospective Resources are further categorized in accordance with the range of uncertainty associated with recoverable estimates, assuming discovery and development, and may be sub- classified based on project maturity.
6. Unrecoverable Resources are that portion of either discovered or undiscovered PIIP evaluated, as of a given date, to be unrecoverable by the currently defined project(s). A portion of these quantities may become recoverable in the future as commercial circumstances change, technology is developed, or additional data are acquired. The remaining portion may never be recovered because of physical/chemical constraints represented by subsurface interaction of fluids and reservoir rocks.

1. The sum of Reserves, Contingent Resources, and Prospective Resources may be referred to as "remaining recoverable resources." Importantly, these quantities should not be aggregated without due consideration of the technical and commercial risk involved with their classification. When such terms are used, each classification component of the summation must be provided.
2. Other terms used in resource assessments include the following:

1. Estimated Ultimate Recovery (EUR) is not a resources category or class, but a term that can be applied to an accumulation or group of accumulations (discovered or undiscovered) to define those quantities of petroleum estimated, as of a given date, to be potentially recoverable plus those quantities already produced from the accumulation or group of accumulations. For clarity, EUR must reference the associated technical and commercial conditions for the resources; for example, proved EUR is Proved Reserves plus prior production.
2. Technically Recoverable Resources (TRR) are those quantities of petroleum producible using currently available technology and industry practices, regardless of commercial considerations. TRR may be used for specific Projects or for groups of Projects, or, can be an undifferentiated estimate within an area (often basin-wide) of recovery potential.

Definitions - Page 2 of 10

PETROLEUM RESERVES AND RESOURCES CLASSIFICATION AND DEFINITIONS

Excerpted from the 2018 Petroleum Resources Management System (PRMS), version 1.03

Approved by the Society of Petroleum Engineers (SPE) Board of Directors

1.2 Project-Based Resources Evaluations

1. The resources evaluation process consists of identifying a recovery project or projects associated with one or more petroleum accumulations, estimating the quantities of PIIP, estimating that portion of those in-place quantities that can be recovered by each project, and classifying the project(s) based on maturity status or chance of commerciality.
2. The concept of a project-based classification system is further clarified by examining the elements contributing to an evaluation of net recoverable resources (see Figure 1.2).

Net

Recoverable

Resources

Entitlement

Figure 1.2-Resources evaluation

1. The reservoir (contains the petroleum accumulation): Key attributes include the types and quantities of PIIP and the fluid and rock properties that affect petroleum recovery.
2. The project: A project may constitute the development of a well, a single reservoir, or a small field; an incremental development in a producing field; or the integrated development of a field or several fields together with the associated processing facilities (e.g., compression). Within a project, a specific reservoir's development generates a unique production and cash-flow schedule at each level of certainty. The integration of these schedules taken to the project's earliest truncation caused by technical, economic, or the contractual limit defines the estimated recoverable resources and associated future net cash flow projections for each project. The ratio of EUR to total PIIP quantities defines the project's recovery efficiency. Each project should have an associated recoverable resources range (low, best, and high estimate).
3. The property (lease or license area): Each property may have unique associated contractual rights and obligations, including the fiscal terms. This information allows definition of each participating entity's share of produced quantities (entitlement) and share of investments, expenses, and revenues for each recovery project and the reservoir to which it is applied. One property may encompass many reservoirs, or one reservoir may span several different properties. A property may contain both discovered and undiscovered accumulations that may be spatially unrelated to a potential single field designation.
4. An entity's net recoverable resources are the entitlement share of future production legally accruing under the terms of the development and production contract or license.
5. In the context of this relationship, the project is the primary element considered in the resources classification, and the net recoverable resources are the quantities derived from each project. A project represents a defined activity or set of activities to develop the petroleum accumulation(s) and the decisions taken to mature the resources to reserves. In general, it is recommended that an individual project has assigned to it a specific maturity level sub-class (See Section 2.1.3.5, Project Maturity Sub-Classes) at which a decision is made whether or not to proceed (i.e., spend more money) and there should be an associated range of estimated recoverable quantities for the project (See Section 2.2.1, Range of Uncertainty). For completeness, a developed field is also considered to be a project.
6. An accumulation or potential accumulation of petroleum is often subject to several separate and distinct projects that are at different stages of exploration or development. Thus, an accumulation may have recoverable quantities in several resources classes simultaneously.

1. Not all technically feasible development projects will be commercial. The commercial viability of a development project within a field's development plan is dependent on a forecast of the conditions that will exist during the time period encompassed by the project (see Section 3.1, Assessment of Commerciality). Conditions include technical, economic (e.g., hurdle rates, commodity prices), operating and capital costs, marketing, sales route(s), and legal, environmental, social, and governmental factors forecast to exist and impact the project during the time period being evaluated. While economic factors can be summarized as forecast costs and product prices, the underlying influences include, but are not limited to, market conditions (e.g., inflation, market factors, and contingencies), exchange rates, transportation and processing infrastructure, fiscal terms, and taxes.
2. The resources being estimated are those quantities producible from a project as measured according to delivery specifications at the point of sale or custody transfer (see Section 3.2.1, Reference Point) and may permit forecasts of CiO quantities (see Section 3.2.2., Consumed in Operations). The cumulative production forecast from the effective date forward to cessation of production is the remaining recoverable resources quantity (see Section 3.1.1, Net Cash-Flow Evaluation).

Definitions - Page 3 of 10

PETROLEUM RESERVES AND RESOURCES CLASSIFICATION AND DEFINITIONS

Excerpted from the 2018 Petroleum Resources Management System (PRMS), version 1.03

Approved by the Society of Petroleum Engineers (SPE) Board of Directors

1.2.0.12 The supporting data, analytical processes, and assumptions describing the technical and commercial basis used in an evaluation must be documented in sufficient detail to allow, as needed, a qualified reserves evaluator or qualified reserves auditor to clearly understand each project's basis for the estimation, categorization, and classification of recoverable resources quantities and, if appropriate, associated commercial assessment.

1. Classification and Categorization Guidelines
2. Resources Classification

2.1.0.1 The PRMS classification establishes criteria for the classification of the total PIIP. A determination of a discovery differentiates between discovered and undiscovered PIIP. The application of a project further differentiates the recoverable from unrecoverable resources. The project is then evaluated to determine its maturity status to allow the classification distinction between commercial and sub-commercial projects. PRMS requires the project's recoverable resources quantities to be classified as either Reserves, Contingent Resources, or Prospective Resources.

2.1.1 Determination of Discovery Status

1. A discovered petroleum accumulation is determined to exist when one or more exploratory wells have established through testing, sampling, and/or logging the existence of a significant quantity of potentially recoverable hydrocarbons and thus have established a known accumulation. In the absence of a flow test or sampling, the discovery determination requires confidence in the presence of hydrocarbons and evidence of producibility, which may be supported by suitable producing analogs (see Section 4.1.1, Analogs). In this context, "significant" implies that there is evidence of a sufficient quantity of petroleum to justify estimating the in-place quantity demonstrated by the well(s) and for evaluating the potential for commercial recovery.
2. Where a discovery has identified potentially recoverable hydrocarbons, but it is not considered viable to apply a project with established technology or with technology under development, such quantities may be classified as Discovered Unrecoverable with no Contingent Resources. In future evaluations, as appropriate for petroleum resources management purposes, a portion of these unrecoverable quantities may become recoverable resources as either commercial circumstances change or technological developments occur.

2.1.2 Determination of Commerciality

2.1.2.1 Discovered recoverable quantities (Contingent Resources) may be considered commercially mature, and thus attain Reserves classification, if the entity claiming commerciality has demonstrated a firm intention to proceed with development. This means the entity has satisfied the internal decision criteria (typically rate of return at or above the weighted average cost-of-capital or the hurdle rate). Commerciality is achieved with the entity's commitment to the project and all of the following criteria:

1. Evidence of a technically mature, feasible development plan.
2. Evidence of financial appropriations either being in place or having a high likelihood of being secured to implement the project.
3. Evidence to support a reasonable time-frame for development.
4. A reasonable assessment that the development projects will have positive economics and meet defined investment and operating criteria. This assessment is performed on the estimated entitlement forecast quantities and associated cash flow on which the investment decision is made (see Section 3.1.1, Net Cash-Flow Evaluation).
5. A reasonable expectation that there will be a market for forecast sales quantities of the production required to justify development. There should also be similar confidence that all produced streams (e.g., oil, gas, water, CO2) can be sold, stored, re-injected, or otherwise appropriately disposed.
6. Evidence that the necessary production and transportation facilities are available or can be made available.
7. Evidence that legal, contractual, environmental, regulatory, and government approvals are in place or will be forthcoming, together with resolving any social and economic concerns.

1. The commerciality test for Reserves determination is applied to the best estimate (P50) forecast quantities, which upon qualifying all commercial and technical maturity criteria and constraints become the 2P Reserves. Stricter cases [e.g., low estimate (P90)] may be used for decision purposes or to investigate the range of commerciality (see Section 3.1.2, Economic Criteria). Typically, the low- and high-case project scenarios may be evaluated for sensitivities when considering project risk and upside opportunity.
2. To be included in the Reserves class, a project must be sufficiently defined to establish both its technical and commercial viability as noted in Section 2.1.2.1. There must be a reasonable expectation that all required internal and external approvals will be forthcoming and evidence of firm intention to proceed with development within a reasonable time-frame. A reasonable time-frame for the initiation of development depends on the specific circumstances and varies according to the scope of the project. While five years is recommended as a benchmark, a longer time-frame could be applied where justifiable; for example, development of economic projects that take longer than five years to be developed or are deferred to meet contractual or strategic objectives. In all cases, the justification for classification as Reserves should be clearly documented.

Definitions - Page 4 of 10

PETROLEUM RESERVES AND RESOURCES CLASSIFICATION AND DEFINITIONS

Excerpted from the 2018 Petroleum Resources Management System (PRMS), version 1.03

Approved by the Society of Petroleum Engineers (SPE) Board of Directors

2.1.2.4 While PRMS guidelines require financial appropriations evidence, they do not require that project financing be confirmed before classifying projects as Reserves. However, this may be another external reporting requirement. In many cases, financing is conditional upon the same criteria as above. In general, if there is not a reasonable expectation that financing or other forms of commitment (e.g., farm-outs) can be arranged so that the development will be initiated within a reasonable time-frame, then the project should be classified as Contingent Resources. If financing is reasonably expected to be in place at the time of the final investment decision (FID), the project's resources may be classified as Reserves.

2.2 Resources Categorization

2.2.0.1 The horizontal axis in the resources classification in Figure 1.1 defines the range of uncertainty in estimates of the quantities of recoverable, or potentially recoverable, petroleum associated with a project or group of projects. These estimates include the uncertainty components as follows:

1. The total petroleum remaining within the accumulation (in-place resources).
2. The technical uncertainty in the portion of the total petroleum that can be recovered by applying a defined development project or projects (i.e., the technology applied).
3. Known variations in the commercial terms that may impact the quantities recovered and sold (e.g., market availability; contractual changes, such as production rate tiers or product quality specifications) are part of project's scope and are included in the horizontal axis, while the chance of satisfying the commercial terms is reflected in the classification (vertical axis).

2.2.0.2 The uncertainty in a project's recoverable quantities is reflected by the 1P, 2P, 3P, Proved (P1), Probable (P2), Possible (P3) reserves; 1C, 2C, 3C, C1, C2, and C3 contingent resources; or 1U, 2U, and 3U prospective resources categories. The chance of commerciality is associated with resources classes or sub-classes and not with the resources categories reflecting the range of recoverable quantities.

2.2.1 Range of Uncertainty

1. Uncertainty is inherent in a project's resources estimation and is communicated in PRMS by reporting a range of category outcomes. The range of uncertainty of the recoverable and/or potentially recoverable quantities may be represented by either deterministic scenarios or by a probability distribution (see Section 4.2, Resources Assessment Methods).
2. When the range of uncertainty is represented by a probability distribution, a low, best, and high estimate shall be provided such
   that:

1. There should be at least a 90% probability (P90) that the quantities actually recovered will equal or exceed the low estimate.
2. There should be at least a 50% probability (P50) that the quantities actually recovered will equal or exceed the best estimate.
3. There should be at least a 10% probability (P10) that the quantities actually recovered will equal or exceed the high estimate.

1. In some projects, the range of uncertainty may be limited, and the three scenarios may result in resources estimates that are not significantly different. In these situations, a single value estimate may be appropriate to describe the expected result.
2. When using the deterministic scenario method, typically there should also be low, best, and high estimates, where such estimates are based on qualitative assessments of relative uncertainty using consistent interpretation guidelines. Under the deterministic incremental method, quantities for each confidence segment are estimated discretely (see Section 2.2.2, Category Definitions and Guidelines).
3. Project resources are initially estimated using the above uncertainty range forecasts that incorporate the subsurface elements together with technical constraints related to wells and facilities. The technical forecasts then have additional commercial criteria applied (e.g., economics and license cutoffs are the most common) to estimate the entitlement quantities attributed and the resources classification status: Reserves, Contingent Resources, and Prospective Resources.

2.2.2 Category Definitions and Guidelines

1. Evaluators may assess recoverable quantities and categorize results by uncertainty using the deterministic incremental method, the deterministic scenario (cumulative) method, geostatistical methods, or probabilistic methods (see Section 4.2, Resources Assessment Methods). Also, combinations of these methods may be used.
2. Use of consistent terminology (Figures 1.1 and 2.1) promotes clarity in communication of evaluation results. For Reserves, the general cumulative terms low/best/high forecasts are used to estimate the resulting 1P/2P/3P quantities, respectively. The associated incremental quantities are termed Proved (P1), Probable (P2) and Possible (P3). Reserves are a subset of, and must be viewed within the context of, the complete resources classification system. While the categorization criteria are proposed specifically for Reserves, in most cases, the criteria can be equally applied to Contingent and Prospective Resources. Upon satisfying the commercial maturity criteria for discovery and/or development, the project quantities will then move to the appropriate resources sub-class. Table 3 provides criteria for the Reserves categories determination.

Definitions - Page 5 of 10

PETROLEUM RESERVES AND RESOURCES CLASSIFICATION AND DEFINITIONS

Excerpted from the 2018 Petroleum Resources Management System (PRMS), version 1.03

Approved by the Society of Petroleum Engineers (SPE) Board of Directors

1. For Contingent Resources, the general cumulative terms low/best/high estimates are used to estimate the resulting 1C/2C/3C quantities, respectively. The terms C1, C2, and C3 are defined for incremental quantities of Contingent Resources.
2. For Prospective Resources, the general cumulative terms low/best/high estimates also apply and are used to estimate the resulting 1U/2U/3U quantities. No specific terms are defined for incremental quantities within Prospective Resources.
3. Quantities in different classes and sub-classes cannot be aggregated without considering the varying degrees of technical uncertainty and commercial likelihood involved with the classification(s) and without considering the degree of dependency between them (see Section 4.2.1, Aggregating Resources Classes).
4. Without new technical information, there should be no change in the distribution of technically recoverable resources and the categorization boundaries when conditions are satisfied to reclassify a project from Contingent Resources to Reserves.
5. All evaluations require application of a consistent set of forecast conditions, including assumed future costs and prices, for both classification of projects and categorization of estimated quantities recovered by each project (see Section 3.1, Assessment of Commerciality).

Table 1-Recoverable Resources Classes and Sub-Classes

Class/Sub-Class	Definition	Guidelines
Reserves	Reserves are those quantities of	Reserves must satisfy four criteria: discovered, recoverable,
	petroleum anticipated to be	commercial, and remaining based on the development project(s)
	commercially recoverable by	applied. Reserves are further categorized in accordance with the level
	application of development	of certainty associated with the estimates and may be sub-classified
	projects to known accumulations	based on project maturity and/or characterized by the development and
	from a given date forward under	production status.
	defined conditions.	To be included in the Reserves class, a project must be sufficiently
		defined to establish its commercial viability (see Section 2.1.2,
		Determination of Commerciality). This includes the requirement that
		there is evidence of firm intention to proceed with development within a
		reasonable time-frame.
		A reasonable time-frame for the initiation of development depends on
		the specific circumstances and varies according to the scope of the
		project. While five years is recommended as a benchmark, a longer
		time-frame could be applied where, for example, development of an
		economic project is deferred at the option of the producer for, among
		other things, market-related reasons or to meet contractual or strategic
		objectives. In all cases, the justification for classification as Reserves
		should be clearly documented.
		To be included in the Reserves class, there must be a high confidence
		in the commercial maturity and economic producibility of the reservoir
		as supported by actual production or formation tests. In certain cases,
		Reserves may be assigned on the basis of well logs and/or core
		analysis that indicate that the subject reservoir is hydrocarbon-bearing
		and is analogous to reservoirs in the same area that are producing or
		have demonstrated the ability to produce on formation tests.
On Production	The development project is	The key criterion is that the project is receiving income from sales,
	currently producing or capable of	rather than that the approved development project is necessarily
	producing and selling petroleum to	complete. Includes Developed Producing Reserves.
	market.	The project decision gate is the decision to initiate or continue economic
		production from the project.
Approved for	All necessary approvals have	At this point, it must be certain that the development project is going
Development	been obtained, capital funds have	ahead. The project must not be subject to any contingencies, such as
	been committed, and	outstanding regulatory approvals or sales contracts. Forecast capital
	implementation of the	expenditures should be included in the reporting entity's current or
	development project is ready to	following year's approved budget.
	begin or is under way.	The project decision gate is the decision to start investing capital in the
		construction of production facilities and/or drilling development wells.

Definitions - Page 6 of 10

PETROLEUM RESERVES AND RESOURCES CLASSIFICATION AND DEFINITIONS

Excerpted from the 2018 Petroleum Resources Management System (PRMS), version 1.03

Approved by the Society of Petroleum Engineers (SPE) Board of Directors

Class/Sub-Class	Definition	Guidelines
Justified for	Implementation of the	To move to this level of project maturity, and hence have Reserves
Development	development project is justified on	associated with it, the development project must be commercially viable
	the basis of reasonable forecast	at the time of reporting (see Section 2.1.2, Determination of
	commercial conditions at the time	Commerciality) and the specific circumstances of the project.	All
	of reporting, and there are	participating entities have agreed and there is evidence of a committed
	reasonable expectations that all	project (firm intention to proceed with development within a reasonable
	necessary approvals/contracts will	time-frame). There must be no known contingencies that could
	be obtained.	preclude the development from proceeding (see Reserves class).
		The project decision gate is the decision by the reporting entity and its
		partners, if any, that the project has reached a level of technical and
		commercial maturity sufficient to justify proceeding with development at
		that point in time.
Contingent	Those quantities of petroleum	Contingent Resources may include, for example, projects for which
Resources	estimated, as of a given date, to	there are currently no viable markets, where commercial recovery is
	be potentially recoverable from	dependent on technology under development, where evaluation of the
	known accumulations by	accumulation is insufficient to clearly assess commerciality, where the
	application of development	development plan is not yet approved, or where regulatory or social
	projects, but which are not	acceptance issues may exist.
	currently considered to be	Contingent Resources are further categorized in accordance with the
	commercially recoverable owing
	level of certainty associated with the estimates and may be	sub-
	to one or more contingencies.
	classified based on project maturity and/or characterized by the
		economic status.
Development	A discovered accumulation where	The project is seen to have reasonable potential for eventual
Pending	project activities are ongoing to	commercial development, to the extent that further data acquisition
	justify commercial development in	(e.g., drilling, seismic data) and/or evaluations are currently ongoing
	the foreseeable future.	with a view to confirming that the project is commercially viable and
		providing the basis for selection of an appropriate development plan.
		The critical contingencies have been identified and are reasonably
		expected to be resolved within a reasonable time-frame. Note that
		disappointing appraisal/evaluation results could lead to a
		reclassification of the project to On Hold or Not Viable status.
		The project decision gate is the decision to undertake further data
		acquisition and/or studies designed to move the project to a level of
		technical and commercial maturity at which a decision can be made to
		proceed with development and production.
Development on	A discovered accumulation where	The project is seen to have potential for commercial development.
Hold	project activities are on hold	Development may be subject to a significant time delay. Note that a
	and/or where justification as a	change in circumstances, such that there is no longer a probable
	commercial development may be	chance that a critical contingency can be removed in the foreseeable
	subject to significant delay.	future, could lead to a reclassification of the project to Not Viable status.
		The project decision gate is the decision to either proceed with
		additional evaluation designed to clarify the potential for eventual
		commercial development or to temporarily suspend or delay further
		activities pending resolution of external contingencies.
Development	A discovered accumulation where	The project is seen to have potential for eventual commercial
Unclarified	project activities are under	development, but further appraisal/evaluation activities are ongoing to
	evaluation and where justification	clarify the potential for eventual commercial development.
	as a commercial development is	This sub-class requires active appraisal or evaluation and should not be
	unknown based on available
	maintained without a plan for future evaluation. The sub-class should
	information.
	reflect the actions required to move a project toward commercial
		maturity and economic production.

Definitions - Page 7 of 10

PETROLEUM RESERVES AND RESOURCES CLASSIFICATION AND DEFINITIONS

Excerpted from the 2018 Petroleum Resources Management System (PRMS), version 1.03

Approved by the Society of Petroleum Engineers (SPE) Board of Directors

Class/Sub-Class	Definition	Guidelines
Development Not	A discovered accumulation for	The project is not seen to have potential for eventual commercial
Viable	which there are no current plans	development at the time of reporting, but the theoretically recoverable
	to develop or to acquire additional	quantities are recorded so that the potential opportunity will be
	data at the time because of limited	recognized in the event of a major change in technology or commercial
	commercial potential.	conditions.
		The project decision gate is the decision not to undertake further data
		acquisition or studies on the project for the foreseeable future.
Prospective	Those quantities of petroleum that	Potential accumulations are evaluated according to the chance of
Resources	are estimated, as of a given date,	geologic discovery and, assuming a discovery, the estimated quantities
	to be potentially recoverable from	that would be recoverable under defined development projects. It is
	undiscovered accumulations.	recognized that the development programs will be of significantly less
		detail and depend more heavily on analog developments in the earlier
		phases of exploration.
Prospect	A project associated with a	Project activities are focused on assessing the chance of geologic
	potential accumulation that is	discovery and, assuming discovery, the range of potential recoverable
	sufficiently well defined to	quantities under a commercial development program.
	represent a viable drilling target.
Lead	A project associated with a	Project activities are focused on acquiring additional data and/or
	potential accumulation that is	undertaking further evaluation designed to confirm whether or not the
	currently poorly defined and	Lead can be matured into a Prospect. Such evaluation includes the
	requires more data acquisition	assessment of the chance of geologic discovery and, assuming
	and/or evaluation to be classified	discovery, the range of potential recovery under feasible development
	as a Prospect.	scenarios.
Play	A project associated with a	Project activities are focused on acquiring additional data and/or
	prospective trend of potential	undertaking further evaluation designed to define specific Leads or
	prospects, but that requires more	Prospects for more detailed analysis of their chance of geologic
	data acquisition and/or evaluation	discovery and, assuming discovery, the range of potential recovery
	to define specific Leads or	under hypothetical development scenarios.
	Prospects.
Table 2-Reserves Status Definitions and Guidelines

Status	Definition	Guidelines
Developed	Expected quantities to be	Reserves are considered developed only after the necessary equipment
Reserves	recovered from existing wells	has been installed, or when the costs to do so are relatively minor
	and facilities.	compared to the cost of a well. Where required facilities become
		unavailable, it may be necessary to reclassify Developed Reserves as
		Undeveloped. Developed Reserves may be further sub-classified as
		Producing or Non-producing.
Developed	Expected quantities to be	Improved recovery Reserves are considered producing only after the
Producing	recovered from completion	improved recovery project is in operation.
Reserves	intervals that are open and
	producing at the effective date of
	the estimate.
Developed	Shut-in and behind-pipe	Shut-in Reserves are expected to be recovered from (1) completion
Non-Producing	Reserves.	intervals that are open at the time of the estimate but which have not yet
Reserves		started producing, (2) wells which were shut-in for market conditions or
		pipeline connections, or (3) wells not capable of production for
		mechanical reasons. Behind-pipe Reserves are expected to be
		recovered from zones in existing wells that will require additional
		completion work or future re-completion before start of production with
		minor cost to access these reserves.
		In all cases, production can be initiated or restored with relatively low
		expenditure compared to the cost of drilling a new well.

Definitions - Page 8 of 10