Equity Capital Markets and Advisory Business, Auctus Advisors

Auctus Advisors

Equity Capital Markets and Advisory Business

Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector. The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy. Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors. Auctus provides Corporate Broking, Equity Research and Investment Banking services.

Equity Bottom-Up

<ul>
<li>3Q25 production averaged 2,076 boe/d, in line with our expectations.</li>
<li>The GH LSC 13-13 #2 well in the Lower Selma Chalk continues to exhibit a notably shallower decline profile than prior Upper Selma Chalk wells.</li>
<li>Current output is ~1.7 mmcf/d, with an IP120 outperforming typical Upper Selma Chalk results.</li>
</ul>


3Q25 production averaged 2,076 boe/d, in line with our expectations.
The GH LSC 13-13 #2 well in the Lower Selma Chalk continues to exhibit a notably shallower decline profile than prior Upper Selma Chalk wells.
Current output is ~1.7 mmcf/d, with an IP120 outperforming typical Upper Selma Chalk results.


Southern Energy Corp. (SOUC LN/SOU CN): Gas Prices Up.

<ul>
<li>Southern Energy’s 2Q25 production averaged 1,883 boe/d, exceeding our forecast of 1,698 boe/d.</li>
<li>Current assets minus accounts payable stood at ~US$1.5 mm at end-June, in line with expectations.</li>
<li>The GH LSC 13-13 #2 well in the Lower Selma Chalk continues to exhibit a notably shallower decline rate than the previous Upper Selma Chalk wells.</li>
</ul>


Southern Energy’s 2Q25 production averaged 1,883 boe/d, exceeding our forecast of 1,698 boe/d.
Current assets minus accounts payable stood at ~US$1.5 mm at end-June, in line with expectations.
The GH LSC 13-13 #2 well in the Lower Selma Chalk continues to exhibit a notably shallower decline rate than the previous Upper Selma Chalk wells.


Southern Energy Corp. (SOUC LN/SOU CN): Shallower Decline at LSC Well Supports Reserve Upside

<ul><li>• The GH LSC 13-13 #2 well (Lower Selma Chalk) commenced production at ~4.0 mmcf/d and averaged 3.6 mmcf/d over its IP30 period.</li><li>Although below the initial 5.5 mmcf/d forecast, the observed decline rate is notably shallower than expected, with flow rates holding at 3.4 mmcf/d after one month (~15% decline).</li><li>• This performance benchmarks favourably against Upper Selma Chalk (USC) wells, which typically exhibit higher IP30 rates of 5.0–6.5 mmcf/d but decline more steeply, often down to ~3.0 mmcf/d within the first month.</li></ul>

• The GH LSC 13-13 #2 well (Lower Selma Chalk) commenced production at ~4.0 mmcf/d and averaged 3.6 mmcf/d over its IP30 period.Although below the initial 5.5 mmcf/d forecast, the observed decline rate is notably shallower than expected, with flow rates holding at 3.4 mmcf/d after one month (~15% decline).• This performance benchmarks favourably against Upper Selma Chalk (USC) wells, which typically exhibit higher IP30 rates of 5.0–6.5 mmcf/d but decline more steeply, often down to ~3.0 mmcf/d within the first month.

Southern Energy Corp. (SOUC LN/SOU CN): IP30 flow rate at first DUC could derisk up to 45 new locations in the Lower Selma Chalk

<ul>
<li>1Q25 production of 2,135 boe/d was broadly in line with our expectations.</li>
<li>The company’s gas production was sold a US$0.49/mcf premium to Henry Hub (+13%).</li>
<li>Field operations are scheduled to commence on the 13‐13 #2 Lower Selma Chalk horizontal well in the next few weeks, and Southern with production due to commence in June.</li>
</ul>


1Q25 production of 2,135 boe/d was broadly in line with our expectations.
The company’s gas production was sold a US$0.49/mcf premium to Henry Hub (+13%).
Field operations are scheduled to commence on the 13‐13 #2 Lower Selma Chalk horizontal well in the next few weeks, and Southern with production due to commence in June.


Southern Energy Corp. (SOUC LN/SOU CN): 1Q25 Production in Line.

<ul>
<li>Southern achieved production of 2,259 boe/d in 4Q24, close to with our forecasts of 2,192 boe/d.</li>
<li>The YE24 working capital deficit of US$24.9 mm also met our expectations.</li>
<li>YE24 1P and 2P reserves were estimated at 12.7 mmboe and 27.9 mmboe, respectively.</li>
</ul>


Southern achieved production of 2,259 boe/d in 4Q24, close to with our forecasts of 2,192 boe/d.
The YE24 working capital deficit of US$24.9 mm also met our expectations.
YE24 1P and 2P reserves were estimated at 12.7 mmboe and 27.9 mmboe, respectively.


Southern Energy Corp. (SOUC LN/SOU CN): Reserves Resilient to Low US Gas Prices

Canada

Southern Energy Corp. operates as an oil and natural gas exploration and production company. The Company focuses on developing conventional and unconventional light oil and liquids rich natural gas resources. Southern Energy serves customers in Canada and the United States.

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Southern Energy Corp (SOUC LN)