Leucrotta Exploration Inc. announced a Plan to reach 30,000 boepd within a five-year time frame. The accomplishments outlined below will assist in accelerating the development and provide greater clarity on funding and timeline to achieve those goals: Gas processing arrangement noted below along with currently owned facilities provides Leucrotta with enough gas processing to reach an interim goal of approximately 25,000 boepd. $55 million infrastructure funding allows Leucrotta to reach its goals using existing cash ($30 million), estimated cash flow, and projected credit facilities.

Expansion of Mica Project into Alberta provides jurisdictional and time flexibility in business plan. Commencement of Drilling Program will add production and cash flow sooner than previously anticipated. Leucrotta has entered into a 10 year gas processing agreement with NorthRiver Midstream Inc. ("NRM") to provide 50 mmcf/d of firm processing capacity at NRM's West Doe gas processing facility.

The agreement commences after the construction of the Mica Battery and is subject to a ramp-up period. Leucrotta will also hold certain rights to additional firm processing capacity that, along with Leucrotta's owned 25 mmcf/d processing facility at Doe, will allow Leucrotta to reach 25,000 boepd in the Mica area. Concurrent with this agreement, NRM has agreed to provide up to $55 million of capital funding that Leucrotta will use to construct a battery facility at Mica (the Mica Battery").

The Mica Battery will consist of facilities for in-field processing of oil, gas and water and will deliver gas to NRM's West Doe gas processing facility. The Mica Battery will have an initial capacity of 60 mmcf/d expandable to 90 mmcf/d with added compression. Leucrotta owns approximately 50 sections of Montney lands in Alberta that mirror the Mica Development in British Columbia.

These lands are geologically very similar to Mica with good well control. Leucrotta recently completed a Lower Montney well in Alberta that was flowing over 600 boepd (150 bopd of 42 API light oil and 2.8 mmcf/d of liquids-rich gas) at the end of an 18-day flow test.(1) The well was drilled in 2018 for land retention and used a 1,500 metre lateral and a 52 stage frac. This is in contrast to the recently completed Mica Test Pad that used 2,400 metre laterals and 133 stage fracs.

The Alberta well compares favourably to similar Mica wells and Leucrotta is very pleased with the result. Leucrotta views this as a very material development given the significant delineation of the resource and jurisdictional flexibility to spend capital and increase shareholder value while the Mica Project is being permitted and constructed. Leucrotta has secured a drilling rig and is preparing to drill a 5-well Montney Pad located in Alberta offsetting the Mica Development in British Columbia.

Drilling is expected to commence by early April and will be drilled to a lateral length of 3,000 metres with 166 frac stages. The wells can be completed in early Third Quarter 2022 and equipped and on-stream in late Third Quarter 2022. The Mica development will proceed with a total of 10 wells during 2022 and early First Quarter 2023 to coincide with the commissioning of the Mica Battery once all regulatory approvals are received for Mica Project.

Leucrotta estimates First Quarter 2022 and current production at 4,250 boepd. Production for the remainder of the year is projected to remain relatively flat until the new Alberta Pad is placed on production at which point approximately 4,000 boepd will be added. Mica Pads II and III (5,000 boepd per Pad) would be brought on sequentially during First Quarter 2023 and Second Quarter 2023 in conjunction with the anticipated start-up of the Mica Battery in First Quarter 2023.

Leucrotta estimates that current cash and working capital are approximately $30 million with no debt. In conjunction with year-end filings, Leucrotta will look to increase its bank credit facility to provide more flexibility with respect to its future capital operations.