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PAN ORIENT ENERGY CORP. - 2021 Year-end Financial & Operating Results

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CALGARY, AB, March 17, 2022 /CNW/ - Pan Orient Energy Corp. ("Pan Orient" or the "Company") (TSXV: POE) reports 2021 year-end and fourth quarter consolidated financial and operating results. Please note that all amounts are in Canadian dollars unless otherwise stated, BOPD refers to barrels of oil per day and BOPD for Thailand operations represents volumes net to Pan Orient's 50.01% equity interest in the Thailand Joint Venture.

logo (CNW Group/Pan Orient Energy Corp.)
logo (CNW Group/Pan Orient Energy Corp.)

The Company is today filing its audited consolidated financial statements as at and for the year ended December 31, 2021 and related management's discussion and analysis with Canadian securities regulatory authorities. Copies of these documents may be obtained online at www.sedar.com or the Company's website, www.panorient.ca.

Commenting today on Pan Orient's 2021 results, President and CEO Jeff Chisholm stated:

"In the fourth quarter of 2021 the Company announced its intention to take a number of steps that would accelerate Pan Orient shareholder value. The first of these steps was completed in February 2021 with the payment of a $0.40 per share special distribution to Pan Orient shareholders. Since late 2021 the Company has also been actively engaged in a process that would potentially result in the sale of the Company's onshore Thailand L53 asset. Industry interest has been very strong and oil prices have certainly been a positive factor. Pan Orient hopes to be in a position to announce a potential transaction late in the first half of 2022."

HIGHLIGHTS

Thailand (Pan Orient's 50.01% equity interest in the Thailand Joint Venture)

  • Net to Pan Orient's 50.01% equity interest in the Thailand Joint Venture, oil sales from Concession L53 were 1,395 BOPD in 2021, an increase of 15% from 1,213 BOPD in 2020. The L53-DD10 and L53-DD11 appraisal wells were drilled in the L53-DD field and brought onto production in 2021. In addition, water disposal capacity at the L53-DD field was increased through conversion of the L53-DD8 well to a water disposal well and drilling of the L53-DD12 water disposal well.

  • Adjusted Thailand funds flow from operations of $20.4 million in 2021 ($40.10 per barrel), with $5.7 million ($43.56 per barrel) in the fourth quarter, net to Pan Orient's 50.01% equity interest in the Thailand Joint Venture. During 2021, the realized price of Concession L53 crude oil was higher than the previous year by 56% as the Brent reference price increased 60%. Operating expenses in 2021 declined 27% to $5.66 per barrel primarily due to increased water handling capacity for the L53-DD field and higher oil volumes.

  • Net to Pan Orient's 50.01% equity interest in the Thailand Joint Venture, adjusted funds flow from Thailand operations of $20.4 million in 2021 funded $5.8 million of Thailand exploration and development activities and $13.7 million of dividends from the Thailand Joint Venture to Pan Orient. Pan Orient's share of working capital and long-term deposits in Thailand at December 31, 2021 was $5.0 million.

  • December 31, 2021 reserves report assigned proved plus probable crude oil reserves of 2.3 million barrels (a decrease of 3%), net to Pan Orient's 50.01% equity interest in the Thailand Joint Venture, with an after tax net present value using forecast prices and costs discounted at 10% per year of $54.1 million (an 39% increase). The 3% decrease in proved plus probable crude oil reserves results from 509,195 barrels of oil sales largely offset by a 445,809 barrel increase from positive technical revisions, economic factors and extension of fields. The 39% increase in the net present value is the result of the 31% increase average oil sales prices more than offsetting the 3% decrease in proved plus probable reserves.

Indonesia East Jabung Production Sharing Contract (Pan Orient is non-operator with a 49% ownership interest)

  • The operator of the East Jabung Production Sharing Contract ("PSC") provided notice to the Government of Indonesia in January 2020 of withdrawal from the East Jabung PSC and is continuing to complete final steps to be taken for formal approval of the expiry from the Government of Indonesia, including reclamation requirements. Pan Orient is withdrawing from operations in Indonesia and the office in Jakarta was closed March 31, 2020.

  • Activities of the Company in Indonesia for 2021 are reported as discontinued operations. Discontinued operations in Indonesia for 2021 were $212 thousand of G&A expense, $23 thousand in foreign exchange loss and $165 thousand increase of impairment expense for the East Jabung PSC.

Sawn Lake (Operated by Andora Energy Corporation ("Andora"), in which Pan Orient has a 71.8% ownership)

  • Since March 31, 2020, no Sawn Lake operating expenses or G&A have been capitalized. For 2021, Pan Orient reports total operating expense of $279 thousand associated with the Sawn Lake suspended SAGD facility and wellpair.

Corporate

  • Total 2021 corporate adjusted funds flow from operations (including Pan Orient's 50.01% equity interest in the Thailand Joint Venture) of $16.7 million ($0.33 per share), with $4.4 million ($0.09 per share) in the fourth quarter of 2021. The 75% increase from $9.5 million ($0.18 per share) in 2020 is largely due to the Thailand Joint Venture with 56% higher realized prices of Concession L53 crude oil and 15% higher oil sales volume.

  • Net income attributable to common shareholders was $8.5 million ($0.17 per share) for 2021 and $3.0 million ($0.06 per share) for the fourth quarter of 2021.

  • Pan Orient repurchased 1,950,100 common shares in 2021 at an average price of $0.87 per share (before the $0.40 per share special distribution to Pan Orient shareholders in February 2022). There have been no shares repurchased in 2022 to date.

  • Pan Orient had working capital and non-current deposits of $32.1 million and no long-term debt at December 31, 2021. In addition, the Thailand Joint Venture had $5.0 million in working capital and long-term deposits, net to Pan Orient's 50.01% equity interest, and Thailand funds flow from operations are expected to fund remaining development activities at Concession L53.

  • At the Annual and Special Meeting of Shareholders January 18, 2022, shareholders approved the previously announced capital reorganization resulting in a $0.40 per common share return of capital distribution to shareholders on February 10, 2022. The total amount of the distribution was $19.9 million.

OUTLOOK

CORPORATE

In the fourth quarter of 2021, the Company announced a process to accelerate shareholder value given the mid to late stage development of Thailand, intention to minimize further investment into the Sawn Lake asset, and strength in current oil prices. This process will involve both the Thailand assets and the Sawn Lake, Canada assets and it is expected that there will be two distinct transactions due to the contrasting nature of the assets. It is intended that the proceeds from any potential sale of any of the assets will be paid or distributed to Pan Orient shareholders.

An updated December 31, 2021 independent reserves evaluation for Thailand on-shore Concession L53/48 of Pan Orient Energy (Siam) Ltd. was prepared at the end of January 2022 and financial statements for December 31, 2021 are now available. Both the Brent and Western Canada Select reference prices for oil have continued to increase. Pan Orient is reviewing alternatives and having discussions with interested parties to achieve value for Pan Orient shareholders. The outcome, timing and amount of potential transactions is uncertain at this time.

It is currently proposed that in the period after the sale of the Company's oil and gas interests, and the distribution of the vast majority of cash to shareholders, the Company will continue to pursue international oil and gas opportunities with a substantially scaled down cost structure.

THAILAND

Pan Orient Energy (Siam) Ltd. is currently undertaking an approximately eight to ten well workover program with the aim of increasing oil production and take advantage of the current oil price environment.

Pan Orient is a Calgary, Alberta based oil and gas exploration and production company with operations currently located onshore Thailand and Western Canada.

This news release contains forward-looking information. Forward-looking information is generally identifiable by the terminology used, such as "expect", "believe", "estimate", "should", "anticipate" and "potential" or other similar wording. Forward-looking information in this news release includes, but is not limited to, references express or implied to estimates of reserves and potentially recoverable resources; oil price expectations; Thailand funds flow from operations being expected to fund remaining development activities at Concession L53; Pan Orient's intention and efforts to sell its Thailand assets and Sawn Lake, Canada assets; the timing of any sale transactions and required shareholder approval; Pan Orient's future business plans after the sale of its oil and gas interests; withdrawal from the East Jabung PSC in Indonesia; and potential purchases of common shares under the normal course issuer bid. By their very nature, the forward-looking statements contained in this news release require Pan Orient and its management to make assumptions that may not materialize or that may not be accurate. The forward-looking information contained in this news release is subject to known and unknown risks and uncertainties and other factors, which could cause actual results, expectations, achievements or performance to differ materially, including without limitation: imprecision of reserves estimates and estimates of recoverable quantities of oil, changes in project schedules, operating and reservoir performance, the effects of weather and climate change, the results of exploration and development drilling and related activities, demand for oil and gas, commercial negotiations, other technical and economic factors or revisions and other factors, many of which are beyond the control of Pan Orient. Although Pan Orient believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurances that the expectations of any forward-looking statements will prove to be correct.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Financial and Operating Summary

Three Months Ended

December 31,

Year Ended

December 31,

% Change

(thousands of Canadian dollars except where indicated)

2021

2020

2021

2020

FINANCIAL






Financial Statement Results – Excluding 50.01% Interest in Thailand Joint Venture (Note 1)






Net income (loss) attributed to common shareholders

2,951

(417)

8,479

(59,631)

-114%


Per share – basic and diluted

$ 0.06

$ (0.01)

$ 0.17

$ (1.13)

-114%

Cash flow used in operating activities (Note 2 & 3)

(1,212)

(597)

(3,050)

(1,942)

57%


Per share – basic and diluted

$ (0.02)

$ (0.01)

$ (0.06)

$ (0.04)

57%

Cash flow from (used in) investing activities (Note 2 & 3)

5,098

(26)

13,712

6,984

96%


Per share – basic and diluted

$ 0.10

$ 0.00

$ 0.27

$ 0.13

96%

Cash flow used in financing activities (Note 2 & 3)

(3)

(225)

(1,728)

(1,733)

0%


Per share – basic and diluted

$ (0.00)

$ (0.00)

$ (0.03)

$ (0.03)

0%

Change in cash & cash equivalents from discontinued operations (Note 3)

(9)

(46)

(153)

(795)

-81%

Working capital

31,472

22,968

31,472

22,968

37%

Working capital & non-current deposits

32,084

23,577

32,084

23,577

36%

Long-term debt

-

-

-

-

0%

Shares outstanding (thousands)

49,794

51,744

49,794

51,744

-4%

Capital Commitments (Note 4)

1,060

801

1,060

801

32%

Working Capital and Non-current Deposits






Beginning of period – Excluding Thailand Joint Venture

28,443

26,411

23,577

22,158

6%


Adjusted funds flow used in continuing operations (Note 3 & 5)

(1,072)

(1,754)

(3,376)

(3,340)

1%


Adjusted funds flow from (used in) discontinued operations (Note 3)

(239)

47

(400)

395

-201%


Consolidated capital expenditures (Note 6)

-

-

-

(85)



Amounts advanced to Thailand Joint Venture

(8)

(25)

31

(43)

-172%


Dividend received from Thailand Joint Venture

5,141

-

13,715

7,112

93%


Finance lease payments

(3)

(3)

(24)

(139)

-83%


Changes in current decommissioning liabilities

125

-

(518)

-



Normal course issuer bid

-

(222)

(1,704)

(1,705)

0%


Automatic share purchase plan (Note 7)

-

-

945

-



Effect of foreign exchange and other

(303)

(877)

(162)

(776)

-79%

End of period - Excluding Thailand Joint Venture

32,084

23,577

32,084

23,577

36%

Pan Orient 50.01% interest in Thailand Joint Venture Working Capital and Non-Current Deposits

5,023

4,875

5,023

4,875

3%

Economic Results – Including 50.01% Interest in Thailand Joint Venture






Total corporate adjusted funds flow from (used in) operations by region (Note 5)







Canada

(1,055)

(1,745)

(3,329)

(3,310)

1%


Thailand (Note 8)

(17)

(9)

(47)

(30)

57%


From continuing operations

(1,072)

(1,754)

(3,376)

(3,340)

1%


Indonesia – Discontinued Operations

(239)

47

(400)

395

-201%


Adjusted funds flow used in operations (excl. Thailand Joint Venture)

(1,311)

(1,707)

(3,776)

(2,945)

28%


Share of Thailand Joint Venture (Note 1 & 9)

5,731

3,235

20,466

12,492

64%

Total corporate adjusted funds flow from operations

4,420

1,528

16,690

9,547

75%


Per share – basic and diluted

$ 0.09

$ 0.03

$ 0.33

$ 0.18

84%

Capital Expenditures – Petroleum and Natural Gas Properties (Note 6)






Consolidated capital expenditures (excl. Thailand Joint Venture)

-

-

-

85

-100%

Share of Thailand Joint Venture capital expenditures

853

1,644

5,803

10,248

-43%

Total capital expenditures (incl. Thailand Joint Venture)

853

1,644

5,803

10,333

-44%

Investment in Thailand Joint Venture






Beginning of period

24,636

26,809

28,329

34,127

-17%


Net income from Joint Venture

4,259

1,294

12,146

1,906

537%


Other comprehensive gain (loss) from Joint Venture

332

201

(2,635)

(635)

315%


Dividend paid

(5,141)

-

(13,715)

(7,112)

93%


Amounts advanced to (from) Joint Venture

8

25

(31)

43

-172%

End of period

24,094

28,329

24,094

28,329

-15%


Three Months Ended

December 31,

Year Ended

December 31,

% Change

(thousands of Canadian dollars except where indicated)

2021

2020

2021

2020

Thailand Operations






Economic Results – Including 50.01% Interest in Thailand Joint Venture (Note 9)






Oil sales (bbls)

131,207

137,137

509,195

444,020

15%

Average daily oil sales (BOPD) by Concession L53

1,426

1,491

1,395

1,213

15%

Average oil sales price, before transportation (CDN$/bbl)

$ 98.03

$ 56.95

$ 84.69

$ 54.18

56%

Reference Price (volume weighted) and differential







Crude oil (Brent $US/bbl)

$ 79.73

$ 44.62

$ 70.78

$ 41.73

70%


Exchange Rate $US/$Cdn

1.27

1.32

1.27

1.35

-6%


Crude oil (Brent $Cdn/bbl)

$ 101.41

$ 58.71

$ 89.61

$ 56.16

60%


Sale price / Brent reference price

97%

97%

95%

96%

-2%

Adjusted funds flow from (used in) operations (Note 5)







Crude oil sales

12,862

7,810

43,123

24,055

79%


Government royalty

(688)

(419)

(2,308)

(1,252)

84%


Transportation expense

(316)

(314)

(1,208)

(1,005)

20%


Operating expense

(766)

(1,094)

(2,883)

(3,424)

-16%


Field netback

11,092

5,983

36,724

18,374

100%


General and administrative expense (Note 8)

(283)

(306)

(911)

(968)

-6%


Interest income

-

1

2

7

-71%


Foreign exchange gain (loss)

2

4

(36)

46

-178%


Current income tax

(5,097)

(2,456)

(15,360)

(4,997)

207%


Thailand - Adjusted funds flow from operations

5,714

3,226

20,419

12,462

64%

Adjusted funds flow from (used in) operations / barrel (CDN$/bbl) (Note 5)







Crude oil sales

$ 98.03

$ 56.95

$ 84.69

$ 54.18

56%


Government royalty

(5.24)

(3.06)

(4.53)

(2.82)

61%


Transportation expense

(2.41)

(2.29)

(2.37)

(2.26)

5%


Operating expense

(5.84)

(7.98)

(5.66)

(7.71)

-27%


Field netback

$ 84.54

$ 43.63

$ 72.12

$ 41.38

74%


General and administrative expense (Note 8)

(2.16)

(2.22)

(1.79)

(2.18)

-18%


Interest Income

-

0.01

0.00

0.02

-75%


Foreign exchange gain (loss)

0.02

0.03

(0.07)

0.10

-168%


Current income tax

(38.85)

(17.91)

(30.17)

(11.25)

168%


Thailand – Adjusted funds flow from operations

$ 43.56

$ 23.54

$ 40.10

$ 28.07

43%

Government royalty as percentage of crude oil sales

5.3%

5.4%

5.4%

5.2%

0%

Income tax & SRB as percentage of crude oil sales

40%

31%

36%

21%

15%

As percentage of crude oil sales







Expenses - transportation, operating, G&A and other

11%

22%

12%

22%

-11%


Government royalty, SRB and income tax

45%

37%

41%

26%

15%


Adjusted funds flow from operations, before interest income

44%

41%

47%

52%

-4%

Wells drilled







Gross

-

1

3

8

-63%


Net

-

0.5

1.5

4.0

-63%

Financial Statement Presentation

Results – Excl. 50.01% Interest in Thailand Joint Venture (Note 1)







General and administrative expense (Note 8)

(17)

(9)

(47)

(30)

57%


Adjusted funds flow used in consolidated operations

(17)

(9)

(47)

(30)

57%

Adjusted fund flow included in Investment in Thailand Joint Venture







Net income from Thailand Joint Venture

4,259

1,294

12,146

1,906

537%


Add back non-cash items in net income

1,472

1,941

8,320

10,586

-21%


Adjusted funds flow from Thailand Joint Venture

5,731

3,235

20,466

12,492

64%

Thailand – Economic adjusted funds flow from operations (Note 9)

5,714

3,226

20,419

12,462

64%


Three Months Ended

December 31,

Year Ended

December 31,

% Change

(thousands of Canadian dollars except where indicated)

2021

2020

2021

2020

Canada Operations






Interest income

13

19

48

220

-78%

General and administrative expenses (Note 8)

(564)

(546)

(2,036)

(2,070)

-2%

Operating expense (Note 10)

(59)

(54)

(279)

(210)

33%

Stock based compensation on restricted share units (note 11)

(375)

(156)

(1,001)

(383)

161%

Realized foreign exchange gain (Note 12)

53

1

53

2

2550%

Unrealized foreign exchange loss (loss) (Note 12)

(123)

(1,009)

(114)

(869)

-87%


Canada – Adjusted funds flow used in operations

(1,055)

(1,745)

(3,329)

(3,310)

1%

Add back Thailand general and administrative expense (note 8)

(17)

(9)

(47)

(30)

57%

Add back changes in non-cash working capital, continuing operations

(263)

148

212

529

-60%

Add back unrealized foreign exchange loss

123

1,009

114

869

-87%

Cash flow used in operating activities, continuing operations

(1,212)

(597)

(3,050)

(1,942)

-57%

Indonesia – Discontinued Operations






General and administrative expense (Note 8)

(45)

(61)

(212)

(284)

-25%

Impairment recovery (expense) (Note 13)

(164)

1

(165)

675

-124%

Foreign exchange gain (loss)

(30)

107

(23)

4

-675%


Indonesia – Adjusted funds flow from (used in) operations

(239)

47

(400)

395

-201%

Add back changes in non-cash working capital, discontinued operations

366

(93)

383

(1,079)

-135%

Settlement of decommissioning provision

(136)

-

(136)

-


Cash flow used in operating activities, discontinued operations

(9)

(46)

(153)

(684)

-122%






Year Ended

December 31,

% Change

(thousands of Canadian dollars except where indicated)

2021

2020

RESERVES AND CONTINGENT RESOURCES




Onshore Thailand – Concession L53 (50.01% economic interest) (Note 1)

(Note 15)

(Note 14)



Proved oil reserves (thousands of barrels)

1,540

1,418

9%


Proved plus probable oil reserves (thousands of barrels)

2,313

2,377

-3%


Net present value of proved + probable reserves, after tax discounted at 10%

54,095

38,888

39%



Per Pan Orient share – basic (Note 16)

$ 1.09

$ 0.75

45%

Canada (Pan Orient's 71.8% share of the oil sands leases of Andora at Sawn Lake, Alberta)

(Note 17)



INTERNATIONAL INTERESTS AT DECEMBER 31, 2021

All amounts reflect Pan Orient's economic
interest

Status

Net Square Kilometers

December 31, 2021

Financial Commitments

(Cdn thousands)

2021 Avg. Production
(BOPD)

P+P
Reserves
(thousands of barrels)

Onshore Thailand Concession (Recorded in Investment in Joint
Venture)

L53/48 (Pan Orient 50.01% ownership in
Pan Orient Energy (Siam) Ltd. (Note 1 & 18)

Partially developed

13.66

-

1,395

2,313

Onshore Indonesia PSC (Consolidated subsidiary)






East Jabung PSC, South Sumatra (49%
interest & non-operator) (Note 3)

Expired






(1)

Pan Orient holds a 50.01% equity interest in Pan Orient Energy (Siam) Ltd. as a joint arrangement where the Company shares joint
control with the 49.99% equity interest holder. The resulting joint arrangement is classified as a Joint Venture under IFRS 11 and is
accounted for using the equity method of accounting where Pan Orient's 50.01% equity interest in the assets, liabilities, working capital,
operations and capital expenditures of Pan Orient Energy (Siam) Ltd. are recorded in Investment in Thailand Joint Venture.

(2)

As set out in the Consolidated Statements of Cash Flows in the Consolidated Financial Statements of Pan Orient Energy Corp.

(3)

The East Jabung Production Sharing Contract ("PSC") expired in January 2020 and the operator is continuing to complete the final
steps to be taken for formal approval of the expiry from the Government of Indonesia, including reclamation requirements. Pan Orient
is withdrawing from operations in Indonesia and the office in Jakarta was closed March 31, 2020. For accounting purposes, the operation
in Indonesia for accounting purposes is considered a discontinued operation since 2020.

(4)

Refer to Commitments note disclosure of the December 31, 2021 and December 31, 2020 Consolidated Financial Statements.

(5)

Total corporate adjusted funds flow from operations is cash flow from operating activities prior to changes in non-cash working capital,
unrealized foreign exchange gain or loss plus the corresponding amount from Pan Orient's 50.01% interest in the Thailand Joint Venture
which is recorded in Joint Venture for financial statement purposes. This measure is used by management to analyze operating
performance and leverage. Adjusted funds flow as presented does not have any standardized meaning prescribed by IFRS and
therefore it may not be comparable with the calculation of similar measures of other entities. Adjusted funds flow is not intended to
represent operating cash flow or operating profits for the period nor should it be viewed as an alternative to cash flow from operating
activities, net earnings or other measures of financial performance calculated in accordance with IFRS.

(6)

Cost of capital expenditures excluded decommissioning costs and the impact of changes in foreign exchange.

(7)

In December 2020, the Company entered into an Automatic Share Purchase Plan ("ASPP"), which permits an independent broker to
repurchase shares during certain blackout periods under the Company's normal course issuer bid, subject to agreed trading parameters
and other instructions for such purchases. At December 31, 2021, the Company recognized a provision of $nil (December 31, 2020 -
$0.9 mill) in accounts payable and accrued liabilities as an estimate for the number of shares that may be repurchased during potential
blackout periods at the maximum share price under the ASPP.

(8)

General & administrative expenses excluding non-cash accretion expense. The nominal amount of G&A shown in the three months and
years ended December 31, 2021 and 2020 for Thailand operations related to G&A of the holding company of Pan Orient Energy (Siam)
Ltd.

(9)

For the purpose of providing more meaningful economic results from operations for Thailand, the amounts presented include 50.01%
of results of the Thailand Joint Venture. Pan Orient has a 50.01% ownership interest in Pan Orient Energy (Siam) Ltd., but does not
have any direct interest in, or control over, the crude oil reserves, operations or working capital of on-shore Concession L53.

(10)

Operating expense related to Andora's suspended demonstration project facility and wellpair at Sawn Lake Central. These expenses
were previously capitalized prior to the E&E impairment recorded during the first quarter of 2020.

(11)

The Company granted 1,050,000 and 520,000 restricted share units ("RSUs") to directors, senior management, employees and
consultant on May 19, 2020 and May 14, 2021, respectively. At December 31, 2021, 599,998 RSUs are outstanding. The amount
represents the stock-based compensation expenses.

(12)

Realized and unrealized foreign exchange gain or loss mainly related to the U.S. dollars denominated cash balances held in Canada.

(13)

Adjustment to previously booked capital expenditures at East Jabung PSC.

(14)

Thailand reserves as at December 31, 2020 as evaluated by Sproule International Limited of Calgary assessed at forecast crude oil
reference prices and costs. The US$ reference price for crude oil per barrel (US$ UK Brent per barrel) in the evaluation is $48.00 for
2021, $50.00 for 2022, $55.00 for 2023, $56.10 for 2024, $57.22 for 2025 and prices increase at 2.0% per year thereafter. Foreign
exchange rate used of Cdn$1=US$0.77. The engineered values disclosed may not represent fair market value.

(15)

Thailand reserves as at December 31, 2021 as evaluated by Sproule International Limited of Calgary assessed at forecast crude oil
reference prices and costs. The US$ reference price for crude oil per barrel (US$ UK Brent per barrel) in the evaluation is $75.00 for
2022, $72.00 for 2023, $70.00 for 2024, $71.40 for 2025, $72.83 for 2026 and prices increase at 2.0% per year thereafter. Foreign
exchange rate used of Cdn$1=US$0.80. The engineered values disclosed may not represent fair market value.

(16)

Per share values calculated based on 49,793,907 and 51,744,007 Pan Orient Shares outstanding at December 31, 2021 and 2020,
respectively.

(17)

The evaluation of Andora's contingent resources of the oil sands project at Sawn Lake Alberta, Canada as at September 30, 2019 was
conducted by Sproule Associates Limited. Andora's unrisked "Best Estimate" contingent resources were 227.8 million barrels (163.6
million net to Pan Orient's interest in Andora) of recoverable bitumen as at September 30, 2019 using forecast prices at September 30,
2019. At March 31, 2020 low commodity prices indicated there was no expected commercial development at Sawn Lake in that market
and Andora recorded a full non-cash net impairment charge on the Sawn Lake Exploration and Evaluation assets

(18)

At December 31, 2021 Concession L53/48 in Thailand consisted of 27.32 square kilometers associated with the L53-A, L53-B, L53-D,
L53-G, L53-DD and L53-AA South and L53-AA fields held through production licenses (with a 20 year primary term ending in 2036 plus
an additional 10 year renewal period that can be applied for).

(19)

Tables may not add due to rounding.

SOURCE Pan Orient Energy Corp.

Cision
Cision

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