Serinus Energy : Q4 2023 Report and Accounts

Serinus Energy plc

2023 Annual Report and Accounts (US dollars)

2023 HIGHLIGHTS

FINANCIAL

• Revenue for the year ended 31 December 2023 was $17.9 million (2022 - $49.3 million)
• Cash generated from operations for the year ended 31 December 2023 was $1.9 million (2022 - $7.4 million)
• EBITDA for the year ended 31 December 2023 was $2.1 million (2022 - $12.7 million)
• Gross profit for the year was $2.5 million (2022 - $12.9 million)
• The Group recognised impairment of the Romanian assets in the amount of $7.0 million (2022 - $1.9 million) reflecting the depletion of the Moftinu gas field
• The Group's production expense averaged $34.78/boe (2022 - $31.82/boe)
• The Group realised a net price of $77.58/boe for the year ended 31 December 2023 (2022 - $149.46/boe), comprising:
  o Realised oil price - $79.85/bbl (2022 - $94.39/bbl)
  o Realised natural gas price - $11.94/Mcf (2022 - $34.53/Mcf)
• The Group's operating netback decreased during the year ended 31 December 2023, in line with the commodity prices and declining production in Romania, and was $33.89/boe (2022 - $107.59/boe), comprising:
  o Romania operating netback - negative $2.19/boe (31 December 2022 - $181.57/boe) o Tunisia operating netback - $40.35/boe (31 December 2022 - $54.34/boe)
• Capital expenditures of $5.5 million for the year ended 31 December 2023 (2022 - $12.9 million), comprising: o Romania - $0.5 million
  o Tunisia - $5.0 million
• Third party reserves report attributes $45.79 million of Net Present Value at a 10% discount rate to the audited Proved and Probable Reserves of the Group as at 31 December 2023 (2022 - $85.4 million)

OPERATIONAL

• In Tunisia, installation of artificial lift in the Sabria W-1 well will require a sidetrack. The sidetrack design has been completed and the tender process for the long lead items is progressing.
• The Sabria N-2 well is dewatering at a slow rate and the Group is in discussions with its partner regarding stimulation techniques to enhance the dewatering of this well.
• Production in Chouech Es Saida continues to increase with the benefits of artificial lift programme.
• The Company conducted two liftings of Tunisian crude oil in 2023 (May and November) and expects three liftings in 2024 with the first lifting confirmed to occur in March 2024.
• Static and dynamic reservoir models of the Sabria field are being finalised. The study will help inform optimum reservoir management including potential well workovers and new well locations.
• The Moftinu Gas Field continues to produce at naturally declining rates.
• In 2023, Canar-1 water injection well was continuously used to dispose of water produced from the Moftinu field. This resulted in a cost saving of approximately $600,000 for the year.
• In October 2023, the Group received an exploration phase extension of the Satu Mare Concession in Romania. The Concession has been granted until 2034.
• Production for the year averaged 642 boe/d, comprising: o Romania - 103 boe/d
  o Tunisia - 539 boe/d
• The Company continued its excellent safety record with no Lost Time Incidents in 2023.

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SERINUS AT A GLANCE

Serinus Energy plc (the "Company" or "Serinus") is an oil and gas exploration, appraisal and development company which is incorporated under the Companies (Jersey) Law 1991. The Company, through its subsidiaries (together the "Group"), acts as the operator for all of its assets and has operations in two business units: Romania and Tunisia.

ROMANIA

In Romania the Group currently holds the 2,950 km2 Satu Mare Concession. The Satu Mare Concession area includes the Moftinu Gas Project which was brought on production in April 2019 and has produced approximately

9.4 Bcf and $93.4 million of revenue to the end of 2023. In addition to the Moftinu Gas Development Project the Satu Mare Concession holds several highly prospective exploration plays. Serinus' recently completed block wide geological review has highlighted the potential of multiple plays that have encountered oil and gas on the block. Focus is on proven hydrocarbon systems, known productive trends that need further data, and studies of over 40 legacy wells on the concession area that have encountered oil and gas. The concession is extensively covered by legacy 2D seismic, augmented by the Group's own 3D and 2D acquisition programs that have further refined the identified prospects. Putting this extensive evidence-based analysis together in a block wide review has allowed the Group to identify a pathway towards future exploration growth.

TUNISIA

The Group's Tunisian operations are comprised of two concession areas.

The largest asset in the Tunisian portfolio is the Sabria field, which is a large oilfield with an independently estimated original in-place volume of 445 million barrels-of-oil-equivalent of which 1.6% has been produced to date. Serinus considers this historically under-developed field to be an excellent asset for development work to significantly increase production in the near-term. The Group has embarked on an artificial lift programme whereby the first pumps in the Sabria field will be installed. Independent third-party studies suggest that the use of pumps in this field can have a material impact on production volumes.

The Chouech Es Saida concession in southern Tunisia holds a producing oilfield that produces from four wells, three of which are produced using artificial lift. Chouech Es Saida is a mature oilfield that benefits from active production management. Underlying this oilfield are significant gas prospects. These prospects lie in a structure that currently produces gas in an adjacent block. Exploration of these lower gas zones became commercially possible with the recent construction of gas transportation infrastructure in the region. Upon exploration success these prospects can be developed in the medium term, with the ability to access the near-byunder-utilised gas transmission capacity.

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OPERATIONAL SUMMARY AND OUTLOOK

CORPORATE

The Group is focused on developing its existing assets and enhancing production by active reservoir management. A critical foundation to the advancement of these projects is the cash flow generation inherent in our production assets. For the year to 31 December 2023, the Group generated cashflow from operating activities of $1.9 million and invested $5.5 million of capital expenditure.

The Group is currently focused on enhancing production from its Tunisian assets. The large underdeveloped Sabria field offers significant opportunities in a well identified oilfield. Investments in artificial lift and, in time, new wells offer near term production growth. The Satu Mare Concession in Romania has excellent exploration potential that can offer the Company another Moftinu style shallow gas development. Work continues and exploration targets have been identified. The Moftinu gas field is a shallow gas field that has initial high production rates followed by natural declines. Managing these declines to extract the most value from the gas in place has allowed the Group to extract $93.4 million of revenue from this field since production began in 2019.

ROMANIA

The Group's Romanian operating subsidiary, Serinus Energy Romania S.A. ("Serinus Romania"), holds the licence to the Satu Mare concession area, covering approximately 2,950 km2 in the north-west of Romania. The Moftinu Gas Development project began production in 2019. The development project includes the Moftinu gas plant, and currently has four gas production wells - M-1003,M-1004,M-1007 and M-1008. During 2023, the Group's Romanian operations produced a total of 225 MMcf of gas, equating to an average daily production of 103 boe/day (2022: 379 boe/day).

The Moftinu gas field is nearing the end of its natural life. The field has identified existing gas in uncompleted zones that can be completed and produced with higher gas prices and reduced windfall tax. The Group has recognised an impairment of $7.0 million.

In October 2023, the Group was granted an exploration phase extension to the Satu Mare Concession in Romania. The Moftinu gas field has been declared a Commercial Area, all other areas of the Concession remain Exploration Area. The exploration period extension is in two phases. The first phase of the extension is mandatory and is two years in duration starting on 28 October 2023. The work commitment for the first phase is the reprocessing of 100 kilometres of legacy 2D seismic as well as a 2D seismic acquisition program of 100 kilometres including processing the acquired seismic data. The second phase of the extension is optional and is two years in duration starting on 28 October 2025 with a work commitment of drilling one well within the concession area with no total drilling depth requirement stipulated.

The Canar-1 water injection well is currently disposing of all produced water volumes from the Moftinu field. The use of Canar-1 as a water injection well is delivering significant cost savings in operating expenses due to the elimination of the high costs of trucking produced water volumes for disposal off-site.

The Group has identified additional gas volumes in uncompleted zones in M-1003 and M-1007. During initial drilling and completion of these wells gas was encountered and logged. The decision was made to complete and produce lower zones until such time as those zones were depleted. Upon depletion of the lower zones the Group can return to these wells, complete the higher zones and produce the incremental gas.

Serinus has continued to operate safely and effectively in Romania throughout the period. As at the year-end 2023, the Group had achieved 1,712 accident-free days of continuous operation which is a testament to the professionalism and hard work of our team in Romania.

In February 2023, the International Chamber of Commerce ("ICC") has released the final merits award in respect of Serinus Romania arbitration case against its former partner in the Satu Mare Concession in Romania, Oilfield Exploration Business Solutions S.A. ("OEBS"), and has awarded in favour of Serinus.

The decision of the arbitral tribunal has confirmed that, as a result of OEBS' default under the Joint Operating Agreement between the parties ("JOA"), OEBS' 40% participating interest in the Satu Mare Concession in Romania will be transferred to Serinus as of the notification to the parties of the approval by the Romanian Government and the National Agency of Fiscal Administration ("ANAF"). The arbitral tribunal has also directed OEBS to take all necessary actions to formally transfer the 40% participating interest to Serinus.

Key elements of the decision are as follows:

• OEBS is to be considered as withdrawn from the JOA and the Concession Agreement as of the notification to the parties of the approval of the competent authorities of such withdrawal.
• The transfer of OEBS' 40% participating interest to Serinus will be effective as of the notification to the parties of the approval by the Romanian Government and ANAF. This will result in OEBS having no more interest in the JOA and the Concession Agreement.
• OEBS is ordered to undertake all actions necessary to transfer the 40% participating interest to Serinus.
• Serinus is the true and lawful attorney of OEBS to execute such documents and make such filings and applications as may be necessary to make the transfer of OEBS' 40% participating interest to Serinus

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legally effective and to obtain any necessary consents from the Romanian Government, the Romanian Agency for Mineral Resources (NAMR) and ANAF.

TUNISIA

The Group currently holds two concession areas within Tunisia, through its operating subsidiary in Tunisia, Serinus Tunisia B.V. ("Serinus Tunisia"). These concession areas both contain discovered oil and gas reserves and are currently producing. The largest asset is the Sabria field. Sabria is a large, conventional oilfield which the Group's independent reservoir engineers have estimated to have approximately 445 million barrels of oil equivalent originally in place. Of this oil in place only 1.6% has been produced to date due to a low rate of development on the field. Serinus has spent extensive time studying the best means of further developing this field and considers this to be an excellent asset for remedial work to increase production and, on completion of ongoing reservoir studies, to conduct further development operations including new wells. Due to a low rate of development on the field, Serinus has spent extensive time studying the best means of further developing this field and considers this to be an excellent asset for remedial work to increase production and, on completion of ongoing reservoir studies, to conduct further development operations.

During 2023, the Group's Tunisian operations produced a total of 167 Mbbl of oil and 177 MMcf of gas, equating to an average daily production of 539 boe/day (2022: 511 boe/day).

The workover to install a pump into the Sabria W-1 well encountered unexpected conditions as a result of old drilling mud and tubulars left in the well from operations in 1998. The Group and its partner, Enterprise Tunisienne D'Activite Petroliere ("ETAP"), suspended the workover and have determined that a sidetrack is required to complete the operation. The sidetrack design has been completed and the procurement process for the long lead items has commenced.

The Group and ETAP also conducted workover operations on the Sabria N-2 well. Workover operations were completed on time and within budget. The objectives of the workover were to remove wellbore restrictions, install new production tubing, and remediate reservoir damage around the wellbore. Wellbore restrictions were removed and new production tubing was installed. The well will need further stimulation to clean up the formation damage and discussions are continuing with the partner on this issue. The well was drilled in 1980 but was damaged during completion and, although in proximity to producing wells, in particular the prolific WIN-12bis well, was not able to flow oil to surface. The Group's engineering analysis estimates that a successful workover and recompletion will initially increase gross production from the Sabria field by approximately 420 boe/d.

Production from the Chouech Es Saida area increased during 2023. This was the result of the Group's active management of the artificial lift systems, optimising production rates. In addition, the active life of the pumping units has been extended, this has increased the pump life from seven months in 2019 to 36 months in 2023.

The Group applied to extend the Ech Chouech licence which expired in June 2022. The Group intends to continue its application to regain the licence once the licence process is formalised. The Group remains the only feasible operator for the Ech Chouech concession due to the proximity of the existing Group's facilities at Chouech Es Saida to the Ech Chouech oil field and legal privileges which the Group enjoys as a former title holder granting the Group pre-emptive rights for this concession.

COVID-19

The Group continues to place the health, safety and wellbeing of all our staff as our top priority. The Group continues to follow government recommendations such as enhanced sanitation of work sites, social distancing and wearing masks. Where government advice has required, the Group closed or reduced the presence of staff in our Head Office, Administration Office and our Business Unit Offices. Our field operations continue to remain ready to modify daily tasks and routines to ensure safe practices for all staff, as required. Existing operations have remained in production and our producing assets have seen no significant operational setbacks resulting from the COVID-19 pandemic.

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SERINUS INVESTMENT THESIS

Investment in Serinus offers shareholders an ability to access international oil and gas upstream operations with strong cash flow generation through the oil and gas commodity cycle. Our low-cost onshore asset base provides significant near-term production growth opportunities. The size of the existing asset base allows for significant organic growth without incremental asset acquisition cost in areas where our technical knowledge has been refined over the years that Serinus has operated these concession areas. Serinus offers a compelling growth opportunity where risks are mitigated by our extensive experience in our operating areas and the low-cost nature of our assets. The Group's existing assets also include large exploration prospects within close proximity of existing infrastructure. The Group allocates capital to these exploration prospects which if successful can add meaningful production and cash flow to the Group.

Serinus' operations in Romania are focused on the large Satu Mare Concession Area. The Satu Mare Concession Area is located in the north west of Romania along-side the Hungarian border. This large block contains the Moftinu gas field, and the Group believes that numerous shallow gas opportunities with similar characteristics to the Moftinu field are present in the immediate surrounding area. In addition, the southern portion of the concession offers excellent exploration opportunities for large oil prospects as across the southern boundary of the Satu Mare concession is the Suplacu de Barcau oil field (held by OMV Petrom). This is a significant oilfield estimated to have produced in excess of 100 million barrels.

In Tunisia, the Group's operations are focused on the Sabria and Chouech Es Saida fields. Sabria is a very large conventional oilfield where our independent reservoir engineers have accessed a field with 445 million barrels of oil equivalent originally in place. Of that number approximately 1.6% has been recovered to date. This is a very low recovery factor for a conventional oilfield and the Group expects to increase that recovery factor materially. The Chouech field in southern Tunisia offers attractive opportunities to increase production from existing oilfields through the application of standard oilfield practices. Serinus' Tunisian assets can be typified as existing discovered and producing oilfields where field optimisation provides the path to production, revenue and cash flow growth with no exploration risk. Underlying the Chouech field is the prospective Acacus gas zone. Gas has been discovered and produced from this zone in nearby concessions and recent gas infrastructure developments make this exploration opportunity commercially attractive.

In addition to the strong asset base Serinus has a strong and experienced management team. Within each jurisdiction, we have local professionals managing the operations. Within the Group we have significant technical and commercial experience and are able to apply that experience across our business units.

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SERINUS' STRATEGY

VISION

The Group's goal is to transform the potential of its extensive land base in Romania and Tunisia into enhanced shareholder value through the efficient allocation of capital.

STRATEGY

Serinus is focused on significant growth potential within its existing concession and license holdings in Romania and Tunisia through the development of low cost, high return projects, as follows:

1. Leverage Land Position:
2. • One concession in Romania with multiple play types and prospects
   • Two exploration and production concessions in Tunisia with all work commitments completed
   • Extensive oil and natural gas exploration and development potential within multiple play horizons
3. Commitment to Shareholders:
4. • Cohesive management team with a commitment to enhancing shareholder value
   • Abide by the highest thresholds of disclosure for an AIM-listed Group
   • Extensive experience and a proven track record of the allocation of shareholder capital
5. Manage Risks:
6. • Managing surface and subsurface risks through constant evaluation and introduction of new technologies
   • Allocate capital to projects with attractive returns at relatively low risk profiles
   • Operator of all concessions allows for cost control
7. Focus on Growth:
8. • Leverage cash flow to grow through expanded exploration and development of the existing asset base
   • Seek acquisitions that will provide synergies at a cost that is accretive to shareholders

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CHAIRMAN'S LETTER

Dear shareholders,

During year 2023 world economy continued to be affected by global destabilization which also impacted the activity of the Group.

In 2023 the Group continued to advance its objectives: enhance production in Tunisia and continue to advance the exploration and development of our Romanian assets. Whilst the Group advanced these goals as planned it is disappointing that they did not advance as quickly as we all would have hoped.

Operationally the teams performed solid work in Tunisia with two workovers being planned and performed. The workover on the W-1 well was very frustrating as the conditions encountered in it were unlike what was recorded in previous well reports. Poor completion practices from the past have impacted the progress on that workover and a side-track remains the safest and most cost-effective means of deploying a pump into this well. The well remains attractive for artificial lift and is a known producer in the past. A silver lining from the workover plan is that the Group will be putting a pump into a clean, newly drilled sidetrack section and not into the older one. This is anticipated to help make the pump installation smoother and could well allow increased flow rates from a modern well section.

The N-2 well workover was executed very well. The team was able to complete the removal of the wellbore restrictions and clean out the well bore. Analysis anticipated that reservoir pressures would be sufficient to clean out the well however this has not been the case. The Group believes that methods commonly used to clean the well bore of old drilling mud would be sufficient to allow greater flow and continues to discuss with our partner their application. The technical team continues to study the Sabria field to identify new opportunities for development and deploying production enhancement techniques. We also look forward to further optimisation of production from Chouech Es Saida in 2024.

The Moftinu gas field in Romania produced strongly at higher gas prices, however the field is now in the latter stages of its producing life. As it has been discussed by the Group there are significant volumes of gas in higher zones in the Moftinu wells. These zones have not been produced and offer additional production opportunities. The field has provided the Group with significant after-tax cash flow that has allowed further development in the Group's portfolio, and we would be eager to produce these "behind pipe" quantities of gas. However, the current fiscal terms in Romania and the uncertainty of these fiscal terms make this investment decision marginal at lower gas prices. Tax changes introduced after the Russian invasion of Ukraine have been very punitive to gas producers and rather than increase the production of domestic gas have served to disincentivise investment, resulting in the continued decline of domestic onshore gas production in Romania. The Group continues to work with the Romanian authorities to develop a fiscal policy that would incentivise investment and allow producers to make further investments in gas production and allow the Romanian government to maintain its tax revenues. These discussions continue.

The Group strongly believes that its investment plans remain attractive and that there is considerable upside available in both of its operating areas.

Inflation was a critical effect in 2023. The Group has sought to maintain is operating costs with inflation in consumables being a key target. Inflation moderated, in the later portion of 2023 however higher prices persist in tubulars and oilfield consumables. The Group will continue to seek means of reducing costs in the face of historically higher inflation across all segments of our business.

We hope for certain stabilisation and look optimistically towards 2024; as during the recent years we continue to focus on our articulated capital plans and developments in Tunisia and Romania. I thank all our shareholders for their continued support.

Yours sincerely,

Łukasz Rędziniak, Chairman of the Board of Directors

15 March 2024

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LETTER FROM THE CEO

Dear Fellow Shareholders,

Our business continued to progress its plans for the development of the Sabria and Chouech es Saida field in Tunisia in 2023. The year saw the realisation of several years' preparation with the execution of two workovers in Sabria and the continuation of field enhancements in the Chouech es Saida field.

Production in Chouech es Saida has been particularly encouraging with increases throughout the year. The average life of pumps in the wells has increased from approximately nine months when pumps were first installed to more than 24 months currently. This significantly reduces the cost of using pumps to enhance production in this filed. Pump performance in Chouech es Saida offers great encouragement for the installation of pumps in the Sabria artificial lift programme.

A workover has been planned on the Sabria W-1 well for some time. This well had previously produced approximately 70 bbl/d but due to a leak in its tubing string was no longer in production. This well was chosen for workover firstly to reinstate production but also to install the first artificial lift into the Sabria field. The oil rate using a pump is estimated to be over 540 bbl/d. The workover initially proceeded well but at a depth of approximately 2,900 metres the team ran into a combination of old drilling mud and debris that had been left in the well since it was originally drilled. Poor completion practises meant that the well was perforated with heavy drilling mud in the well rather than circulating it out and replacing with clear completion fluid. The old drilling mud has settled and had hardened around the tubing. The team attempted to mill through the obstruction but at the rate we were able to progress, the time to mill the well would have been excessive. The difficult decision to suspend the workover and return at a later date to sidetrack around the obstruction was made. Work immediately proceeded to design the sidetrack and begin ordering long lead items for the return to the well. The well remains an important candidate for returning to production and external engineering reports highlight this well and an excellent candidate for artificial lift, this remains the case. The Sabria N-2 well workover commenced immediately following the demobilisation of the rig from the Sabria W-1 well. The workover proceeded ahead of schedule and under budget. The workover was designed to remove wellbore restrictions, install new production tubing and remediate reservoir damage around the wellbore. All work was completed and the well began flowing water to surface. The well is approximately 560 metres north of Sabria WIN-12, the Group's best producer, and it is expected to produce oil once the well has dewatered. Like the Sabria W-1 well, poor completion practices in the past mean that the near bore areas surrounding the well are clogged with old drilling mud. The Group has worked to demonstrate this scenario to its Partner, ETAP, to receive partner approval to conduct an acid job to clean the perforations. The Group believes an acid job would clear some of the old mud and allow the well to dewater much more quickly and move to producing oil. Work to solicit and approve partner approval for this clean-up work continues.

In Romania the Moftinu field continues to produce as it nears the end of its natural life. Over the life of this field it has provided almost US$100 million of revenue to the Group. Cash flow from this field allowed the Group to pay off the Senior debt and allowed for the ultimate recapitalisation of the Group to leave it debt free. There remains an estimated 4 BCF of gas that is in uncompleted and unproduced zones in East Moftinu area however the recent fiscal uncertainties in Romania including the very punitive windfall tax mean that these zones will not be completed and produced from until fiscal certainty is delivered.

2023 began with commodity prices continuing their strength from 2022. Gas prices in particular fluctuated wildly through the year based on constraints derived from the war in Ukraine and the expectation of storage builds and seasonal demand. From a high of EUR 59.00/MWh in January to a low of EUR 23.25/MWh in June the volatility of the gas price received in Romania was significant. Oil was much more stable reflecting a more global supply and demand pattern but nonetheless fluctuated from a high of US$96.55/bbl in September and a low of US$ 71.84/bbl in December. Fluctuations like this are incredibly important for a Group like Serinus which matches its capital programmes to the available operating cash flow. Work that we would have wished to advance was restrained as we watch the cashflow generation suffer volatility. The Group has worked hard to manage costs such that maximised after-tax cash flow is available for future capital plans.

Going forward into 2024 the Group is focused on completing the work on the Sabria W-1 well and installing the first artificial lift into the Sabria field. Rig availability in Tunisia and procurement of long-lead items are the determining factors in the timing of this work. A geological model is near completion and will lead to a full field reservoir simulation model being available in second quarter of 2024. Early results are encouraging that four or five new drilling locations will result from this work. It will also aid the application of artificial lift in the Sabria field. 2023 provided advancement of our project albeit at a slower pace than we would have hope for. Our investment thesis remains valid, and we look forward to moving further ahead in 2024.

Yours sincerely,

Jeffrey Auld, Chief Executive Officer 15 March 2024

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REPORT FROM THE CFO

LIQUIDITY, DEBT AND CAPITAL RESOURCES

During the year the Group invested a total of $5.5 million (2022 - $12.9 million) on capital expenditures before working capital adjustments. In Romania, the Group invested $0.5 million (2022 - $8.4 million) during the year. In Tunisia, the Group invested $5.0 million (2022 - $4.5 million) performing workovers and purchasing long lead items for the Sabria artificial lift programme.

The Group's funds from operations for the year ended 31 December 2023 were $1.9 million (2022 - $11.4 million). Including changes in non-cash working capital, the cash flow generated from operating activities in 2023 was $1.9 million (2022 - $7.4 million). The Group is debt-free and continues to pursue opportunities to expand and continue growing production within our existing resource base to deliver shareholder returns.

The working capital deficit at 31 December 2023 was $5.6 million (2022 - $0.1 million surplus).

Current assets as at 31 December 2023 were $11.3 million (31 December 2022 - $16.7 million), a decrease of $5.4 million. Current assets consist of:

• Cash and cash equivalents of $1.3 million (2022 - $4.9 million)
• Restricted cash of $1.2 million (2022 - $1.1 million)
• Trade and other receivables of $8.1 million (2022 - $10.0 million).
• Product inventory of $0.7 million (2022 - $0.7 million)

Current liabilities as at 31 December 2023 were $16.9 million (2022 - $16.6 million), an increase of $0.3 million. Current liabilities consist of:

• Accounts payable and accrued liabilities of $9.3 million (2022 - $9.3 million)
• Decommissioning provision of $6.7 million (2022 - $5.1 million)

1. Canada - $0.8 million (2022 - $0.8 million) which are offset by restricted cash in the amount of

$1.2 million (2022 - $1.1 million) in current assets

• 1. Romania - $0.6 million (2022 - $0.5 million) o Tunisia - $5.3 million (2022 - $3.8 million)
• Income taxes payable of $0.8 million (2022- $1.9 million)
• Current portion of lease obligations of $0.1 million (2022 - $0.3 million)

NON-CURRENT ASSETS

Property, plant and equipment ("PP&E") decreased to $56.0 million (2022 - $62.3 million). The decrease is due to depletion expense of $4.3 million, a change in the estimate of asset retirement assets of $0.6 million, and an impairment expense of $7.0 million in Moftinu due to natural depletion of the gas field. The reductions in PP&E were partially offset by capital additions of $5.5 million. Exploration and evaluation assets ("E&E") remained the same and comprised $10.7 million (2022 - $10.5 million).

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