Calgary, Alberta--(Newsfile Corp. - May 7, 2024) - Journey Energy Inc. (TSX: JOY) (OTCQX: JRNGF) (the "Company" or "Journey") is pleased to announce that it has entered into an agreement with Spartan Delta Corp. ("Spartan") to jointly develop a block of land in the west shale basin of the Duvernay oil and liquids fairway.

The Joint Venture (the "JV") block of land covers 128 sections in the oil window of the Duvernay where shale thickness is approximately 30-40 meters. The initial working interests for the JV are Spartan 62.5% and Journey 37.5%. The parties currently control 94 sections within the JV block. Spartan has the potential to increase their interest within the JV from 62.5% to 70% with the contribution of additional lands acquired at their cost. The vast majority of the lands controlled within the block have significant tenure exceeding six years, with applicable extensions. On March 20, 2024, Crown lands immediately south of the block were acquired by other industry players for up to $1 million per section.

Spartan will be the operator of the JV. Expenditures within the block will be capped at $30 million in 2024 and $100 million for 2025 on a gross basis. However, expenditures may be increased with the agreement of both parties. The potential within the JV block is defined by the extensive production history from three existing Duvernay wells (Journey 29.17% WI, Spartan 70.83% WI). Duvernay production within the JV block is overlain by liquid-rich glauconitic production, which is expected to be processed through Journey's operated, gas processing facility and gathering system in the Gilby area.

This is a significant venture for Journey, both in terms of potential resource capture and capital expenditures. The Company has, and will continue to, position itself financially to meet the joint development plans throughout the term of the JV. To assist in this alignment, Journey recently closed a $38 million convertible debenture, which provides no principal repayments for five years. This combined with Journey's low net debt; cash flows from Journey's existing production; and the expected future revenues from the expanding power business, will provide sufficient resources to fund the JV commitments, while allowing the Company to execute on its other drilling and optimization projects throughout 2024 and 2025.

Journey looks forward to providing regular updates on its progress in developing this significant resource.

About the Company

Journey is a Canadian exploration and production company focused on oil-weighted operations in western Canada. Journey's strategy is to grow its production base by drilling on its existing lands, implementing water flood projects, and by executing on accretive acquisitions. Journey seeks to optimize its legacy oil pools on existing lands through the application of best practices in horizontal drilling and, where feasible, with water floods.