Why Invest?

Zephyr Energy is a profitable, cash generating exploration and production company focused on responsible resource development from operations in established oil producing basins in the Rocky Mountain region of the U.S.

Our balanced portfolio of operated and non-operated assets continues to yield strong results. Following 14 discrete acquisitions, the non-operated portfolio has generated strong cashflows for the Group, moving from zero production to over 1.5 million boe produced from 2021 to 2024.

Cashflows generated from our non-operated portfolio will be primarily used to develop the Paradox Project into full commercial production and open up the next prolific onshore U.S. oil and gas play.

Transformational Resource Base at Paradox

The State 36-2R well delivered a peak test rate of 2,848 boepd without fracture stimulation or material bottom-hole pressure decline.

The independent CPR prepared by Sproule in October 2025 confirmed a transformational uplift:

• 1P reserves: 14.8 million boe (+93× vs 2022 CPR);
• 2P reserves: 35.3 million boe (+25×);
• Total recoverable resources: 74.2 million boe (+3.5×);
• Prospective resources (2U): 270 million boe.

Cashflow Generating Non-operated Portfolio

During 2025, the Company:

• Completed a US$7.3 million acquisition of producing working interests;
  ~ Added approximately 400 boepd of PDP production;
  ~ Added ~600,000 boe of PDP reserves;
  ~ Forecast ~US$4 million operating income over 12 months;
• Actively managing portfolio with divestments of undeveloped acreage.

This portfolio provides immediate cash generation, reserve growth and reinvestment optionality, forming the financial backbone of Zephyr’s broader strategy.

Strategic Capital Partnership

A defining development in 2025 was the execution and extension of a US$100 million strategic partnership with a U.S.-based energy capital provider.

Under this structure:

• The partner funds 100% of drilling, completion and equipping CAPEX;
• Zephyr retains exposure to production and cashflow upside;
• Initial commitments of ~US$2.5 million CAPEX have been made;
• The partnership may expand beyond the Williston Basin into other Rocky Mountain plays.

Significantly Strengthened Financial Position

During 2025, Zephyr materially enhanced its capital structure:

• US$13.3 million (£9.8m) equity raise at 3p per share;
• US$0.9 million (£0.7 million) Director & management participation;
• Successful refinancing of term loans;
• Renewal of US$15.15 million revolving credit facility to December 2026;
• Interest rate reduced from 10% to 8.99%.

Balanced Risk Profile With Dual Value Drivers

Zephyr’s investment case is uniquely balanced:

Cashflow stability	Transformational upside
Producing non-operated assets	Large-scale operated Paradox project
Low operational risk exposure	Material reserve and resource growth
Capital partnership funding	High leverage to gas pricing
Proven PDP reserves	270 MMboe prospective upside

This dual-track model provides downside protection through production while maintaining substantial long-term growth optionality.

Clear Path to Near- and Medium-Term Catalysts

Key upcoming value drivers include:

• Finalisation of gas marketing agreements at Paradox;
• Pipeline interconnect construction milestones;
• Advancement toward first commercial production;
• Continued non-operated drilling via strategic partner;
• Potential additional accretive acquisitions;
• Further reserve conversion and development planning.