Q1 2025 Greenfire Resources Ltd Earnings Call

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Speaker Change: All participants, please continue to stand by. The conference will begin momentarily. Once again, please continue to stand by. We thank you for your patience.

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The conference is being recorded, this conference is being recorded.

Speaker Change: All participants, please stand by. Your conference is ready to begin. Good morning, ladies and gentlemen. Welcome to the Greenfire Resources First Quarter Resolve Conference call. As a reminder, this conference call is being recorded. I would now like to turn the meeting over to Mr. Robert Loebach.

Vice President of the Capitol Market. Please go ahead, Robert.

Speaker Change: Thank you, Operator. Good morning, and welcome to Greenfire's conference call for our Q1 2025 results. Please note that today's call includes forward-looking statements and references non-GAF and other financial measures. We encourage you to review the associated risks detailed in our latest MDNA.

Speaker Change: Unless specified otherwise, all monetary figures discussed today are in Canadian dollars. Capital expenditures and production figures presented today are based on our working interest, Matthew Greenfire, I'm up noted otherwise.

Jonathan Kanderka: Joining us on today's call are key members of Greenfire's leadership team, including Adam Waterous, Executive Chairman, Colin Germaniuk, President, Tony Kraljic, Chief Financial Officer, and Jonathan Incherpet, Chief Operating Officer.

Speaker Change: Upon the conclusion of our prepared remarks, I will open the floor to questions and participants. I will now hand over the call to Adam.

Speaker Change: Thank you, Robert, and welcome everyone to Greenfire's Q1 2025 conference call. To open up the call to questions, we just have a few brief comments on the business.

Speaker Change: Let's touch on the bad news first. The punchline is that the current production of Greenfire's expansion asset has been poor and is primarily attributable to three factors.

Speaker Change: First, Greenfire's 2023 and 2024 lethal program has accelerated the base decline profile at the expansion asset.

Speaker Change: Second, one of four boilers at our expansion asset has been offline due to wear from self reproduction at the central processing facility. We believe the root cause of the excess self reproduction is due to operating the reservoir at a high pressure and temperature during late life recovery.

Speaker Change: Third, and related to the second challenge, Greenfire self-limitians are currently exceeding the Alberta Energy Regulators' maximum limit. Upon learning of the exceedance, Greenfire immediately reported the freeze to the AER and has been an active dialogue with the AER ever since.

Speaker Change: Greenfire takes its regulatory obligations very seriously and has ordered self-renewable facilities at the expansion asset within solid escalation and commissioning targets for Q4 2025.

Speaker Change: By giving these challenges it would be premature to provide 2025 capital or production guidance at this time.

Speaker Change: So that is the snapshot of the current challenges, which of course we are laser folks on addressing. Now let's turn some brighter news, which is the high quality work we have progressed on Greenfire's future development plan. I will now turn it over to Colin to touch on this.

Thanks Adam.

Colin: Before I touch on our feature development plans, I want to highlight that an integral part of Greenfire's strategy.

Colin: Simply joined has been a cultural overhaul, which is gaining momentum. I Greenfire, we are focused on attracting top performing individuals with a constant focus on our IEI mantra that has integrity, energy and intelligence and in that order of importance.

Colin: We have introduced initiatives to about a safety first mindset and elevate performance across all levels of the organization. Following recent organizational restructuring, we have added professionals of pre-entrap records in SAG-E to support Greenfire's development.

Colin: Now I'd like to provide a small preview on our future development plans, which we're very excited about. We're going to be focusing on drilling new.

Colin: Long cycle well-pairs and undeveloped reservoir at the extension asset. Our near-term priority is to drill wells just northeast of the Greenfire Central Processing Facility.

Colin: The region contains well-plundated reservoir directly off-setting existing production and we plan to start drilling as soon as Q4 2025. As we look to the median term, our next priority will be to develop reservoir that is just

Colin: of the Greenfire CPF and contains the largest amount of undeveloped 2P reserves in the company. Are governing approach with a small-to-year development plan is to ensure that capital decisions align with our goal of maximizing.

Colin: Net asset value per share and deliver strong returns for Greenfire shareholders. We will provide the details of the new development plan once it's finalized.

We'll now open it up for Q and A.

Speaker Change: Thank you. We will now take questions from the telephone lines. If you have a question, please press star one.

Speaker Change: You may can solve your question at any time by pressing start-up

Speaker Change: Please press star one at this time if you have a question. There will be a brief pause while participants register for questions. We thank you for your patience.

and many more. Thank you. Thank you.

Speaker Change: First question is from Jason Wenglar from Empowery Old Capital. Please go ahead.

Good morning.

Jason Wenglar: I just understand obviously what you're talking about as far as the kind of going forward with the development program. Can you just talk about this year kind of obviously the production drop? Are we kind of at a level you think we're stabilizing or where do you think the production kind of goes until you start to ramp back up on the drilling side?

Thank you.

Jason Wenglar: Yeah, it's a good question. Well, we'll do the first quarter.

Jason Wenglar: and it's April . We've seen some declines. Our base production has high recovery factor. We drilled some refills over the last couple of years, so we have pretty steep declines in Q1. We do expect to be classed to shallow out a bit, but we do expect production to decline a little bit. Let's go.

Jason Wenglar: Throughout the year, we can't really provide any specific numbers or guidance until we finalize our plans.

Speaker Change: Okay, and maybe just on that's a national side, you know, I saw on this slide you guys kind of mentioned, you know, the bonds specifically maybe something that you guys are looking at talking about, I guess, the entire capital structure. Can you talk about what you're thinking about, how you optimize that part of the business as you kind of also are working on the production side as well?

Sure, this is Adam Marshall. I'll take that.

So we think that Donald is speaking to business. Yes.

Speaker Change: The amount of bonds is not appropriate for the size of the business today and so we look at those as being the transitory. We haven't made the decision yet on what we're going to do, but we don't think that those bonds are an appropriate part of the long term capital structure of the business.

I appreciate it. Thank you.

Speaker Change: Thank you. Once again, please press star one at this line for any questions or comments.

Speaker Change: We have no further questions registered at this time so I would not like to turn the meeting back over to Mr. Loebach.

Mr. Loebach: Thank you all, ladies. On behalf of Greenfire, we appreciate you joining us on our Q1 2025 ourselves conference call. Have a great day.

Thank you.

The conference has now ended.

Please disconnect your lines at this time.

and we thank you for your participation.