Alvopetro Announces Year End 2025 Financial Results, Q1 2026 Dividend of US$0.12/share, and Filing of our AIF

CALGARY, AB, March 17, 2026 /CNW/ - Alvopetro Energy Ltd. (TSXV: ALV) (OTCQX: ALVOF) ("Alvopetro" or the "Company") announces an operational update, our financial results for the year ended December 31, 2025, a quarterly dividend of US$0.12 per common share and filing of our annual information form. We will be hosting a live webcast to discuss our Q4 2025 results on Wednesday March 18, 2026 at 8:00 a.m. Mountain time. 

All references herein to $ refer to United States dollars, unless otherwise stated and all tabular amounts are in thousands of United States dollars, except as otherwise noted.

President & CEO, Corey C. Ruttan commented:

"2025 was a transformational year for Alvopetro. Mainly off the success of our 183-D4 well on our 100% owned Murucututu asset, year-over-year we increased average daily sales by 41% to 2,523 boepd and grew 2P reserves by 43% to 13.1 MMboe, replacing production over 5 times. With record production to start the year, we are well positioned for another exceptional year in 2026."

Operational Update

Following the success of our 183-D4 well on our 100% owned Murucututu field, we are now focused on enhancing and expanding our capacity to deliver additional Murucututu production, positioning this asset for sustained multi-year growth. We plan to expand our Murucututu field production facility and pipelines to support an increase in our Murucututu field capacity from our current level of approximately 150 e³m³/d up to 600 e³m³/d. Simultaneously, we plan to enhance our gas processing capabilities at UPGN Caburé to accommodate higher proportions of richer gas from Murucututu, and also targeting an overall capacity of up to 600 e³m³/d.

On the drilling and completions front, on our 100% owned Murucututu field, we have just recompleted our 183-1 well in a lower portion of the Gomo Formation and are working to bring the well back online. Upcoming plans on the field in 2026 involve drilling and completing a new well in the Caruaçu Formation, as well as permitting a new drilling pad to support future Caruaçu development updip of the successful 183-D4 well. We expect drilling to commence next month. At Caburé (56.2% working interest), 2026 capital plans include the sidetrack of one unfinished well from 2025.

In Canada, we have completed drilling two (1.0 net) additional wells in 2026 . One (0.5 net) well requires remedial action but we now have 7 (3.5 net) wells on production. We have also added an additional 5 gross sections of land in one of our core-areas bringing our land position to 80.5 gross sections (25,760 net acres) targeting the Mannville stack heavy oil play fairway with over 100 Tier 1 drilling locations.

On February 25, 2026, we announced our December 31, 2025 reserves based on the independent reserve assessment and evaluation prepared by GLJ Ltd. ("GLJ") dated February 25, 2026 with an effective date of December 31, 2025 (the "GLJ Reserves and Resources Report"). Highlights include:

• 1P reserves increased 79% to 8.1 MMboe after 2025 production of 0.9 MMboe, representing a 1P production replacement ratio⁽¹⁾ of 485%. The increase was mainly due to results from our 183-D4 well on our Murucututu field which commenced production in August 2025 and added an additional five proved undeveloped locations to our 1P reserves as well as newly added Canadian reserves of 0.3 MMboe.
• 2P reserve volumes increased 43% to 13.1 MMboe, representing a 2P production replacement ratio of 530%⁽¹⁾. Success on our 183-D4 well also contributed to the bulk of the increase to 2P reserves which includes eight undeveloped locations. In Canada, 0.7 MMboe of 2P reserves were assigned.
• With increased reserve volumes, 1P net present value before tax, discounted at 10% ("NPV10") increased 38% to $245.6 million and 2P NPV10 increased 20% to $393.6 million.
• 2P reserves life index⁽¹⁾ of 12.5 years.
• 2P F&D costs⁽¹⁾ of $15.42/boe with a 2P recycle ratio⁽¹⁾ of 3.4 times.
• Risked best estimate contingent resources decreased by 0.7 MMboe from 4.5 MMboe to 3.8 MMboe at December 31, 2025 with a NPV10 of $88.0 million, decreases from December 31, 2024 of 16% and 20% respectively. The decreases were associated with the migration of contingent resources to Reserves for the Caruaçu Formation at Murucututu.
• Risked best estimate prospective resources increased from 10.2 MMboe to 12.1 MMboe with a NPV10 of $264.3 million, increases of 19% and 27% respectively from December 31, 2024. The increases were mainly due to additional prospective resource in the Caruaçu Formation at Murucututu adjacent to the assigned reserves area.

(1)	Refer to the sections entitled "Oil and Natural Gas Advisories – Other Metrics" for additional disclosures and assumptions used in calculating production replacement ratio, 2P reserves life index, 2P F&D costs and 2P recycle ratio.

Financial and Operating Highlights – Fourth Quarter of 2025

• Average daily sales in Q4 2025 were 2,867 boepd⁽¹⁾ (+65% from Q4 2024 and +22% from Q3 2025). In Brazil, daily sales averaged 2,719 boepd (+56% compared to Q4 2024 and +23% from Q3 2025) and in Canada, oil sales averaged 148 bopd in the quarter (+7% from Q3 2025).
• Our average realized natural gas price was $9.97/Mcf (-5% from Q4 2024 and -10% from Q3 2025). Our overall average realized sales price per boe was $59.75/boe (-6% from Q4 2024 and -9% from Q3 2025).
• Our natural gas, oil and condensate revenue increased to $15.8 million (+54% from Q4 2024 and +11% from Q3 2025). The increases compared to Q4 2024 and Q3 2025 were driven by higher sales volumes, partially offset by lower realized prices.
• Our operating netback⁽²⁾ in the quarter was $49.70 per boe, a decrease of $5.39 per boe compared to Q4 2024 and a decrease of $6.20 per boe compared to Q3 2025 due mainly to lower realized prices and higher royalties.
• We generated funds flows from operations⁽²⁾ of $10.6 million ($0.28 per basic and per diluted share), increases of $3.6 million compared to Q4 2024 and $0.1 million compared to Q3 2025.
• We reported net income of $5.6 million ($0.15 per basic and diluted share), an increase of $3.3 million compared to Q4 2024.
• In October 2025, Alvopetro entered into an expanded area of mutual interest (the "Expanded AMI") with our existing partner in Saskatchewan. Under the terms of the Expanded AMI, Alvopetro agreed to fund 100% of the costs for drilling two earning wells in exchange for a 50% working interest in an additional 46.9 sections of land (15,010 net acres). The two earning wells were drilled in Q4 2025. Capital expenditures in Q4 2025 of $4.9 million included the cost of these two earning wells and a seismic program in Saskatchewan, additional Unit development costs to tie in the wells drilled earlier in the year as well as costs for facilities improvements at the Unit and Murucututu.
• During the quarter Alvopetro entered into a $20 million loan agreement (the "Loan"). The Loan has a two-year term and bears interest at 7% per annum (payable quarterly), including all applicable charges and fees. Repayments of the Loan commence quarterly on November 30, 2026, ending on November 29, 2027.
• Our working capital⁽²⁾ surplus was $18.5 million as of December 31, 2025. Our working capital surplus net of debt was $2.5 million as of December 31, 2025.

Financial and Operating Highlights – Year Ended December 31, 2025

• Our annual sales volumes averaged 2,523 boepd, an increase of 41% from 2024, with Brazil sales volumes of 2,417 boepd (+35% from 2024) and 106 bopd from the newly added Canadian operations.
• We reported net income of $23.1 million, compared to $16.3 million in 2024 (+42%).
• We generated funds flow from operations⁽¹⁾ of $40.6 million ($1.09 per basic share and $1.08 per diluted share), an increase of $7.3 million (+22%) compared to 2024.
• Capital expenditures totaled $33.5 million in 2025.
• Dividends declared totaled $0.42 per share in 2025 compared to $0.36 per share in 2024 (+17%).

_{(1) Alvopetro reported volumes are based on sales volumes which, due to the timing of sales deliveries, may differ from production volumes.
(2) See "Non-GAAP and Other Financial Measures" section within this news release.}

The following table provides a summary of Alvopetro's financial and operating results for the periods noted. The consolidated financial statements with the Management's Discussion and Analysis ("MD&A") are available on our website at www.alvopetro.com and will be available on the SEDAR+ website at www.sedarplus.ca.

	As at and Three Months Ended December 31,			As at and Year Ended December 31,
	2025	2024	Change (%)	2025	2024	Change (%)
Financial
($000s, except where noted)
Natural gas, oil and condensate sales	15,756	10,214	54	57,954	45,517	27
Net income	5,585	2,243	149	23,098	16,295	42
Per share – basic ($)^(1)	0.15	0.06	150	0.62	0.44	41
Per share – diluted ($)^(1)	0.15	0.06	150	0.61	0.43	42
Cash flows from operating activities	9,362	7,114	32	40,805	34,901	17
Per share – basic ($)^(1)	0.25	0.19	32	1.09	0.94	16
Per share – diluted ($)^(1)	0.25	0.19	32	1.08	0.93	16
Funds flow from operations^(2)	10,561	6,966	52	40,597	33,275	22
Per share – basic ($)^(1)	0.28	0.19	47	1.09	0.89	22
Per share – diluted ($)^(1)	0.28	0.19	47	1.08	0.89	21
Dividends declared	4,408	3,283	34	15,384	13,170	17
Per share^(1) (2)	0.12	0.09	33	0.42	0.36	17
Capital expenditures	4,883	4,682	4	33,493	15,305	119
Cash and cash equivalents	32,372	21,697	49	32,372	21,697	49
Net working capital^(2)	18,450	13,181	40	18,450	13,181	40
Working capital, net of debt^(2)	2,450	13,181	(81)	2,450	13,181	(81)
Weighted average shares outstanding
Basic (000s)^(1)	37,260	37,315	-	37,270	37,289	-
Diluted (000s)^(1)	37,717	37,566	-	37,666	37,558	-
Operations
Average daily sales volumes^(3):
Brazil:
Natural gas (Mcfpd), by field:
Caburé (Mcfpd)	9,655	7,476	29	10,467	9,228	13
Murucututu (Mcfpd)	5,437	2,231	144	3,080	928	232
Total natural gas (Mcfpd)	15,092	9,707	55	13,547	10,156	33
NGLs – condensate (bopd)	184	109	69	149	90	66
Oil (bopd)	19	11	73	11	12	(8)
Total (boepd) - Brazil	2,719	1,738	56	2,417	1,794	35
Canada:
Oil (bopd) - Canada	148	-	-	106	-	-
Total Company (boepd)	2,867	1,738	65	2,523	1,794	41
Average realized prices^(2):
Natural gas ($/Mcf)	9.97	10.51	(5)	10.49	11.42	(8)
NGLs – condensate ($/bbl)	69.18	75.95	(9)	73.75	84.84	(13)
Oil ($/bbl)	47.99	61.74	(22)	48.86	66.94	(27)
Total ($/boe)	59.75	63.88	(6)	62.92	69.31	(9)
Operating netback ($/boe)^(2)
Realized sales price	59.75	63.88	(6)	62.92	69.31	(9)
Royalties	(3.83)	(2.15)	78	(4.46)	(1.99)	124
Production expenses	(6.03)	(6.64)	(9)	(5.71)	(6.33)	(10)
Transportation expenses	(0.19)	-	-	(0.14)	-	-
Operating netback	49.70	55.09	(10)	52.61	60.99	(14)
Operating netback margin^(2)	83 %	86 %	(3)	84 %	88 %	(4)

Notes:
(1)	Per share amounts are based on weighted average shares outstanding other than dividends per share, which is based on the number of common shares outstanding at each dividend record date. The weighted average number of diluted common shares outstanding in the computation of funds flow from operations and cash flows from operating activities per share is the same as for net income per share.
(2)	See "Non-GAAP and Other Financial Measures" section within this news release.
(3)	Alvopetro reported volumes are based on sales volumes which, due to the timing of sales deliveries, may differ from production volumes.

Quarterly Dividend of US$0.12 per Share

Our Board of Directors has declared a quarterly dividend of US$0.12 per common share, payable in cash on April 15, 2026 to shareholders of record at the close of business on March 31, 2026. The dividend is designated as an "eligible dividend" for Canadian income tax purposes. 

Dividend payments to non-residents of Canada will be subject to withholding taxes at the Canadian statutory rate of 25%.  Shareholders may be entitled to a reduced withholding tax rate under a tax treaty between their country of residence and Canada.  For further information, see Alvopetro's website at https://alvopetro.com/Dividends-Non-resident-Shareholders.

Annual Information Form

Alvopetro has filed its annual information form ("AIF") with the Canadian securities regulators on SEDAR+. The AIF includes the disclosure and reports relating to oil and gas reserves data and other oil and gas information required pursuant to National Instrument 51-101 of the Canadian Securities Administrators. The AIF may be accessed electronically at www.sedarplus.ca and on our website at www.alvopetro.com.

2025 Results Webcast

Alvopetro will host a live webcast to discuss our 2025 financial results at 8:00 am Mountain time on Wednesday March 18, 2026. Details for joining the event are as follows:

DATE:	March 18, 2026
TIME:	8:00 AM Mountain/10:00 AM Eastern
LINK:	https://us06web.zoom.us/j/82316007995
DIAL-IN NUMBERS:	https://us06web.zoom.us/u/kdThlHQznI
WEBINAR ID:	823 1600 7995

The webcast will include a question-and-answer period. Online participants will be able to ask questions through the Zoom portal. Dial-in participants can email questions directly to [email protected].

Corporate Presentation

Alvopetro's updated corporate presentation is available on our website at:
http://www.alvopetro.com/corporate-presentation.

Social Media

Follow Alvopetro on our social media channels at the following links:

X -	https://x.com/AlvopetroEnergy
Instagram -	https://www.instagram.com/alvopetro/
LinkedIn -	https://www.linkedin.com/company/alvopetro-energy-ltd

Alvopetro Energy Ltd. is deploying a balanced capital allocation model where we seek to reinvest roughly half our cash flows into organic growth opportunities and return the other half to stakeholders. Alvopetro's organic growth strategy is to focus on the best combinations of geologic prospectivity and fiscal regime. Alvopetro is balancing capital investment opportunities in Canada and Brazil where we are building off the strength of our Caburé and Murucututu natural gas fields and the related strategic midstream infrastructure.

Neither the 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 news release.

Abbreviations:

$ or USD	=				United States dollars
$000s	=				thousands of USD
1P	=				proved reserves
2P	=				proved plus probable reserves
boepd	=				barrels of oil equivalent ("boe") per day
bopd	=				barrels of oil and/or natural gas liquids (condensate) per day
BRL	=				Brazilian Real
e^3m^3/d	=				thousand cubic metre per day
m^3	=				cubic metre
m^3/d	=				cubic metre per day
Mcf	=				thousand cubic feet
Mcfpd	=				thousand cubic feet per day
MMcf	=				million cubic feet
MMcfpd	=				million cubic feet per day
NGLs	=				natural gas liquids (condensate)
NPV10	=				net present value before tax, discounted at 10%
Q3 2025	=				three months ended September 30, 2025
Q4 2024	=				three months ended December 31, 2024
Q4 2025	=				three months ended December 31, 2025
GAAP or IFRS	=				IFRS Accounting Standards

Non-GAAP and Other Financial Measures

This news release contains references to various non-GAAP financial measures, non-GAAP ratios, capital management measures and supplementary financial measures as such terms are defined in National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure. Such measures are not recognized measures under GAAP and do not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. While these measures may be common in the oil and gas industry, the Company's use of these terms may not be comparable to similarly defined measures presented by other companies. The non-GAAP and other financial measures referred to in this news release should not be considered an alternative to, or more meaningful than measures prescribed by IFRS and they are not meant to enhance the Company's reported financial performance or position. These are complementary measures that are used by management in assessing the Company's financial performance, efficiency and liquidity and they may be used by investors or other users of this document for the same purpose. Below is a description of the non-GAAP financial measures, non-GAAP ratios, capital management measures and supplementary financial measures used in this news release. For more information with respect to financial measures which have not been defined by GAAP, including reconciliations to the closest comparable GAAP measure, see the "Non-GAAP Measures and Other Financial Measures" section of the Company's MD&A which may be accessed through the SEDAR+ website at www.sedarplus.ca.

Non-GAAP Financial Measures

Operating Netback

Operating netback is calculated as natural gas, oil and condensate revenues less royalties, production expenses, and transportation expenses. This calculation is provided in the "Operating Netback" section of the Company's MD&A using our IFRS measures. The Company's MD&A may be accessed through the SEDAR+ website at www.sedarplus.ca. Operating netback is a common metric used in the oil and gas industry used to demonstrate profitability from operations.

Non-GAAP Financial Ratios

Operating Netback per boe

Operating netback is calculated on a per unit basis, which is per barrel of oil equivalent ("boe"). It is a common non-GAAP measure used in the oil and gas industry and management believes this measurement assists in evaluating the operating performance of the Company. It is a measure of the economic quality of the Company's producing assets and is useful for evaluating variable costs as it provides a reliable measure regardless of fluctuations in production. Alvopetro calculated operating netback per boe as operating netback divided by total sales volumes (boe). This calculation is provided in the "Operating Netback" section of the Company's MD&A using our IFRS measures. The Company's MD&A may be accessed through the SEDAR+ website at www.sedarplus.ca.

Operating netback margin

Operating netback margin is calculated as operating netback per boe divided by the realized sales price per boe. Operating netback margin is a measure of the profitability per boe relative to natural gas, oil and condensate sales revenues per boe and is calculated as follows:

	Three Months Ended December 31,		Year Ended December 31,
	2025	2024	2025	2024
Operating netback - $ per boe	49.70	55.09	52.61	60.99
Average realized price - $ per boe	59.75	63.88	62.92	69.31
Operating netback margin	83 %	86 %	84 %	88 %

Funds Flow from Operations Per Share

Funds flow from operations per share is a non-GAAP ratio that includes all cash generated from operating activities calculated before changes in non-cash working capital, divided by the weighted average shares outstanding for the respective period. For the periods reported in this news release the cash flows from operating activities per share and funds flow from operations per share are as follows:

	Three Months Ended December 31,		Year Ended December 31,
$ per share	2025	2024	2025	2024
Per basic share:
Cash flows from operating activities	0.25	0.19	1.09	0.94
Funds flow from operations	0.28	0.19	1.09	0.89
Per diluted share:
Cash flows from operating activities	0.25	0.19	1.08	0.93
Funds flow from operations	0.28	0.19	1.08	0.89

Capital Management Measures

Funds Flow from Operations

Funds flow from operations is a non-GAAP capital management measure that includes all cash generated from operating activities calculated before changes in non-cash working capital. The most comparable GAAP measure to funds flow from operations is cash flows from operating activities. Management considers funds flow from operations important as it helps evaluate financial performance and demonstrates the Company's ability to generate sufficient cash to fund future growth opportunities. Funds flow from operations should not be considered an alternative to, or more meaningful than, cash flows from operating activities however management finds that the impact of working capital items on the cash flows reduces the comparability of the metric from period to period. A reconciliation of funds flow from operations to cash flows from operating activities is as follows:

	Three Months Ended December 31,		Year Ended December 31,
	2025	2024	2025	2024
Cash flows from operating activities	9,362	7,114	40,805	34,901
Changes in non-cash working capital	1,199	(148)	(208)	(1,626)
Funds flow from operations	10,561	6,966	40,597	33,275

Net Working Capital

Net working capital is computed as current assets less current liabilities. Net working capital is a measure of liquidity, is used to evaluate financial resources, and is calculated as follows: 

		As at December 31,
		2025	2024
Total current assets		39,892	26,984
Total current liabilities		(21,442)	(13,803)
Net working capital		18,450	13,181

Working Capital, Net of Debt

Working capital net of debt is computed as net working capital decreased by the non-current portion of the Loan. Working capital net of debt is used by management to assess the Company's overall financial position. As of December 31, 2025, Alvopetro's net working capital exceeds the balance outstanding on the Loan.

		As at December 31
		2025	2024
Net working capital		18,450	13,181
Loan, non-current		(16,000)	-
Working capital, net of debt		2,450	13,181

Supplementary Financial Measures

"Average realized natural gas price - $/Mcf" is comprised of natural gas sales as determined in accordance with IFRS, divided by the Company's natural gas sales volumes.

"Average realized NGL – condensate price - $/bbl" is comprised of condensate sales as determined in accordance with IFRS, divided by the Company's NGL sales volumes from condensate.

"Average realized oil price - $/bbl" is comprised of oil sales as determined in accordance with IFRS, divided by the Company's oil sales volumes.

"Average realized price - $/boe" is comprised of natural gas, condensate and oil sales as determined in accordance with IFRS, divided by the Company's total natural gas, NGL and oil sales volumes (barrels of oil equivalent).

"Dividends per share" is comprised of dividends declared, as determined in accordance with IFRS, divided by the number of shares outstanding at the dividend record date.

"Royalties per boe" is comprised of royalties, as determined in accordance with IFRS, divided by the total natural gas, NGL and oil sales volumes (barrels of oil equivalent).

"Production expenses per boe" is comprised of production expenses, as determined in accordance with IFRS, divided by the total natural gas, NGL and oil sales volumes (barrels of oil equivalent).

"Transportation expenses per boe" is comprised of transportation expenses, as determined in accordance with IFRS, divided by the total natural gas, NGL and oil sales volumes (barrels of oil equivalent).

Oil and Natural Gas Advisories

Oil and Natural Gas Reserves

The disclosure in this news release summarizes certain information contained in the GLJ Reserves and Resources Report but represents only a portion of the disclosure required under National Instrument 51-101 ("NI 51-101"). Full disclosure with respect to the Company's reserves as at December 31, 2025 is included in the Company's annual information form for the year ended December 31, 2025 which has been filed on SEDAR+ (www.sedarplus.ca). The GLJ Reserves and Resources Report has been prepared in accordance with the standards contained in the Canadian Oil and Gas Evaluation Handbook (the "COGE Handbook" or "COGEH") that are consistent with the standards of NI 51-101. GLJ is a qualified reserves evaluator as defined in NI 51-101.

All net present values in this press release are based on estimates of future operating and capital costs and GLJ's forecast prices as of December 31, 2025. The reserves definitions used in this evaluation are the standards defined by COGEH reserve definitions and are consistent with NI 51-101 and used by GLJ. The net present values of future net revenue attributable to Alvopetro's reserves estimated by GLJ do not represent the fair market value of those reserves. Other assumptions and qualifications relating to costs, prices for future production and other matters are summarized herein. The recovery and reserve estimates of the Company's reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual reserves may be greater than or less than the estimates provided herein. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves.

Caburé Working Interest

Alvopetro's working interest in the Caburé natural gas field is 56.2% as of December 31, 2025 and the date hereof. This working interest is subject to redeterminations, the first of which was completed in April 2024. An independent expert (the "Expert") was engaged in connection with the first redetermination to evaluate the redetermination and the impact to each party's working interest. Following the Expert's decision, Alvopetro's working interest was increased from 49.1% to 56.2%. Alvopetro's partner filed a notice of dispute with respect to the Expert's decision, seeking to stay the redetermination procedure. Alvopetro subsequently filed a request for emergency arbitration before the International Chamber of Commerce ("ICC") seeking to make the Expert decision effective starting on June 1, 2024. In May 2024, Alvopetro received the decision of the emergency arbitrator ("the Order") wherein the arbitrator found in favour of Alvopetro, making the Expert decision effective June 1, 2024 until such time as the dispute is reviewed by and decided upon by an arbitral tribunal pursuant to the Rules of Arbitration of the ICC. The redetermination dispute proceeded to a full arbitration under the Rules of the ICC, however the timing and outcome of the full arbitration is uncertain and the resulting impact on the reserves and the net present value of future net revenue attributable to such reserves as presented herein may be material. In addition, future redeterminations may also have a material impact on Alvopetro's reserves and future cash flows.

Contingent Resources

This news release discloses estimates of Alvopetro's contingent resources and the net present value associated with net revenues associated with the production of such contingent resources as included in the GLJ Reserves and Resources Report. There is no certainty that it will be commercially viable to produce any portion of such contingent resources and the estimated future net revenues do not necessarily represent the fair market value of such contingent resources. Estimates of contingent resources involve additional risks over estimates of reserves. Full disclosure with respect to the Company's contingent resources as at December 31, 2025 is included in the Company's annual information form for the year ended December 31, 2025 which has been filed on SEDAR+ (www.sedarplus.ca).

Prospective Resources

This news release discloses estimates of Alvopetro's prospective resources included in the GLJ Reserves and Resources Report. There is no certainty that any portion of the prospective resources will be discovered and even if discovered, there is no certainty that it will be commercially viable to produce any portion. Estimates of prospective resources involve additional risks over estimates of reserves. The accuracy of any resources estimate is a function of the quality and quantity of available data and of engineering interpretation and judgment. While resources presented herein are considered reasonable, the estimates should be accepted with the understanding that reservoir performance subsequent to the date of the estimate may justify revision, either upward or downward. Full disclosure with respect to the Company's prospective resources as at December 31, 2025 is included in the Company's annual information form for the year ended December 31, 2025 which has been filed on SEDAR+ (www.sedarplus.ca).

Other Metrics

This new release contains references to metrics commonly used in the oil and natural gas industry, which have been calculated by management including "production replacement ratio", "reserve life index", finding and development costs ("F&D costs") and "recycle ratio". These terms do not have standardized meanings and may not be comparable to similar measures presented by other companies, and therefore should not be used to make such comparisons.

"Production replacement ratio" is calculated by dividing the change in reserve volumes plus current year production by current year production. Alvopetro's 1P production replacement ratio and 2P production replacement ratio in 2025 is calculated as:

	1P	2P
Reserve volumes as at December 31, 2025 – Mboe	8,054	13,112
Reserve volumes as at December 31, 2024 – Mboe	4,512	9,148
Reserve additions – Mboe	3,542	3,964
2025 production – Mboe	921	921
Change in reserves before 2025 production - Mboe	4,463	4,885
2025 production replacement ratio	485 %	530 %

"Reserve life index" is expressed in years and is calculated by dividing 2P reserve volumes by the Company's annualized Q4 2025 production of 2,867 boepd, as follows:

	2P
2P Reserve volumes as at December 31, 2025 – Mboe	13,112
Annualized Q4 2025 Total Production - Mboe	1,046
Reserve life index - years	12.5

"F&D costs" are reflected on a per barrel of oil equivalent and are calculated as the sum of capital expenditures in the current year plus the change in future development costs ("FDC") in 2P reserves for the period, divided by the change in 2P reserves in the period, before current year production.  The 2025 F&D costs are computed as follows:

2025 capital expenditures - US$000s	33,493
Change in FDC from 2025^(1) – US$000s	41,856
Total	75,349
Change in 2P reserves before 2025 production^(2)– thousands of boe ("Mboe")	4,885
2025 F&D costs (per boe) – US$	$15.42

^(1)	^Computed based on FDC costs from the 2P reserves in the December 31, 2025 GLJ Reserves and Resources Report less FDC costs from the December 31, 2024 GLJ Reserves and Resources Report.
^(2)	^Computed as the change in 2P reserves from December 31, 2024 to December 31, 2025 (which increased 3,964 Mboe, from 9,148 Mboe to 13,112 Mboe) plus 2025 total production of 921 Mboe.

"Recycle ratio" is calculated by dividing the 2025 operating netback by 2P F&D costs per boe for the year. The Company's 2025 recycle ratio is calculated as follows:

2025 operating netback – US$ per boe	$52.61
2024 F&D costs – US$ per boe – see computation above	$15.42
2P recycle ratio	3.4

BOE Disclosure

The term barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet per barrel (6 Mcf/bbl) of natural gas to barrels of oil equivalence is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. All boe conversions in this news release are derived from converting gas to oil in the ratio mix of six thousand cubic feet of gas to one barrel of oil.

Contracted Natural Gas Volumes

The contracted daily firm volumes under Alvopetro's long-term gas sales agreement of 400 e³m³/d (before any provisions for take or pay allowances) represents contracted volumes based on contract referenced natural gas heating value. Alvopetro's reported natural gas sales volumes are prior to any adjustments for heating value of Alvopetro natural gas. Alvopetro's natural gas is approximately 8% higher than the contract reference heating value. Therefore, to satisfy the contractual firm deliveries Alvopetro would be required to deliver approximately 371e³m³/d (13.1MMcfpd).

Forward-Looking Statements and Cautionary Language

This news release contains forward-looking information within the meaning of applicable securities laws. The use of any of the words "will", "expect", "intend", "plan", "may", "believe", "estimate", "forecast", "anticipate", "should" and other similar words or expressions are intended to identify forward-looking information. Forward‐looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to vary significantly from the expectations discussed in the forward-looking statements. These forward-looking statements reflect current assumptions and expectations regarding future events. Accordingly, when relying on forward-looking statements to make decisions, Alvopetro cautions readers not to place undue reliance on these statements, as forward-looking statements involve significant risks and uncertainties. More particularly and without limitation, this news release contains forward-looking statements concerning the expected natural gas price, gas sales and gas deliveries under Alvopetro's long-term gas sales agreement, the timing and taxation of dividends and plans for dividends in the future, future production and sales volumes, plans relating to the Company's operational activities, proposed exploration and development activities and the timing for such activities, capital spending levels, future capital and operating costs, anticipated timing for upcoming drilling and testing of other wells, arbitration procedures associated with the redetermination of working interests of the Caburé natural gas field, and projected financial results. Forward-looking statements are necessarily based upon assumptions and judgments with respect to the future including, but not limited to the success of future drilling, completion, testing, recompletion and development activities and the timing of such activities, the performance of producing wells and reservoirs, well development and operating performance, expectations and assumptions concerning the timing of regulatory licenses and approvals, equipment availability, environmental regulation, including regulations relating to hydraulic fracturing and stimulation, the ability to monetize hydrocarbons discovered, the outlook for commodity markets and ability to access capital markets, foreign exchange rates, the outcome of any disputes, the outcome of  redeterminations, general economic and business conditions, forecasted demand for oil and natural gas, the impact of global pandemics, weather and access to drilling locations, the availability and cost of labour and services, and the regulatory and legal environment and other risks associated with oil and gas operations. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. Current and forecasted natural gas nominations are subject to change on a daily basis and such changes may be material. In addition, the declaration, timing, amount and payment of future dividends remain at the discretion of the Board of Directors. Although we believe that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because we can give no assurance that they will prove to be correct. Since forward looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, reliance on industry partners, availability of equipment and personnel, uncertainty surrounding timing for drilling and completion activities resulting from weather and other factors, changes in applicable regulatory regimes and health, safety and environmental risks), commodity price and foreign exchange rate fluctuations, market uncertainty associated with trade or tariff disputes, and general economic conditions. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be incorrect. Although Alvopetro believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Alvopetro can give no assurance that it will prove to be correct. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on factors that could affect the operations or financial results of Alvopetro are included in our AIF which may be accessed on Alvopetro's SEDAR+ profile at www.sedarplus.ca. The forward-looking information contained in this news release is made as of the date hereof and Alvopetro undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

SOURCE Alvopetro Energy Ltd.

FOR FURTHER INFORMATION, PLEASE CONTACT: Corey C. Ruttan, President, Chief Executive Officer and Director, or; Alison Howard, Chief Financial Officer, Phone: [phone], Email: [email protected], www.alvopetro.com, TSX-V: ALV, OTCQX: ALVOF