Cerus Energy Group: Saskatchewan Well Completed

Nanton, AB - December 18, 2017 - Objective

The objective of Cerus Energy Group (TSXV:CEA) is to build a premier energy portfolio of development interest through its proprietary CWI (Carried Working Interest) capitalization structure.


Strategy/Investment process

Cerus uses a formal Development Finance Program (or DFP) structure to enhance the management and placement of investment capital. Our Finance Program is suitable for long and short-term capital projects with the capability of retained expansion through the provision of rolling development options. The DFP both uses and optimizes a series of revenue sharing mechanisms to recover investment capital and associated fees from inner corporate investments.

Update Cut Off - December 15, 2017 Market Close
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Period of Performance

The Company's inaugural DFP with Vital Energy has completed the drill and casing of 101/14-15-18-17W3 which was spudded on November 13th, 2017. The development had experienced operational setbacks forcing the deviation of the completions and frac fluid recovery process. The fracing operation was successfully completed and with the lost section of the BHA successfully being fished out of hole and the well was placed directly on production. The frac fluids will continue to be recovered with continued monitoring for well fluid stabilization. Once a stabilized fluid rate is achieved the operator and cerus will provide a joint news release announcing production results. Cerus and Vital will perform a program and geological review to assess the mechanical efficiencies and performance vs. theoretical modeling.

Cerus funded the program through the Lomac Syndicate Program to a non-arm's length financier. The financier will retain 160% of the total 180% Penalty Payout on the Pennant, Saskatchewan Play. The tailing 20% and 5% GORR with be retained by Cerus as an earned margin and retained royalty.


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