===== SIDA 1 ===== Suite 2500 666 Burrard Street, Vancouver, B.C. Canada V6C 2X8 info@africaoilcorp.com africaoilcorp.com * Important information: Africa Oil's interest in Prime is accounted for as an investment in joint venture. Refer to Note 1 on page 7 for further details. All dollar amounts in this press release are U.S. Dollars unless otherwise indicated. NEWS RELEASE AFRICA OIL ANNOUNCES 2024 FOURTH QUARTER & FULL-YEAR RESULTS, ITS YEAR-END 2024 STATEMENT OF RESERVES AND THE IMMINENT COMPLETION OF THE PRIME CONSOLIDATION February 27, 2025 (AOI–TSX, AOI–Nasdaq-Stockholm) – Africa Oil Corp. (“Africa Oil”, “AOC” or the “Company”) today published its financial and operating results for the three and twelve months ended December 31, 2024, and posted its 2024 statement of reserves on SEDAR (www.sedar.com) as part of its Annual Information Form. The Company is also pleased to announce the imminent completion of the amalgamation to consolidate all the Prime Oil & Gas Coöperatief U.A (“Prime”) shareholding in Africa Oil (“Proposed Reorganization”). Africa Oil President and CEO, Roger Tucker commented: “2024 was a transformative year for the Company as we executed several strategic initiatives that have simplified and strengthened the fundamental business proposition. It was also a year in which we returned a record $67.9 million to our shareholders, a trend that will continue following the impending completion of the Prime consolidation. This transformational milestone will significantly enhance our scale, financial strength, and ability to deliver meaningful shareholder value. The enlarged Africa Oil will benefit from robust long -term free cash flows and a strong balance sheet with low leverage. We will have direct interests in producing assets in Nigeria, complemented by funded development and exploration projects in the prolific Orange Basin. These pillars position us to implement steady and predictable shareholder returns and to pursue new growth opportunities focused on producing assets in a disciplined manner.” Highlights* • The completion of the Proposed Reorganization is expected on or about March 7, 2025, a strategic milestone to double the Company’s reserves and production and allowing it to take direct control of Prime’s cash flows and balance sheet. • The Proposed Reorganization will position the Company to significantly increase its annual base dividend distribution to at least $100 million (U.S. Dollars) or approximately $0.15 per share (assuming pro-forma issued and outstanding share count of ~675 million), which is approximately 3x the current annual base distribution of $0.05 per share, subject to customary board approval and consents. • The Company intends to declare the first quarterly dividend of $25 million or approximately $0.037 per share on the completion of the Proposed Reorganisation, subject to customary board approval and consents. • During 2024, the Company returned $67.9 million to its shareholders through the base dividend policy and share buybacks, the highest annual capital return in its history. • During 2024, the Company materially increased its shareholding in Impact to 39.5% from 31.1% at a total cost of approximately $88.6 million, enhancing the Company’s influence and control over a core strategic asset and value driver in the Namibian Orange Basin, containing the Venus field. • Significant year-end 2024 combined AOC and Prime (100% basis) cash balance of $460.9 million. • Post year-end 2024 received a $31.6 million dividend from Impact Oil & Gas Limited (“Impact”). ===== SIDA 2 ===== - 2 - • Prime’s highlights and results net to Africa Oil’s 50% shareholding: o Recorded full -year average daily working interest (“ W.I.”) production2 of approximately 17,000 barrels of oil equivalent per day (“boepd”) and average daily lifting entitlement production3 of approximately 19,400 boepd. These compare with mid -range 2024 Management Guidance of 17,500 boepd and 19,500 boepd for W .I. and lifting entitlement production, respectively. o Recorded full-year 2024 cashflow from operations4,5 of $267.8 million which compares with mid-range 2024 Management Guidance of $275.0 million. o Prime’s cash position of $199.7 million and debt balance of $375.0 million resulting in a Prime net debt position of $175.3 million at December 31, 2024. • Africa Oil’s year-end 2024 reserves based on the Company’s 50% ownership in Prime 6: o 101% Proved reserves (“1P”) and 7 7% Proved plus Probable reserves W.I. Reserves Replacement7 for year-end (“YE”) 2024. o YE’24 reserves determination has delivered after -tax 1P NPV(10) and 2P NPV(10) valuations of $624 million (YE’23: $722 million) and $1,064 million (YE’23: 1,192 million) respectively8. o YE’24 W.I. and net entitlement9 1P reserves of 29.9 MMboe (YE’23: 29.8 MMboe) and 35.4 MMboe (YE’23: 35.6 MMboe), respectively. o YE’24 W.I. and net entitlement 2P reserves of 50.8 MMboe (YE’23: 52.2 MMboe) and 58.2 MMboe (YE’23: 59.6 MMboe), respectively. 2024 Fourth Quarter Results Summary (Millions United States Dollars, except Per Share and Share Amounts) Three months ended Years ended Unit December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 AOC highlights Net income / (loss) $’m 6.2 (88.8) (279.1) 87.1 Net income / (loss) per share – basic $/ share 0.02 (0.19) (0.62) 0.19 Cash position $’m 61.4 232.0 61.4 232.0 Prime highlights, net to AOC’s 50% shareholding(1) W.I. production(2) boepd 17,200 18,500 17,000 19,800 Lifting entitlement production(3) boepd 19,500 21,700 19,400 22,400 Cash flow from operations (4,5) $’m 52.9 64.1 267.8 300.4 EBITDAX(4) $’m 242.3 112.3 519.5 460.3 Free Cash Flow(4) $’m 8.8 16.7 197.2 149.1 Net debt $’m 175.3 298.9 175.3 298.9 The financial information in this table was selected from the Company’s audited consolidated financial statements for the year ended December 31, 2024. The Company's consolidated financial statements, notes to the financial statements, management's discussion and analysis for the year ended December 31, 2024 and 2023 and the 2024 Report to Shareholders and Annual Information Form have been filed on SEDAR (www.sedar.com) and are available on the Company’s website (www.africaoilcorp.com). As at December 31, 2024, the Company had $61.4 million cash on hand, compared with a cash balance of $232.0 million as at December 31, 2023. The Company received a dividend from Prime of $36.0 million, returned $67.9 million to shareholders by way of share buybacks and dividends, paid $87.8 million to increase its shareholding in Impact, paid the second and third tranches totaling $6 .5 million to Azinam in ===== SIDA 3 ===== - 3 - relation to the increased working interest in Block 3B/4B, received $3.3 million as part of the farm out deal in Block 3B/4B, incurred capital expenditure in respect of the licenses in Equatorial Guinea and South Africa, settled working capital balances and incurred general and administrative costs. As at December 31, 2024, the fair value of the Company’s existing shareholding in Prime was calculated to be $328.4 million based on the implied value of the Proposed Reorganization, resulting in an accounting non-cash impairment loss on the investment in Prime of $436.7 million for the year ended December 31, 2024, which does not reflect the asset valuation presented in the Year-End 2024 Statement of Reserves. The fair value of the existing 50% shareholding in Prime decreased as the fair value considers the number of Africa Oil shares that were agreed in relation to the purchase of the additional interest in Prime and the trading value of Africa Oil shares, as this is an observable fair value input under IFRS Accounting Standards The fair value has been calculated based on the Africa Oil share price of CAD 1.97 as of December 31, 2024, and the USD/CAD exchange rate of 1.4384 as of December 31, 2024. The consideration under the Proposed Reorganization will be based on the share price and exchange rate as of the date of completion of the Proposed Reorganization and may therefore change materially compared to the fair value of $328.4 million as at December 31, 2024. This might therefore result in the recognition of additional impairmen t charges or the reversal of previously recognized impairment charges based on the movements in the Africa Oil share price and the USD/CAD exchange rate between December 31, 2024, and the closing date of the transaction. The figures below , which explain the movements in the results of Prime , are based on Prime’s gross balances as per its financial statements. Prime revenues decreased by $342.8 million in Q4 2024 compared to Q4 2023, driven by no liftings in Q4 2024 compared to four liftings in Q4 2023. There was a decrease in costs of sales of $274.3 million, primarily driven by an underlift movement during Q4 2024 of $204.8 million compared to an overlift movement in Q4 2023 of $63.0 million. This resulted in a decrease in gross profit to $72.4 million in Q4 2024 from $140.9 million in Q4 2023. In Q4 2023 there was an impairment recognized of $263.3 million and no impairment recognized in Q4 2024. Other operating income increased by $329.7 million in Q4 2024 compared to Q4 2023 relating to other operating income recognized by Prime in Q4 2024 under the Securitization Agreement as no comprehensive resolution was reached among all unit parties in respect of the tract participation in the Agbami field by December 27, 2024. Finance income decreased by $10.2 million in Q4 2024 compared to Q4 2023, mainly driven by an accounting loss on derivatives in Q4 2024. There wa s a tax charge in Q4 2024 of $46.6 million compared to $11.7 million in Q4 2023. The increase was mainly driven by capital gains tax in Q4 2024 in relation to the income recognized by Prime under the Securitization Agreement at a Capital Gains Tax rate in Nigeria of 10 percent. This has resulted in Prime’s profit increasing from a loss of $158.6 million in Q4 2023 to a profit of $318.7 million in Q4 2024, an increase of $477.3 million. Year-End 2024 Statement of Reserves The Company has posted its 2024 statement of reserves on SEDAR (www.sedar.com) as part of its Annual Information Form. This disclosure is based on an independent reserves evaluation, effective December 31, 2024, prepared by RISC (UK) Limited (“RISC”) for Africa Oil in accordance with Canadian National Instrument 51-101 – Standards for Oil and Gas Activities ("NI 51 -101") and the Canadian Oil and Gas Evaluation Handbook ("COGE Handbook"). Africa Oil’s statement of reserves is based on the Company’s 50% ownership interest in Prime. Prime’s main assets are an indirect 8% interest in Petroleum Mining License (“PML”) 52 (previously part of Oil Mining Lease (“OML”) 127) and an indirect 16% interest in PMLs 2, 3, 4 (previously part of OML 130); both are deep-water Nigeria concessions. PML 2, PML 3 and PML 4 are operated by affiliates of TotalEnergies SE and contain the producing Akpo and Egina fields and the undeveloped Preowei field. PML 52 is operated by affiliates of Chevron Corporation and contains the producing Agbami field. The year-end 2024 reserves and reconciliation of changes in W.I. reserves summarized in the following tables pertain to 50% of Prime’s W.I. and net entitlement reserves: ===== SIDA 4 ===== - 4 - Summary of Oil and Gas Reserves (Forecast Prices and Costs) Light and Medium Oil Conventional Natural Gas Natural Gas Liquids Reserve Category Gross (MMstb) Net (MMstb) Gross (Bcf) Net (Bcf) Gross (MMstb) Net (MMstb) Proved Developed Producing 13.2 17.0 37.2 37.2 - - Developed Non-Producing - - - - - - Undeveloped 9.2 11.0 7.6 7.6 - - Total Proved 22.4 27.9 44.9 44.9 - - Probable 17.1 18.9 23.0 23.0 - - Total Proved plus Probable 39.5 46.8 67.9 67.9 - - Possible 15.5 15.8 15.1 15.1 - - Total Proved plus Probable plus Possible 55.0 62.6 83.0 83.0 - - Notes: i. Figures in the table may not add up precisely due to rounding errors. ii. Units are MMstb (million stock tank barrels) and Bcf (billion cubic feet). iii. Gross Company reserves are the total project sales volumes multiplied by Company’s working interest. iv. Net oil reserves are Company’s net entitlement calculated using economic limit testing. v. Gross and net reserves for sales gas are equal as the gas terms are set out in the Gas Sales and Purchase Agreement rather th an the Production Sharing Agreement (“PSA”), and the net reserves are based on Company’s working interest. The following table provides a reconciliation between the Gross W.I. Reserves disclosed on the February 27, 2024 (effective date December 31, 2023) and this disclosure (effective date December 31, 2024). Gross Light and Medium Oil (MMstb) Conventional Natural Gas (Bscf) Proved Probable Proved + Probable Proved Probable Proved + Probable Effective date 31 December 2023 25.7 18.0 43.6 24.9 26.4 51.3 Extensions and Improved Recovery 0.0 0.0 0.0 0.0 0.0 0.0 Resource Transfers 0.0 0.0 0.0 0.0 0.0 0.0 Technical Revisions 1.5 -0.9 0.6 28.7 -3.4 25.3 Discoveries 0.0 0.0 0.0 0.0 0.0 0.0 Acquisitions 0.0 0.0 0.0 0.0 0.0 0.0 Dispositions 0.0 0.0 0.0 0.0 0.0 0.0 ===== SIDA 5 ===== - 5 - Economic Factors 0.0 0.0 0.0 0.0 0.0 0.0 Production 4.8 0.0 4.8 8.7 0.0 8.7 Effective date 31 December 2024 22.4 17.1 39.5 44.9 23.0 67.9 Notes: i. Figures in the table may not add up precisely due to rounding. ii. Gross Company Reserves are the total project sales volumes multiplied by AOC’s share of Prime’s working interest. iii. RISC notes that the Proved + Probable Reserves reconciliation for oil and gas is lower than the Proved in some categories. Th is results in a negative Probable increment. The difference is due to a larger increase in Proved Reserves than the Proved + Probab le, compared to last year. Outlook Consolidation of the Ownership in Prime On June 23, 2024, the Company entered into a definitive agreement (the “Amalgamation Agreement”) with BTG Pactual Oil & Gas S.a.r.l. (“BTG Oil & Gas”) and BTG Pactual Holding S.a.r.l. ("BTG Holding"), the entity which holds the interests of BTG Oil & Gas i n Prime, to reorganize and consolidate their respective 50:50 shareholdings in Prime (the “Proposed Reorganization”). On completion of the Proposed Reorganization, which is expected on or about March 7, 2025, Africa Oil will hold 100% of Prime with BTG Oil & Gas receiving 239,828,655 newly issued common shares in Africa Oil, representing approximately 35.5% of the outstanding share capital of the enlarged Africa Oil as of February 26, 2025. The Proposed Reorganization provides the enlarged Africa Oil with a number of strategic and financial benefits, including: • 100% increase in working interest Proved plus Probable (“2P”) reserves and production on a pro - forma basis, for BTG receiving approximately 35.5% of the shares in the enlarged Africa Oil. • Increased scale and balance sheet strength along with the potential to benefit from lower borrowing costs. • The introduction of a long-term cornerstone shareholder that is strategically aligned with Africa Oil and committed to growing a sustainable upstream oil and gas business, will, after completion, deliver superior value creation and shareholder capital returns. • BTG Oil & Gas’ support has the potential to increase Africa Oil’s access to business opportunities and potentially unlock new sources of growth capital, while complementing Africa Oil’s disciplined capital allocation and financial decision making through BTG Oil & Gas' participation on the Board. • Enabling direct control of Prime’s cash flows and balance sheet through the consolidation of Africa Oil and BTG Oil & Gas' respective interests in Prime versus the equity accounting method that is followed by Africa Oil today for its investment in Prime. This in turn will facilitate greater transparency and visibility of Prime’s financial performance for Africa Oil’s shareholders. • Significant scope to streamline the business processes and decision making to achieve cost savings. The enlarged Africa Oil is expected to have significant scale with robust long -term free cash flows and a low leverage balance sheet, driven by large -scale and high netback assets in deepwater Nigeria. This will be complemented by funded development and exploration projects in the prolific Orange Basin. These pillars will provide a strong platform for the enlarged Africa Oil to implement steady and predictable shareholder returns underpinned by an enhanced base dividend policy, whilst delivering organic growth from its core assets and pursuing inorganic g rowth opportunities supported by a long -term and committed strategic shareholder. The enlarged Africa Oil’s objective is to deliver a superior investment case relative ===== SIDA 6 ===== - 6 - to its peer group through a combination of financial discipline, sustainable total shareholder returns, and funded growth. Namibia Orange Basin Appraisal and Exploration Campaign Block 2913B, offshore Namibia, contains the Venus light oil field, discovered by the Venus -1X well, drilled in 2022 and subsequently successfully appraised with three further wells and four drill stem tests. The Joint Venture is continuing to progress the proposed development of the Venus Field, with development studies ongoing. The Venus Field is expected to be the first development in Block 2913B, producing 150kbopd (gross field) of ~45° API oil, with final investment decision expected by the end of H1 2026. During 2024, two additional 3D seismic acquisition programs were completed to facilitate further exploration over the southern and northern parts of the Blocks. This has resulted in most of the licensed area now being covered by 3D seismic. This data is cu rrently being processed and interpreted and will help further evaluate prospects and leads in the far northern and southern parts of the Blocks. On February 3, 2025, the Deepsea Mira drilling rig spud the Marula-1X exploration well within the southern part of Block 2913B. This well will target Albian -aged sandstones, within the Marula fan complex and has the potential to unlock further exploration targets across the south, which is an area lying at the heart of the prolific Kudu source -rock kitchen. Deepsea Mira is also expected to drill the Olympe prospect, targeting Albian sands within a structural closure on Block 2912 by the end of 2025. As announced on February 6, 2025, the Tamboti-1X well encountered black oil within 85m of net reservoir of lower quality Upper Cretaceous sandstones, belonging to the Mangetti fan system. As reported by Impact, the drill stem test (“DST”) program was concluded at the Tamboti-1X location, and results from the acquired log, core and DST data are currently under analysis. On January 10, 2024, the Company announced a strategic farm down agreement between its investee company Impact Oil and Gas Limited (“Impact”), and TotalEnergies, that allows the Company to continue its participation in the world class Venus oil development project, and the follow -on exploration campaign on the Blocks with no upfront costs. This transaction frees up the Company’s balance sheet for the pursuit of other growth opportunities and shareholder capital returns. As announced on November 1, 2024, thi s farm down deal closed following the receipt of the final approval from Government of Namibia. At the date hereof, AOC has an interest in this program through its 39.5% shareholding in Impact, which in turn has a 9.5% WI in each of Block 2913B (PEL 56) and Block 2912 (PEL 91). Nigeria Agbami field performed in line with expectations throughout 2024. Planned maintenance on one of the three compressors commenced at the end of Q4 2024 and continued into Q1 2025. The remaining two compressors will also be overhauled over the coming 2 years to maintain high equipment uptime. Processing of the 4D -M3 seismic acquired in Q3 2024 is underway and other preparations for the next drilling campaign, scheduled for 2026, are continuing as planned. A planned full -field shut down for maintenance activities is scheduled for Q4 2025. The Egina field completed the year above the production plan thanks to its high production efficiency and successful well interventions during Q3 2024 and Q4 2024. Well planning for a 2025 drilling program based on the 4D-M2 acquired in Q2 2024 is ongoing with drilling commencing in Q1 2025. The Akpo field ended the year with production rates in line with those at the start of 2024, primarily due to the Akpo West wells performing above expectation and the infill well on Akpo main offsetting natural decline in the field. A total of 3 new producers and 1 new injector were completed and tied back to the Akpo FPSO in 2024. Overall, for 2024, production was below the production plan due to drilling delays pushing the expected production gains from drilling to the second half of the year. Well planni ng for additional infill drilling, based on the 4D-M4 seismic acquired in Q1 2024, and potential near field exploration are underway. ===== SIDA 7 ===== - 7 - The 2023 and 2024 Egina and Akpo drilling campaign was paused in November 2024 to allow time to mature drilling opportunities from the 2024 seismic acquisition campaigns. The 2025 campaign kicked off in January 2025 as planned. Progress on phase 2 of the Preowei Field front end engineering design (“FEED”) is now subject to further cost optimization and the results of ongoing field development studies on the basis of the 4D baseline seismic acquisition acquired in Q2 2024. These w ork streams are aimed at supporting an FID decision on the project and enabling Engineering, Procurement, Construction and Installation (“EPCI”). South Africa Orange Basin, Block 3B/4B Block 3B/4B lies to the southeast and on trend with a number of Orange Basin oil discoveries including Venus. There is approximately 14,000 km of 2D seismic and 10,800 km 2 of 3D seismic over the block, identifying a large opportunity set of exploration prospects. On August 28, 2024, the Company announced the completion of the farm down agreement with TotalEnergies and QatarEnergy for the Orange Basin Block 3B/4B. The Company retained a 17.0% interest in Block 3B/4B and transferred the operatorship of the block to TotalEnergies, for a maximum consideration of $46.8 million, including the exploration carry of its retained interest. On January 10, 2025, the Company completed a separate transaction with Azinam, a subsidiary of Eco for the transfer of a 1.0% (one percent) interest to the Company, increasing the group’s direct interest in Block 3B/4B to 18.0%. The Company will have the b enefit of exploration carry for the additional 1.0% interest assigned to it by Azinam. An Environmental Authorization for exploration activities (drilling of up to 5 exploration wells) was granted by the Department of Mineral Resources and Energy for the Republic of South Africa on September 16, 2024. The legislative notification and appeals process is in progress with the relevant regulatory agencies. TotalEnergies, as the block operator, has stated its expectation for the first exploration well on this block to be drilled in 2026. Equatorial Guinea On December 23, 2024, the Company was granted a 1 year extension to the first exploration sub period on both two exploration licenses (EG-18 and EG-31), offshore Equatorial Guinea. The Company also received approval of the first amendment to the EG -31 Prod uction Sharing Contract (PSC). The amendment expanded the block boundary to ensure that the full extent of the two main exploration prospects were captured fully within the block boundary. The Company is continuing with the farm down process for Blocks EG-18 and EG-31 as well as subsurface studies to enhance the definition of multiple targets already identified. The Company holds an operated WI of 80.0% in each of Blocks EG-18 and EG-31. 2025 Management Guidance Management guidance for 2025 will be announced following the completion of the Proposed Reorganization, expected on or about March 7, 2025. Notes 1. The 50% shareholding in Prime is accounted for using the equity method and presented as an investment in joint venture in the Consolidated Balance Sheet. Africa Oil’s 50% share of Prime’s net profit or loss will be shown in the Consolidated Statements of Net (Loss) / Income and Comprehensive (Loss) / Income. Any dividends received by Africa Oil from Prime are recorded as Cash flow from Investing Activities. 2. Aggregate oil equivalent production data comprised of light and medium crude oil and conventional natural gas production net to Prime’s W.I. in Agbami, Akpo and Egina fields. These production rates only include sold gas volumes and not those volumes used for fuel, reinjected or flared. 3. Lifting entitlement production is calculated using the economic interest methodology and includes cost recovery oil, tax oil, royalty oil and profit oil and is different from working interest production that is calculated based on project volumes multiplied by Prime’s effective working interest in each license. ===== SIDA 8 ===== - 8 - 4. Includes non-GAAP measures. Definitions and reconciliations to these non-GAAP measures are provided in Fourth Quarter 2024 MD&A. 5. Cash flow from operations before working capital adjustments and interest payments. 6. Please refer to the oil and gas advisory on page 9 for important information. 7. Reserves replacement ratios are based on full-year 2024 production of 6.2 MMboe, positive 1P and 2P reserves technical revisions of 6.3 MMboe and 4.8 MMboe, respectively. 8. Based on Brent oil price forecast of ($/bbl): 2025 - $75.0; 2026 - $76.5; 2027 - $78; 2028 – 79.6; 2029 - $81.2; 2030 and beyond escalation rate of 2.0%.The valuation include the impact of a lower oil price deck used in this report relative to the deck used for YE’23, including a lower long term escalation factor of 2.0% compared to 2.5% used for the YE’23 report. 9. Net entitlement reserves are calculated using the economic interest methodology and include cost recovery oil, tax oil and profit oil, but exclude royalty oil, and are different from working interest reserves that are calculated based on project volumes multiplied by Prime’s effective working interest. Management Conference Call Senior management will hold a conference call to discuss the results on Friday, February 28, 2024 at 09:00 (EST) / 14:00 (GMT) / 15:00 (CET). The conference call may be accessed by dial in or via webcast. Participants should use the following link to register for the live webcast: https://edge.media-server.com/mmc/p/rfzp6we6/ Participants can also join via telephone with the instructions available on the following link: https://register.vevent.com/register/BI57e8456656ec4d65bb4257b575487d35 1. Click on the call link and complete the online registration form. 2. Upon registering you will receive the dial-in info and a unique PIN to join the call as well as an email confirmation with the details. 3. Select a method for joining the call; i. Dial-In: A dial in number and unique PIN are displayed to connect directly from your phone. ii. Call Me: Enter your phone number and click “Call Me” for an immediate callback from the system. The call will come from a US number. About Africa Oil Africa Oil Corp. is a Canadian oil and gas company with producing and development assets in deepwater Nigeria, an interest in the Venus light oil and associated gas discovery, offshore Namibia, and an exploration/appraisal portfolio in West and South of Africa. The Company is listed on the Toronto Stock Exchange and on Nasdaq Stockholm under the symbol "AOI". For further information, please contact: Shahin Amini Head of Investor Relations and Communications shahin.amini@africaoilcorp.com T: +44 (0)20 8017 1511 Burson Buchanan Financial PR & Communications Advisor Energy@Buchanan.uk.com T: +44 (0)20 7466 5000 Additional Information This information is information that Africa Oil is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 8:00 p.m. EST on February 27, 2024. ===== SIDA 9 ===== - 9 - Advisory Regarding Oil and Gas Information The terms boe (barrel of oil equivalent) and MMboe (millions of barrels of oil equivalent) are used throughout this press release. Such terms may be misleading, particularly if used in isolation. Year -end 2024 reserves estimates are based on a conversion ratio of six thousand cubic feet per barrel of oil equivalent (6 Mcf: 1 boe), which is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value. RISC’s report was prepared using Brent oil price forecast of ($/bbl): 202 5 - $75.0; 2026 - $76.5; 2027 - $78.0; 2028- $79.6; 2029 – 81.2; 2030 and beyond escalation rate of 2. 0%. There is no assurance that the forecast prices will be attained and variances could be material. The recovery and reserves estimates of crude oil, natural gas liquids and natural gas reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual crude oil, natural gas and natural gas liquids reserves may be greater than or less than the estimates provided herein. The reserves estimates presented in this press release have been evaluated by RISC in accordance with NI 51-101 and the COGE Handbook, are effective December 31, 2024. The reserves presented herein have been categorized accordance with the reserves and resource definitions as set out in the COGE Handbook. The estimates of reserves in this press release may not reflect the same confidence level as estimates of reserves for all properties, due to the effects of aggregation. Reserves Reserves are estimated remaining quantities of commercially recoverable oil, natural gas, and related substances anticipated to be recoverable from known accumulations, as of a given date, based on the analysis of drilling, geological, geophysical, and engineering data, the use of established technology, and specified economic conditions, which are generally accepted as being reasonable. Reserves are further categorized according to the level of certainty associated with the estimates and may be sub-classified based on development and production status. Proved reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves. Probable reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves. Oil and gas reserves and production referred to in this release are for conventional light and medium gravity oil and conventional natural gas. Forward-Looking Information Certain statements and information contained herein constitute "forward -looking information" (within the meaning of applicable Canadian securities legislation) , including statements related to: the enlarged base dividend distribution; annual dividend distribution of $100 million; the declaration of the $25 million quarterly dividend; schedules and costs of drilling activity including those offshore Namibia and Nigeria; the outcome of exploration and appraisal activities including those offshore Namibia; the development of the Venus discovery; the completion of the Proposed Reorganization, i.e. Prime consolidation on or about March 7, 2025 ; the ability of the enlarged Africa Oil to deliver further growth or increased shareholder returns; the continuing benefits from funded, high value growth opportunities, including the Venus oil project in the Orange Basin ; the completion and timing of the Proposed Reorganization ; the Proposed Reorganization creating a differentiated upstream oil & gas company with stable production and free cash flow; the anticipated strategic and financial benefits of the Proposed Reorganization; expectations regarding free-cash flow; statements regarding access to business opportunities in Africa Oil’s regions of focus and unlocking new sources of growth capital ; and the structure of the Proposed Reorganization . Such statements and information (together, "forward-looking statements") relate to future events or the Company's future performance, business prospects or opportunities. All statements other than statements of historical fact may be forward -looking statements. Statements concerning proven and probable reserves and resource estimates may also be deemed to constitute forward -looking statements and reflect conclusions that ar e based on certain assumptions that the reserves and resources can be economically exploited. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future event s or performance (often, but not always, using words or phrases such as "seek", "anticipate", "plan", "continue", "estimate", "expect, "may", "will", "project", "predict", "potential", ===== SIDA 10 ===== - 10 - "targeting", "intend", "could", "might", "should", "believe" and similar expressions) are not statements of historical fact and may be "forward -looking statements". Forward -looking statements involve known and unknown risks, ongoing uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements, including statements pertaining to performance of commodity hedges, uninsured risks, regulatory and fiscal changes, availabilit y of materials and equipment, unanticipated environmental impacts on operations, duration of the drilling program, availability of third party service providers and defects in title , the sustainability of Africa Oil across oil and gas price cycles , the enhanced visibility and certainty over the use of capital , and statements regarding capital priorities . Forward-looking statements are based on a number of assumptions, including but not limited to, the ability of Africa Oil to delivery further growth , the ability to have a Board comprised at all times of a majority of independent non-executive directors, high value growth opportunities will continue to be funded, and the ability to access business opportunities in Africa Oil’s regions of focus. No assurance can be given that these expectations will prove to be correct and such forward -looking statements should not be unduly relied upon. The Company does not intend, and does not assume any obligation, to update these forward -looking statements, except as required by applicable laws. These forward -looking statements involve risks and uncertainties relating to, among other things, changes in macro -economic conditions and their impact on operations, changes in oil prices, reservoir and production facility performance, contractual performance, results of exploration and development activities, cost overruns, uninsured risks, regulatory and fiscal changes including defects in title, claims and legal proceedings, availability of materials and equipment, availability o f skilled personnel, the need to obtain required approvals from regulatory authorities, timeliness of government or other regulatory approvals, actual performance of facilities, joint venture partner underperformanc e, availability of financing on reasonable terms, availability of third party service providers, equipment and processes relative to specifications and expectations and unanticipated environmental, health and safety impacts on operations , satisfaction of the conditions to consummate the Proposed Reorganization; failure to complete the Proposed Reorganization; the amount of costs, fees, expenses and charges related to the Proposed Reorganization; and the failure to realize the anticipated benefits of the Proposed Reorganization . Actual results may differ materially from those expressed or implied by such forward-looking statements. ===== SIDA 11 ===== REPORT TO SHAREHOLDERS AFRICAOILCORP .COM AFRICA OIL CORP. FOR THE YEAR ENDED DECEMBER 31, 2024 ===== SIDA 12 ===== PAGE 2 Report to Shareholders | December 31, 2024 Africa Oil Corp. GLOSSARY A “Africa Energy” means Africa Energy Corp. an international oil and gas exploration company that holds an effective 4.9% participating interest in the Exploration Right for Block 11B/12B offshore South Africa. “Africa Oil” , “AOC” , or the “Company” means Africa Oil Corp. “Amalgamation Agreement” means the definitive agreement between the Company, BTG Oil & Gas and BTG Holding the entity which holds the interests of BTG Oil & Gas in Prime, to reorganize and consolidate their respective 50:50 shareholdings in Prime. “Applicable law” means all laws and regulations issued by authorities that have appropriate jurisdiction over the Company. “Azinam” means Azinam Ltd. B “Bcf” means billion cubic feet. “Blocks” means blocks 2912 and 2913B. “boepd” means barrels of oil equivalent per day. “BTG Holding” means BTG Pactual Holding S.a.r.l. “BTG Oil & Gas” means BTG Pactual Oil & Gas S.a.r.l. C “CGU” means Cash Generating Unit. A Cash Generating Unit is defined as assets that are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets. “Chevron” means Chevron Corp. “CIT” means Corporate Income Tax. “Concessions” , “PSC” or “Production Sharing Contract” means concessions, production sharing contracts and other similar agreements entered into with a host government providing for petroleum operations in a defined area and the division of petroleum production from the petroleum operations. “Corporate Facility” means the $200.0 million facility dated October 20, 2022, with a three-year term, as amended from time to time. D “DD&A” means Depreciation, Depletion and Amortization. “DST” means Drill Stem Testing. E “EPS” means Early Production System. “EBITDAX” means Earnings Before Interest, Taxes, Depreciation & Impairment, Amortization and Exploration Expenses. “Eco” means Eco (Atlantic) Oil & Gas Ltd, an international oil and gas exploration company that holds working interests in four exploration Blocks offshore Namibia and operates one exploration Block offshore South Africa and is party with the Company in Block 3B/4B, offshore South Africa and holds working interest in two exploration Blocks offshore Guyana. “Entitlement production” means production that is calculated using the economic interest methodology and includes cost oil, profit oil, tax oil and royalty oil. “ESG” means Environmental, Social and Governance. “ESHS” means Environmental, Social, Health and Safety. “ESIA” means Environmental and Social Impact Assessment. F “FCCPC” means Nigeria’s Federal Competition & Consumer Protection Commission. “FCF” means Free Cash Flow. “FDP” means Field Development Plan. “FEED” means Front End Engineering and Design. “FID” means Final Investment Decision. “FPSO” means Floating Production Storage and Offloading. G “GHG” means Greenhouse Gas. I “IFRS Accounting Standards” means International Financial Reporting Standards as issued by the International Accounting Standards Board. “Impact” means Impact Oil and Gas Ltd, a privately owned exploration company with a strategic focus on large scale, mid to deep water plays of sufficient materiality to be of interest to major companies. Impact has an asset base across the offshore margins of Southern and West Africa. ===== SIDA 13 ===== PAGE 3 Report to Shareholders | December 31, 2024 Africa Oil Corp. J “J V ” means Joint Venture. K “Kenya entities” means Centric Energy Kenya Limited, Africa Oil Kenya B.V Branch and Africa Oil Turkana Limited. L “LTI” means loss time injury. “LTIP” means Long Term Incentive Plan. M “Mcf” means million cubic feet. “MD&A” means Management’s Discussion and Analysis. “Mbbl” and “MMbbl” means one thousand and one million barrels, respectively. “Mboe” and “MMBoe” means thousands of barrels of oil equivalent and millions of barrels of oil equivalent, respectively. N “NCIB” means Normal Course Issuer Bid. “NI 51-101” means National Instrument 51-101 — Standards of Disclosure for Oil and Gas Activities of the Canadian Securities Administrators and the companion policies and forms thereto, as amended from time to time. “NI 52-109” means National Instrument 52-109 – Certification of Disclosure in Issuers’ Annual and Interim Filings and the companion policies and forms thereto, as amended from time to time. “NUPRC” means Nigerian Upstream Petroleum Regulatory Commission. O “OML” means Oil Mining Lease. “OML 127” means the oil mining lease on Block 127, offshore Nigeria which was converted to a petroleum mining lease under the new PIA regime in Q3 2023 with effective date 1 March 2023 “OML 130” means the oil mining lease on Block 130, offshore Nigeria which was converted to three new petroleum mining leases and one petroleum prospecting license under the new PIA regime in Q2 2023 P “Petrovida” means PetroVida Holding B.V. “PIA” means Petroleum Industry Act. “PML” means Petroleum Mining License. “PML 2” means the Petroleum Mining License containing the Akpo field. “PML 3” means the Petroleum Mining License containing the Egina field. “PML 4” means the Petroleum Mining License containing the Preowei field. “PML 52” means the Petroleum Mining License containing the Agbami field. “PPL” means Petroleum Prospecting License. “PPL 261” means the Petroleum Prospecting License containing the South Egina prospect. “PPT” means Profit Petroleum Tax. “Prime” or “Prime Oil & Gas Coöperatief U.A.” means Prime Oil & Gas Coöperatief U.A., previously known as Prime Oil & Gas B.V., a company that holds interests in deepwater Nigeria production and development assets. “Proposed Reorganization” means the proposed reorganization and consolidation of the 50:50 shareholdings of the Company and BTG Holding in Prime announced by the Company on June 24, 2024. “PSA” means Petroleum Sharing Agreement. “PSU” means Performance Share Unit. “PXF Facility” means Pre-Export Finance Facility. R “RBL” means Reserves Based Lending. “RSU” means Restricted Share Unit. S “spud” or “spudded” means the initial drilling for an oil well. T “TotalEnergies” means TotalEnergies SE and subsidiaries. “TSX” means Toronto Stock Exchange. U “US” means United States. V “VAT” means Value-added tax. W “WI” means working interest. “WI production” means production based on the percentage of working interest owned. ===== SIDA 14 ===== PAGE 4 Report to Shareholders | December 31, 2024 Africa Oil Corp. MANAGEMENT’S DISCUSSION AND ANALYSIS The Management’s Discussion and Analysis (“MD&A”) focuses on significant factors that have affected the Company during the year ended December 31, 2024, and such factors that may affect its future performance. To better understand the MD&A, it should be read in conjunction with the Company’s audited consolidated financial statements for the years ended December 31, 2024, and 2023, and related notes thereto. The financial information in this MD&A is derived from the Company’s audited consolidated financial statements which have been prepared in US dollars, in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”). This MD&A was reviewed and approved by the Board of Directors. The effective date of this MD&A is February 27, 2025. Additional information about the Company and its business activities is available on the Company’s website at www.africaoilcorp.com and on SEDAR at www.sedar.com. PROFILE AND STRATEGY Africa Oil is a Canadian oil and gas company with producing and development assets in deep-water offshore Nigeria. The Company also has a portfolio of development and exploration assets in West and South of Africa. The Company’s Common Shares are listed on the Toronto Stock Exchange in Canada and the Nasdaq Stockholm Exchange in Sweden, under the symbol ‘AOI’. Africa Oil’s long-term objective is to implement a steady and predictable total shareholder returns model underpinned by an enhanced base dividend policy, whilst delivering organic growth from its core assets and pursuing disciplined inorganic growth opportunities focused on producing assets. This plan is supported by the Company’s high netback production assets in Nigeria that are included in its interests in PMLs 2, 3, 4 (previously part of OML 130) and PML 52 (previously part of OML 127). These PMLs provide the Company with a long-life cash flowing asset base, to support its business objectives over the long term, and also present development opportunities for supporting future production. The Company’s other core assets are comprised of its Orange Basin opportunity set including Blocks 2912 and 2913B offshore Namibia and Block 3B/4B, offshore South Africa, as well as Equatorial Guinean exploration blocks (EG-18 and EG-31). The Company is a unique investment opportunity, amongst its publicly-listed independent E&P peer group, for its Orange Basin opportunity set that includes an effective interest in the Venus light oil and associated gas discovery offshore Namibia. The Venus discovery, understood to be the largest oil discovery globally in 2022, has partially de-risked a new petroleum province in the Orange Basin that has significant prospectivity. HIGHLIGHTS AND OUTLOOK Full-Year 2024, Q4 2024 and Post Period Highlights • The completion of the Proposed Reorganization is expected on or about March 7, 2025, a strategic milestone to double the Company’s reserves and production and allowing it to take direct control of Prime’s cash flows and balance sheet. • The Proposed Reorganization will position the Company to significantly increase its annual dividend distribution to at least $100 million or approximately $0.15 per share (assuming pro-forma issued and outstanding share count of ~675 million), which is approximately 3x the current annual base distribution of $0.05 per share, subject to customary board approval and consents. • The Company intends to declare the first quarterly dividend of $25 million or approximately $0.037 per share on the closing of the Proposed Reorganisation, subject to customary board approval and consents. • During 2024, the Company returned $67.9 million to its shareholders through the base dividend policy and share buybacks. • During 2024, the Company materially increased its shareholding in Impact to 39.5% from 31.1% at a total cost of approximately $88.6 million, enhancing the Company’s influence and control over a core strategic asset and value driver in the Namibian Orange Basin, containing the Venus light oil field. • Significant year-end 2024 combined Africa Oil and Prime cash balance of $460.9 million. • Post year-end 2024 received a $31.6 million dividend from Impact. • Prime’s highlights and results net to Africa Oil’s 50% shareholding: » Recorded full-year average daily WI production of approximately 17,000 barrels of oil equivalent per day (“boepd”) and average daily entitlement production of approximately 19,400 boepd. These compare with mid-range 2024 Management Guidance of 17,500 boepd and 19,500 boepd for WI and entitlement production, respectively. » Recorded full-year 2024 cashflow from operations of $267.8 million which compares with mid-range 2024 Management Guidance of $275.0 million. » Prime’s cash position of $199.7 million and debt balance of $375.0 million resulting in a Prime net debt position of $175.3 million at December 31, 2024. ===== SIDA 15 ===== PAGE 5 Report to Shareholders | December 31, 2024 Africa Oil Corp. HIGHLIGHTS AND OUTLOOK - CONTINUED FINANCIAL SUMMARY (1) Three months ended Years ended Unit December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 AOC highlights Net income/ (loss) $’m 6.2 (88.8) (279.1) 87.1 Net income/ (loss) per share – basic $/ share 0.02 (0.19) (0.62) 0.19 Cash position $’m 61.4 232.0 61.4 232.0 Prime highlights, net to AOC’s 50% shareholding WI production boepd 17,200 18,500 17,000 19,800 Entitlement production boepd 19,500 21,700 19,400 22,400 Cash flow from operations (2) $’m 52.9 64.1 267.8 300.4 EBITDAX $’m 242.3 112.3 519.5 460.3 Free Cash Flow $’m 8.8 16.7 197.2 149.1 Net debt $’m 175.3 298.9 175.3 298.9 (1) The table includes non-GAAP measures. Definitions and reconciliations to these non-GAAP measures are provided on pages 13-16. (2) Cash flow from operations before working capital adjustments and interest payments. OUTLOOK Consolidation of the Ownership in Prime On June 23, 2024, the Company entered into a definitive agreement (the “Amalgamation Agreement”) with BTG Pactual Oil & Gas S.a.r.l. (“BTG Oil & Gas”) and BTG Pactual Holding S.a.r.l. (“BTG Holding”), the entity which holds the interests of BTG Oil & Gas in Prime, to reorganize and consolidate their respective 50:50 shareholdings in Prime (the “Proposed Reorganization”). On completion of the Proposed Reorganization, which is expected on or about March 7, 2025, Africa Oil will hold 100% of Prime with BTG Oil & Gas receiving 239,828,655 newly issued common shares in Africa Oil, representing approximately 35.5% of the outstanding share capital of the enlarged Africa Oil as of February 26, 2025. The Proposed Reorganization provides the enlarged Africa Oil with a number of strategic and financial benefits, including: • 100% increase in working interest Proved plus Probable (“2P”) reserves and production on a pro-forma basis, for BTG receiving approximately 35.5% of the shares in the enlarged Africa Oil. • Increased scale and balance sheet strength along with the potential to benefit from lower borrowing costs. • The introduction of a long-term cornerstone shareholder that is strategically aligned with Africa Oil and committed to growing a sustainable upstream oil and gas business, will, after completion, deliver superior value creation and shareholder capital returns. • BTG Oil & Gas’ support has the potential to increase Africa Oil’s access to business opportunities and potentially unlock new sources of growth capital, while complementing Africa Oil’s disciplined capital allocation and financial decision making through BTG Oil & Gas’ participation on the Board. • Enabling direct control of Prime’s cash flows and balance sheet through the consolidation of Africa Oil and BTG Oil & Gas’ respective interests in Prime versus the equity accounting method that is followed by Africa Oil today for its investment in Prime. This in turn will facilitate greater transparency and visibility of Prime’s financial performance for Africa Oil’s shareholders. • Significant scope to streamline the business processes and decision making to achieve cost savings. ===== SIDA 16 ===== PAGE 6 Report to Shareholders | December 31, 2024 Africa Oil Corp. HIGHLIGHTS AND OUTLOOK - CONTINUED The enlarged Africa Oil is expected to have significant scale with robust long-term free cash flows and a low leverage balance sheet, driven by large-scale and high netback assets in deepwater Nigeria. This will be complemented by funded development and exploration projects in the prolific Orange Basin. These pillars will provide a strong platform for the enlarged Africa Oil to implement steady and predictable shareholder returns underpinned by an enhanced base dividend policy, whilst delivering organic growth from its core assets and pursuing inorganic growth opportunities supported by a long-term and committed strategic shareholder. The enlarged Africa Oil’s objective is to deliver a superior investment case relative to its peer group through a combination of financial discipline, sustainable total shareholder returns, and funded growth. Namibia Orange Basin Appraisal and Exploration Campaign Block 2913B, offshore Namibia, contains the Venus light oil field, discovered by the Venus-1X well, drilled in 2022 and subsequently successfully appraised with three further wells and four drill stem tests. The Joint Venture is continuing to progress the proposed development of the Venus Field, with development studies ongoing. The Venus Field is expected to be the first development in Block 2913B, producing 150kbopd (gross field) of ~45° API oil, with final investment decision expected by the end of H1 2026. During 2024, two additional 3D seismic acquisition programs were completed to facilitate further exploration over the southern and northern parts of the Blocks. This has resulted in most of the licensed area now being covered by 3D seismic. This data is currently being processed and interpreted and will help further evaluate prospects and leads in the far northern and southern parts of the Blocks. On February 3, 2025, the Deepsea Mira drilling rig spud the Marula-1X exploration well within the southern part of Block 2913B. This well will target Albian-aged sandstones, within the Marula fan complex and has the potential to unlock further exploration targets across the south, which is an area lying at the heart of the prolific Kudu source-rock kitchen. Deepsea Mira is also expected to drill the Olympe prospect, targeting Albian sands within a structural closure on Block 2912. On January 10, 2024, the Company announced a strategic farm down agreement between its investee company Impact Oil and Gas Limited (“Impact”), and TotalEnergies, that allows the Company to continue its participation in the world class Venus oil development project, and the follow-on exploration campaign on the Blocks with no upfront costs. This transaction frees up the Company’s balance sheet for the pursuit of other growth opportunities and shareholder capital returns. As announced on November 1, 2024, this farm down deal closed following the receipt of the final approval from Government of Namibia. At the date hereof, AOC has an interest in this program through its 39.5% shareholding in Impact, which in turn has a 9.5% WI in each of Block 2913B (PEL 56) and Block 2912 (PEL 91). Nigeria Agbami field performed in line with expectations throughout 2024. Planned maintenance on one of the three compressors commenced at the end of Q4 2024 and continued into Q1 2025. The remaining two compressors will also be overhauled over the coming 2 years to maintain high equipment uptime. Processing of the 4D-M3 seismic acquired in Q3 2024 is underway and other preparations for the next drilling campaign, scheduled for 2026, are continuing as planned. A planned full-field shut down for maintenance activities is scheduled for Q4 2025. The Egina field completed the year above the production plan thanks to its high production efficiency and successful well interventions during Q3 2024 and Q4 2024. Well planning for a 2025 drilling program based on the 4D-M2 acquired in Q2 2024 is ongoing with drilling commencing in Q1 2025. The Akpo field ended the year with production rates in line with those at the start of 2024, primarily due to the Akpo West wells performing above expectation and the infill well on Akpo main offsetting natural decline in the field. A total of 3 new producers and 1 new injector were completed and tied back to the Akpo FPSO in 2024. Overall, for 2024, production was below the production plan due to drilling delays pushing the expected production gains from drilling to the second half of the year. Well planning for additional infill drilling, based on the 4D-M4 seismic acquired in Q1 2024, and potential near field exploration are underway. The 2023 and 2024 Egina and Akpo drilling campaign was paused in November 2024 to allow time to mature drilling opportunities from the 2024 seismic acquisition campaigns. The 2025 campaign kicked off in January 2025 as planned. Progress on phase 2 of the Preowei Field front end engineering design (“FEED”) is now subject to further cost optimization and the results of ongoing field development studies on the basis of the 4D baseline seismic acquisition acquired in Q2 2024. These work streams are aimed at supporting an FID decision on the project and enabling Engineering, Procurement, Construction and Installation (“EPCI”). ===== SIDA 17 ===== PAGE 7 Report to Shareholders | December 31, 2024 Africa Oil Corp. HIGHLIGHTS AND OUTLOOK - CONTINUED South Africa Orange Basin, Block 3B/4B Block 3B/4B lies to the southeast and on trend with a number of Orange Basin oil discoveries including Venus. There is approximately 14,000 km of 2D seismic and 10,800 km2 of 3D seismic over the block, identifying a large opportunity set of exploration prospects. On August 28, 2024, the Company announced the completion of the farm down agreement with TotalEnergies and QatarEnergy for the Orange Basin Block 3B/4B. The Company retained a 17.0% interest in Block 3B/4B and transferred the operatorship of the block to TotalEnergies, for a maximum consideration of $46.8 million, including the exploration carry of its retained interest. On January 10, 2025, the Company completed a separate transaction with Azinam, a subsidiary of Eco for the transfer of a 1.0% (one percent) interest to the Company, increasing the group’s direct interest in Block 3B/4B to 18.0%. The Company will have the benefit of exploration carry for the additional 1.0% interest assigned to it by Azinam. An Environmental Authorization for exploration activities (drilling of up to 5 exploration wells) was granted by the Department of Mineral Resources and Energy for the Republic of South Africa on September 16, 2024. The legislative notification and appeals process is in progress with the relevant regulatory agencies. Equatorial Guinea On December 23, 2024, the Company was granted a 1 year extension to the first exploration sub period on both two exploration licenses (EG-18 and EG-31), offshore Equatorial Guinea. The Company also received approval of the first amendment to the EG-31 Production Sharing Contract (PSC). The amendment expanded the block boundary to ensure that the full extent of the two main exploration prospects were captured fully within the block boundary. The Company is continuing with the farm down process for Blocks EG-18 and EG-31 as well as subsurface studies to enhance the definition of multiple targets already identified. The Company holds an operated WI of 80.0% in each of Blocks EG-18 and EG-31. SUMMARY OF 2024 MANAGEMENT GUIDANCE AND ACTUALS Prime, net to AOC’s 50% shareholding: 2024 Actuals 2024 Updated Guidance WI production (boepd) (1) 17,000 16,500 – 18,500 Entitlement production (boepd) (1) 19,400 18,000 – 21,000 Cash flow from operations (million) (2, 3) $267.8 $260.0 - $290.0 Capital investment (million) $76.3 $80.0 - $110.0 (1) All of the Company’s production is contributed solely by its shareholding in Prime. Entitlement production is calculated using the economic interest methodology and includes cost oil, profit oil, tax oil and royalty oil and is different from WI production that is calculated based on project volumes multiplied by Prime’s effective WI. (2) Cash flow from operations before working capital adjustments and interest payments. (3) Prime does not pay dividends to its shareholders, including the Company, on a fixed pre-determined schedule. Previous number of dividends and their amounts should not be taken as a guide for future dividends to be received by the Company. Any dividends received by the Company from Prime’s operating cash flows will be subject to Prime’s capital investment and financing cashflows, including payments of Prime’s RBL principal amortization, which are subject to semi-annual RBL redeterminations, and Prime’s minimum cash on hand requirements. Africa Oil will announce its 2025 Management Guidance on the closing of the Proposed Reorganization, which is expected on or about March 7, 2025. ===== SIDA 18 ===== PAGE 8 Report to Shareholders | December 31, 2024 Africa Oil Corp. THE COMPANY’S SHAREHOLDING AND WORKING INTERESTS The Company’s material interests and material exploration partnership interests as at December 31, 2024, are summarized in the following table: Africa Oil’s Shareholding in Prime Oil & Gas Coöperatief U.A. (50%) (1) Country Concession License renewal Working Interests NIGERIA PML 52 November 24, 2044(2) Prime Chevron Corporation Famfa Oil 8% 32% 60% (carried) PML 2, 3, 4 and PPL 261 – PSA May 24, 2043(2) Prime TotalEnergies SAPETRO 32% 48% 20% (carried) Africa Oil’s Shareholding in Impact Oil & Gas Limited (39.5%) Country Concession License renewal Working Interests NAMIBIA PEL 56 (Block 2913B) April 1, 2025 Impact TotalEnergies QatarEnergy NAMCOR 9.5% 50.5% 30% 10% (carried) PEL 91 (Block 2912) October 1, 2027 Impact TotalEnergies QatarEnergy NAMCOR 9.5% 47.2% 28.3% 15% (carried) Africa Oil’s Direct Working Interests (3,4) Country Concession License renewal Working Interests SOUTH AFRICA Block 3B/4B October 26, 2024 (5) AOC TotalEnergies (Operator) QatarEnergy Azinam Ricocure (Pty) Ltd 17% (6) 33% 24% 5.25% 19.75% EQUATORIAL GUINEA EG-18 EG-31 March 1, 2026 AOC (Operator) GEPetrol 80% 20% (1) At December 31, 2024, the Company had a 50% shareholding in Prime. On completion of the Proposed Reorganization, the Company will hold a 100% interest in Prime. Completion of the Proposed Reorganization is targeted to occur on or about March 7, 2025. (2) Renewal of the rights under OML 130 resulted in the award of three new petroleum mining leases and one petroleum prospecting license. These cover some of the areas previously covered by OML 130, with some of the areas also relinquished. These are PML 2 (Akpo field), PML 3 (Egina), PML 4 (Preowei) and PPL 261 (South Egina). 50% of the production (currently from PMLs 2 and 3, future production from PML 4 and potential future production from PPL 261) is covered by a PSA framework, in which Prime owns a 32% WI. Prime’s net WI in these assets is therefore 16%. Conversion of OML 127 to the new PIA earlier this year also resulted in the new designation of PML 52 for the license area that contains part of the Agbami oil field. (3) Net WI are subject to back-in rights or carried WI, if any, of the respective governments or national oil companies of the host governments. (4) The Company has agreed with its JV parties its withdrawal from the entirety of the production sharing contracts and joint operating agreements for Blocks 10BB, 13T and 10BA in Kenya with effect on and from June 30, 2023. The Company is waiting for government consent to complete its withdrawal and the transfer of rights and future obligations. (5) The operator has submitted an application for license renewal. This is currently awaiting Government approval. (6) As at December 31, 2024, the Company held a non-operated WI of 17%. On January 13, 2025, the Company announced the completion of the agreement with Eco for the acquisition of an additional 1% from Azinam, as a result of which the Company increased its interest to 18%. Information on the Company’s equity interests in Africa Energy, Eco and Impact is included in ‘Equity Investments in Associates’ on pages 18-19. ===== SIDA 19 ===== PAGE 9 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE Macroeconomic conditions Q4 2024 was the most subdued quarterly period during 2024 for international oil price decks. Average Bloomberg Dated Brent price of $74.7/bbl compared to an average of $80.3/bbl for Q3 2024, and full-year 2024 average of $80.7/bbl. During Q4 2024 Bloomberg Date Brent traded at a high of $81.2/bbl and a low of $71.3/bbl. Full-year 2024 average price of $80.7/bbl was approximately 2% lower than full-year 2023 average of $82.6/bbl and approximately 5% lower than the preceding 3-year average of $84.8/bbl. The overall price weakness during 2024 was driven by the negative outlook for Chinese economic activity, above-average OPEC spare capacity and the outlook of growing supplies from non-OPEC countries. These factors were countered by geopolitical tension in the Middle East and concerns over a widening conflict in the region. The conflict in the Middle East impacted maritime traffic through the Red Sea, including the flow of oil tankers, during 2024 and highlighted the risks to oil supplies from the region, which remains a key production area for the global markets. These challenges reiterated the strategic advantage of West African oil production for the Atlantic basin markets. Nigeria economic environment Nigeria’s year-on-year headline inflation rate reached a new record of 34.8% in December 2024 driven by higher transport costs and consumer spending during the holiday season. This followed an upward trend in inflationary pressure from August 2024, after a brief reversal with inflation falling from 34.2% in June to 32.2% in August. Inflationary pressures, exacerbated by the devaluation of the country’s currency, Naira, have resulted in significant economic hardship leading to social unrest in the country. The Central Bank of Nigeria raised interest rates six times last year in an attempt to control inflation, and the government of Nigeria expects headline inflation to drop to 15% during 2025, in part helped by lower imports of petroleum products. However, the outlook for Nigerian economic activity, productivity gains and in turn inflationary direction remains highly uncertain. Prime’s business in Nigeria has limited exposure to these local economic developments with its revenues denominated in US Dollars. Also, considering the location of the producing assets in deepwater, offshore Nigeria, Prime’s operations are shielded from the security challenges faced onshore Nigeria. SHAREHOLDER RETURNS On completion of the Proposed Reorganisation, subject to the customary consents and approvals, including Africa Oil’s board approval, the Company plans to implement an enlarged annual base dividend of $100 million, to be distributed to its shareholders on a quarterly basis. The Company also intends to distribute 50% free cashflows net of the base dividend of $100 million in supplementary special dividends and/or share buybacks, subject to the customary consents and approvals. On February 27, 2025, the Company announced its intention to declare the first quarterly dividend of $25 million or approximately $0.037 per share, on the closing of the Proposed Reorganisation. This and other future dividend distributions are subject to customary board approval and consents. During 2024 the Company returned $67.9 million to shareholders through its base dividend policy and share buybacks executed under its Normal Course Issuer Bid (“NCIB”). The Company distributed two semi-annual dividends for a total of $0.05 per share (approximately $22.6 million) during 2024. The Company views the 2024 distributions to have been prudent with due consideration for its capital allocation options and the priority of maintaining a strong balance sheet in a range of market scenarios. The Company repurchased its shares under a NCIB program that was launched on December 6, 2023, and which expired on December 5, 2024, as well as a new program that was launched on December 6, 2024. In total, during 2024, the Company repurchased a total of 26,519,932 at an average price of C$2.34 per share with an aggregate amount of $45.3 million. During Q4 2024, the Company repurchased a total of 4,587,700 shares at an average price of C$1.90 per share. Pursuant to the current NCIB (launched on December 6, 2024) Africa Oil is authorized to repurchase through the facilities of the TSX, Nasdaq Stockholm and/or alternative Canadian trading systems, as and when considered advisable by Africa Oil, up to 18,362,364 Common Shares of the Company, which represented 5% of its “public float” of 367,247,289 Common Shares as at November 22, 2024. Purchases of Common Shares may occur over a period of up to twelve months commencing December 6, 2024, and ending on the earlier of December 5, 2025, the date on which the Company has purchased the maximum number of Common Shares permitted under the NCIB, and the date on which the NCIB is terminated by Africa Oil. There cannot be any assurances as to the number of Common Shares that will ultimately be acquired by the Company. Any Common Shares purchased by Africa Oil under the NCIB will be cancelled. In Canada, Bill C-59 sets out taxes on repurchases of equity, with a 2% tax applying to the net value of shares repurchased by any corporation resident in Canada whose shares are listed on a designated stock exchange. Bill C-59, was enacted on June 20, 2024, and the Company has accrued for the tax payable on shares purchased during 2024. ===== SIDA 20 ===== PAGE 10 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED EQUITY INVESTMENT IN PRIME – NIGERIA The Company’s 50% equity interest in Prime as at December 31, 2024, is accounted for as an investment in joint venture under the equity method on the Balance Sheet. During the period the Company recorded a 50% share of Prime’s net income or loss as well as a 50% share of its other comprehensive income or loss in the period in the Consolidated Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. Dividends received are disclosed as a cash flow from investing activities in the Consolidated Statement of Cash Flows. The main assets of Prime are an indirect 8% WI in PML 52 and an indirect 16% WI in PMLs 2, 3 and 4 as well as PPL 261. PML 52 is operated by affiliates of Chevron and covers part of the producing Agbami field. PMLs 2, 3 and 4 and PPL 261 are operated by affiliates of TotalEnergies and contain the producing Akpo and Egina fields. The three fields in these PMLs are located over 100 km offshore Nigeria. All three fields have high quality reservoirs and produce light to medium sweet crude oil through FPSO facilities. Akpo and Egina also export associated gas which feeds into the Nigerian liquified natural gas plant, whilst Agbami associated gas is mostly reinjected. All amounts included in the narrative discussions below are net to the Company’s 50% shareholding in Prime as at December 31, 2024, unless otherwise noted. Production and Operations Production Metrics – rounded Three months ended Years ended Unit December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Total gross field production boepd 270,300 296,700 273,600 314,200 Net to AOC’s 50% shareholding: Average daily WI production (1) boepd 17,200 18,500 17,000 19,800 Average daily entitlement production boepd 19,500 21,700 19,400 22,400 Oil volumes sold MMbbl - 2.0 4.5 6.4 Gas volumes sold bcf 2.5 2.4 8.7 9.5 Oil/gas percentage split % 74%/26% 80%/20% 77%/23% 81%/19% (1) Production allocation occurs periodically and can result in a change in production numbers previously reported. The total gross field production in Q4 2024 was lower than Q4 2023, primarily due to the expected natural reservoir decline across all assets. The total gross field production in 2024 was lower than 2023 primarily due to a planned maintenance shutdown at the Akpo FPSO and the expected natural reservoir decline across all assets. The Agbami and Egina fields production was in line with the plan for 2024. The Akpo field underwent a full field shutdown in mid-March to perform maintenance on equipment with production resuming in mid-April. New wells drilled and completed in Akpo continue to exceed expectations and assist offsetting the natural production decline of the field. Entitlement production is calculated using the economic interest methodology and includes cost oil, profit oil, tax oil and royalty oil. It differs from WI production which is calculated based on field volumes multiplied by Prime’s effective WI in each Block. The cargoes lifted by Prime and described below represent Prime’s share of cost oil, profit oil and included in the comparative period part of income tax oil in relation to the period prior to conversion to the new PIA regime. The remaining part of income tax oil and royalties was either lifted and sold by the operator or paid in cash, to settle the tax and royalty obligations to the Nigerian state. From August 2023, Prime has been lifting its own entitlement production and paying its tax in cash. Aggregate oil equivalent production data comprises of light and medium crude oil and conventional natural gas production net to Prime’s WI in the Agbami, Akpo and Egina fields. These production rates only include sold gas volumes and not those volumes used for fuel, reinjected or flared. In Q4 2024, Prime was allocated no oil liftings. Cargos initially scheduled for Q4 2024 have been pushed into Q1 2025 resulting in a large underlift position at the end of Q4 2024. Up to 5 cargos are scheduled to be lifted in Q1 2025 unwinding this large underlift position. In Q4 2023, Prime was allocated 4 oil liftings with total sales volume of approximately 3.9 million barrels or 2.0 million barrels net to the Company’s 50% shareholding at an average realized oil price of $86.6/bbl. In 2024, Prime was allocated 9 oil liftings with total sales volume of approximately 9.0 million barrels or 4.5 million barrels net to the Company’s 50% shareholding at an average realized oil price of $84.6/bbl. In 2023, Prime was allocated 13 oil liftings with a total sales volume of approximately 12.9 million barrels or 6.4 million barrels net to the Company’s 50% shareholding at an average realized oil price of $84.6/bbl. ===== SIDA 21 ===== PAGE 11 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED Financial Prime’s financial information is presented in note 5 of the financial statements on a 100% basis, with a reconciliation to the Company’s 50% share of Prime’s net assets and net income. In Q4 2024 and full year 2024, the result from the 50% investment in Prime was an income of $159.3 million and $226.0 million respectively (Q4 2023 and full year 2023 – loss of $79.3 million and a profit of $228.0 million respectively). As at December 31, 2024, the Company’s investment in Prime was $328.4 million (as at December 31, 2023 - $572.5 million) following the recognition of a non-cash impairment charge of $436.7 million as a result of the significant decrease in the Africa Oil share price between June 24, 2024, when the Company announced the Proposed Reorganization and December 31, 2024. The fair value of the existing 50% shareholding in Prime decreased as the fair value considers the number of Africa Oil shares that were agreed in relation to the purchase of the additional interest in Prime and the trading value of Africa Oil shares as this is an observable fair value input under IFRS Accounting Standards. As at December 31, 2024, the fair value of the Company’s existing shareholding in Prime was calculated to be $328.4 million based on the Africa Oil share price of CAD 1.97 as of December 31, 2024, and the USD/CAD exchange rate of 1.4384 as of December 31, 2024. All amounts presented and discussed below are net to AOC’s 50% shareholding in Prime (unless otherwise stated) to reflect AOC’s 50% shareholding in Prime. Financial Metrics(1) Three months ended Years ended Net to AOC’s 50% shareholding: Unit December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Total revenues $’m 2.2 173.6 391.4 581.1 Cost of Sales (2) $’m (34.0) 103.1 208.6 299.0 Gross profit $’m 36.2 70.5 182.8 282.1 Opex/boe (3,4) $/boe 9.9 12.0 10.3 9.2 Cash flow from operations before working capital $’m 52.9 64.1 267.8 300.4 Cash flow from operations $’m 29.3 43.9 273.6 237.9 Free cash flow $’m 8.8 16.7 197.2 149.1 Free cash flow/boe (4) $/boe 4.4 8.4 27.8 18.2 Tax $’m 23.3 5.9 60.3 (122.7) Capex (5) $’m 20.5 27.2 76.3 88.8 Dividends paid $’m 11.0 50.0 36.0 175.0 Net Debt $’m 175.3 298.9 175.3 298.9 EBITDAX $’m 242.3 112.3 519.5 460.3 Net Debt/EBITDAX (6) ratio 0.3 0.7 0.3 0.7 AOC Net Cash/ (Debt) inclusive of 50% Prime Net Debt $’m (113.9) (66.9) (113.9) (66.9) (1) The table includes non-GAAP measures. Definitions and reconciliations to these non-GAAP measures are provided on pages 13-16 (2) Given the nature of Prime’s operations in terms of oil cargo liftings and the variability in their frequency from one quarter to next, the non-cash accounting treatment of underlift/overlift and the timing between recording revenues and receipts of sales cash, leads to high variability in Prime’s quarterly financial metrics. Please refer to the commentary in the rest of this section for the specific details of this period’s changes relative to the corresponding historical period. (3) Opex represents production costs presented on Prime’s Statement of Net Income and Other Comprehensive Income in note 5 to the financial statements. (4) Boe is calculated on an entitlement basis. (5) Full year 2024 amount includes the PML 52 license renewal fee and 2023 amount includes the PMLs 2, 3 and 4 and PPL 261 license renewal fee both of which have been capitalized to oil and gas interests. (6) Calculated on a 12-month rolling basis until December 31, 2024, and December 31, 2023, respectively. ===== SIDA 22 ===== PAGE 12 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED Total Revenues Three months ended Years ended Unit December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Per Prime’s financial statements Total revenue $’m 4.4 347.2 782.7 1,162.2 Net to AOC’s 50% shareholding: Oil revenue $’m - 170.7 381.1 545.3 Gas revenue $’m 2.2 2.9 10.3 8.1 PPT revenue $’m - - - 19.8 Royalty revenue $’m - - - 7.9 Total revenue $’m 2.2 173.6 391.4 581.1 Realized oil prices (1) $/bbl - 86.6 84.6 84.6 Oil volumes sold MMbbl - 2.0 4.5 6.4 Realized gas prices $/bcf 1.0 1.2 1.2 0.9 Gas volumes sold Bcf 2.5 2.4 8.7 9.5 (1) Realized oil prices might be different to values calculated from the table above due to roundings. There were no oil liftings in Q4 2024 and therefore no oil revenue was recognized compared to Q4 2023. Cargos initially scheduled for Q4 2024 have been pushed into Q1 2025 with up to 5 cargos scheduled to be lifted in Q1 2025. The decrease in oil revenue in 2024 was lower due to lower liftings in 2024 compared to 2023. PPT revenue is revenue recognized for tax oil, being Prime’s share of entitlement production that is sold by the operators to settle its tax obligations to the Nigerian state. As the tax oil lifted by the operator on behalf of Prime is sold to 3rd party customers and proceeds are used to settle Prime’s tax liabilities, this share of PPT is considered to be within the scope of IFRS 15, ‘Revenue from contracts with customers’. Consequently, this portion of income tax is presented gross in revenue and offset in current income tax expense. Prime has no longer reported PPT revenue since August 2023 following conversion to PIA as PPT is no longer due under the act with Prime lifting its own entitlement production and paying its tax in cash. Up to the end of July 2023, PML 52 royalties were presented gross in both revenue and cost of sales. No royalty revenue has been reported anymore since August 2023 with PML 52 royalties being paid in cash and presented in cost of sales. Cost of sales Three months ended Years ended $’m December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Per Prime’s financial statements Total cost of sales (68.0) 206.3 417.2 598.0 Net to AOC’s 50% shareholding: DD&A 43.5 43.7 186.0 180.9 Production costs 17.9 24.0 73.1 75.5 Movements on overlift/underlift balances (102.4) 31.5 (85.6) 11.8 Royalties – oil and gas 7.0 3.9 35.1 30.8 Total cost of sales (34.0) 103.1 208.6 299.0 Cost of sales decreased in Q4 2024 and 2024 compared to Q4 2023 and 2023 primarily due to a large underlift movement in Q4 2024 and 2024 compared to an overlift movement in Q4 2023 and 2023. Cargos initially scheduled for Q4 2024 have been pushed into Q1 2025 resulting in a large underlift position at the end of Q4 2024 which is a credit to cost of sales. Up to 5 cargos are scheduled to be lifted in Q1 2025 unwinding this large underlift position. ===== SIDA 23 ===== PAGE 13 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED Opex/boe Opex/boe is a non-GAAP measure which represents production costs on a per barrel of oil equivalent basis (using entitlement production). This allows the Company to better analyze performance against prior periods on a comparable basis. The most direct financial statement measure is production costs, disclosed in note 5 to the financial statements. Entitlement production is calculated using the economic interest methodology and includes cost recovery oil, tax oil, profit oil and royalty oil and is different from WI production that is calculated based on project volumes multiplied by Prime’s effective WI in each Block. Three months ended Years ended Unit December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Per Prime’s financial statements Production costs $’m 35.6 48.0 146.1 151.0 Net to AOC’s 50% shareholding: Production costs $’m 17.9 24.0 73.1 75.5 Entitlement production MMboe 1.8 2.0 7.1 8.2 Opex/boe $/boe 9.9 12.0 10.3 9.2 Production costs have decreased in 2024 compared to 2023 because of planned shutdown maintenance costs during H1 2024. Opex/boe decreased in Q4 2024 compared to Q4 2023 primarily from the lower production costs. Opex/boe increased in 2024 compared to 2023 as a result lower entitlement production despite a decrease in production costs. Entitlement production is used as the denominator as production costs include carry of costs that are recovered through entitlement production. Cash flow from operations Cash flow from operations before working capital is a non-GAAP measure. This represents cash generated by removing the impact from working capital from cash generated by operating activities and is a measure commonly used to better understand cash flow from operations across periods on a consistent basis and when viewed in combination with the Company’s results provides a more complete understanding of the factors and trends affecting the Company’s performance. A reconciliation from cash flow from operations to cash flow from operations before working capital is shown below: Three months ended Years ended $’m December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Per Prime’s financial statements Cash flow from operations 58.6 87.8 547.2 475.8 Net to AOC’s 50% shareholding: Cash flow from operations 29.3 43.9 273.6 237.9 Working capital adjustments included in cash flow from operations Changes in trade and other receivables (67.2) 56.0 (78.4) 16.0 Changes in over/underlift balances 102.4 (31.4) 85.6 (11.8) Changes in other working capital balances (11.6) (4.4) (13.0) 58.3 Total working capital adjustments 23.6 20.2 (5.8) 62.5 Cash flow from operations before working capital 52.9 64.1 267.8 300.4 ===== SIDA 24 ===== PAGE 14 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED Cash flow from operations before working capital decreased in Q4 2024 compared to Q4 2023. This is primarily from lower oil prices and lower tax payments in Q4 2024. Cash flow from operations before working capital decreased in 2024 compared to 2023. This is primarily from lower production volumes in 2024 compared to 2023 and lower other operating income partly offset by lower tax payments in 2024 Other operating income recognized in 2023 consisted of investment tax credits which could be offset against PPT which is no longer applicable since Prime operates under the PIA terms. Cash flow from operations decreased in Q4 2024 compared to Q4 2023 primarily as there were no liftings in Q4 2024 compared to Q3 2023 with working capital adjustments being relatively consistent. Cash flow from operations has increased in 2024 compared to 2023 as there were lower liftings in 2024 compared to 2023 and there was a working capital release in the 2024 compared to a working capital build in 2023. FCF and FCF/boe FCF is a non-GAAP measure. This measure represents cash generated after costs, and is a measure commonly used to assess the Company’s profitability. A reconciliation from total cash flow (a GAAP measure) to FCF (a non-GAAP measure) is shown below: Three months ended Years ended Unit December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Per Prime’s financial statements Total cash flow $’m (21.2) (85.6) 247.3 (179.5) Add back dividends $’m 22.0 100.0 72.0 350.0 Add back debt service costs (1) $’m 16.8 18.9 71.9 122.3 Add back derivatives $’m - - 3.2 5.3 FCF $’m 17.6 33.3 394.4 298.1 Net to AOC’s 50% shareholding: FCF $’m 8.8 16.7 197.2 149.1 Entitlement production MMboe 1.8 2.0 7.1 8.2 FCF/boe $/boe 4.4 8.4 27.8 18.2 (1) Debt service costs comprise interest payments, repayments and drawdowns of third-party borrowings. FCF and FCF/boe in Q4 2024 has decreased compared to Q4 2023 primarily from the lower cash flow from operations. FCF and FCF/boe has increased in 2024 compared to 2023 primarily from the higher cash flow from operations and lower tax payments. FCF/boe is a non-GAAP ratio which represents FCF on a per barrel of oil equivalent basis using entitlement production which allows the Company to better analyze performance against prior periods on a comparable basis. Entitlement production is calculated using the economic interest methodology and includes cost oil, profit oil, tax oil and royalty oil and is different from WI production that is calculated based on project volumes multiplied by Prime’s effective WI in each Block. Tax The tax expense is made up of the following items: Three months ended Years ended $’m December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Per Prime’s financial statements Petroleum Profit Tax - - (2.3) 138.1 Deferred tax income (24.5) (87.3) (80.9) (570.9) Education tax 2.1 7.9 14.2 21.9 Corporate income tax 17.1 74.9 130.1 134.3 Withholding tax on dividends 15.0 13.0 22.5 28.0 Capital gains tax 33.0 - 33.0 - Other taxes 3.9 3.2 3.9 3.2 Total tax 46.6 11.7 120.5 (245.4) Net to AOC’s 50% shareholding: Total tax 23.3 5.9 60.3 (122.7) ===== SIDA 25 ===== PAGE 15 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED The tax charge was higher in Q4 2024 compared to Q4 2023. Deferred income tax was higher in Q4 2023 compared to Q4 2024 following an impairment recognized in Prime in Q4 2023 which resulted in a deferred tax release. Corporate income tax was lower in Q4 2024 compared to Q4 2023 from lower revenues in Q4 2024 compared to Q4 2023 and lower corporate income tax rates. Capital gains tax in Q4 2024 relates to the income recognized by Prime under the Securitization Agreement at a Capital Gains Tax rate in Nigeria of 10 percent. There was a tax charge in 2024 compared to an income in 2023. In 2023, Prime renewed the OML 130 license resulting in OML 130 operating under the terms of the new Petroleum Industry Act as from June 1, 2023, and Prime voluntarily converted the OML 127 license. The renewal of the OML 130 license resulted in the award of three new petroleum mining leases and one petroleum prospecting license. These cover some of the areas previously covered by OML 130, with some of the areas also relinquished. These are PML 2 (Akpo field), PML 3 (Egina), PML 4 (Preowei) and PPL 261 (South Egina). The conversion of the OML 127 license resulted in the award of PML 52. Under these terms, PML 2, 3, 4 and 52 and PPL 261 are subject to a 30% Corporate Income Tax regime compared to the previous 50% PPT regime which resulted in the release of $62.0 million of deferred tax liabilities for PML 52 and $346.0 million of deferred income tax liabilities PML 2, 3 and 4 and PPL 261 during 2023. Capital gains tax in 2024 relates to the income recognized by Prime under the Securitization Agreement at a Capital Gains Tax rate in Nigeria of 10 percent. Petroleum Profits Tax is a tax on the income of companies engaged in upstream petroleum operations in Nigeria. The PPT rate for petroleum operations under production sharing contracts with the Nigerian National Petroleum Corporation (NNPC) is 50%. Since operating under the new PSA terms following conversion during 2023, the leases and licenses are no longer subject to PPT. Education tax is imposed on every Nigerian company at a rate of 3.0% of the assessable profit in the period. Capital expenditure Capital expenditure in Q4 2024 and 2024 amounted to $20.5 million and $76.3 million, respectively, net to the Company’s 50% shareholding in Prime. Capital expenditure in Q4 2024 mainly related to Prime’s share of the PML 52 renewal fee. In 2024, capital expenditure mainly related to the infill drilling campaign on PML 2, with the drilling and completion of two Akpo West wells, and the drilling of a third Akpo West well that completed during April 2024 as well as the PML 52 license fee renewal. Expenditures in Q4 2023 and 2023 of $27.2 million and $88.8 million mainly related to the OML 130 drilling campaign with the drilling of two production wells on the Akpo West Field. Capital expenditure in 2023 also included the share of the OML 130 renewal fee. Dividends paid In Q4 2024, Prime made one dividend payment with a net payment to the Company of $11.0 million (Q4 2023 – one dividend payment with a net payment to the Company of $50.0 million). In 2024, Prime made two dividend payments with a net payment to the company of $36.0 million (2023 – three dividend payments with a net payment to the Company of $175.0 million). Net Debt Net Debt is a non-GAAP measure. Net Debt is calculated as loans and borrowings less cash and cash equivalents. As at/ $’m December 31, 2024 December 31, 2023 Per Prime’s financial statements Loans and borrowings 750.0 750.0 Cash and cash equivalents (399.5) (152.2) Net Debt 350.5 597.8 Net to AOC’s 50% shareholding: Net Debt 175.3 298.9 Net to AOC’s 50% shareholding, Prime has $199.7 million of cash and $375.0 million of debt (as at December 31, 2023 - $76.1 million of cash and $375.0 million of debt). During 2024, $250.0 million of the commitments under Prime’s RBL facility were cancelled, reducing the principal amount from $1,050.0 million to $800.0 million. $750.0 million remains drawn and outstanding at December 31, 2024. ===== SIDA 26 ===== PAGE 16 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED EBITDAX and Net Debt/EBITDAX EBITDAX is a non-GAAP measure. This is used as a performance measure to understand the financial performance from Prime’s business operations without including the effects of the capital structure, tax rates, DD&A, impairment and exploration expenses. A reconciliation from total profit (a GAAP measure) to EBITDAX (a non-GAAP measure) is shown below. Net Debt/EBITDAX is a non-GAAP measure. Net Debt divided by EBITDAX is a measure of the leverage. Three months ended Twelve months ended $’m December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Per Prime’s financial statements Total profit/ (loss) 318.7 (158.6) 452.0 456.0 Add back: Tax 46.6 11.7 120.5 (245.4) Finance costs 22.7 22.7 97.8 89.5 Finance income 8.1 (2.1) (6.4) (6.8) DD&A and Impairment 87.0 350.6 372.0 625.0 Exploration expenses 1.5 0.3 3.1 2.3 EBITDAX 484.6 224.6 1,039.0 920.6 Net Debt (350.5) (597.8) Net Debt/EBITDAX 0.3 0.7 Net to AOC’s 50% shareholding: Net Debt (175.3) (298.9) EBITDAX 519.5 460.3 Net Debt/ EBITDAX 0.3 0.7 AOC Net Cash 61.4 232.0 AOC Net Cash/(Debt) inclusive of 50% Prime Net Debt (113.9) (66.9) EBITDAX has increased in Q4 2024 compared to Q4 2023. The increase is mainly relating to other operating income recognized by Prime in Q4 2024 under the Securitization Agreement as no comprehensive resolution was reached among all unit parties in respect of the tract participation in the Agbami field by December 27, 2024. This is offset against lower production volumes. EBITDAX has increased in 2024 compared to 2023. The increase is mainly relating to other operating income recognized by Prime in Q4 2024 under the Securitization Agreement as no comprehensive resolution was reached among all unit parties in respect of the tract participation in the Agbami field by December 27, 2024. This is offset against lower production volumes and the fact that no other operating income related to tax credits is recognized in 2024 as Prime operates now under the PIA terms. Crude Oil Marketing In considering Prime’s cargo liftings, the reader should note that the timing and the frequency of these can vary based on a number of factors such as: reservoir performance; actual realized oil price; capex; opex; underlift/overlift positions and marine logistics. The revenue numbers reported for Prime include cost oil, profit oil, tax oil and royalty oil where relevant for each field. Prime uses contingent physical forward sales contracts for the marketing and sale of its lifted entitlement production, to manage commodity price risk and ensure stability in cash flows in line with the marketing strategy. Prime does not fix the Dated Brent component of the sales price at the time of entering the contract, instead using a trigger pricing mechanism, whereby Prime gives an irrevocable instruction to an off-taker to fix the Dated Brent component of a cargo, if the forward curve price goes below a certain trigger based on a percentage of the Brent forward curve (at the time the instruction was given) for the month of the expected lifting. If the forward curve price never goes below that threshold, the cargo is sold spot. In Q3 2024, Prime purchased an Asian put option for one million barrels of oil. This option protects Prime against price movements below $75.0/bbl in the period between January 2 and March 31, 2025. If the average spot price in the period between January 2 and March 31, 2025, falls below $75.0/bbl then Prime is compensated in cash for the difference with the strike price of $75.0/bbl. If the average spot price in the period is above the strike price the option would expire and Prime benefits from the higher price. ===== SIDA 27 ===== PAGE 17 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED In Q3 2024, Prime also entered into a zero-premium Asian Dated Brent Collar transaction for one million barrels of oil. This contract protects Prime against price movements below $75.0/bbl with a cap of $90.85/bbl in the period between December 1, 2024, and February 28, 2025. If the average spot price in the period between December 1, 2024, and February 28, 2025, falls below $75.0/bbl then Prime is compensated in cash for the difference with the strike price of $75.0/bbl. If the average spot price in the period is above $90.85/bbl then Prime has to compensate in cash for the difference with the strike price of $90.85/bbl. Based on the average spot price to the date of release of this MD&A, Prime expects no actual cash settlement for this Asian Dated Brent Collar. The average cargo size lifted is one million barrels of oil. Oil sales were comprised of the following: Unit Three months ended Years ended Oil Sales December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Number of cargo liftings - 4 9 13 Of which: Sold forward with the trigger price mechanism activated - - 2 2 Sold at spot - 4 7 11 - 4 9 13 Gross crude oil sales Quantity in Mboe Mboe - 3,943.3 9,012.8 12,891.7 Average sales price $/bbl - 86.6 84.6 84.6 Average Bloomberg Dated Brent for the period $/bbl - 84.3 82.7 82.6 Subsequent to the period-end, Prime sold three cargos with an average Dated Brent price of $81.6/bbl. Prime is expected to lift 2 more cargoes before the end of Q1 2025. Of the 7 cargoes expected for the remainder of the year post Q1 2025, 5 cargos are hedged with an average trigger price of $65.2/bbl. As of the date of this report none of the trigger prices have been triggered. Other non-GAAP measures related to Prime This MD&A includes non-GAAP measures, non-GAAP ratios and supplementary financial measures as further described herein. These non-GAAP figures do not have a standardized meaning prescribed by IFRS Accounting Standards and, therefore, may not be comparable with the calculation of similar measures by other companies. The Company believes that the presentation of these non- GAAP figures provides useful information to investors and shareholders as the measures provide increased transparency and the ability to better analyze performance against prior periods on a comparable basis. BLOCK 3B/4B – SOUTH AFRICA On August 28, 2024, the Company announced the completion of the strategic farm down agreement with TotalEnergies and QatarEnergy. The Company retained a direct 17.0% non-operated interest in the block and operatorship was transferred to TotalEnergies. Transaction highlights are: • Maximum transaction value of up to $46.8 million to the Company. • The Company will receive, subject to achieving certain milestones defined in the farm down agreement, staged payments for a total cash amount of $10.0 million, of which $3.3 million was received at completion with the remaining balance to be received in two successive payments conditional upon achieving key operational and regulatory milestones. • The Company will also receive a full carry of its 17.0% retained share of all JV costs, up to a cap, that is repayable to TotalEnergies and QatarEnergy from production, and which is expected to be adequate to fund the Company’s share of drilling for 1-2 wells on the license. On January 13, 2025, the Company announced the completion of the agreement with Eco to acquire an additional 1.0% (one percent) interest from Azinam Limited, Eco’s wholly owned subsidiary, in exchange for all common shares and warrants held by the Company in Eco. The Company now holds 18.0% in Block 3B/4B and is no longer a shareholder in Eco. Africa Oil will benefit from the carry agreed between Eco, TotalEnergies and QatarEnergy for this incremental interest The Company expects that the first exploration well on Block 3B/4B can be drilled during 2026. ===== SIDA 28 ===== PAGE 18 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED BLOCKS EG-18 AND EG-31 – EQUATORIAL GUINEA The Company has two PSCs with the Republic of Equatorial Guinea for offshore Blocks EG-18 and EG-31. The Company holds an 80% operated interest, subject to back in rights by GEPetrol in both Blocks. Work programs on both Blocks include re-processing of existing 3D seismic surveys and identification of prospects within the first 2-year sub period. A 1-year extension of the first Exploration sub-period was granted on December 23, 2024, extending the renewal period to March 1, 2026. At the end of 2024, all financial commitments for the initial exploration period have been met, the 1 year extension should enable the required technical work to be completed. EQUITY INVESTMENTS IN ASSOCIATES AND INVESTMENT HELD FOR SALE As at December 31, 2024, the Company held equity investments in three oil and gas companies, which provides exposure to several high-impact exploration drilling prospects in South Africa, Namibia, and Guyana. The Company held the following equity investments in associates and investment held for sale as of December 31, 2024: Africa Energy Eco Impact (1) Issued and Outstanding 1,407,812,249 370,173,680 1,139,147,442 Shares held by AOC at January 1, 2024 276,982,414 54,941,744 343,545,659 Shares acquired in the period - - 105,918,737 Shares held by AOC at December 31, 2024 276,982,414 54,941,744 449,464,396 AOC’s holding (%) – December 31 2024 19.67% 14.84% 39.46% AOC’s holding (%) – December 31 2023 19.67% 14.84% 31.09% Share price (CAD) on December 31, 2024 0.03 0.21 - Exchange rate to USD on December 31, 2024 0.70 0.70 - (1) Impact is a privately held UK company and no share price is available. Impact Impact is a private UK oil and gas exploration company with assets located offshore Namibia and South Africa. In the year ended December 31, 2024, the Company acquired an additional 105,918,737 shares from various parties. The total cost for these purchases was approximately $88.6 million. Through these transactions, the Company has materially increased its interest from 31.1% at start of 2024 to 39.5% at end of 2024, enhancing its rights and influence over a core strategic asset and value driver for Africa Oil. On February 24, 2022, Impact announced that the Venus-1X exploration well in Block 2913B, offshore Namibia, had discovered hydrocarbons. 4 subsequent wells, Venus-1X side track, Venus-1A, Venus-2A and Mangetti-1X have been drilled and tested to appraise the Venus discovery. The Joint Venture is continuing to progress the proposed development of the Venus Field, with development studies ongoing. The Venus Field is expected to be the first development in Block 2913B, producing 150 kbopd (gross field) of ~45° API oil, with final investment decision expected by the end of first half of 2026. During Q1 2025, the joint venture completed the drilling of Tamboti-1X exploration well in Block 2913B. Tamboti-1X was safely and successfully drilled to a total depth of 6450mMD on Block 2913B, approximately 12km northeast of the Mangetti-1X well and approximately 25km north-northwest of the Venus-2A well, using the Deepsea Mira semi-submersible drilling rig. Black oil was encountered within 85m of net reservoir of lower quality Upper Cretaceous sandstones, belonging to the Mangetti fan system. A DST program was completed at the Tamboti-1X location, and results from the acquired log, core and DST data are currently under analysis. During 2024, two additional 3D seismic acquisition programs were completed to facilitate further exploration over the southern and northern parts of the combined blocks. This has resulted in most of the licensed area now being covered by 3D seismic. This data is currently being processed and interpreted and will help further evaluate prospects and leads in the far northern and southern parts of the Blocks. On February 3, 2025, the Deepsea Mira drilling rig spud the Marula-1X exploration well within the southern part of Block 2913B. This well will target Albian-aged sandstones, within the Marula fan complex and has the potential to unlock further exploration targets across the south, which is an area lying at the heart of the prolific Kudu source-rock kitchen. Deepsea Mira is also expected to drill the Olympe prospect, targeting Albian sands within a structural closure on Block 2912. On November 1, 2024, the Company announced the completion of a strategic farm-down agreement between its investee company, Impact, and TotalEnergies. Following the closing of this deal, Impact retains a 9.5% interest in the Blocks that is fully carried for all joint venture costs, with no cap, through to first commercial production. Impact also received a cash reimbursement of approximately $99.0 million for its share of the past costs incurred on the Blocks net to the farmout interests. This agreement provides Impact with a full interest-free carry loan over all of Impact’s remaining development, appraisal and exploration costs on the Blocks from January 1, 2024 (“Effective Date”), until the date on which Impact receives the first sales proceeds from oil production on the Blocks (“First Oil Date”). On and from the First Oil Date, the carry is repayable to TotalEnergies in kind from 60% of Impact’s after-tax cash flow net of all joint venture costs, including capital expenditures. During the repayment of the carry, Impact will pool its entitlement barrels with those of TotalEnergies for more regular off-takes and a more stable cashflow profile and will also benefit from TotalEnergies’ marketing and sales capabilities. ===== SIDA 29 ===== PAGE 19 Report to Shareholders | December 31, 2024 Africa Oil Corp. BUSINESS UPDATE - CONTINUED Africa Energy Africa Energy is a TSX-Venture (Toronto) and Nasdaq First North Growth Market (Stockholm) listed international oil and gas exploration company with an interest in Block 11B/12B offshore South Africa. There are two gas condensate discoveries (Brulpada and Luiperd) on this block in proximity to offshore gas infrastructure and onshore gas market in Mossel Bay, South Africa. On July 1, 2024, Africa Energy announced that CNR International (South Africa) Limited, a partner in Block 11B/12B, has provided notice to the joint venture partners that it will withdraw from its 20% interest in the Block. On July 29, 2024, TotalEnergies EP South Africa B.V., the operating partner on the Block, and QatarEnergy International E&P LLC announced that they will withdraw from their 45% and 25% operated interests in the Block, respectively. Under the joint operating agreement, the withdrawing parties will assign their interest free of charge to Main Street 1549 Proprietary Ltd. (“Main Street”), the non-withdrawing partner, which currently has a direct 10% participating interest in Block 11B/12B. The Company owns 49% of the common shares and 100% of the Class B shares of Main Street. The remaining 51% of the common shares of Main Street are held by Arostyle. In light of the withdrawal of the joint venture partners in Block 11B/12B, and subject to all relevant regulatory approvals, Main Street expects to hold a 100% participating interest in Block 11B/12B. On December 20, 2024, Africa Energy announced that it has entered into a non-binding agreement with Arostyle Investments (RF) Proprietary Ltd. (“Arostyle”), to restructure their join investment in Main Street. Under the non-binding agreement, Africa Energy and Arostyle agreed that subject to all relevant regulatory approvals, the Parties will restructure Main Street resulting in the Company holding a direct 75% participating interest and Arostyle holding a direct 25% participating interest in Block 11B/12B, with the relationship between the Parties being governed by the existing Joint Operating Agreement in respect to Block 11B/12B. Africa Energy and Arostyle believe that natural gas will play a critical role in South Africa’s energy transition, and the use of indigenous gas from Block 11B/12B discoveries are currently the most material domestic supply option in South Africa Eco Eco is a TSX-V and AIM-listed oil and gas company that operates and holds WI in four exploration Blocks offshore Namibia and operates one exploration Block offshore South Africa and is a party with the Company in Block 3B/4B, offshore South Africa. Eco also has a direct WI and indirect interest in two exploration Blocks offshore Guyana, the Orinduik and Canje Blocks. The Company’s ownership interest was approximately 14.8% at December 31, 2024. On July 26, 2024, the Company signed an agreement with Eco to acquire an additional 1.0% interest in Block 3B/4B from Azinam Limited, Eco’s wholly owned subsidiary, in exchange for all common shares and warrants over common shares held by the Company in Eco. On January 13, 2025, the Company announced the closing of this transaction. The Company is no longer a shareholder in Eco and its representative on Eco’s Board of Directors has resigned from this position. ENVIRONMENTAL, SOCIAL AND GOVERNANCE The Company is committed to being a responsible company that integrates sustainability considerations throughout its decision- making and operational management. The Company is focused on the effective identification and management of risk in its operational activities and, to the extent that it is reasonably able to influence them, those of its JV parties and investee companies. The Company selects its operating parties in part on their ability and commitment to manage ESG risks effectively. The Company monitors operator performance and works with operators where possible and necessary to improve performance. The Company’s role as the custodian of its shareholders’ capital is to ensure robust governance systems are in place to minimize risks and deliver our sustainability goals. As part of those governance systems, the Company receives operator ESG performance data from Prime on a quarterly basis, which allows it to monitor alignment with agreed ESG targets and objectives. Prime developed an updated ESG Strategy and GHG Roadmap in 2024, focused on compliance with IFC Performance Standards, a long term plan for net zero Scope 1 and 2 GHG emissions by 2050 and zero routine flaring by 2030. Prime has reported good flare performance during 2024 despite flare events on Agbami and Egina related to operational and maintenance issues. Reductions in flaring and fugitive emissions will support Prime’s objectives to reduce working interest scope 1 greenhouse gas (“GHG”) emissions by 25% by 2025 and by 35% by 2030 compared to a 2020 baseline as part of Prime’s Net Zero by 2050 for scope 1 and 2 emissions. Additionally, Prime commissions independent Environmental, Social, Health and Safety (“ESHS”) monitoring reviews conducted annually to support its reserves-based lending facility. The 2024 Monitoring Review found that overall, Prime is managing the ESHS aspects of its business, in its non-operated role, “exceptionally well,” with no significant issues that would impact financing. The Company has completed an environmental and social impact assessment to support permitting and licensing to support exploration drilling activities in Block 3B/4B in South Africa. The Company submitted an ESIA application for proposed drilling activities on Block 3B/4B during Q2 2024. An Environmental Authorization was issued by the regulator in September 2024 and that is being followed by a stakeholder consultation and appeals process which concluded in December 2024. The regulator is then expected to provide its final decision on the appeals during mid-2025. As part of its compliance with its PSC requirements in Equatorial Guinea and in line with the Company’s Social Investment Framework, the Company has funded the renovation of a school at Ayene in mainland Equatorial Guinea. In addition to the PSC requirements, Africa Oil funded school supplies for all student and classrooms at the recently renovated school. ===== SIDA 30 ===== PAGE 20 Report to Shareholders | December 31, 2024 Africa Oil Corp. The Company’s environmental and social management system, which is overseen by the Board-level Sustainability Committee (previously the ESGHS Committee), aims effectively and appropriately to identify, monitor and address environmental, health & safety and social risks to our business and investments, in addition to identifying opportunities for performance improvement and risk reduction. The Company maintains a risk register by which it monitors financial, operational and ESG risks to the Company. Africa Oil regularly undertakes annual independent HSEC audits and engages with a range of ESG ratings assessments in support of investor and broader stakeholder engagement, as well as to identify opportunities for performance improvement. Africa Oil is committed to regular review and update of its sustainability strategy to ensure continued alignment with both the Company’s evolving business and the broader global context. The Company was awarded a gold rating by the ESG rating agency EcoVadis in February 2024. The independent evaluation undertaken concluded that the Company was within the top 3% of all companies evaluated for ESG performance. To the extent possible given its non-Operator role on assets, the Company endeavors to undertake its activities in line with the International Finance Corporation’s Performance Standards on Environmental and Social Sustainability and independent monitoring reviews are conducted on a regular basis to assess compliance with those standards. The most recent review was completed in December 2024. This found that Company management systems were fit for purpose to manage ESG risks. The report is published, along with all other Independent Monitoring Group reports, on Africa Oil’s website. The Company’s 2024 Sustainability Report is under preparation and will be disclosed on the Company website, as in previous reports it will contain information on our performance and strategy. On an ongoing basis, the Company monitors the development of applicable legislation to ensure compliance with evolving policy and associated regulatory requirements. As the Company has a primary listing in Canada on the Toronto Stock Exchange and a secondary listing in Sweden on the Oslo Stock Exchange, this includes sustainability disclosure requirements in both Canada and the EU, including the EU Corporate Sustainability Reporting Directive. BUSINESS UPDATE - CONTINUED ===== SIDA 31 ===== PAGE 21 Report to Shareholders | December 31, 2024 Africa Oil Corp. SELECTED ANNUAL INFORMATION For the years ended December 31, 2024 December 31, 2023 December 31, 2022 Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income: Net (loss)/ income attributable to common shareholders ($’m) (279.1) 87.1 (60.3) Data per Common Share: Basic (loss)/ income per share ($/share) (0.62) 0.19 (0.13) Diluted (loss)/ income per share ($/share) (0.62) 0.18 (0.13) Balance Sheet: Working capital ($’m) 62.1 214.7 158.6 Total assets ($’m) 615.2 966.2 917.7 In 2024, the Company recorded a net loss attributable to common shareholders of $279.1 million which is a decrease from the net income of $87.1 million recorded in 2023. In 2024, this is primarily made up of income from the Company’s investment in Prime of $226.0 million offset against losses from the Company’s investment in associates of $38.7 million and an impairment in the Company’s investment in Prime of $436.7 million as the fair value of the Company’s existing shareholding in Prime was calculated based on the implied value of the Proposed Reorganization, which was in excess of the carrying value resulting in a non-cash impairment loss on the investment in Prime. In 2023, the Company recorded a net income attributable to common shareholders of $87.1 million which is an increase from the loss recorded in 2022 of $60.3 million. In 2023, this is primarily made up of income from the Company’s investment in Prime of $228.0 million offset against losses from the Company’s investment in associates of $47.0 million and impairment recognized to its Kenyan intangible exploration assets of $62.2 million writing these assets down to nil. The net income attributable to common shareholders in 2023 of $87.1 million has increased from a loss of $60.3 million in 2022 as the income from Prime has increased by $81.4 million and the impairment recognized in relation to the Company’s intangible exploration assets in Kenya has decreased by $108.4 million. This is offset by an increase in the share of loss from investments in associates of $38.8 million. In 2024, the basic and diluted loss per share was $0.62 (2023 – the basic income per share was $0.19 and the diluted income per share was $0.18). The loss per share has arisen primarily from the impairment recognized to the Company’s investment in Prime. In 2023, the basic income per share was $0.19 and the diluted income per share was $0.18 (2022 - the basic loss and diluted loss per share was $0.13). The net basic and diluted income per share has increased from 2022 as the income from Prime is higher and the impairment in Kenya is lower. In 2024, the decrease in working capital was driven by a decrease in cash balances following the acquisition of additional shares in Impact and shareholder returns. In 2024 the decrease in total assets is primarily due to the decrease in cash balances and the decrease to the Company’s investment in Prime from the impairment recognized. In 2023, the increase in working capital was driven by an increase in cash balances and lower payables following settlement of a provision for joint venture matters and joint venture payables in Kenya. In 2023, the increase in total assets is primarily due to increases in cash balances and the Company’s investment in Prime. ===== SIDA 32 ===== PAGE 22 Report to Shareholders | December 31, 2024 Africa Oil Corp. SUMMARY OF QUARTERLY INFORMATION Summarized quarterly results for the past eight quarters are as follows: For the three months ended 31-Dec 2024 30-Sep 2024 30-Jun 2024 31-Mar 2024 31-Dec 2023 30-Sep 2023 30-Jun 2023 31-Mar 2023 Share of profit/ (loss) from equity investments in joint venture and associates ($’m) 152.1 18.3 9.7 7.2 (80.8) 51.3 178.0 32.5 Net income/ (loss) attributable to common shareholders ($’m) 6.2 (289.2) 0.4 3.5 (88.8) 47.1 106.9 21.9 Weighted average shares – Basic ‘000 442,690 442,960 451,231 460,991 462,231 462,340 456,229 461,199 Weighted average shares – Diluted ‘000 449,667 442,960 464,890 474,746 472,942 473,959 467,839 473,846 Basic income / (loss) per share ($) 0.02 (0.65) 0.00 0.01 (0.19) 0.10 0.23 0.05 Diluted income/ (loss) per share ($) 0.02 (0.65) 0.00 0.01 (0.19) 0.10 0.23 0.05 SUMMARY OF KEY ITEMS OF FINANCIAL PERFORMANCE IN THE THREE MONTHS AND YEARS ENDED DECEMBER 31, 2024, AND DECEMBER 31, 2023 Three months ended Years ended December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Share of profit/ (loss) from investment in joint venture 159.3 (80.8) 226.0 181.0 General and administrative expenses (13.3) (9.0) (32.4) (31.9) Net income/ (loss) 6.2 (88.8) (279.1) 87.1 Adjusted net (loss)/ income (3.2) 4.9 48.0 84.5 Share of profit from investment in joint venture In Q4 2024 and 2024, the Company’s share in the result of its 50% equity investment in Prime was $159.3 million and $226.0 million respectively (Q4 2023 and 2023 – loss of $80.8 million and a profit of $181.0 million respectively). The figures below explaining the movements in the results of Prime are based on Prime’s gross balances as per its financial statements. Prime revenues decreased by $342.8 million in Q4 2024 compared to Q4 2023, driven by no liftings in Q4 2024 compared to four liftings in Q4 2023. There was a decrease in costs of sales of $274.3 million, primarily driven by an underlift movement during Q4 2024 of $204.8 million compared to an overlift movement in Q4 2023 of $63.0 million. This resulted in a decrease in gross profit to $72.4 million in Q4 2024 from $140.9 million in Q4 2023. In Q4 2023 there was an impairment recognized of $263.3 million and no impairment recognized in Q4 2024. Other operating income increased by $329.7 million in Q4 2024 compared to Q4 2023 relating to other operating income recognized by Prime in Q4 2024 under the Securitization Agreement as no comprehensive resolution was reached among all unit parties in respect of the tract participation in the Agbami field by December 27, 2024. Finance income decreased by $10.2 million in Q4 2024 compared to Q4 2023, mainly driven by an accounting loss on derivatives in Q4 2024. There was a tax charge in Q4 2024 of $46.6 million compared to $11.7 million in Q4 2023. The increase was mainly driven by capital gains tax in Q4 2024 in relation to the income recognized by Prime under the Securitization Agreement at a Capital Gains Tax rate in Nigeria of 10 percent. This has resulted in Prime’s profit increasing from a loss of $158.6 million in Q4 2023 to a profit of $318.7 million in Q4 2024, an increase of $477.3 million. Prime revenues decreased by $379.5 million in 2024 compared to 2023, mainly driven by lower liftings and no PPT and royalty revenue recognized in relation to the Agbami field. PPT revenue has no longer been reported in gross revenues since August 2023 with Prime lifting its own entitlement production and paying its tax in cash and no royalty revenue has been reported since August 2023 with PML 52 royalties being paid in cash and presented in cost of sales. There was a decrease in costs of sales of $180.8 million, primarily driven by an underlift movement during 2024 of $171.2 million compared to an overlift movement of $23.6 million in 2023. This resulted in a decrease in gross profit to $365.5 million in 2024 from $564.2 million in 2023. Other operating income increased by $305.0 million compared to 2023, mainly relating to $329.7 million of other operating income recognized by Prime in 2024 under the Securitization Agreement as no comprehensive resolution was reached among all unit parties in respect of the tract participation in the Agbami field by December 27, 2024. Other operating income in 2023 related to investment tax credits that offset PPT that Prime no longer receives under the PIA. In 2023 there was an impairment recognized of $263.3 million and no impairment recognized in 2024. There was a tax charge in 2024 of $120.5 million compared to an income of $245.4 million in 2023. Prime renewed the OML 130 license resulting in OML 130 operating under the terms of the new Petroleum Industry Act as from June 1, 2023, and Prime voluntarily converted the OML 127 license to operate under the new Petroleum Industry Act from March 1, 2023, with all key conditions precedent fulfilled during ===== SIDA 33 ===== PAGE 23 Report to Shareholders | December 31, 2024 Africa Oil Corp. 2023. Under these terms, OML 127 and OML 130 are subject to a 30% Corporate Income Tax regime compared to the previous 50% PPT regime which resulted in the release of $62.0 million and $346.0 million of deferred income tax liabilities during 2023 for OML 127 and OML 130 respectively. Prime recognized a capital gains tax charge in 2024 of $33.0 million in relation to the income recognized by Prime under the Securitization Agreement at a Capital Gains Tax rate in Nigeria of 10 percent. This has resulted in Prime’s profit decreasing from $456.0 million in 2023 to $452.0 million in 2024, a decrease of $4.0 million. General and administrative costs On June 24, 2024, the Company announced that it had reached an agreement with BTG to acquire the remaining 50% interest in Prime in exchange for newly to be issued common shares in Africa Oil. Completion of this transaction is subject to customary closing conditions and is expected on or about March 7, 2025. This transaction falls under IFRS 3 Business Combinations under which acquisition related costs are expensed in the periods in which the costs are incurred, and the services are received. The table below shows adjusted general and administrative expenses, which is a non-GAAP measure, by excluding the BTG transaction related expenses and is meant to improve comparability between periods. Three months ended Years ended December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 General and administrative expenses 13.3 9.0 32.4 31.9 BTG transaction related expenses (0.7) - (6.9) - Adjusted general and administrative expenses 12.6 9.0 25.5 31.9 Adjusted general and administrative expenses, including share-based compensation charges relating to the LTIP and Stock Option Plan, amounted to $12.6 million and $25.5 million, respectively, in Q4 2024 and 2024 (Q4 2023 and 2023 - $9.0 million and $31.9 million respectively). Share-based compensation charges amounting to $0.2 million and $1.5 million, respectively, in Q4 2024 and 2024 (Q4 2023 and 2023 – $1.9 million and $11.3 million respectively) are impacted by movements in the share price of the Company. Adjusted general and administrative expenses excluding share-based compensation charges amounted to $12.4 million in Q4 2024 compared to $7.1 million in Q4 2023 with the increase primarily driven by business development costs and an increase in the number of employees. Adjusted general and administrative expenses excluding share-based compensation charges amounted to $24.0 million in 2024 compared to $20.6 million in 2023 with the increase primarily driven by business development costs and an increase in the number of employees. Net (loss) / income and Adjusted net (loss)/ income Net (loss) / income as reported by the Company in its Consolidated Statement of Net (Loss) / Income and Comprehensive (Loss) / Income can be impacted by items that are not reflective of the Company’s underlying performance for the period. This might impact the comparability of the results of the Company between periods. Adjusted net (loss)/ income is a non-GAAP measure. This measure adjusts for the following items and is meant to improve comparability between periods: • Impairment and reversal of impairment is adjusted since this affects the economics of an asset for the lifetime of that asset, not only the period in which it is impaired, or the impairment is reversed. • Share of loss from investments in associates is adjusted since the associated companies are in the exploration phase with the results not being reflective of the Company’s underlying performance for the period. • Other items of income and expenses are adjusted when the impact on net income in the period is not reflective of the Company’s underlying performance for the period. • Tax effects of the above-mentioned adjustments to net income. SUMMARY OF QUARTERLY INFORMATION - CONTINUED ===== SIDA 34 ===== PAGE 24 Report to Shareholders | December 31, 2024 Africa Oil Corp. A reconciliation from net (loss) / income to adjusted net (loss)/ income is shown below: Three months ended Years ended Unit December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Net income/ (loss) $’m 6.2 (88.8) (279.1) 87.1 Adjusted for: Impairment recognized by Prime – net to AOC’s 50% shareholding $’m - 131.7 - 131.7 Tax effect of impairment recognized by Prime – net to AOC’s 50% shareholding $’m - (39.5) - (39.5) Deferred tax release recognized by Prime following PIA conversion – net to AOC’s 50% shareholding $’m - - - (204.0) Income recognized by Prime under Securitization Agreement – net to AOC’s 50% shareholding $m (164.8) - (164.8) - Tax effect of income recognized by Prime under Securitization Agreement – net to AOC’s 50% shareholding $m 16.5 - 16.5 - Impairment investment in Prime $’m 131.7 - 436.7 - Share of loss from investments in associates $’m 7.2 1.5 38.7 47.0 Impairment intangible exploration assets $’m - - - 62.2 Adjusted net (loss)/ income $’m (3.2) 4.9 48.0 84.5 Adjusted net (loss)/ income attributable to common shareholders per share Basic (0.00) 0.01 0.11 0.18 Diluted (0.00) 0.01 0.11 0.18 Weighted average number of shares outstanding for the purpose of calculating adjusted net income per share Basic 442,690,041 463,020,104 449,431,803 462,231,061 Diluted 442,690,041 473,772,143 456,462,277 472,942,487 Adjusted net (loss)/ income amounted to $(3.3) million and $48.0 million, respectively, in Q4 2024 and 2024 (Q4 2023 and 2023 - $4.9 million and $84.5 million respectively). Adjusted net result in Q4 2024 is a loss compared to an adjusted net income in Q4 2023. This is primarily from higher general and administrative expenses in Q4 2024. Adjusted net income in 2024 is lower than 2023. This is primarily from a lower profit from the investment in Prime in 2024 mainly driven by lower production volumes. SUMMARY OF QUARTERLY INFORMATION - CONTINUED ===== SIDA 35 ===== PAGE 25 Report to Shareholders | December 31, 2024 Africa Oil Corp. SUMMARY OF KEY ITEMS OF FINANCIAL POSITION AS AT DECEMBER 31, 2024, AND DECEMBER 31, 2023 As at December 31, 2024 December 31, 2023 Assets   Equity investment in joint venture 328.4 572.5 Equity investments in associates 177.6 134.7 Intangible exploration assets 29.3 19.1 Cash and cash equivalents 61.4 232.0 Equity investment in joint venture As at December 31, 2024, the Company’s investment in Prime was $328.4 million compared to $572.5 million as at December 31, 2023. The carrying value of the investment mainly decreased from impairment recognized of $436.7 million and dividends received of $36.0 million offset by the Company’s share of Prime’s profit of $226.0 million in 2024. As a result of the significant decrease in the Africa Oil share price between June 24, 2024, when the Company announced the Proposed Reorganization and December 31, 2024, the fair value of the existing 50% shareholding in Prime decreased as the fair value considers the number of Africa Oil shares that were agreed in relation to the purchase of the additional interest in Prime and the trading value of Africa Oil shares as this is an observable fair value input under IFRS Accounting Standards. As at December 31, 2024, the fair value of the Company’s existing shareholding in Prime was calculated to be $328.4 million based on the implied value of the Proposed Reorganization, resulting in a non-cash impairment loss on the investment in Prime of $436.7 million in 2024. The fair value has been calculated based on the Africa Oil share price of CAD 1.97 as of December 31, 2024, and the USD/CAD exchange rate of 1.4384 as of December 31, 2024. The consideration under the Proposed Reorganization will be based on the share price and exchange rate as of the date of completion of the Proposed Reorganization and may therefore change materially compared to the fair value of $328.4 million as at December 31, 2024. This might therefore result in the recognition of additional impairment charges or the reversal of previously recognized impairment charges in future reporting periods based on the movements in the Africa Oil share price and the USD/CAD exchange rate between December 31, 2024, and the closing date of the transaction. Equity investments in associates As at December 31, 2024, the Company’s investment in associates was $177.6 million compared to an investment value of $134.7 million as at December 31, 2023. The carrying value of the investments increased by $42.9 million in 2024 from the acquisition of shares in Impact for $88.6 million and the reversal of an impairment in relation to the Company’s investment in Africa Energy Corp, partly offset by the Company’s share of the associate’s losses and the reclassification of the investment in Eco from equity investments in associates to an investment held for sale of $7.0 million. The investment in Impact Oil and Gas Ltd, holding the working interests in the Namibia Orange Basin Blocks 2913B and 2912, makes up $174.8 million of the total equity investments in associates. Intangible exploration assets The Company’s intangible exploration assets relate to its interests in Blocks EG-18 and EG-31 in Equatorial Guinea and Block 3B/4B in South Africa. December 31, 2024 December 31, 2023 Equatorial Guinea 17.9 13.4 South Africa 11.4 5.7 Net carrying amount, end of the period 29.3 19.1 Equatorial Guinea The Company signed two Production Sharing Contracts with the Republic of Equatorial Guinea for offshore Blocks EG-18 and EG-31 in February 2023. The Company holds an 80% operating interest in these Blocks. In 2024, expenditure of $4.5 million was incurred (2023 - $13.4 million). SUMMARY OF QUARTERLY INFORMATION - CONTINUED ===== SIDA 36 ===== PAGE 26 Report to Shareholders | December 31, 2024 Africa Oil Corp. South Africa At December 31, 2024, the Company held a 17.0% participating interest in the Block 3B/4B Exploration Right. In the year ended December 31, 2024, expenditure of $5.7 million was incurred (years ended December 31, 2023 - $0.6 million) which included $9.0 million payments to Azinam Limited, a wholly owned subsidiary of Eco, for the increase of its operated working interest in Block 3B/4B by 6.25% to 26.25%. Government approval was obtained on January 19, 2024, resulting in payment of the second tranche of $2.5 million to Azinam and a farm down deal with a third party was completed on August 28, 2024, resulting in the payment of the third tranche of $4.0 million. The first tranche of $2.5 million was paid during 2023 and was reclassified from prepayments to intangible exploration assets following government approval. On August 28, 2024, the Company announced the completion of the strategic farm down agreement with TotalEnergies and QatarEnergy for the Block 3B/4B Exploration Right, located in South Africa. The Company retained a 17.0% interest in Block 3B/4B and operatorship was transferred to TotalEnergies. The Company will receive, subject to achieving certain milestones as defined in the agreement, staged cash payments for a total amount of $10.0 million of which $3.3 million was received at closing of the transaction with the remaining balance to be received in two successive payments conditional upon achieving key operational and regulatory milestones. On July 26, 2024, the Company signed an agreement with Eco to acquire an additional 1.0% interest in Block 3B/4B from Azinam Limited, Eco’s wholly owned subsidiary, in exchange for all common shares and warrants over common shares held by the Company in Eco. On January 13, 2025, the Company announced the completion of the transaction and the Company’s interest in Block 3B/4B increased by 1.0% to 18.0% and the Company ceased to be a shareholder in Eco. Africa Oil will benefit from the carry agreed between Eco, TotalEnergies and QatarEnergy for this incremental interest. Cash and cash equivalents As at December 31, 2024, the Company had $61.4 million cash on hand, compared with a cash balance of $232.0 million as at December 31, 2023. The Company received a dividend from Prime of $36.0 million, returned $67.9 million to shareholders by way of share buybacks and dividends, paid $87.8 million to increase its shareholding in Impact, paid the second and third tranches totaling $6.5 million to Azinam in relation to the increased working interest in Block 3B/4B, received $3.3 million as part of the farm out deal in Block 3B/4B, incurred capital expenditure in respect of the licenses in Equatorial Guinea and South Africa, settled working capital balances and incurred general and administrative costs. LIQUIDITY AND CAPITAL RESOURCES As at December 31, 2024, the Company had cash of $61.4 million and working capital of $62.1 million. The Company’s primary source of liquidity is dividends received from Prime. If Prime experiences operational delays, reduced performance or similar adverse conditions, or reinvest their free cash flow, the dividends received could be reduced in future periods. Corporate Facility On May 21, 2024, the Company amended its existing Corporate Facility. At any point before Prime refinances its debt, the availability under the Corporate Facility will now be $65.0 million until June 30, 2025, $43.0 million from July 1, 2025, until June 30, 2026, and $22.0 million from July 1, 2026, to May 21, 2027, i.e. its new final maturity date. After Prime refinances its debt, the availability under the Corporate Facility will be $125.0 million until June 30, 2026, and $63.0 million from July 1, 2026, until May 21, 2027. Commitment fees of 40% of the margin are payable on the undrawn available portion of the Corporate Facility and commitment fees of 15% of the margin are payable on the unavailable portion of the Corporate Facility. The Corporate Facility carries interest of 1 month-SOFR plus a margin of 6.5% in the first year from May 21, 2024, 7.0% in the second year and 7.5% in the third year. The Corporate Facility is subject to financial and liquidity covenants. The Company shall ensure that total net debt to adjusted EBITDAX on June 30 and December 31 of each year is no greater than 3.0:1, the FLCR ratio on March 31 and September 30 of each year is not less than 1.1:1 and that from March 31 and September 30 of each year during each of the four successive quarters there are or will be sufficient funds available to the Group to meet all relevant expenditure to be incurred in each of these four successive quarters as they fall due. The Company has been in compliance with the covenants in the three months and years ended December 31, 2024. The Company has no off-balance sheet arrangements. Future Funding Outlook To finance its future acquisition, exploration, development and operating costs, the Company may require financing from external sources, including issuance of new shares, issuance of debt or executing farmout or disposition arrangements. There can be no assurance that such financing will be available to the Company or, if available, that it will be offered on terms acceptable to the Company. The Company believes that its existing cash balances combined with anticipated funds flow from Prime dividends will provide sufficient liquidity for the Company to meet its financing, operating and capex commitments as they fall due. SUMMARY OF QUARTERLY INFORMATION - CONTINUED ===== SIDA 37 ===== PAGE 27 Report to Shareholders | December 31, 2024 Africa Oil Corp. OUTSTANDING SHARE DATA The following table outlines the maximum potential impact of share dilution upon full execution of outstanding convertible instruments as at the effective date of the MD&A. Common shares outstanding 436,602,570 Outstanding share purchase options 457,616 Outstanding performance share units 8,605,860 Outstanding restricted share units 1,672,515 Full dilution impact on Common Shares outstanding 447,338,561 RELATED PARTY TRANSACTIONS Transactions with Africa Energy: On December 19, 2022, Africa Energy announced that it had secured a $5.0 million promissory note of which $2.0 million was provided by the Company and the remaining by other parties. On November 7, 2023, the promissory note provided by the Company and other parties to Africa Energy was increased by $3.3 million with $1.5 million of the increase to be provided by the Company of which $1.0 million was provided in the year ended December 31, 2024, and $0.5 million was provided in the year ended December 31, 2023. The note is unsecured and matures on March 31, 2025, when the principal and accrued interest are due in full. The note carries an annual interest rate of 15%. The note is repayable pro rata any time before maturity without penalty. In the year ended December 31, 2024, interest on the note amounted to $0.5 million (year ended December 31, 2023 - $0.3 million). The Company has technical and administrative cost sharing agreements with Africa Energy totaling $0.5 million in the year ended December 31, 2024 (year ended December 31, 2023 - $0.6 million). Transactions with Eco: During the year ended December 31, 2023, Africa Oil SA Corp. signed a legally binding Assignment and Transfer agreement with Azinam Limited (“Azinam”), a wholly owned subsidiary of Eco, to acquire an additional 6.25% interest in Block 3B/4B for a total cash consideration of up to $10.5 million, to be paid in tranches on the following milestones: • $2.5 million within 30 business days after July 10, 2023; • $2.5 million upon the SA government’s approval for the transfer of the 6.25% interest to Africa Oil SA Corp.; • $4.0 million upon the completion of a farm-out deal to a third party; and • $1.5 million upon spudding of the first exploration well on the Block. The first tranche was paid during 2023, the second and third tranches were paid during 2024. On July 26, 2024, the Company signed an agreement with Eco to acquire an additional 1.0% interest in Block 3B/4B from Azinam Limited, Eco’s wholly owned subsidiary, in exchange for all common shares and warrants over common shares held by the Company in Eco. On January 13, 2025, the Company announced that it had completed this transaction. The Company’s interest in Block 3B/4B increased by 1.0% to 18.0% and the Company ceased to be a shareholder in Eco. Africa Oil will benefit from the carry agreed between Eco, TotalEnergies and QatarEnergy for this incremental interest. Transactions with Impact: On March 24, 2023, the Company subscribed for 39,455,741 shares in Impact for $31.4 million, payable in two tranches, and directly following the transaction the Company held 31.1% of the enlarged share capital in Impact. The first tranche of $14.9 million was paid on April 21, 2023, and the final tranche of $16.5 million was paid on July 21, 2023. On October 6, 2023, the Company subscribed for 16,524,058 shares in Impact for $13.0 million and directly following the transaction the Company continued to hold 31.1% of the enlarged share capital in Impact. Transaction with Director: On November 23, 2023, the Company entered into an arm’s length agreement with Andrew Bartlett to acquire 106,500 shares in Impact at a price of £0.65 per share for a total amount of £69,225. This amount was paid during 2023 and the transaction completed on January 16, 2024. ===== SIDA 38 ===== PAGE 28 Report to Shareholders | December 31, 2024 Africa Oil Corp. Remuneration of Directors and Senior Management: Remuneration of Non-Executive Directors and Senior Management includes all amounts earned and awarded to the Company’s Board of Directors and Senior Management. Senior Management includes the Company’s President and Chief Executive Officer, Chief Financial Officer, Chief Commercial Officer, Chief Operating Officer, Chief Technical Officer and the Chief Legal Officer. Directors’ fees include Board and Committee Chair retainers. Management’s short-term wages and benefits include salary, benefits, bonuses and any other cash-based compensation earned or awarded during the year. Share-based compensation includes expenses related to the Company’s share purchase option plan as well as the Long-Term Incentive Plan. For the years ended December 31, 2024 December 31, 2023 Non-Executive Directors' fees 0.5 0.5 Non-Executive Directors' share-based compensation 0.6 1.1 Managements’ short-term wages and benefits 7.3 5.4 Managements’ share-based compensation 0.5 6.5 8.9 13.5 COMMITMENTS AND CONTINGENCIES The following commitments and contingencies are representative of AOC’s net obligations at the effective date of the MD&A. PRIME OIL & GAS COÖPERATIEF U.A: Under the Prime Sale and Purchase Agreement completed on January 14, 2020, a deferred payment of $118.0 million, subject to adjustment, may be due to the seller contingent upon the timing of the final PML 52 tract participation in the Agbami field. The signing of the Securitization Agreement by Prime in 2021 led the Company reassessing its view of the likelihood of making a contingent consideration payment to the seller. The signing of the Securitization Agreement by Prime does not constitute a redetermination of the tract participation and therefore does not trigger the payment of a contingent consideration under the Sale and Purchase Agreement but, at the Company’s discretion, could trigger discussions with the seller. The outcome of this process is uncertain. In 2021, the Company recorded $32.0 million as contingent consideration and increased this to $37.8 million in the year ended December 31, 2023, and to $40.4 million in the years ended December 31, 2024, increasing the Company’s investment in Prime. WITHDRAWAL FROM KENYA: On May 23, 2023, the Kenya entities along with TotalEnergies submitted withdrawal notices to the remaining joint venture party on Blocks 10BB, 13T and 10BA in Kenya, to unconditionally and irrevocably, withdraw from the entirety of the JOAs and PSCs for these concessions. The Company concurrently submitted notices to Ministry of Energy and Petroleum, requesting the government’s consent to transfer all of its rights and future obligations under the PSCs to its remaining joint venture party. Government consent to the transfer remained outstanding as at December 31, 2024. In accordance with the JOA and PSC the Company retains economic participation for activities prior to June 30, 2023, which might result in additional costs for the Company. The Company continues to monitor the claim made against the operator by local communities in relation to past operations which may relate to the period prior to June 30, 2023. No provision has been recognized for this as at December 31, 2024. CRITICAL ACCOUNTING ESTIMATES The Company’s critical accounting estimates are defined as those estimates that have a significant impact on the portrayal of its financial position and operations and that require management to make judgements, assumptions and estimates in the application of IFRS Accounting Standards. Judgements, assumptions and estimates are based on historical experience and other factors that management believes to be reasonable under current conditions. As events occur and additional information is obtained, these judgements, assumptions and estimates may be subject to change. USE OF ESTIMATES The preparation of the consolidated financial statements in conformity with IFRS Accounting Standards requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Such estimates include unsettled transactions and events as of the date of the consolidated financial statements. Accordingly, actual results may differ from these estimated amounts as future confirming events occur. Significant estimates used in the preparation of the consolidated financial statements include, but are not limited to, recovery of exploration costs capitalized in accordance with IFRS Accounting Standards, equity method accounting, valuation and impairment of equity investments and contingent consideration arising from the acquisition of Prime. The Company’ material accounting policies can be found in the Company’s Consolidated Financial Statements for the year ended December 31, 2024. ===== SIDA 39 ===== PAGE 29 Report to Shareholders | December 31, 2024 Africa Oil Corp. INTANGIBLE EXPLORATION ASSETS The Company capitalizes costs related to the acquisition of a license interest, directly attributable general and administrative costs, expenditures incurred in the process of determining oil and gas exploration targets, and exploration drilling costs. All exploration expenditures that related to properties with common geological structures and with shared infrastructure are accumulated together within intangible exploration assets. Costs are held un-depleted until such time as the exploration phases on the license area are complete or commercially viable reserves have been discovered and extraction of those reserves is determined to be technically feasible. The determination that a discovery is commercially viable, and extraction is technically feasible requires judgement. Where results of exploration drilling indicate the presence of hydrocarbons which are ultimately not considered commercially viable, all related costs are recognized in the Consolidated Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. If commercial reserves are established and technical feasibility for extraction demonstrated, then the related capitalized intangible exploration costs are transferred into the smallest group of assets that generate cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (CGU) within intangible exploration assets. The allocation of the Company’s assets into CGUs requires judgement. Intangible exploration assets are assessed for impairment when they are reclassified to property and equipment, and also if facts and circumstances suggest that the carrying amount exceeds the recoverable amount. The recoverable amount of an asset or a CGU is the greater of its value in use and its fair value less costs to dispose. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Value in use is generally computed by reference to the present value of the future cash flows expected to be derived from production of proven and probable reserves. In determining fair value less costs to dispose, recent market transactions are taken into account, if available. In the absence of such transactions, an appropriate valuation model is used. The key assumptions the Company uses for estimating future cash flows are the quantity of contingent resources, future commodity prices, expected production volumes, future operating and development costs, likelihood of a successful farm out process and subsequent timing of FID and discount rate. The estimated useful life of the CGU, the timing of future cash flows and discount rates are also important assumptions made by management. The changing worldwide demand for energy and the global advancement of alternative sources of energy could result in a change in the assumptions used to determine the recoverable amount and could affect estimating the future cash flows which could impact carrying amount of the Company’s intangible exploration assets. The timing of when global energy markets transition from carbon- based sources to alternative energy sources is highly uncertain. Environmental considerations are built into our estimates through the use of key assumptions in estimating fair value including future commodity prices and discount rates. The energy transition could impact the future prices of commodities and discount rates used to appraise oil and gas projects. Pricing assumptions used in the determination of recoverable amounts incorporate markets expectations and the evolving worldwide demand for energy. EQUITY METHOD Investments in joint ventures and investments in associates are accounted for using the equity method. Investments of this nature are recorded at original cost. Investments in joint ventures or associates which arise from a loss in control of a subsidiary are recorded at fair value on the date of the loss of control. The investment is adjusted periodically for the Company’s share of the profit or loss of the investment after the date of acquisition. The investor’s share of the profit or loss of the investee is also recognized in the Company’s Consolidated Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. Distributions received reduce the carrying amount of the investment. Additionally, estimates associated with investments in joint ventures include the determination of amounts allocated to non-current assets as well as any negative goodwill associated with the acquisition. IMPAIRMENT OF JOINT VENTURES AND ASSOCIATES The amounts for investments in joint ventures and associates represent the Company’s equity interest in other entities, where there is either joint control or significant influence. The Company assesses investments in joint ventures and associates for an objective evidence of impairment considering changes in circumstances or events which indicate that the carrying value may not be recoverable. The process of determining whether there is an objective evidence of impairment or calculating the recoverable amount requires judgement. The most material area in which the Company has applied judgement in the period is in relation to the investment in Prime. In assessing whether there have been any objective evidence of impairment the Company has considered the implied value of its investment in Prime derived from the Proposed Reorganization. The consideration for the Proposed Reorganization consists of a fixed number of shares in the Company and the implied value of the transaction has been calculated using the Company’s share price as per the end of the reporting period and the USD/CAD exchange rate as per the end of the reporting period as this is considered a Level 1 valuation method under IFRS Accounting Standards. CRITICAL ACCOUNTING ESTIMATES - CONTINUED ===== SIDA 40 ===== PAGE 30 Report to Shareholders | December 31, 2024 Africa Oil Corp. CONTINGENT CONSIDERATION Contingent consideration formed part of the overall consideration for the acquisition of Prime. At the date of acquisition, an estimate of the contingent consideration is determined and included as part of the cost of the acquisition. Subsequent to acquisition, contingent consideration can be treated using two acceptable methods, the cost-based approach and the fair value-based approach. The Company have determined the cost-based approach to give the best estimate of the value of the contingent consideration. Any revisions to the contingent consideration estimates, after the date of acquisition, are accounted for as changes in estimates in accordance with IAS 8, to be accounted for on a prospective basis. The change in the liability, as a result of the revised cash flows, would be adjusted to the cost of the investment and, in accordance with paragraph 37 of IAS 8, recognized as part of the investment’s carrying amount rather than in profit or loss. The estimates involved in assessing the value of the contingent consideration include the expected timing of payments, the expected settlement value, the likelihood of settlement and the probability of the assessed outcomes occurring. There is significant judgement used in the determination of these estimates. INTERNAL FINANCIAL REPORTING AND DISCLOSURE CONTROLS DISCLOSURE CONTROLS AND PROCEDURES Disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed by the Company in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in the securities legislation and include controls and procedures designed to ensure that information required to be disclosed by the Company in its annual filings, interim filings or other reports filed or submitted under securities legislation is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Management, including the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures. As of December 31, 2024, the Chief Executive Officer and Chief Financial Officer have each concluded that the Company’s disclosure controls and procedures, as defined in NI 52-109 - Certification of Disclosure in Issuer’s Annual and Interim Filings, are effective to achieve the purpose for which they have been designed. INTERNAL CONTROLS OVER FINANCIAL REPORTING Internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with IFRS Accounting Standards. Management is also responsible for the design of the Company’s internal control over financial reporting in order to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS Accounting Standards. The Company’s internal controls over financial reporting include policies and procedures that: pertain to the maintenance of records that, in reasonable detail accurately and fairly reflect the transactions and disposition of assets; provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements in accordance with IFRS Accounting Standards and that receipts and expenditures are being made only in accordance with authorization of management and directors of the Company; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on the financial statements. Management, including the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of the Company’s internal controls over financial reporting. As at December 31, 2024, the Chief Executive Officer and Chief Financial Officer have each concluded that the Company’s internal controls over financial reporting, as defined in NI 52-109 - Certification of Disclosure in Issuer’s Annual and Interim Filings, are effective to achieve the purpose for which they have been designed. Because of their inherent limitations, internal controls over financial reporting can provide only reasonable assurance and may not prevent or detect misstatements. Furthermore, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. ===== SIDA 41 ===== PAGE 31 Report to Shareholders | December 31, 2024 Africa Oil Corp. ADVISORY REGARDING OIL AND GAS INFORMATION The terms boe (barrel of oil equivalent) and MMboe (millions of barrels of oil equivalent) are used throughout this report. Such terms may be misleading, particularly if used in isolation. The conversion ratio of six thousand cubic feet per barrel (6 Mcf:1 Bbl) of conventional natural gas to barrels of oil equivalent and the conversion ratio of 1 barrel per six thousand cubic feet (1 Bbl:6 Mcf) of barrels of oil to conventional natural gas equivalent is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to conventional natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value. In this report, references are made to historical and potential future oil production in Nigeria and Kenya. In all instances these references are to light and medium crude oil category in accordance with NI 51-101 and the COGE Handbook. Reserves are estimated remaining quantities of petroleum anticipated to be recoverable from known accumulations, as of a given date, based on the analysis of drilling, geological, geophysical, and engineering data; the use of established technology; and specified economic conditions, which are generally accepted as being reasonable. Reserves are further classified according to the level of certainty associated with the estimates and may be sub-classified based on development and production status. Proved Reserves are those quantities of petroleum, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible from a given date forward, from known reservoirs and under existing economic conditions, operating methods and government regulations. Probable Reserves are those additional quantities of petroleum that are less certain to be recovered than Proved Reserves, but which, together with Proved Reserves, are as likely as not to be recovered. Possible Reserves are those additional reserves that are less certain to be recovered than probable reserves. It is unlikely that actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves. RISK FACTORS With Board oversight, the Company proactively manages the identification, assessment and mitigation of risks, many of which are common to operations in the oil and gas industry as a whole, whilst others are unique to the Company. The realization of any of the risks listed below could have a material adverse effect on the Company’s business, financial condition, reserves and results of operations, such list being non-exhaustive. The risks noted in the risk factors section comprises those that can materially affect the figures presented and disclosures in the Financial Statements and MD&A. The Company’s Annual Information Form contains a more comprehensive list of risks that can affect the Company. RISKS RELATING TO THE PROPOSED REORGANIZATION There are a number of risks and uncertainties associated with the Proposed Reorganization. These include risks associated with the completion of the Proposed Reorganization and the expected timeframe to achieve completion as well as the additional obligations assumed by the Company in connection with the Proposed Reorganization and the restrictions imposed on the Company while the Proposed Reorganization is pending. These risks are described in more detail in the Risk Factors section of the Company’s Management Information Circular dated September 13, 2024. INCREASED COSTS AND SUPPLY DISRUPTION A failure to secure the services and equipment necessary for the Company’s operations for the expected price, on the expected timeline, or at all, may have an adverse effect on the Company’s financial performance and cash flows. The Company’s operating and capital costs could escalate and become uncompetitive due to supply chain disruptions, inflationary cost pressures, equipment limitations, escalating supply costs, and additional government intervention through stimulus spending or additional regulations. The Company’s inability to manage costs may impact project returns and future development decisions, which could have a material adverse effect on its financial performance and cash flows. In addition, with rising inflation levels combined with global cost of living expenses, the Company may be faced with the challenge of how to attract and retain employees. Though Africa Oil does not directly control procurement decisions associated with all of our assets, the Company works with its JV parties to ensure adequate contingency for cost inflation is incorporated into capital and operating budgets and that costs are controlled within budget. PRICES, MARKETS AND MARKETING OF CRUDE OIL AND NATURAL GAS Crude oil and natural gas are commodities whose prices are determined based on world demand, supply and other factors, all of which are beyond the control of the Company. World prices for oil and gas have fluctuated widely in recent years. Any material decline in prices could have an adverse effect on the Company’s business and prospects. The Company may be required by government authorities to limit production due to OPEC+ quotas from time to time. The conflicts in Ukraine and the Middle East have impacted global markets and may continue to result in increased volatility in financial markets and commodity prices. The Company does not have a direct exposure to operations in Ukraine and the Middle East. The Company may undertake hedging activities when efficient to do so, however, hedging may not fully mitigate, in whole or in part, the risk and effect of lower commodity prices. The Company or its investee company’s ability to market its oil and gas may depend upon its ability to acquire space on vessels or in pipelines that deliver oil and gas to commercial markets. The Company could also be affected by deliverability uncertainties related to the proximity of its reserves to pipelines and processing and storage facilities and operational issues affecting such pipelines and facilities as well as government regulation relating to prices, taxes, royalties, land tenure, allowable production, the export of oil and gas and many other aspects of the oil and gas business. ===== SIDA 42 ===== PAGE 32 Report to Shareholders | December 31, 2024 Africa Oil Corp. LIQUIDITY AND CASH FLOW Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Liquidity describes a company’s ability to access cash. Companies operating in the upstream oil and gas industry require sufficient cash in order to fulfil their work commitments in accordance with contractual obligations, and to be able to potentially acquire strategic oil and gas assets and face potentially unexpected liabilities. The Company could potentially issue debt or equity, extend its debt maturities and enter into farmout agreements to ensure it has sufficient available funds to meet current and foreseeable financial requirements. Concerns around climate change have resulted in a number of lenders and investors moving away from financing oil and gas activities, and the Company may find access to capital limited, more expensive or made contingent upon environmental performance standards. The Company periodically receives dividends from Prime related to the Company’s shareholding in Prime, its main source of income, the amount and timing of which the Company does not control. However, a significant reduction, infrequent distributions, or no payment of Prime’s dividends to the Company could significantly reduce the amount of the Company’s anticipated cash flow and could also expose the Company to financial risk. The Company actively monitors its liquidity to ensure that its cash flows and working capital are adequate to support these financial obligations and the Company’s capital programs. The Company will also adjust the pace of its activities to manage its liquidity position. Notwithstanding any mitigation efforts, the Company remains exposed to erosion of its balance sheet and revenues and may have difficulty in securing necessary funding, which may lead to insufficient liquidity. PRIME DIVIDENDS The Company periodically receives dividends from Prime related to the Company’s shareholding in Prime, which is its main source of income. A significant reduction, infrequent distributions, or no payment of Prime’s dividends to the Company could have a material adverse effect on the Company’s business, liquidity and financial condition. Such results could occur due to, among other things, the following: • decline in the demand for oil and gas; • reduction of OPEC+ quotas; • changes to the applicable tax and other laws and regulations in Nigeria; • project joint venture party consensus; • Prime’s off-takers defaulting on forward sale agreements or banks defaulting on hedging agreements; • significant or extended declines in oil and gas prices; • Prime’s inability to hedge the production of future assets; • significant capital cost overruns adversely impacting Prime’s cashflows; • significant project delays adversely impacting Prime’s future production and cashflows; • capital or liquidity constraints experienced by Prime, including restrictions imposed by lenders; • accounting delays or adjustments for prior periods; • shortages of, or delays in obtaining skilled personnel or equipment, including drilling rigs; • delays in the sale or delivery of products; • title defects; and • global health emergencies impacting operations and significantly reducing oil and gas demand. CREDIT FACILITIES The Company is party to credit facilities. The terms of the facility contain covenants and restrictions on the ability of the Company to, among other things, incur or lend additional debt, pay dividends and make restricted payments, and encumber its assets. The failure of the Company to comply with the covenants contained in the facility or to repay or refinance the facility by its maturity date could result in an event of default, which could, through acceleration of debt, enforcement of security or otherwise, materially and adversely affect the operating results and financial condition of the Company. FINANCIAL STATEMENTS PREPARED ON A GOING CONCERN BASIS Africa Oil’s financial statements have been prepared on a going concern basis under which an entity is considered to be able to realize its assets and satisfy its liabilities in the ordinary course of business. Africa Oil’s operations to date have been financed by equity financing, dividends received from equity investments, debt financing and the completion of working interest farmout agreements. Africa Oil’s future operations may be dependent upon the identification and successful completion of additional equity or debt financing, the achievement of profitable operations (and profitable operations with equity investments) or other transactions. There can be no assurances that the Company will be successful in completing additional financings, achieving profitability or completing future transactions. The consolidated financial statements do not give effect to any adjustments relating to the carrying values and classification of assets and liabilities that would be necessary should Africa Oil be unable to continue as a going concern. RISK FACTORS - CONTINUED ===== SIDA 43 ===== PAGE 33 Report to Shareholders | December 31, 2024 Africa Oil Corp. RISK FACTORS - CONTINUED SUBSTANTIAL CAPITAL REQUIREMENTS Africa Oil expects to make substantial capital expenditures for exploration, development and production of oil and gas reserves in the future. The Company’s ability to access the equity or debt markets may be affected by any prolonged market instability. The inability to access the equity or debt markets for sufficient capital, at acceptable terms and within required time frames, could have a material adverse effect on the Company’s financial condition, results of operations and prospects. To finance its future acquisition, exploration, development and operating costs, the Company may require financing from external sources, including from the issuance of new shares, issuance of debt or execution of working interest farmout agreements. There can be no assurance that such financing will be available to the Company or, if available, that it will be offered on terms acceptable to the Company. If additional financing is raised through the issuance of equity or convertible debt securities, control of the Company may change and the interests of shareholders in the net assets of the Company may be diluted. If unable to secure financing on acceptable terms, the Company may have to cancel or postpone certain of its planned exploration and development activities which may ultimately lead to the Company’s inability to fulfil the minimum work obligations under the terms of its various concessions. Availability of capital will also directly impact the Company’s ability to take advantage of acquisition opportunities. CURRENT GLOBAL FINANCIAL CONDITIONS Global financial conditions have always been subject to volatility. These factors may impact the ability of the Company to obtain equity or debt financing in the future, and, if obtained, on terms favorable to the Company. Increased levels of volatility and market turmoil can adversely impact the Company’s operations and the value, and the price of the Common Shares could be adversely affected. FOREIGN CURRENCY EXCHANGE RATE RISK The Company is exposed to changes in foreign exchange rates as expenses in international subsidiaries, oil and gas expenditures, or financial instruments may fluctuate due to changes in rates. The Company’s exposure is partially offset by sourcing capital projects and expenditures in US dollars. The Company had no forward exchange contracts in place as at December 31, 2024. INTEREST RATE RISK The Company has borrowed in the past and has a utilized standby credit facility. Interest payments under potential future borrowings could be exposed to volatility in interest rates that could constrain the company’s cashflows. The Company’s main income is derived from its investment in Prime that has outstanding borrowings. Prime’s cash flows can be impacted adversely by increases in interest rates that in turn could constrain dividend distributions to Africa Oil. CREDIT RISK Credit risk is the risk of loss if counterparties do not fulfil their contractual obligations. Most of the Company’s credit exposure relates to amounts due from its JV parties. The risk of the Company’s JV parties defaulting on their obligations per their respective joint operating and farmout agreements is mitigated as there are contractual provisions allowing the Company to default JV parties who are non- performing and reacquire any previous farmed out working interests. The maximum exposure for the Company is equal to the sum of its cash, restricted cash, and accounts receivable. A portion of the Company’s cash is held by banks in foreign jurisdictions where there could be increased exposure to credit risk. LIMITATION OF LEGAL REMEDIES Securities legislation in certain of the provinces and territories of Canada provides purchasers with various rights and remedies when a reporting issuer’s continuous disclosure contains a misrepresentation and ongoing rights to bring actions for civil liability for secondary market disclosure. Under the legislation, the directors would be liable for a misrepresentation. It may be difficult for investors to collect from the directors who are resident outside Canada on judgements obtained in courts in Canada predicated on the purchaser’s statutory rights and on other civil liability provisions of Canadian securities legislation. DECOMMISSIONING The Company is responsible for compliance with all applicable laws, regulations and contractual requirements regarding the decommissioning, abandonment and reclamation of the Company’s assets at the end of their economic life, the costs of which may be substantial. It is not possible to predict these costs with certainty since they will be a function of requirements at the time of decommissioning, abandonment and reclamation and the actual costs may exceed current estimates. Laws, regulations and contractual requirements about abandonment and decommissioning may be implemented or amended in the future. SHAREHOLDER CAPITAL RETURNS The Company has implemented a base dividend policy and has in the past engaged in share repurchases as part of its commitment to return capital to the shareholders. The amount and frequency of future returns cannot be guaranteed and the Company’s performance in this regard is subject to its financial and operational performance that are subject to the risks already outlined. The declaration, timing, amount and payment of dividends remain at the discretion of the Company’s Board. Also, the amount and the pace of share buybacks, if implemented, are at the discretion of the Board. ===== SIDA 44 ===== PAGE 34 Report to Shareholders | December 31, 2024 Africa Oil Corp. RISK FACTORS - CONTINUED RISKS INHERENT IN OIL AND GAS EXPLORATION, DEVELOPMENT, AND PRODUCTION Oil and gas operations involve many risks, which, even with the combination of experience, knowledge and careful evaluation may not be able to overcome. The long-term commercial success of Africa Oil depends on its ability to find, acquire, develop and commercially produce oil and gas reserves. No assurance can be given that the Company will be able to locate satisfactory properties for acquisition or participation. Moreover, if such acquisitions or participations are identified, the Company may determine that current markets, terms of acquisition and participation or pricing conditions make such acquisitions or participations uneconomic. It is difficult to project the costs of implementing an exploratory, appraisal or development drilling program due to the inherent uncertainties of drilling in unknown formations, the costs associated with encountering various drilling conditions such as over pressured zones, tools lost in the hole, equipment failures or malfunctions and changes in drilling plans and locations as a result of prior exploratory wells or additional seismic data and interpretations thereof. Without the continual addition of new reserves, any existing reserves associated with the Company’s oil and gas assets at any particular time, and the production therefrom, could decline over time as such existing reserves are exploited. There is a risk that additional commercial quantities of oil and gas may not be discovered or acquired by the Company. Africa Oil’s business is subject to all the risks and hazards inherent in businesses involved in the exploration for, and the acquisition, development, production and marketing of, oil and gas, many of which cannot be overcome even with a combination of experience and knowledge and careful evaluation. The risks and hazards typically associated with oil and gas operations include fire, explosion, blowouts, sour gas releases, pipeline ruptures and oil spills, each of which could result in substantial damage to oil and gas wells, production facilities, other property, the environment or personal injury, and such damages may not be fully insurable. RESERVES AND RESOURCES VOLUMES There are many uncertainties inherent in estimating quantities of oil and natural gas reserves and resources (contingent and prospective) and the future cash flows attributed to such reserves and resources. The actual production, revenues, taxes and development and operating expenditures with respect to the reserves and resources associated with the Company’s assets will vary from estimates thereof and such variations could be material. Estimates of reserves that may be developed and produced in the future are often based upon volumetric calculations and upon analogy to similar types of reserves rather than actual production history. There is uncertainty that it will be commercially viable to produce any portion of the contingent resources. Actual future net cash flows will be affected by other factors, such as actual production levels, supply and demand for oil and natural gas, curtailments or increases in consumption by oil and natural gas purchasers, changes in governmental regulation or taxation and the impact of inflation on costs. GOVERNMENT REGULATIONS AND TAX RISK The Company may be adversely affected by changes to applicable laws to which it is subject, and its host governments may implement new applicable laws, modify existing ones, or interpret them in a manner that is detrimental to the Company. Such changes to the laws to which the Company is subject could, amongst other things, result in a windfall tax, an increase in existing tax rates or the imposition of new ones or the Company may be subject to tax assessments, all of which on their own or taken together could have a material adverse effect on the Company’s business, financial condition, results of operations and prospects of the Company’s oil and gas assets. As has become customary in Nigeria since 2019, the annual budget for Nigeria has been accompanied by a proposed finance bill that supports the revenue needs indicated in the annual budget. This bill could include changes to tax laws, including laws that can affect directly or indirectly the oil and gas industry. INVESTMENTS IN ASSOCIATES AND INVESTMENTS IN JOINT VENTURES The Company has invested in other frontier oil and gas exploration companies that face similar risks and uncertainties, which could have a material adverse effect on their businesses, prospects and results of operations. Such risks include, without limitation, equity risk, liquidity risk, commodity price risk, credit risk, currency risk, foreign investment risk, and changes in environmental regulations, economic, political or market conditions, or the regulatory environment in the countries in which they operate. The associates or joint ventures are entities in which the Company has some influence, including through its representation on their boards, but given its equal or minority interest, no or limited control over their decisions, including, without limitation, financial and operational policies, the Company has no or limited control over outcomes, performance and governance. The Company’s access to information is subject to the contractual provisions of shareholder agreements. The Company is reliant on the information provided by investments and may not have the ability to independently verify such information. The Company’s investments are not diversified over different types of investments and industries, rather, they are concentrated in one type of investment. If an associated company or jointly controlled entity in which the Company has invested fails, liquidates, or becomes bankrupt, the Company could face the potential risk of loss of some, or all, of its investments, and may be unable to recover any of its investments. The Company’s share price performance is subject to timely communication of financial and operational results. The Company is reliant on its associates and joint ventures for timely and accurate disclosures of material updates. Although the Company has procedures in place to maximise its oversight of such disclosures, including representation on the boards of its investee companies, failure to mitigate delays and/or inaccuracies in such disclosures could expose the Company to regulatory sanctions and shareholder legal action that could adversely impact the Company’s finances and reputation. ===== SIDA 45 ===== PAGE 35 Report to Shareholders | December 31, 2024 Africa Oil Corp. INTERNATIONAL OPERATIONS The Company participates in oil and gas projects located in emerging markets, primarily in Africa. Oil and gas exploration, development and production activities in these emerging markets are subject to significant political, economic, and other uncertainties that may adversely affect the Company’s operations. The Company could be adversely affected by changes in applicable laws and policies in the countries where the Company has interests. Additional uncertainties include, but are not limited to, the risk of war, terrorism, expropriation, civil unrest, nationalization, renegotiation or nullification of existing or future concessions and contracts, the imposition of international sanctions, a change in crude oil or gas pricing policies, changes to taxation laws and policies, assessments and audits (including income tax) against the Company by regulatory authorities, difficulty or delays in obtaining necessary regulatory approvals, risks associated with potential future legal proceedings, and the imposition of currency controls. These uncertainties, all of which are beyond the Company’s control, could have a material adverse effect on the Company’s business, prospects and results of operations. In addition, if legal disputes arise related to oil and gas concessions acquired by the Company, they could be subject to the jurisdiction of courts other than those of Canada. The Company’s recourse may be very limited in the event of a breach by a government or government authority of an agreement governing a concession in which the Company acquires an interest. The Company may require licenses or permits from various governmental authorities to carry out future exploration, development and production activities. There can be no assurance that the Company will be able to obtain all necessary licenses and permits when required. DIFFERENT LEGAL SYSTEM AND LITIGATION The Company’s exploration, development and production activities are located in countries with legal systems that in various degrees differ from that of Canada. Rules, regulations and legal principles may differ in respect of matters of substantive law and of such matters as court procedure and enforcement. Almost all material exploration and production rights and related contracts of the Company are subject to the national or local laws and jurisdiction of the respective countries in which the operations are carried out. This means that the Company’s ability to exercise or enforce its rights and obligations may differ between different countries and also from what would have been the case if such rights and obligations were subject to Canadian law and jurisdiction. The Company’s operations are, to a large extent, subject to various complex laws and regulations as well as detailed provisions in concessions, licenses and agreements that often involve several parties. If the Company was to become involved in legal disputes in order to defend or enforce any of its rights or obligations under such concessions, licenses, and agreements or otherwise, such disputes or related litigation could be costly, time consuming and the outcome would be highly uncertain. Even if the Company ultimately prevailed, such disputes and litigation may still have a substantially negative effect on the Company’s business, assets, financial conditions, and its operations. BRIBERY, CORRUPTION AND FRAUD The Company is subject to various laws which aim to combat bribery, corruption and fraud, including the Corruption of Foreign Public Officials Act (Canada) and the Bribery Act 2010 (United Kingdom) and the Economic Crime and Corporate Transparency Act 2023 (United Kingdom). Failure to comply with such laws could subject the Company to, among other things, civil and criminal penalties, other remedial measures and legal expenses and reputational damage, each of which could adversely affect the Company’s business, results in operations, and financial condition. Weaknesses in the anti-corruption legal and judicial system of certain countries may undermine the Company’s or a host government’s capacity to effectively detect, prevent and sanction corruption and fraud. To mitigate this risk, the Company has implemented an anti-corruption compliance and onboarding program for anyone that does business with the Company, anti-corruption training initiatives for its personnel and consultants, and an anti-corruption policy for its personnel, and consultants. However, the Company cannot guarantee that its personnel, contractors, or business partners have not in the past or will not in the future engage in conduct undetected by the onboarding processes and procedures adopted by the Company, and it is possible that the Company, its personnel or contractors, could be subject to investigations or charges related to bribery, corruption or fraud as a result of actions of its personnel or contractors. SHARED OWNERSHIP AND DEPENDENCY ON JV PARTIES The Company’s operations are primarily conducted together with one or more JV parties through contractual arrangements, including unincorporated associations. In such instances, the Company may be dependent on, or affected by, the due performance and financial strength of its JV parties. If a JV party fails to perform or becomes insolvent, the Company may, among other things, risk losing rights or revenues or incur additional obligations or costs, experience delays, or be required to perform such obligations in place of its JV party. The Company and its JV parties may also, from time to time, have different opinions on how to conduct certain operations or on what their respective rights and obligations are under a certain agreement. If a dispute were to arise with one or more JV parties relating to a project, such dispute may have material adverse effect on the Company’s or investee company’s operations relating to such project. RISKS RELATING TO CONCESSIONS, LICENSES AND CONTRACTS Africa Oil’s operations are based on a relatively limited number of concession agreements, licenses and contracts. The rights and obligations under such concessions, licenses and contracts may be subject to interpretation and could also be affected by, among other things, matters outside the control of Africa Oil. In case of a dispute, it cannot be certain that the view of the Company would prevail or that the Company otherwise could effectively enforce its rights which, in turn, could have significantly negative effects on Africa Oil. Also, if the Company or any of its JV parties were found to have failed to comply with their obligations or liabilities under a concession, license or contract, including record-keeping, budgeting, and time scheduling requirements, the Company’s or JV parties rights under such concession, license or contract may be terminated or otherwise relinquished in whole or in part. The Company cannot guarantee that requirements are adequately met by its JV parties, which could bring an increased risk of impairment and reduced future cash flow. In May 2023, the Company submitted notices to withdraw from its concessions on Blocks 10BB, 13T and 10BA in Kenya. The Company’s withdrawal from the concessions is subject to approvals from the Kenyan authorities and, while the Company is working with its JV parties and the authorities to effect a smooth withdrawal process, there can be no certainty that such approvals will be forthcoming on terms acceptable to all parties. RISK FACTORS - CONTINUED ===== SIDA 46 ===== PAGE 36 Report to Shareholders | December 31, 2024 Africa Oil Corp. RISKS RELATING TO INFRASTRUCTURE Africa Oil is dependent on having available and functioning infrastructure relating to the properties and licenses on which it operates, such as roads, power and water supplies, pipelines and gathering systems, supply bases and associated services. The amount of oil and gas that the Company can produce, and sell is subject to accessibility, availability, proximity and capacity of gathering, processing and pipeline systems. The lack of availability of capacity or a failure in any of the gathering, processing and pipeline systems, and in particular the processing facilities could result in the Company’s inability to realize the full economic potential of its production or in a reduction of the price offered for the Company’s production. Any significant change in market factors, terms of use or other conditions affecting these infrastructure systems and facilities, as well as any delays in constructing new infrastructure systems and facilities could harm the Company’s business financial condition, results of operations, cash flows and future prospects. In Nigeria, gas export relies on the continued safe operations at the Nigeria LNG facility. Gas export restrictions could have an adverse effect on oil production, due to reductions in overall facility production to minimise flaring of associated gas. The supply chain for offshore is dependent upon existing ports and onshore infrastructure. Several factors, including social unrest onshore, have the potential to disrupt both the gas processing facilities and the upstream supply chain which could have detrimental impacts on Prime’s cashflow and subsequent dividend payments to Africa Oil. In Equatorial Guinea, exploration efforts in Block EG-31 are targeting gas prospects located close to existing gas export and processing facilities. In the event of a discovery, the discovered fluids may not be compatible with the existing processing facilities resulting in additional cost which may result in the potential discovery being non-commercial. There may also be insufficient ullage in the facilities to accept additional capacity and without appropriate commercial arrangements it may not be possible to produce any potential discovery. INSURANCE The Company’s involvement in oil and gas operations may result in the Company becoming subject to liability for pollution, blow-outs, property damage, personal injury or other hazards. While the Company obtains insurance in accordance with industry standards to address such risks, the nature of the risks facing the oil and gas industry is such that liabilities might exceed policy limits, the liabilities and hazards might not be insurable, or the Company might elect not to insure itself against such liabilities due to high premium costs or other reasons. The payment of such uninsured liabilities would reduce the funds available to the Company. The occurrence of a significant event that the Company is not fully insured against, or the insolvency of an insurer, could have a material adverse effect on the Company’s business, financial condition and results of operations. There can be no assurance that insurance will be available in the future. CLIMATE RISKS MARKET RISKS Changing consumer preferences for low carbon sources of energy, transport and products and services may erode demand for oil and gas as alternatives come to market and gain scale. Reduced demand for oil and gas may result in stranded reserves or resources and negatively impact the Company’s valuation and share price. In addition to limiting the Company’s ability to sell into the market, these trends could lead to lower commodity prices in the medium and long-term, putting further pressure on revenues. In the short- term, unbalanced investment in traditional vs. new energy technologies and sources, combined with uncertain demand dynamics, may lead to commodity price volatility. Supply chains may also become constrained, as suppliers adjust their strategies and product mix in response to the energy transition, resulting in increasing costs for some goods and services. The Company has conducted scenario analysis, which suggests the current portfolio remains competitive in a low demand environment. We update our analysis on a regular basis and ahead of new project sanction to minimize the risk of stranded assets. In order to remain resilient in an uncertain and volatile future commodity environment, the Company works with and through its parties to reduce operational costs as much as possible without sacrificing health and safety or longer-term efficiency and environmental or strategic goals. Additionally, the Company will maintain a prudent budget and financial strategy, including hedging as appropriate, to manage medium term oil price volatility ensure the business remains resilient in a low oil price environment. LITIGATION RISKS Climate-related litigation is a rapidly evolving and increasingly important issue for our industry. The risk of legal challenges could rise as the costs of climate change mitigation and adaptation increase, and as more climate laws and agreements are put in place. Climate- related litigation could result in liabilities or loss of license related to current or historical activities’ contribution to global emissions. We do not consider Africa Oil at immediate risk of climate litigation but are monitoring developments closely. Even if the Company is not directly targeted by litigation, operations may be indirectly impacted by outcomes in related cases involving other oil and gas companies in jurisdictions where we operate. The Company will seek legal counsel as required to remain abreast of potential legal action and its implications for our business. RISK FACTORS - CONTINUED ===== SIDA 47 ===== PAGE 37 Report to Shareholders | December 31, 2024 Africa Oil Corp. REGULATORY RISKS Since the Paris Agreement was signed in 2015, countries have steadily enacted policies to enable the transition to a low carbon future and meet their Nationally Determined Contributions (NDCs). This includes the governments of countries where Africa Oil conducts business. These policies may directly or indirectly increase the cost of doing business in these countries or potentially restrict the Company’s ability to operate. Africa Oil regularly monitors the evolving regulatory landscape, both globally and in the Company’s countries of operation, to anticipate the impact of new climate-related measures and ensure the Company remains compliant. Additionally, the Company is developing a comprehensive energy transition strategy, including measures to minimize operational emissions in line with Paris Agreement objectives, which should help the Company to remain aligned with evolving regulatory requirements and minimize negative impacts. REPUTATIONAL RISK Increased scrutiny, pressure and action by environmental activists, non-governmental organizations and other stakeholders may result in disruption to operations or loss of license to operate. Such disruption may negatively impact cash flows, returns or the value of our portfolio. Similarly, companies within the sector and our supply chain may make emissions performance and climate risk management explicit in partner or contract decisions. The Company has not been directly targeted by environmental activists but could be targeted in the future. To mitigate this risk, Africa Oil proactively engages with the communities and other stakeholders where the Company operates to keep them informed about the impact of our operations on the environment and their livelihoods. The Company also ensures proper security is in place to minimize the impact of any potential disruptions and prevent harm to staff, bystanders and assets. In addition to environmental activists, numerous banks and large institutional investors have communicated an intention to divest from or limit future exposure to fossil fuels, including oil and gas. Increasing investor and lender concerns regarding climate resilience could limit access to capital, increase the cost of that capital via higher interest rates or result in direct costs associated with new measures to meet investor expectations. Since 2020, Africa Oil has published public climate disclosures aligned with the Taskforce for Climate- Related Financial Disclosures (TCFD) recommendations to proactively address investor and other stakeholder concerns regarding climate risk exposure. In addition, Africa Oil regularly engages with investors and lenders to understand their climate policies and requirements and to inform them about the steps the Company is taking to manage climate risks. This includes development of a strategy to minimize operational emissions. PHYSICAL RISKS Climate change has already resulted in significant shifts in global weather patterns, including an increase in the number and severity of heat waves, cold spells, droughts and storms, including hurricanes and tropical cyclones. Longer term, climate change may also result in rising sea levels due to melting polar ice caps. The physical effects of climate change have the potential to directly impact the Company’s assets and operations. In 2022, the Company contracted a global climate risk analytics company to perform a quantified assessment of the physical climate risks facing the Company’s assets under three IPCC climate scenarios: SSP1-2.6 (consistent with 1.8°C warming), SSP2-4.5 (consistent with 2.7°C warming) and SSP5-8.5 (consistent with 4.4°C warming). That analysis suggests exposure to future changes in physical climate hazards is relatively minimal compared to the historical baseline across all three scenarios. We will continue to monitor our assets’ exposure to physical climate risks as our portfolio and the global scientific community’s understanding of changing climate patterns evolves. OTHER ENVIRONMENTAL RISKS The regulatory frameworks in the Company’s countries of operation extend beyond emissions to include broader areas of environmental concern, including water management, waste handling, soil pollution and biodiversity protection. These regulations typically include environmental licensing and permitting subject to the conduct of Environmental and Social Impact Assessments prior to any new exploration or development activity, as well as ongoing monitoring and reporting. Non-compliance with environmental regulations can result in fines or permits being revoked, both of which could materially impact the Company’s financial position or license to operate. Breaches could also lead to civil or criminal litigation, particularly in cases resulting in significant environmental damage. The Company is committed to minimizing the broader environmental impact of its activities. The Company acts in compliance with the applicable environmental laws and regulations of its countries of operation and manages activities according to good international practice. This includes taking a rigorous approach to operational planning, including identifying potential environmental or social risks and impacts of operations, and obtaining and maintaining all necessary permits and licenses. The Company also consults with stakeholders on environmental issues that may affect them, investigates any environmental incidents, and maintains emergency response procedures for protection of the environment. The Company assesses and puts measures in place to minimize impact on biodiversity and ecosystem services in line with the mitigation hierarchy to ensure that activities lead to no net loss of natural habitats. Where the Company is not the operator, it monitors environmental risk management via regular reports from JV parties and operators and participation in quarterly operating and technical committee meetings. Though the Company endeavors to engage all relevant stakeholders proactively and early in the project planning process, environmental activism is increasing, and in some cases has resulted in delays or disruptions to activities, including delays to permitting where activists have challenged permits in courts. Africa Oil has not to date suffered impacts to operations due to environmental activism. However, such delays could affect project economics by incurring additional costs or delaying forecast production and revenues. The Company does not currently face any environmental fines or charges. However, accidents can occur and the unexpected nature of these events makes the timing and scope challenging to quantify with respect to financial impacts. ===== SIDA 48 ===== PAGE 38 Report to Shareholders | December 31, 2024 Africa Oil Corp. FORWARD-LOOKING STATEMENTS Certain statements in this document may constitute forward-looking information or forward-looking statements under applicable Canadian securities law (collectively “forward-looking statements”). Forward-looking statements are statements that relate to future events, including the Company’s future performance, opportunities or business prospects. All statements other than statements of historical fact may be forward-looking statements. Statements concerning proven and probable reserves and resource estimates may also be deemed to constitute forward-looking statements and reflect conclusions that are based on certain assumptions that the reserves and resources can be economically exploited. Any statements that express or involve discussions with respect to expectations, forecasts, assumptions, objectives, beliefs, projections, plans, guidance, predictions, future events or performance (often, but not always, identified by words such as “believes” , “seeks” , “anticipates” , “expects” , “continues” , “may” , “projects” , “estimates” , “forecasts” , “pending” , “intends” , “plans” , “could” , “might” , “should” , “will” , “would have” or similar words suggesting future outcomes) are not statements of historical fact and may be forward-looking statements. By their nature, forward-looking statements involve assumptions, inherent risks and uncertainties, many of which are difficult to predict, and are usually beyond the control of management, that could cause actual results to be materially different from those expressed by such forward-looking statements. Undue reliance should not be placed on these forward-looking statements because the Company cannot assure that the forward-looking statements will prove to be correct. As forward-looking information address future conditions and events, they could involve risks and uncertainties including, but are not limited to, risk with respect to macro-economic conditions and their impact on operations, regulations and taxes, civil unrest, corporate restructuring and related costs, capital and operating expenses, pricing and availability of financing and currency exchange rate fluctuations. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Forward-looking statements include, but are not limited to, statements concerning: • A change to the shareholder capital return program including the implementation of share buy-backs; • The completion and timing of proposed transactions; • Planned exploration, appraisal and development activity including both expected drilling, and geological and geophysical related activities; • Potential for an improved economic environment; • Proposed development plans; • Future development costs and the funding thereof; • Expected funding and development costs; • Anticipated future financing requirements; • Future sources of funding for the Company’s capital program; • Future capital expenditures and their allocation to exploration and development activities; • Expected operating costs; • Future sources of liquidity, ability to fully fund the Company’s expenditures from cash flows, and borrowing capacity; • Availability of potential farmout partners/ parties; • Government or other regulatory consent for exploration, development, farmout, or acquisition activities; • Future production levels; • Future crude oil or natural gas prices; • Future earnings; • The Company’s ability to deliver further growth and expectations regarding free-cash flow; • Future asset acquisitions or dispositions and the anticipated strategic and financial benefits of those transactions; • Future debt levels; • Availability of committed credit facilities, including existing credit facilities, on terms and timing acceptable to the Company; • Possible commerciality; • Development plans or capacity expansions; • Future ability to execute dispositions of assets or businesses; • Future drilling of new wells; • Ultimate recoverability of current and long-term assets; • Ultimate recoverability of reserves or resources; • The sustainability of the Company across oil and gas price cycles; • Future foreign currency exchange rates; • Future market interest rates; • Future expenditures and future allowances relating to environmental matters; • Dates by which certain areas will be explored or developed or will come on stream or reach expected operating capacity; ===== SIDA 49 ===== PAGE 39 Report to Shareholders | December 31, 2024 Africa Oil Corp. • The Company’s ability to comply with future legislation or regulations; • Future staffing level requirements; and • Changes in any of the foregoing. Statements relating to “reserves” or “resources” are forward-looking statements, as they involve the implied assessment, based on estimates and assumptions, that the reserves and resources described exist in the quantities predicted or estimated, and can be profitably produced in the future. These forward-looking statements are subject to known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements. Such factors include, among others: • Market prices for oil and gas; • Uncertainty of estimates and projections relating to reserves, resources, production, revenues, costs and expenses; • Changes in exploration or development project plans or capital expenditures; • The Company’s ability to explore, develop, produce and transport crude oil and natural gas to markets; • Production and development costs and capital expenditures; • The imprecise nature of reserve estimates and estimates of recoverable quantities of oil, natural gas and liquids; • Changes in oil prices; • Availability of financing; • Uninsured risks; • Changes in interest rates and foreign-currency exchange rates; • Regulatory changes; • Changes in the social climate in the regions in which the Company operates; • Health, safety and environmental risks; • Climate change legislation and regulation changes; • Defects in title; • Availability of materials and equipment; • Timelines of government or other regulatory approvals; • Ultimate effectiveness of design or design modification to facilities; • The results of exploration, appraisal and development drilling and related activities; • Short-term well test results on exploration and appraisal wells do not necessarily indicate the long-term performance or ultimate recovery that may be expected from a well; • Pipeline or delivery constraints; • Volatility in energy trading markets; • Incorrect assessments of value when making acquisitions; • Economic conditions in the countries and regions in which the Company carries on business; • Governmental actions including changes to taxes or royalties, and changes in environmental and other laws and regulations; • The Company’s treatment under governmental regulatory regimes and tax laws; • Renegotiations of contracts; • Results of litigation, arbitration or regulatory proceedings; • Political uncertainty, including actions by terrorists, insurgent or other groups, or other armed conflict; and • Internal conflicts within states or regions. The impact of any one risk, uncertainty or factor on a particular forward-looking statement is not determinable with certainty as these factors are interdependent, and management’s future course of action would depend on its assessment of all available information at that time. Although management believes that the expectations conveyed by the forward-looking statements are reasonable based on the information available to it on the date such forward-looking statements were made, no assurances can be given that such expectations will prove to be correct, and such forward-looking statements included in, or incorporated by reference into, this document should not be unduly relied upon. The forward-looking statements are made as of the date hereof or as of the date specified in the documents incorporated by reference into this document, as the case may be, and except as required by law, the Company undertakes no obligation to update publicly, re-issue, or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This cautionary statement expressly qualifies the forward-looking statements contained herein. FORWARD-LOOKING STATEMENTS - CONTINUED ===== SIDA 50 ===== PAGE 40 Report to Shareholders | December 31, 2024 Africa Oil Corp. ===== SIDA 51 ===== PAGE 41 Report to Shareholders | December 31, 2024 Africa Oil Corp. ===== SIDA 52 ===== PAGE 42 Report to Shareholders | December 31, 2024 Africa Oil Corp. ===== SIDA 53 ===== PAGE 43 Report to Shareholders | December 31, 2024 Africa Oil Corp. ===== SIDA 54 ===== PAGE 44 Report to Shareholders | December 31, 2024 Africa Oil Corp. ===== SIDA 55 ===== PAGE 45 Report to Shareholders | December 31, 2024 Africa Oil Corp. (Expressed in millions of United States dollars) CONSOLIDATED BALANCE SHEETS  As at     Note December 31, 2024 December 31, 2023 ASSETS Current assets Cash and cash equivalents 4 61.4 232.0 Loan to associated company 19 4.3 - Accounts receivable and prepaid expenses 4.0 5.1 Investment held for sale 7 7.0 - 76.7 237.1 Long-term assets Equity investment in joint venture 5 328.4 572.5 Equity investments in associates 6 177.6 134.7 Intangible exploration assets 8 29.3 19.1 Other tangible fixed assets 9 3.2 - Loan to associated company 19 - 2.8 538.5 729.1 Total assets 615.2 966.2 LIABILITIES AND EQUITY Current liabilities Financial liabilities 9 0.7 - Accounts payable and liabilities 10 9.7 14.2 Share-based compensation liability 17 4.2 8.2 14.6 22.4 Long-term liabilities Financial liabilities 9 2.6 - Share-based compensation liability 17 3.1 5.9 Provision for contingent consideration 14 40.4 37.8 Provision for site restoration 11 5.7 5.5 51.8 49.2 Total liabilities 66.4 71.6 Equity attributable to common shareholders Share capital 13(B) 1,195.8 1,265.3 Contributed surplus 87.4 61.6 Treasury share account (0.4) - Deficit (734.0) (432.3) Total equity attributable to common shareholders 548.8 894.6 Total liabilities and equity attributable to common shareholders 615.2 966.2 The notes are an integral part of the consolidated financial statements. Approved on behalf of the Board: “ANDREW BARTLETT” “ROGER TUCKER” ANDREW BARTLETT, DIRECTOR ROGER TUCKER, DIRECTOR ===== SIDA 56 ===== PAGE 46 Report to Shareholders | December 31, 2024 Africa Oil Corp. (Expressed in millions of United States dollars) CONSOLIDATED STATEMENT OF NET (LOSS)/ INCOME AND COMPREHENSIVE (LOSS)/ INCOME For the years ended Note December 31, 2024 December 31, 2023 Operating (loss)/ income Share of profit from investment in joint venture 5 226.0 228.0 Share of loss from investments in associates 6 (38.7) (47.0) Total operating income 187.3 181.0 Operating expenses General and administrative expenses (32.4) (31.9) Impairment of investment in joint venture 5 (436.7) - Impairment of intangible exploration assets 8 - (62.2) Total operating expense (469.1) (94.1) Net operating (loss)/ income (281.8) 86.9 Finance income 15 7.6 7.8 Finance expense 15 (4.9) (7.6) Net (loss)/income attributable to common shareholders (279.1) 87.1 Total comprehensive (loss)/ income (279.1) 87.1 Net (loss)/income attributable to common shareholders per share Basic 16 (0.62) 0.19 Diluted 16 (0.62) 0.18 Weighted average number of shares outstanding for the purpose of calculating earnings per share Basic 16 449,431,803 462,231,061 Diluted 16 449,431,803 472,942,487 The notes are an integral part of the consolidated financial statements. ===== SIDA 57 ===== PAGE 47 Report to Shareholders | December 31, 2024 Africa Oil Corp. (Expressed in millions of United States dollars) CONSOLIDATED STATEMENTS OF EQUITY For the years ended Note December 31, 2024 December 31, 2023 Share capital: 13(B) Balance, beginning of the year 1,265.3 1,267.7 Exercise of Share Options 13/ 17 0.5 1.4 Settlement of Restricted Share Units 13/ 17 0.5 1.1 Settlement of Performance Share Units 13/ 17 1.1 3.5 Weighted average value of shares cancelled 13 (71.6) (8.4) Balance, end of the year 1,195.8 1,265.3 Contributed surplus: Balance, beginning of the year 61.6 59.2 Excess of weighted value of shares cancelled 13 25.8 2.4 Balance, end of the year 87.4 61.6 Treasury account: Balance, beginning of the year - - Shares purchased 13 (46.2) (6.0) Shares cancelled 13 45.8 6.0 Balance, end of the year (0.4) - Deficit: Balance, beginning of the year (432.3) (496.3) Dividends paid 13 (22.6) (23.1) Net income attributable to common shareholders (279.1) 87.1 Balance, end of the year (734.0) (432.3) Total equity attributable to common shareholders Balance, end of the year 548.8 894.6 The notes are an integral part of the consolidated financial statements. ===== SIDA 58 ===== PAGE 48 Report to Shareholders | December 31, 2024 Africa Oil Corp. CONSOLIDATED STATEMENTS OF CASH FLOWS (Expressed in millions of United States dollars) For the years ended Note December 31, 2024 December 31, 2023 Cash flows generated by/ (used in): Operations: Net (loss)/ income for the year (279.1) 87.1 Adjustments for: Share of profit from investment in joint venture 5 (226.0) (228.0) Share of loss from investments in associates 6 38.7 47.0 Share-based compensation 17 1.5 11.3 Impairment of investment in joint venture 5 436.7 - Impairment of intangible exploration asset 8 - 62.2 Other 2.1 (4.1) Net cash used in operating activities before working capital (26.1) (24.5) Changes in working capital (14.8) (28.8) Net cash used in operating activities (40.9) (53.3) Investing: Intangible exploration expenditures 8 (7.7) (15.4) Equity investment in associates 6 (88.6) (44.4) Dividends received from joint venture 5 36.0 175.0 Loan provided to associated company 19 (1.0) (0.5) Net cash (used) / generated in investing activities (61.3) 114.7 Financing: Repayment of principal portion of lease commitments 9 (0.5) - Dividends paid to shareholders 13 (22.6) (23.1) Repurchase of share capital 13 (45.3) (6.0) Net cash used in financing activities (68.4) (29.1) Effect of exchange rate changes on cash and cash equivalents denominated in foreign currency - - (Decrease)/ increase in cash and cash equivalents (170.6) 32.3 Cash and cash equivalents, beginning of the year 4 232.0 199.7 Cash and cash equivalents, end of the year 4 61.4 232.0 The notes are an integral part of the consolidated financial statements. ===== SIDA 59 ===== PAGE 49 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2024, and December 31, 2023 (Expressed in millions of United States dollars unless otherwise indicated) 1. Incorporation and nature of business: Africa Oil Corp. (collectively with its subsidiaries, “AOC” or the “Company”) was incorporated on March 29, 1993, under the laws of British Columbia and is an international oil and gas exploration and production company based in Canada with oil and gas interests in Africa. The Company’s registered address is 25th Floor, 666 Burrard Street, Vancouver, B.C., Canada V6C 2X8. 2. Basis of preparation: A. Statement of compliance: The Company prepares its consolidated financial statements in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”). The policies applied in these consolidated financial statements are based on IFRS Accounting Standards issued and outstanding as at February 27, 2025, the date the Board of Directors approved the statements. B. Basis of measurement: The consolidated financial statements have been prepared on the historical cost basis. Where there are assets and liabilities calculated on a different basis, this fact is disclosed in the material accounting policies. C. Functional and presentation currency: These consolidated financial statements are presented in United States (US) dollars. The functional currencies of the Company’s individual entities are US dollars which represents the currency of the primary economic environment in which the entities operate. The consolidated financial statements are expressed in millions of US dollars unless otherwise indicated. D. Use of estimates and judgements: The preparation of financial statements in conformity with IFRS Accounting Standards requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Information about significant areas of estimation and critical judgements in applying accounting policies that have the most significant effect on the amounts recognized in the consolidated financial statements are noted below, with further details of the assumptions contained in the relevant note. The Company has a 50% interest in Prime, which is a key asset for the Company. Information about Prime’s reserve and resource estimates has been included. i. Exploration and evaluation costs: Exploration and evaluation costs are initially capitalized as intangible exploration assets with the intent to establish commercially viable reserves. The Company is required to make significant estimates and judgements about the future events and circumstances regarding whether the carrying amount of intangible exploration assets exceeds its recoverable amount (see note 8). The carrying amounts of the Company’s exploration and evaluation costs are reviewed at each reporting date to determine whether there is any indication of impairment. Exploration and evaluation assets are assessed for impairment if facts and circumstances suggest that the carrying amount exceeds the recoverable amount. Should the carrying amount exceed the recoverable amount, an impairment loss is recognized. Significant assumptions developed by management used to determine the recoverable amount of the cash generating unit (“CGU”) include estimates for the quantity of contingent resources, future commodity prices, production forecasts, operating expenses, development costs, the likelihood of a successful farm out process, the timing of financial investment decision (“FID”) and the discount rate. The contingent resources and production rates are prepared by the Company’s independent petroleum engineers (management’s experts). CGU’s are assets that are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets. Exploration and evaluation assets are assessed if facts and circumstances suggest that an impairment loss recognized in prior periods may no longer exist or may have decreased. An impairment reversal is recognized if there has been an increase in the asset’s recoverable amount since the last impairment loss was recognized. The changing worldwide demand for energy and the global advancement of alternative sources of energy could result in a change in the assumptions used to determine the recoverable amount and could affect estimating the future cash flows which could impact the carrying amount of the Company’s intangible exploration assets. The timing of when global energy markets transition from carbon- based sources to alternative energy sources is highly uncertain. Environmental considerations are built into our estimates through the use of significant assumptions in estimating fair value including future commodity prices and discount rates. The energy transition could impact the future prices of commodities and discount rates used to appraise oil and gas projects. Pricing assumptions used in the determination of recoverable amounts incorporate market expectations and the evolving worldwide demand for energy. ===== SIDA 60 ===== PAGE 50 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED ii. Share based compensation: Charges for share purchase options are based on the fair value at the date of the award. Share purchase options are valued using the Black-Scholes model, and inputs to the model include assumptions on share price volatility, discount rates and expected life outstanding (see note 17). The estimated fair value of Performance share units (“PSUs”) is calculated based on non-market performance conditions set by the Company which are initially determined at the time of grant. The Company assesses the progress of reaching the individual performance conditions during each reporting period. PSUs cliff vest three years from the date of grant, at which time the Board of Directors will assign a performance multiple ranging from nil to 200% to determine the ultimate vested number of PSUs. The awards are revalued every quarter based on the Company’s share price and an estimate of the performance conditions at the quarter end. It is anticipated that PSU settlements will be made by issuing shares from treasury or cash, at the discretion of the Board of Directors (see note 17). The estimated fair value of the Restricted share units (“RSUs”) is initially determined at the time of grant. The awards are revalued every quarter based on the Company’s share price. RSUs may be settled in shares issued from treasury or cash, at the discretion of the Board of Directors (see note 17). iii. Consolidation of entities: When assessing control over a subsidiary, the Company is required to consider the nature of its relationship with the subsidiary, and whether strategic and operating decisions made by the subsidiary are made independently without the significant influence or control of the Company. Factors considered when assessing for control include share ownership, board composition and management involvement in the business. The determination of whether strategic and operating decisions made by the Company’s subsidiaries (see note 20) are made independently without the significant influence or control of the Company requires judgement. iv. Valuation of investments: An investment in an associate or a joint venture is accounted for using the equity method from the date on which the investee becomes an associate or a joint venture. Investments in associates or joint ventures are initially recorded at cost. On acquisition of the investment in an associate or a joint venture, any excess of the cost of the investment over the share of the net fair value of the identifiable assets and liabilities of the investee is recognized as notional goodwill, which is included within the carrying amount of the investment. Significant assumptions developed by management used to determine the fair value of the non-current assets include estimates for the quantity of proved and probable petroleum reserves, future commodity prices, operating and capital costs as well as discount rates. The proved and probable petroleum reserves are prepared by the investee’s independent petroleum engineers (management’s experts). Where contingent consideration has been recognized in an investment in an associate or joint venture, any revisions to the contingent consideration estimates after the date of acquisition, which have been considered as changes in estimates in accordance with IAS 8, are accounted for on a prospective basis. Any change in the liability as a result of the revised cash flows is adjusted to the cost of the asset and, in accordance with paragraph 37 of IAS 8, recognized as part of the associate or joint venture carrying amount rather than in profit or loss. v. Impairment of joint ventures and associates: The amounts for investments in joint ventures and associates represents the Company’s equity interest in other entities, where there is either joint control or significant influence. The Company assesses investments in associates for impairment whenever changes in circumstances or events indicate that the carrying value may not be recoverable. The process of determining whether there is an objective evidence of impairment considering circumstances or events which indicate that the carrying value may not be recoverable or calculating the recoverable amount requires judgement. An area in which the Company has applied judgement in the prior year relates to the investment in Prime. On acquisition, judgements and estimates were used in determining fair values on acquisition for the purposes of the notional purchase price allocation. Subsequently, in assessing whether there are any indicators of impairment the Company has considered any effects of Prime’s forward sales, the loan facility, and any operational and contractual implications on the future dividend stream when assessing for impairment indicators. An area in which the Company has applied judgement in the year relates to the equity investments in associates. In assessing whether there are any indicators of impairment the Company considered the movements in share price of the associates listed on public markets, the results of exploration and appraisal activities and future plans for the operations. vi. Deferred tax asset: A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is probable that the related tax benefit will no longer be realized. vii. Contingencies: Contingencies are subject to measurement uncertainty as the related financial impact will only be confirmed by the outcome of a future event. The assessment of contingencies requires the application of judgements and estimates including the determination of whether a present obligation exists, and the reliable estimation of the timing and amount of cash flows required to settle the contingencies. ===== SIDA 61 ===== PAGE 51 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED viii. Hydrocarbon reserve and resource estimates: Oil and gas production assets, including facilities, are depreciated on a units-of-production (“UoP”) basis at a rate calculated by reference to total proved and probable oil and gas reserves (“2P”) determined in accordance with the principles contained in the SPE Petroleum Resources Management Reporting System (“PRMS”) framework. Prime estimates its 2P reserves based on information provided by reputable independent petroleum engineers, through the information provided by the respective operators. This information from reputable independent petroleum engineers concerns, amongst others, the geological and technical data on the size, depth, shape and grade of the hydrocarbon body and suitable production techniques and recovery rates. 2P reserves are determined using estimates of oil and gas in place, recovery factors, operating expenses, future development costs and future commodity prices; the latter having an impact on the total amount of recoverable reserves and the proportion of the gross reserves which are attributable to the host government under the terms of the Production-Sharing Agreements. The current long-term Brent oil price assumption used in the estimation of proved and probable reserves is based on the long-term oil price forward curve of Bloomberg L.P . As the economic assumptions used may change and, as additional geological information is obtained during the operation of a field, estimates of recoverable reserves may change. ix. Provision for site restoration: Amounts used in recording a provision for site restoration are based on current legal and constructure requirements and current technology and price levels for the removal of facilities and plugging and abandoning of wells. Due to changes in relation to these items, the future cash outflows in relation to the site decommissioning and restoration can be difficult. To reflect the effects due to changes in legislation requirements, technology and price levels, the carrying amounts of site restoration provisions are reviewed on a regular basis. On fields where the Group is required to contribute to site restoration costs, a provision is recorded to recognize the future commitment. An asset is created, as part of oil and gas interests, to represent the discounted value of the anticipated site restoration liability and depleted over the life of the field on a unit of production basis. The corresponding accounting entry to the creation of the asset recognizes the discounted value of the future liability. The discount applied to the anticipated site restoration liability is subsequently released over the life of the field and is charged to finance expense. Changes in site restoration costs and reserves are treated prospectively and consistent with the treatment applied upon initial recognition (see note 11). 3. Material accounting policies: The accounting policies set out below have been applied consistently to all years presented in these consolidated financial statements and have been applied consistently by the Company and its subsidiaries. A. Basis of consolidation: i. Subsidiaries: Subsidiaries are entities controlled by the Company. Control exists when the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that are currently exercisable are taken into account. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. The acquisition method of accounting is used to account for acquisitions of subsidiaries and assets that meet the definition of a business under IFRS Accounting Standards. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued, and liabilities incurred or assumed at the date of exchange. ii. Jointly controlled operations and jointly controlled assets: Many of the Company’s oil and natural gas activities involve jointly controlled assets. The consolidated financial statements include the Company’s share of these jointly controlled assets and liabilities and a proportionate share of the relevant revenue and related costs. iii. Transactions eliminated on consolidation: Intercompany balances and transactions, and any unrealized income and expenses arising from intercompany transactions, are eliminated in preparing the consolidated financial statements. ===== SIDA 62 ===== PAGE 52 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED B. Equity method: Investments in joint ventures and associates are accounted for using the equity method. Investments of this nature are recorded at original cost. Investments in joint ventures or associates which arise from a loss in control of a subsidiary are recorded at fair value on the date of the loss of control. The investment is adjusted at each reporting date for the Company's share of the profit or loss of the investment after the date of acquisition. The investor's share of the profit or loss of the investee is also recognized in the Company's Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. Distributions received reduce the carrying amount of the investment. The Company assesses its investments in joint ventures and associates for an objective evidence of impairment considering circumstances or events which indicate that the carrying value may not be recoverable. If such circumstances or events exist, the carrying amount of the investment is compared to its recoverable amount. The recoverable amount is the higher of the investment’s fair value less costs to dispose and its value in use. The investment is written down to its recoverable amount when its carrying amount exceeds the recoverable amount. As at December 31, 2024, the Company had a 50% interest in Prime which is a key asset for the Company. The material accounting policies for Prime are as follows: i. Sales of crude oil and natural gas: Revenue from the sale of crude oil and natural gas is recognized when control of the goods transfers to the customer. The transfer of control of the crude oil and natural gas sold by Prime usually coincides with title passing to the customer and the customer taking physical possession. This generally occurs when the product is physically transferred into a vessel, pipe or other delivery mechanism. Crude oil transaction prices under forward contracts are based on the agreed contract price plus or minus a premium based on an arithmetical average of the mean in quoted market prices for the previous month of the bill of lading. The performance obligation is satisfied and payment is due upon delivery, FOB, to the buyer. At this point in time, at the bill of lading date, a trade receivable is recognized and there are generally 30 days between revenue recognition and payment. There are no obligations for returns, refunds, warranties nor other obligations when control has been transferred. Prime principally satisfies its performance obligations at a point in time and the amounts of revenue recognized relating to performance obligations satisfied over time are not significant. Revenue from crude oil transactions not covered under forward contracts, arises from the production and lifting of crude oil on an 'entitlements' basis. Under the entitlements method, revenue reflects Prime’s share of production under the terms of the relevant production sharing contracts, regardless of which participant has actually made the sale and invoiced the production. This is achieved by applying the following approach in dealing with imbalances between actual sales and entitlements. Crude oil entitlement underlifts are recognized at the market price of oil at the balance sheet date. The excess of product sold during the period over the participant’s ownership share of production is recognized by Prime (acting as underlifter) as an asset in trade and other receivables with a corresponding credit to cost of sales. Prime’s underlift receivable is the right to receive additional oil from future production without the obligation to fund the production of that additional oil. Crude oil entitlement overlifts are treated as a purchase of crude oil by the overlifter from the underlifter and are also recognized at the market price of oil at the balance sheet date. The excess of product purchased during the period over the participant’s ownership share of production is recognized by Prime (acting as overlifter) as a liability in trade and other payables with a corresponding charge to cost of sales. An overlift liability is the obligation to deliver oil out of Prime’s equity share of future production. Revenues resulting from the production of oil under Production Sharing Contracts (“PSCs”) are recognized for those amounts relating to Prime’s cost recoveries and Prime’s share of the remaining production. Sales between group companies are based on prices generally equivalent to commercially available prices. ii. Tax oil revenue: According to the Production Sharing Agreements (“PSAs”), the share of the profit oil (“PPT”) to which the government is entitled in any calendar year, in accordance with the PSA, is deemed to include a portion representing the corporate income tax imposed upon and due by Prime. As the tax oil lifted by the operator on behalf of Prime is sold to 3rd party customers and proceeds are used to settle Prime’s tax liabilities, this share of PPT is considered to be within the scope of IFRS 15, ‘Revenue from contracts with customers’. Consequently, this portion of income tax and revenue is presented gross in revenue and offset in current income tax expense. Investment tax credit utilized is recognized as ‘Other operating income’. From May 2022, Prime has been lifting its share of tax oil and paying tax revenue in cash for PMLs 2, 3 and 4 and PPL 261. For PML 52, the operator was paying the tax on behalf of Prime to July 2023 and from August 2023, following conversion to the terms of the Petroleum Industry Act 2021 retrospectively from March 2023, Prime has been lifting its share of tax oil and paying tax revenue in cash. As the Group’s income taxes meet the criteria to be treated as an income tax under IAS 12, these are recorded as a single line item in profit and loss. ===== SIDA 63 ===== PAGE 53 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED iii. Depreciation/amortization: Oil and gas properties are depreciated/amortized from the commencement of production, on a UoP basis, which is the ratio of oil and gas production in the period to the estimated quantities of the 2P reserves at the end of the period plus the production in the period, on a field-by-field basis. Facilities included in oil and gas production assets are depreciated on a UoP basis over the economic useful life of the field concerned. Costs used in the UoP calculation comprise the net carrying amount of capitalized costs plus the estimated future field development costs. Changes in the estimates of reserves or future field development costs are dealt with prospectively. Oil and gas volumes are considered produced once they have been measured through meters at custody transfer or sales transaction points at the outlet valve on the field storage tank. Rights and concessions are depleted on the UoP basis over the total proved and probable reserves of the relevant area. iv. Recoverability of oil and gas properties: Prime assesses each asset or cash generating unit (CGU) (excluding goodwill, which is assessed annually regardless of indicators) each reporting period to determine whether any indication of impairment exists. Where an indicator of impairment exists, with reference to total proved and risk-adjusted probable reserves ('2P'), a formal estimate of the recoverable amount is made, which is considered to be the higher of the fair value less costs to dispose and value in use. The assessments require the use of estimates and assumptions such as long-term oil prices (considering current and historical prices, price trends and related factors), discount rates, operating costs, future capital requirements, decommissioning costs, exploration potential, reserves (see Hydrocarbon reserve and resource estimates above) and operating performance (which includes production and sales volumes). These estimates and assumptions are subject to risk and uncertainty. Therefore, there is a possibility that changes in circumstances will impact these projections, which may impact the recoverable amount of assets and/or CGUs. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's length transaction between knowledgeable and willing parties. Fair value for oil and gas properties is generally determined as the present value of estimated future cash flows arising from the continued use of the assets, which includes estimates such as the cost of future expansion plans and eventual disposal, using assumptions that an independent market participant may take into account. Cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset/CGU. C. Long-term debt: Long-term debt is initially measured at fair value less transaction costs that are directly attributable to the acquisition or issue of the debt. Subsequently, long-term debt is measured at amortized cost using the effective interest method. Long-term debt is classified as current if the liability is due to be settled within twelve months from the reporting date. All other debt is classified as non-current. D. Foreign currency: Monetary assets and liabilities denominated in foreign currencies are translated into US dollars at exchange rates prevailing at the balance sheet date and non-monetary assets and liabilities are translated at rates in effect on the date of the transaction. Revenues and expenses are translated at exchange rates at the date of transaction. Exchange gains or losses arising from translation are included in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. E. Intangible exploration assets: i. Pre-exploration expenditures: Costs incurred prior to obtaining the legal rights to explore an area are recognized in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income as incurred. ii. Exploration expenditures: Exploration expenditures include costs associated with the acquisition of a license interest, directly attributable general and administrative costs, expenditures incurred in the process of determining oil and gas exploration targets, and exploration drilling costs. All exploration expenditures with common geological structures and shared infrastructure are accumulated together within intangible exploration assets. The Company does not aggregate exploration expenditures above the segment level for the purpose of impairment testing. Costs are not depleted until such time as the exploration phases on the license area are complete, the license area is relinquished, or commercially viable reserves have been discovered and extraction of those reserves is determined to be technically feasible. If commercial reserves are established and technical feasibility for extraction demonstrated, then the related capitalized intangible exploration costs are transferred into a CGU within oil and gas interests subsequent to determining that the assets are not impaired (see “Impairment” below). Where results of exploration drilling indicate the presence of hydrocarbons which are ultimately not considered commercially viable, all related costs are recognized in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. Net proceeds from any disposal or farmout of an intangible exploration asset are recorded as a reduction in intangible exploration assets. iii. Development and production costs: All costs incurred after the technical feasibility and commercial viability of producing hydrocarbons has been demonstrated are capitalized within oil and gas interests on a CGU basis. Subsequent expenditures are capitalized only where it either enhances the economic benefits of the development/producing asset or replaces part of the existing development/producing asset. Any remaining costs associated with the part replaced are expensed in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. Net proceeds from any disposal of oil and gas interests are recorded as a gain or loss on disposal recognized in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income to the extent that the net proceeds exceed or are less than the appropriate portion of the net capitalized costs of the asset. ===== SIDA 64 ===== PAGE 54 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED F. Impairment: i. Financial assets carried at amortized cost: A financial asset is assessed at each reporting date to determine whether there is any objective evidence that it is impaired. A financial asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset. The Company recognizes loss allowances for expected credit losses (“ECLs”) on its financial assets measured at amortized cost. Due to the nature of its financial assets, the Company measures loss allowances at an amount equal to expected lifetime ECLs. An impairment loss in respect of a financial asset measured at amortized cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the original effective interest rate. Individually significant financial assets are tested for impairment on an individual basis. The remaining financial assets are assessed collectively in groups that share similar credit risk characteristics. All impairment losses are recognized in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognized. For financial assets measured at amortized cost the reversal is recognized in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. ii. Non-financial assets: The carrying amounts of the Company’s non-financial assets, including the Company’s equity investments, other than intangible exploration assets and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment or reversals of impairment. Intangible exploration assets are assessed for impairment when they are reclassified to property and equipment, as oil and gas interests, and also if facts and circumstances suggest that the carrying amount exceeds the recoverable amount. If any such indication exists, then the asset’s recoverable amount is estimated. For goodwill and other intangible assets that have indefinite lives or that are not yet available for use, an impairment test is completed each reporting period. For the purpose of impairment testing, assets are grouped together into a CGU. The recoverable amount of an asset or a CGU is the greater of its value in use and its fair value less costs to dispose. In assessing value in use, the estimated future cash flows are discounted to their present value using a post-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Value in use is generally computed by reference to the present value of the future cash flows expected to be derived from production of 2P reserves. In determining fair value less costs to dispose, recent market transactions are taken into account, if available, and a post-tax discount rate is applied. In the absence of such transactions, an appropriate valuation model is used. An impairment loss is recognized if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognized in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. Impairment losses recognized in respect of CGU’s are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis. If there is an indicator that a previous impairment may no longer exist or may have decreased, the recoverable amount of the relevant asset or its CGU is calculated and compared against the carrying amount. The impairment is reversed to the extent that the asset or its CGU’s recoverable amount does not exceed the carrying amount that would have been determined if no impairment had been recognized. An impairment reversal is recognized in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. G. Other tangible fixed assets and lease liabilities (IFRS 16) All leases are accounted for by recognising a right-of-use asset and a lease liability except for: • Leases of low value assets; and • Leases with a duration of 12 months or less. Lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with the discount rate determined by reference to the Company's incremental borrowing rate on commencement of the lease is used. Variable lease payments are only included in the measurement of the lease liability if they depend on an index or rate. In such cases, the initial measurement of the lease liability assumes the variable element will remain unchanged throughout the lease term. Other variable lease payments are expensed in the period to which they relate. On initial recognition, the carrying value of the lease liability also includes: • amounts expected to be payable under any residual value guarantee; • the exercise price of any purchase option granted in favour of the Company if it is reasonably certain to assess that option; • any penalties payable for terminating the lease, if the term of the lease has been estimated on the basis of termination option being exercised. ===== SIDA 65 ===== PAGE 55 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Right of use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and increased for: • lease payments made at or before commencement of the lease; • initial direct costs incurred; and • the amount of any provision recognized where the Company is contractually required to dismantle, remove or restore the leased asset. Subsequent to initial measurement lease liabilities increase as a result of interest charged at a constant rate on the balance outstanding and are reduced for lease payments made. Right-of-use assets are amortised on a straight-line basis over the remaining term of the lease or over the remaining economic life of the asset if, rarely, this is judged to be shorter than the lease term. When the Company revises its estimate of the term of any lease, it adjusts the carrying amount of the lease liability to reflect the payments to make over the revised term, which are discounted using a revised discount rate. In this case an equivalent adjustment is made to the carrying value of the right-of-use asset, with the revised carrying amount being amortised over the remaining (revised) lease term. If the carrying amount of the right-of-use asset is adjusted to zero, any further reduction is recognised in profit or loss. H. Performance share units (“PSUs”): The Company has a long-term incentive plan (see note 17). Eligible plan participants may be granted PSUs. PSUs are accounted for as cash-based awards and recorded as a liability. The estimated fair value of the awards is initially determined at the time of grant. The awards are revalued every quarter based on the Company’s share price and the change is recorded as share-based compensation in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. The estimated fair value of the awards is calculated based on non-market performance conditions set by the Company which are initially determined at the time of grant. The Company assesses the progress of reaching the individual performance conditions during each reporting period. PSUs cliff vest three years from the date of grant and the estimated fair value of the grant will be expensed evenly throughout the remaining vesting period. PSUs may be settled in shares issued from treasury or cash, at the discretion of the Board of Directors. I. Restricted share units (“RSUs”): The Company has a long-term incentive plan (see note 17). Eligible plan participants may be granted RSUs. RSUs are accounted for as cash-based awards and recorded as a liability. The estimated fair value of the awards is initially determined at the time of grant. The awards are revalued every quarter based on the Company’s share price and the change is recorded as share-based compensation in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income. RSUs granted to Non-Executive Directors cliff vest three years from the date of grant. The estimated fair value of RSUs are expensed evenly throughout the remaining vesting period. RSUs may be settled in shares issued from treasury or cash, at the discretion of the Board of Directors. J. Finance income and expenses: Finance income and expenses are recognized as they accrue in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income, using the effective interest method. K. Income tax: Income tax expense comprises current and deferred tax. Income tax expense is recognized in the Statement of Net (Loss)/ Income and Comprehensive (Loss)/ Income except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. Deferred tax is recognized using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized on the initial recognition of assets or liabilities in a transaction that is not a business combination. In addition, deferred tax is not recognized for taxable temporary differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis, or their tax assets and liabilities will be realized simultaneously. A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized. On May 23, 2023, the International Accounting Standards Board (IASB) issued an amendment to IAS 12 Income Taxes in response to International Tax Reform and specifically the Pillar Two Global Anti-Base Erosion Rules (“Pillar Two Rules”) published by the Organization for Economic Co-operation and Development (“OECD”). The Amendments introduce a mandatory temporary exception to the accounting for deferred taxes arising from the jurisdictional implementation of the Pillar Two model rules; and disclosure requirements for affected entities to help users of the financial statements better understand an entity’s exposure to Pillar Two income taxes arising from that legislation, particularly before its effective date. The Company adopted the mandatory temporary exception immediately. The remaining disclosure requirements have no effect on the Company’s consolidated financial statements. ===== SIDA 66 ===== PAGE 56 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED L. Earnings per share: Basic earnings per share is calculated by dividing net income/(loss) attributable to the common shareholders by the weighted average number of Common Shares outstanding during the year. Diluted earnings per share is determined by adjusting the net income/ (loss) attributable to the common shareholders and the weighted average number of Common Shares outstanding for the effects of dilutive instruments such as options and LTIP’s granted to employees. The weighted average number of diluted shares is calculated in accordance with the treasury stock method. The treasury stock method assumes that the proceeds received from the exercise of all potentially dilutive instruments are used to repurchase Common Shares at the average market price. The PSUs are considered to be contingently issuable and are included in the calculation of diluted EPS as if the conditions of the contingency are deemed to have been met based on the information available at the end of the reporting period. PSUs are only included in the diluted EPS calculation if the effect is dilutive. RSUs are included in full in the diluted EPS calculation only if the effect is dilutive. M. Financial instruments: Financial assets and liabilities are recognized when the Company becomes a party to the contractual provisions of the instrument. Financial assets are derecognized when the rights to receive cash flows from the assets have expired or have been transferred and the Company has transferred substantially all risks and rewards of ownership. Financial assets and liabilities are offset and the net amount is reported in the Balance Sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. At initial recognition, the Company classifies its financial instruments either as fair value through profit and loss, fair value through other comprehensive income or at amortized cost depending on the purpose for which the instruments were acquired. The Company only has instruments recognized at amortized cost. Financial assets and liabilities at amortized cost: Financial assets and liabilities at amortized cost include accounts receivable, loans receivable, accounts payables and debt and are initially recognized at the amount required to be received or paid, less, when material, a discount to reduce the receivables or payables to fair value. Subsequently, these assets and liabilities are measured at amortized cost using the effective interest method. Financial assets and liabilities are classified as current assets and liabilities if payment is due within twelve months. Otherwise, they are presented as non-current assets and liabilities. N. Provisions: A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. Provisions are not recognized for future operating losses. i. Contingent Consideration: Contingent consideration formed part of the overall consideration for the acquisition of Prime. At the date of acquisition, an estimate of the contingent consideration is determined and included as part of the cost of the acquisition. Subsequent to acquisition, contingent consideration can be treated using two acceptable methods, the cost-based approach and the fair value-based approach. The Company have determined the cost-based approach to give the best estimate of the value of the contingent consideration. Any revisions to the contingent consideration estimates after the date of acquisition, are accounted for as changes in estimates in accordance with IAS 8, to be accounted for on a prospective basis. The change in the liability, as a result of the revised cash flows, would be adjusted to the cost of the investment and, in accordance with paragraph 37 of IAS 8, recognized as part of the investment’s carrying amount rather than in profit or loss. The estimates involved in assessing the value of the contingent consideration include the expected timing of payments, the expected settlement value, the likelihood of settlement and the probability of the assessed outcomes occurring. There is significant judgement used in the determination of these estimates. ii. Provision for site restoration: On fields where the Group is required to contribute to site restoration costs, a provision is recorded to recognize the future commitment. An asset is created, as part of oil and gas interests, to represent the discounted value of the anticipated site restoration liability and depleted over the life of the field on a unit of production basis. The corresponding accounting entry to the creation of the asset recognizes the discounted value of the future liability. The discount applied to the anticipated site restoration liability is subsequently released over the life of the field and is charged to finance expense. Changes in site restoration costs and reserves are treated prospectively and consistent with the treatment applied upon initial recognition. O. Investments held for sale Investments held for sale are measured at the lower of their carrying amount and fair value less costs to sell. Costs to sell are the incremental costs directly attributable to the disposal of an asset. The criteria for held for sale classification is regarded as met only when the sale is highly probable, and the asset or disposal group is available for immediate sale in its present condition. The Company has committed to the plan to dispose of the asset and the disposal is expected to be completed within one year from the date of the classification ===== SIDA 67 ===== PAGE 57 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED P. New and amended standards adopted by the Company: The Company has applied the following standards and amendments for the first time for its annual reporting period commencing January 1, 2024: • Classification of Liabilities as Current or Non-current and Non-current liabilities with covenants – Amendments to IAS 1; • Lease Liability in Sale and Leaseback – Amendments to IFRS 16; and • Supplier Finance Arrangements – Amendments to IAS 7 and IFRS 7. The amendments listed above did not have any material impact on the amounts recognized in prior periods and are not expected to significantly affect the current or future periods. Q. New standards and interpretations not yet adopted: Certain new accounting standards and amendments to accounting standards have been published that are not mandatory for December 31, 2024, reporting periods and have not been early adopted by the Company. The Company’s assessment of the impact of these new standards and amendments is set out below: (a.) Amendments to IAS 21 -- Lack of Exchangeability (effective for annual periods beginning on or after 1 January 2025) In August 2023, the IASB amended IAS 21 to help entities to determine whether a currency is exchangeable into another currency, and which spot exchange rate to use when it is not. (b.) Amendments to the Classification and Measurement of Financial Instruments – Amendments to IFRS 9 and IFRS 7 (effective for annual periods beginning on or after 1 January 2026) On 30 May 2024, the IASB issued targeted amendments to IFRS 9 and IFRS 7 to respond to recent questions arising in practice, and to include new requirements not only for financial institutions but also for corporate entities. These amendments: • clarify the date of recognition and derecognition of some financial assets and liabilities, with a new exception for some financial liabilities settled through an electronic cash transfer system; • clarify and add further guidance for assessing whether a financial asset meets the solely payments of principal and interest (SPPI) criterion; • add new disclosures for certain instruments with contractual terms that can change cash flows (such as some financial instruments with features linked to the achievement of environment, social and governance targets); and • update the disclosures for equity instruments designated at fair value through other comprehensive income (FVOCI). (c.) IFRS 19 Subsidiaries without Public Accountability: Disclosures (effective for annual periods beginning on or after 1 January 2027) Issued in May 2024, IFRS 19 allows for certain eligible subsidiaries of parent entities that report under IFRS Accounting Standards to apply reduced disclosure requirements. (d.) IFRS 18 Presentation and Disclosure in Financial Statements (effective for annual periods beginning on or after 1 January 2027) IFRS 18 will replace IAS 1 Presentation of financial statements, introducing new requirements that will help to achieve comparability of the financial performance of similar entities and provide more relevant information and transparency to users. Even though IFRS 18 will not impact the recognition or measurement of items in the financial statements, its impacts on presentation and disclosure are expected to be pervasive, in particular those related to the statement of financial performance and providing management-defined performance measures within the financial statements. Management is currently assessing the detailed implications of applying the new standard on the group’s consolidated financial statements. The group will apply the new standard from its mandatory effective date of 1 January 2027. Retrospective application is required, and so the comparative information for the financial year ending 31 December 2026 will be restated in accordance with IFRS 18. The group is in the process of evaluating the impact of IFRS 18 on the group’s financial statements. The other amendments are not expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions. 4. Cash and cash equivalents: Cash equivalents include short-term deposits made for varying periods of between one day and three months, depending on the immediate cash requirements of the Group, and earn interest at varying rates. ===== SIDA 68 ===== PAGE 58 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 5. Equity investment in joint venture: Prime Oil and Gas Coöperatief U.A. (“Prime”): On January 14, 2020, the Company completed the acquisition of a 50% ownership interest in Prime. BTG Pactual Holding S.à.r.l., a private limited liability company governed and existing under the laws of the Grand Duchy of Luxembourg (“BTG”) continues to own the remaining 50% of Prime. The Company accounts for the acquisition as a joint venture as there is joint control. On June 24, 2024, the Company announced that it had reached an agreement with BTG to acquire the remaining 50% interest in Prime in exchange for 239,828,655 newly to be issued common shares in Africa Oil (the “Proposed Reorganization”). Completion of the Proposed Reorganization is expected on or about March 7, 2025. Prime will be fully consolidated from completion of this transaction. As at December 31, 2024, management determined there was an objective evidence of impairment in relation to the Company’s existing shareholding in Prime as a result of the significant decrease in the Africa Oil share price between June 24, 2024, when the Company announced the Proposed Reorganization and December 31, 2024. The fair value of the existing 50% shareholding in Prime decreased as the fair value considers the number of Africa Oil shares that were agreed in relation to the purchase of the additional interest in Prime and the trading value of Africa Oil shares, as this is an observable fair value input under IFRS Accounting Standards. As at December 31, 2024, the fair value of the Company’s existing shareholding in Prime was calculated to be $328.4 million based on the implied value of the Proposed Reorganization, resulting in a non-cash impairment loss on the investment in Prime of $436.7 million for the year ended December 31, 2024. The fair value has been calculated based on the Africa Oil share price of CAD 1.97 as of December 31, 2024, and the USD/CAD exchange rate of 1.4384 as of December 31, 2024. The consideration under the Proposed Reorganization will be based on the share price and exchange rate as of the date of completion of the Proposed Reorganization and may therefore change materially compared to the fair value of $328.4 million as at December 31, 2024. This might therefore result in the recognition of additional impairment charges or the reversal of previously recognized impairment charges in future reporting periods based on the movements in the Africa Oil share price and the USD/CAD exchange rate between December 31, 2024, and the closing date of the transaction. The Company is not entitled to any of the earnings related to the additional 50% interest in Prime until closing of the Proposed Reorganization. Prime is incorporated in the Netherlands and its principal place of business is Nigeria. The primary assets of Prime are an indirect 8% interest in Petroleum Mining License ("PML") 52 and an indirect 16% interest in PMLs 2, 3 and 4 as well as Petroleum Prospecting License ("PPL") 261. PML 52 is operated by affiliates of Chevron and covers part of the producing Agbami field. PMLs 2, 3 and 4 and PPL 261 are operated by affiliates of TotalEnergies and contain the producing Akpo and Egina fields. In the year ended December 31, 2024, Prime made two dividend payments of $72.0 million gross, with a net payment to the Company of $36.0 million. In the year ended December 31, 2023, Prime made three dividend payments totaling $350.0 million gross, with a net payment to the Company of $175.0 million. The timing and payment of the dividends is discretionary. There are no restrictions on the ability of Prime to pay dividends to its members, subject to distributable reserves being positive and working capital or business requirements. The following table shows the Company’s carrying value of the investment in Prime as at December 31, 2024, and December 31, 2023.   December 31, 2024 December 31, 2023 Balance, beginning of the year 572.5 513.7 Share of joint venture profit 226.0 228.0 Dividends received from Prime (36.0) (175.0) Revaluation of contingent consideration 2.6 5.8 Impairment (436.7) - Balance, end of the year 328.4 572.5 In the year ended December 31, 2024, the Company recognized an income of $226.0 million, relating to its investment in Prime (year ended December 31, 2023 - $228.0 million). On June 25, 2021, Prime signed a Securitization Agreement with two of the unit parties, Equinor and Chevron, whereby Equinor agreed to pay a security deposit to the two other JV parties to secure future payments due under that Securitization Agreement, pending a comprehensive resolution being reached among all unit parties in respect of the tract participation in the Agbami field by December 27, 2024. In accordance with the Securitization Agreement, on June 29, 2021, Prime received from Equinor its portion of the security deposit in the form of a cash payment of $305.3 million. A provision for the full cash payment had been recorded within Prime to reflect the mechanism pursuant to which any such imbalance payments due from Equinor to Prime under the terms of any future agreement among the Agbami parties would be set-off against this security deposit. Given no comprehensive resolution was reached by December 27, 2024, Prime released the provision for the original cash payment and recognized an additional receivable of $24.4 million pursuant to the Securitization Agreement with this additional payment received on January 31, 2025. The Agbami unit parties will continue ongoing discussions to seek final resolution of the formal redetermination of the Agbami tract participation, however there is no certainty that such ongoing discussions will result in a final resolution. ===== SIDA 69 ===== PAGE 59 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED As at December 31, 2023, the Company determined that there was an objective evidence of impairment in relation to its investment in Prime arising from an impairment recognized by Prime. The impairment recognized by Prime arose mainly from an increase in the discount rate and from changes in the technical assumptions in PMLs 2, 3 and 4 and PPL 261. The Company determined the recoverable amount of its investment in Prime by calculating the value in use derived from the discounted cash flow forecast of the dividend stream to be received from Prime. The results of the impairment test indicated that the recoverable amount was in excess of the carrying value and therefore no impairment was recognized. The following tables summarizes Prime’s financial information as at December 31, 2024, and December 31, 2023, and for the years ended December 31, 2024, and December 31, 2023. Prime’s Balance Sheet   As at December 31, 2024 December 31, 2023 Cash and cash equivalents included in current assets (1) 399.5 152.2 Other current assets 316.3 351.5 Non-current assets (2) 1,580.1 2,752.3 Loans and borrowings included in current liabilities (3) (283.7) (91.5) Other current liabilities (215.8) (234.4) Loans and borrowings included in non-current liabilities (3) (466.3) (658.5) Deferred income tax liabilities included in non-current liabilities (403.4) (484.4) Other non-current liabilities (4) (269.9) (642.2) Net assets of Prime 656.8 1,145.0 Percentage ownership 50% 50% Proportionate share of Prime’s net assets 328.4 572.5 (1) See Prime’s Statement of Cash Flows for additional information on movements in cash and cash equivalents. (2) As at December 31, 2024, the carrying value of non-current assets included a fair value adjustment of $(213.5) million (at December 31, 2023 - $654.7 million). (3) In the year ended December 31, 2024, $250.0 million of the commitments under Prime’s RBL facility were cancelled, reducing the principal amount from $1,050.0 million to $800.0 million. The facility has a 6-year tenor of which $750.0 million has been drawn as at December 31, 2024 (at December 31, 2023 - $750.0 million). (4) In the year ended December 31, 2024, Prime released the previously recognized provision in relation to the $305.3 million security deposit received from Equinor during 2021 under the Securitization Agreement as no comprehensive resolution was reached among all unit parties in respect of the tract participation in the Agbami field by December 27, 2024. ===== SIDA 70 ===== PAGE 60 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Prime’s Statement of Net Income and Other Comprehensive Income For the years ended December 31, 2024 December 31, 2023 Revenue 782.7 1,162.2 Depreciation, depletion and amortization (372.0) (361.7) Production costs (146.1) (151.0) Movement in underlift/overlift (1) 171.2 (23.6) Royalties (70.3) (61.7) Cost of sales (417.2) (598.0) Gross profit 365.5 564.2 Other operating income (2) 329.7 24.7 Exploration expenses (3.1) (2.3) Impairment - (263.3) Other operating costs (3,7) (28.2) (30.0) Finance income (4) 6.4 6.8 Finance costs (5) (97.8) (89.5) Profit before tax 572.5 210.6 Tax (6,7) (120.5) 245.4 Total profit and comprehensive income for the year 452.0 456.0 Proportionate share of Prime’s profit and comprehensive income for the year 226.0 228.0 Proportionate share of Prime’s net income 226.0 228.0 (1) As at December 31, 2024, Prime was in a net underlift position, from a net overlift position at December 31, 2023. This resulted in a profit of $171.2 million in the Statement of Net Income and Other Comprehensive Income for the year ended December 31, 2024 (year ended December 31, 2023 – loss of $23.6 million). (2) Other operating income primarily relates to the release of the previously recognized $305.3 million provision for the security deposit received from Equinor during 2021 and the recognition of an additional $24.4 million receivable pursuant to the Securitization Agreement. (3) Other operating costs mainly include Prime’s administrative costs, sales costs and the NDDC Levy, which concerns the Niger Delta Development Commission Levy imposed to fund the sustainable development of the Niger Delta region. (4) Finance income for the year ended December 31, 2024, also included a $1.4 million accounting gain on an Asian Dated Brent Collar (year ended December 31, 2023 – gain on Asian put option of $1.0 million). (5) Finance costs are primarily made up of interest expenses incurred on external facilities and accretion expenses incurred on the decommissioning liability. Finance costs for the year ended December 31, 2024, also included a $7.1 million accounting loss on purchased Asian put options (year ended December 31, 2023 – nil). (6) In the year ended December 31, 2024, there is a tax charge of $120.5 million (year ended December 31, 2023 - tax income of $248.6 million). Other operating income of $329.7 million in 2024 is subject to ten percent Capital Gains Tax in Nigeria lowering the effective tax rate for the year. The income in 2023 was mainly from Prime voluntarily converting the OML 127 license to operate under the new Petroleum Industry Act and from renewing the OML 130 license to operate under the new Petroleum Industry Act. Prime voluntarily converted the OML 127 license to operate under the new Petroleum Industry Act from March 1, 2023, which resulted in the award of one new petroleum mining lease, PML 52. The renewal of the OML 130 license resulted in the award of three new petroleum mining leases and one petroleum prospecting license. These cover some of the areas previously covered by OML 130, with some of the areas also relinquished. These are PML 2 (Akpo field), PML 3 (Egina), PML 4 (Preowei) and PPL 261 (South Egina). PMLs 2, 3 and 4 and PPL 261 operate under the terms of the new Petroleum Industry Act as from June 1, 2023. Under these terms, PMLs 2, 3, 4 and 52 and PPL 261 are subject to a 30% Corporate Income Tax regime compared to the previous 50% PPT regime which resulted in the release of $62.0 million of deferred income tax liabilities in the year ended December 31, 2023, for OML 127 and the release of $346.0 million of deferred income tax liabilities during the year ended June 30, 2023, for OML 130. (7) The National Agency for Science and Engineering Infrastructure (NASENI) Levy in the comparative period has been reclassified from other operating costs to tax expenses as per IAS 12. ===== SIDA 71 ===== PAGE 61 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Supplementary information: Prime’s Statement of Cash Flows For the years ended December 31, 2024 December 31, 2023 Profit before tax 572.5 210.6 Adjustments for: Depreciation, depletion and amortization 372.0 361.7 Impairment - 263.3 Finance costs, net 91.4 82.7 Change in provisions (304.0) (1.1) Interest income received 5.1 5.8 Taxes (201.4) (322.3) Cash generated from operating activities before working capital 535.6 600.7 Changes in working capital Changes in trade and other receivables 156.7 (31.9) Changes in over/underlift balances (171.2) 23.6 Changes in other working capital balances 26.1 (116.6) Total changes in working capital 11.6 (124.9) Net cash generated from operating activities 547.2 475.8 Expenditures on oil and gas properties (1) (152.5) (177.5) Net cash used in investing activities (152.5) (177.5) Payment of dividends to shareholders (72.0) (350.0) Interest expense paid (71.9) (90.0) Derivatives (3.2) (5.3) Drawdown of RBL facility - 750.0 Repayment of loans and borrowings - (782.3) Net cash used in financing activities (147.1) (477.6) Foreign exchange variation on cash and cash equivalents (0.3) (0.2) Total cash flow 247.3 (179.5) Cash and cash equivalents, beginning of the year 152.2 331.7 Cash and cash equivalents, end of the year 399.5 152.2 (1) Expenditures on oil and gas properties for the year ended December 31, 2024, includes the PML 52 license renewal fee. Expenditures on oil and gas properties for the year ended December 31, 2023, includes the PMLs 2, 3 and 4 and PPL 261 license renewal fee. ===== SIDA 72 ===== PAGE 62 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 6. Equity investments in associates: The Company holds the following equity investments in associates: Africa Energy Corp. Eco (Atlantic) Oil and Gas Ltd Impact Oil and Gas Ltd Total Shares held at December 31, 2024 276,982,414 54,941,744 449,464,396 Ownership at December 31, 2024 19.67% 14.84% 39.46% At January 1, 2023 46.6 14.7 76.0 137.3 Share of loss from equity investments (1.7) (0.6) (19.1) (21.4) Gain on dilution of equity investment - - 1.0 1.0 Impairment of equity investments (20.1) (6.5) - (26.6) Additional investment through private placement - - 44.4 44.4 At December 31, 2023 24.8 7.6 102.3 134.7 Share of loss from equity investments (42.1) (0.6) (16.1) (58.8) Reversal of impairment of equity investments 20.1 - - 20.1 Additional investments - - 88.6 88.6 Reclassification to Investment held for sale - (7.0) - (7.0) At December 31, 2024 2.8 - 174.8 177.6 In the year ended December 31, 2024, the Company recognized a total loss of $38.7 million (year ended December 31, 2023 – $47.0 million). During the year ended December 31, 2024, the Company determined that there was an indicator for reversal of impairment in respect of its investment in Africa Energy following the recognition of a significant share in the loss of Africa Energy. The Company recognized an impairment in respect of its investment in Africa Energy during 2023 as a result of the significant decline in market value compared to its carrying value. As a result of the recognized loss during the year ended December 31, 2024, the full impairment recognized during 2023 has been reversed. The Company determined that there was no indicator of impairment for its investment in Eco (Atlantic) Oil and Gas Ltd and also for its investment in Impact Oil and Gas Ltd. A. Africa Energy Corp. (“Africa Energy”): Africa Energy is an oil and gas exploration company with an interest in South Africa. As at December 31, 2024, the market value of the Company’s investment in Africa Energy was $5.8 million based on the share price of CAD 0.03 (as at December 31, 2023 - $19.8 million). The carrying value is less than the market value from significant impairments recognized by Africa Energy. B. Eco (Atlantic) Oil and Gas Ltd. (“Eco”): Eco is an oil and gas exploration company with interests in Guyana, Namibia and South Africa. On July 26, 2024, the Company signed an agreement with Eco to acquire an additional 1.0% interest in Block 3B/4B from Azinam Limited, Eco’s wholly owned subsidiary, in exchange for all common shares and warrants over common shares held by the Company in Eco. Following the announcement of this transaction, the investment in Eco was reclassified to an investment held for sale (see note 7). On January 13, 2025, the Company announced that it had completed this transaction. C. Impact Oil and Gas Ltd (“Impact”): Impact is an oil and gas exploration company with interests in Namibia and South Africa. On January 10, 2024, the Company announced a strategic farmout agreement between its investee company Impact, and TotalEnergies, that allows the Company to continue its participation in the Venus oil development project and the follow-on exploration and appraisal campaign on Blocks 2913B and 2912 with no upfront costs. As announced on November 1, 2024, this farmout closed following the receipt of the final approval from Government of Namibia. At the date hereof, Impact has a 9.5% interest in Blocks 2912 and 2913B that is fully carried for all joint venture costs, with no cap, through to first commercial production. Impact has also received a cash reimbursement of approximately $99.0 million for its share of the net past costs incurred on the Blocks net to the farm out interests. This agreement provides Impact with a full interest-free carry loan over all of Impact’s remaining development, appraisal and exploration costs on the Blocks from January 1, 2024 (“Effective Date”), until the date on which Impact receives the first sales proceeds from oil production on the Blocks (“First Oil Date”). On and from the First Oil Date, the carry is repayable to TotalEnergies in kind from 60% of Impact’s after-tax cash flow, net of all joint venture costs, including capital expenditures. During the repayment of the carry, Impact will pool its entitlement barrels with those of TotalEnergies for more regular off-takes and a more stable cashflow profile and will also benefit from TotalEnergies’ marketing and sales capabilities. ===== SIDA 73 ===== PAGE 63 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED In the year ended December 31, 2024, the Company acquired an additional 105,918,737 shares from various parties. The total cost for these purchases was approximately $88.6 million. After these transactions the Company’s shareholding in Impact increased to approximately 39.5%. The following tables summarize Impact’s financial information for the years ended December 31, 2024, and December 31, 2023. The Company is not aware of any material changes to the financial information. Balance Sheet As at  December 31, 2024 December 31, 2023 Cash and cash equivalents included in current assets 125.1 76.1 Other current assets 1.7 0.7 Non-current assets (1) 316.5 295.4 Current liabilities (0.8) (43.3) Non-current liabilities - - Net assets of Impact 442.5 328.9 Percentage ownership (2) 39.5% 31.1% Proportionate share of Impact's net assets 174.8 102.3 Statement of Net Loss and Comprehensive Loss from continuing operations For the years ended December 31, 2024 December 31, 2023 Net loss and comprehensive loss from continuing operations (40.8) (61.4) Proportionate share of Impact’s loss (16.1) (19.1) (1) As at December 31, 2024, the carrying value of non-current assets included a fair value adjustment of $96.4 million (as at December 31, 2023 - $40.9 million). (2) In the year ended December 31, 2024, the Company’s ownership in Impact changed from 31.1% to 39.5% (year ended December 31, 2023 – changed from 30.9% to 31.1% through the year). 7. Investment held for sale On July 26, 2024, the Company signed an agreement with Eco to acquire an additional 1.0% interest in Block 3B/4B from Azinam Limited, Eco’s wholly owned subsidiary, in exchange for all common shares and warrants over common shares held by the Company in Eco. Following the announcement of this transaction, the investment in Eco was reclassified to an investment held for sale. On January 13, 2025, the Company announced that it had completed this transaction with the result that the Company is no longer a shareholder in Eco. ===== SIDA 74 ===== PAGE 64 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 8. Intangible exploration assets:   December 31, 2024 December 31, 2023 Net carrying amount, beginning of the year 19.1 63.6 Intangible exploration expenditures 10.2 17.7 Impairment of intangible exploration assets - (62.2) Net carrying amount, end of the year 29.3 19.1 Intangible exploration expenditures and impairments: As at December 31, 2024, $29.3 million of expenditures have been capitalized as intangible exploration assets (as at December 31, 2023 - $19.1 million). These expenditures relate to the Company’s share of exploration and appraisal stage projects which are pending the determination of proved and probable petroleum reserves. As at December 31, 2024, no intangible exploration assets have been transferred to oil and gas interests as commercial reserves have not been established and technical feasibility for extraction has not been demonstrated. Capitalized intangible exploration assets relate to various countries as summarized in the following table:   December 31, 2024 December 31, 2023 Equatorial Guinea 17.9 13.4 South Africa 11.4 5.7 Net carrying amount, end of the year 29.3 19.1 Equatorial Guinea: As at December 31, 2024, the carrying amount of the Company’s intangible exploration assets for its 80% interest in Blocks EG-18 and EG-31, located offshore Equatorial Guinea, was $17.9 million (as at December 31, 2023 – $13.4 million). In the year ended December 31, 2024, expenditure of $4.5 million was incurred (year ended December 31, 2023 - $13.4 million). South Africa: As at December 31, 2024, the carrying amount of the Company’s intangible exploration assets for its 17.0% (as at December 31, 2023 – 20.0%) participating interest in the Block 3B/4B Exploration Right, located in South Africa, was $11.4 million (as at December 31, 2023 - $5.7 million). In the year ended December 31, 2024, expenditure of $5.7 million was incurred (year ended December 31, 2023 - $0.6 million) which included $9.0 million payments to Azinam Limited, a wholly owned subsidiary of Eco, for the increase of the Company’s operated interest in Block 3B/4B by 6.25% (see also note 19B). Government approval was obtained on January 19, 2024, resulting in payment of the second tranche of $2.5 million to Azinam and a farm-out deal with a third party was completed on August 28, 2024, resulting in the payment of the third tranche of $4.0 million to Azinam. The first tranche of $2.5 million was paid during 2023 and was reclassified from prepayments to intangible exploration assets following government approval. There is one final tranche to be paid of $1.5 million when the first exploration well has been spudded on the Block. On August 28, 2024, the Company announced the completion of the strategic farm down agreement with TotalEnergies and QatarEnergy for the Block 3B/4B Exploration Right, located in South Africa. The Company retained a 17.0% interest in Block 3B/4B and operatorship was transferred to TotalEnergies. The Company will receive, subject to achieving certain milestones as defined in the agreement, staged cash payments for a total amount of $10.0 million of which $3.3 million was received at closing of the transaction with the remaining balance to be received in two successive payments conditional upon achieving key operational and regulatory milestones. The Company will also be fully carried for all joint venture costs, up to a cap, that is repayable to TotalEnergies and QatarEnergy from future production, and which is expected to be adequate to fund the Company’s share of drilling for up to two wells on the licence. On July 26, 2024, the Company signed an agreement with Eco to acquire an additional 1.0% interest in Block 3B/4B from Azinam Limited, Eco’s wholly owned subsidiary, in exchange for all common shares and warrants over common shares held by the Company in Eco. On January 13, 2025, the Company announced that it had completed this transaction. The Company’s interest in Block 3B/4B increased by 1.0% to 18.0% and the Company ceased to be a shareholder in Eco. Africa Oil will benefit from the carry agreed between Eco, TotalEnergies and QatarEnergy for this incremental interest. ===== SIDA 75 ===== PAGE 65 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 9. Other tangible fixed assets: Other tangible fixed assets mainly relate to the lease of an office building for a period of 5 years that meets the criteria for recognition as right-of-use asset as per IFRS 16 and the Company recognized a corresponding financial liability. The long-term portion of the liability as at December 31, 2024, amounted to $2.6 million and the short term portion of the liability as at December 31, 2024, amounted to $0.7 million (as at December 31, 2023 – nil). During the year ended December 31, 2024, the Company recognized depreciation charges for the right-of-use asset of $0.6 million (year ended December 31, 2023 – nil) and recognized interest expenses on the lease liability of $0.4 million (year ended December 31, 2023 – nil). 10. Accounts payable and accrued liabilities: Accounts payable and accrued liabilities includes liabilities and exit costs associated with the withdrawal from Kenya. In accordance with the JOA and PSC, the Company retains economic participation for activities prior to June 30, 2023, which might result in additional costs for the Company. The remaining balance primarily contains working capital related liabilities and accruals. 11. Provision for site restoration:   December 31, 2024 December 31, 2023 Balance, beginning of the year 5.5 5.3 Unwinding of discount 0.2 0.2 Balance, end of the year 5.7 5.5 The fair value of the provision for site restoration was based on the estimated future cash flows to decommission the exploration and development properties at the end of their useful life. The discount rate used to determine the net present value of the decommissioning obligation was 3.5% (as at December 31, 2023 – 3.5%) based on a risk-free rate with a similar maturity to that of the timing of the expected cash flows and a long-term inflation rate of 2% (as at December 31, 2023 – 2%). The undiscounted costs at December 31, 2024, are estimated to be $7.9 million, net to the Company, and include the costs of physical well abandonment and site remediation. The costs are estimated to be incurred in approximately 25 years. At December 31, 2024, the total provision is $5.7 million (as at December 31, 2023 – $5.5 million). 12. Debt: On May 21, 2024, the Company amended its existing Corporate Facility. At any point before Prime refinances its debt, the availability under the Corporate Facility will now be $65.0 million until June 30, 2025, $43.0 million from July 1, 2025, until June 30, 2026, and $22.0 million from July 1, 2026, to May 21, 2027, i.e. its new final maturity date. After Prime refinances its debt, the availability under the Corporate Facility will be $125.0 million until June 30, 2026, and $63.0 million from July 1, 2026, until May 21, 2027. Commitment fees of 40% of the margin are payable on the undrawn available portion of the Corporate Facility and commitment fees of 15% of the margin are payable on the unavailable portion of the Corporate Facility. The Corporate Facility carries interest of 1 month-SOFR plus a margin of 6.5% in the first year from May 21, 2024, 7.0% in the second year and 7.5% in the third year. Any loan repayments are calculated to be protective of the Company’s liquidity position. Prior to maturity, repayments under the loan are made in the month a dividend is received from Prime. The Company’s loan repayments reduce commensurately with any reduction in dividends from Prime. If drawn, the loan principal would be repaid by the lesser of 100% of the dividends received from Prime, and of an amount that ensures the Company holds a minimum projected consolidated cash balance in the six months following the repayment. The Company provided security in respect of the Corporate Facility mainly in the form of a share pledge over the shares of PetroVida (which holds 50% of Prime), and a charge over the bank account into which the Prime dividends are paid. The Corporate Facility is subject to financial and liquidity covenants. The Company shall ensure that total net debt to adjusted EBITDAX on June 30 and December 31 of each year is no greater than 3.0:1, the FLCR ratio on March 31 and September 30 of each year is not less than 1.1:1 and that from March 31 and September 30 of each year during each of the four successive quarters there are or will be sufficient funds available to the group to meet all relevant expenditure to be incurred in each of these four successive quarters as they fall due. The Company has been in compliance with the covenants in the year ended December 31, 2024. ===== SIDA 76 ===== PAGE 66 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 13. Share capital: A. The Company is authorized to issue an unlimited number of common shares with no par value. B. Issued:   December 31, 2024   December 31, 2023   Shares Amount   Shares Amount Balance, beginning of the year 463,831,871 1,265.3 462,790,680 1,267.7 Settlement of Performance Share Units 577,968 1.1 1,700,042 3.5 Settlement of Restricted Share Units 271,063 0.5 546,332 1.1 Exercise of Share Options 647,000 0.5 1,882,000 1.4 Cancellation of shares repurchased (26,249,732) (71.6) (3,087,183) (8.4) Balance, end of the year 439,078,170 1,195.8 463,831,871 1,265.3 The Company launched a Normal Course Issuer Bid (share buyback) program on September 27, 2022, that ended on September 26, 2023. During the year ended December 31, 2023, a total of 3.1 million Africa Oil common shares were repurchased and cancelled and across the entire share buyback program, a total of 20.5 million Africa Oil common shares were repurchased and cancelled. The Company launched a new share buyback program on December 6, 2023, that ended on December 5, 2024. During the year ended December 31, 2024, a total of 24.0 million Africa Oil common shares were repurchased and cancelled under this share buyback program. The Company launched a new share buyback program on December 6, 2024, under which 2.5 million Africa Oil common shares were repurchased, of which 2.2 million Africa Oil common shares were cancelled during the year ended December 31, 2024. In the year ended December 31, 2024, a total of 26.5 million Africa Oil common shares were repurchased of which 26.2 million Africa Oil common shares had been cancelled as at December 31, 2024. The balance of share capital has been reduced by determining the average per-share amounts in the share capital account, before cancellation of shares repurchased, and applying this to the numbers of shares cancelled. The difference between the reduction in share capital and the amount paid for shares repurchased has been added to the balance of contributed surplus. In the year ended December 31, 2024, the Board of Directors approved two dividends of $0.025 per share which were declared and paid in March and September 2024 for a total amount of $22.6 million. 14. Commitments and contingencies: A. Investment in Prime: Under the Prime Sale and Purchase Agreement completed on January 14, 2020, a deferred payment of $118.0 million, subject to adjustment, may be due to the seller contingent upon the timing of the final PML 52 tract participation in the Agbami field. The signing of the Securitization Agreement by Prime in 2021 led to the Company reassessing its view of the likelihood of making a contingent consideration payment to the seller. The signing of the Securitization Agreement by Prime does not constitute a redetermination of the tract participation and therefore does not trigger the payment of a contingent consideration under the Sale and Purchase Agreement but, at the Company’s discretion, could trigger discussions with the seller. The outcome of this process is uncertain. In 2021, the Company recorded $32.0 million as contingent consideration and increased this to $37.8 million in the year ended December 31, 2023, and to $40.4 million in the year ended December 31, 2024, increasing the Company’s investment in Prime. B. Withdrawal from Kenya: On May 23, 2023, the Kenya entities along with TotalEnergies submitted withdrawal notices to the remaining joint venture party on Blocks 10BB, 13T and 10BA in Kenya, to unconditionally and irrevocably, withdraw from the entirety of the JOAs and PSCs for these concessions. The Company concurrently submitted notices to Ministry of Energy and Petroleum, requesting the government’s consent to transfer all of its rights and future obligations under the PSCs to its remaining joint venture party. Government consent to the transfer remained outstanding as at December 31, 2024. In accordance with the JOA and PSC the Company retains economic participation for activities prior to June 30, 2023, which might result in additional costs for the Company. The Company continues to monitor the claim made against the operator by local communities in relation to past operations which may relate to the period prior to June 30, 2023. No provision has been recognized for this as at December 31, 2024. ===== SIDA 77 ===== PAGE 67 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 15. Finance income and expense: Finance income and expense for the years ended December 31, 2024, and December 31, 2023, is comprised of the following: For the years ended December 31, 2024 December 31, 2023 Finance income 7.6 7.8 Finance expense (4.9) (7.6) Finance income includes interest earned on both cash in bank accounts and short-term deposits. Finance expense includes interest and fees incurred on the Corporate Facility (see note 12). 16. Net (loss)/ income per share: For the years ended December 31, 2024 December 31, 2023       Weighted Average   Weighted Average     Net loss Number of shares Per share amounts Net income Number of shares Per share amounts Basic (loss)/ income per share Net (loss)/ income attributable to common shareholders (279.1) 449,431,803 (0.62) 87.1 462,231,061 0.19   Effect of dilutive securities - - - - 10,711,426 - Dilutive (loss)/ income per share (279.1) 449,431,803 (0.62) 87.1 472,942,487 0.18 In the year ended December 31, 2024, the Company made a loss and therefore all potential dilutive shares are considered antidilutive. In the year ended December 31, 2023, the Company used an average market price of CAD $2.79 per share to calculate the dilutive effect of share purchase options. Dilutive securities include share purchase options, RSUs and PSUs as the inclusion of these reduces the net income per share. In the year ended December 31, 2024, 200,336 options, 1,174,553 RSUs and 5,655,586 PSUs were anti- dilutive and were not included in the calculation of dilutive income per share (year ended December 31, 2023, 473,549 options were anti-dilutive). PSU’s are awarded a performance multiple ranging from nil to 200% which leads to an increase in the dilutive and anti- dilutive potential of these instruments. ===== SIDA 78 ===== PAGE 68 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 17. Share-based compensation: In the year ended December 31, 2024, the Company recognized a total of $1.5 million in share-based compensation expense relating to the Long-Term Incentive Plan (“LTIP”) and Stock Option Plan (year ended December 31, 2023 – $11.3 million). A. Share purchase options: At the 2019 Annual General Meeting, held on April 18, 2019, the Company’s shareholders approved the terms of the stock option plan (the “Plan”). The Plan provides that an aggregate number of Common Shares which may be reserved for issuance as incentive share purchase options shall not exceed 3.5% of the Common Shares outstanding, and option exercise prices will reflect current trading values of the Company’s shares. The term of any option granted under the Plan will be fixed by the Board of Directors and may not exceed five years from the date of grant. Vesting periods are determined by the Board of Directors and no optionee shall be entitled to a grant of more than 5% of the Company’s outstanding issued shares. The Board no longer grants share purchase options under the Plan and instead only awards PSUs to executives and staff. The Company’s outstanding share purchase options are as follows:   December 31, 2024   December 31, 2023     Weighted average     Weighted average Number of options Exercise price (CAD$) Number of options Exercise price (CAD$) Outstanding, beginning of the year 1,104,616 1.20 3,000,616 1.16 Forfeited - - (14,000) 1.21 Exercised (647,000) 1.17 (1,882,000) 1.15 Balance, end of the year 457,616 1.23 1,104,616 1.20 The following table summarizes information regarding the Company’s share purchase options outstanding and exercisable at December 31, 2024: Weighted Average Exercise price (CAD$/share) Number outstanding Number exercisable Weighted average remaining contractual life in years 1.21 435,000 435,000 0.95 1.61 22,616 22,616 1.63 457,616 457,616 In the year ended December 31, 2024, the Company did not recognize a share based payment expense (year ended December 31, 2023 - nil), related to share purchase options. B. Performance share units (“PSUs”): On April 19, 2016, the shareholders of the Company approved a new LTIP . Under the terms of the LTIP , eligible plan participants may be granted PSUs and RSUs. The LTIP provides that an aggregate number of Common Shares which may be reserved for issuance in respect of grants of RSUs and PSUs shall not exceed 28,256,682 shares, which represents approximately 6% of the issued and outstanding Common Shares of the Company as at December 31, 2024. PSUs are notional share instruments which track the value of the Common Shares and are subject to non-market performance conditions related to key strategic, financial and operational milestones. PSUs cliff vest three years from the date of grant, at which time the Board of Directors will assign a performance multiple ranging from nil to 200% to determine the ultimate vested number of PSUs. PSUs are awarded to executives and from 2022 are awarded to staff, replacing share options. They may be settled in shares issued from treasury or cash, at the discretion of the Board of Directors. ===== SIDA 79 ===== PAGE 69 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED The Company’s PSUs outstanding are as follows:   December 31, 2024 December 31, 2023   Number of PSUs Number of PSUs Outstanding, beginning of the year 7,122,839 7,641,886 Granted 3,968,993 3,448,710 Cancelled - (572,935) Vested (3,482,143) (3,394,822) Balance, end of the year 7,609,689 7,122,839 In July 2024, 3,482,143 PSUs vested in which 2,904,175 PSUs were settled for a cash payment of $5.3 million and the remaining were settled via the issuance of Common Shares of the Company. The Company accounts for PSUs as share-based awards whereby the estimated fair value of the grant is expensed evenly throughout the remaining vesting period. In the year ended December 31, 2024, the Company recognized $0.9 million in share-based compensation expenses relating to the PSUs (year ended December 31, 2023 - $10.3 million) with the decrease mainly caused by a lower Africa Oil share price in combination with changes in the expected outcome of performance multiples. C. Restricted share units (“RSUs”): RSUs granted to Non-Executive Directors cliff vest three years from the date of grant. The estimated fair value of RSUs are expensed evenly throughout the remaining vesting period. RSUs are no longer awarded to executives, and only PSU’s are awarded. RSUs may be settled in shares issued from treasury or cash, at the discretion of the Board of Directors. The Company’s RSUs outstanding are as follows:   December 31, 2024 December 31, 2023   Number of RSUs Number of RSUs Outstanding, beginning of the year 1,278,318 2,066,248 Granted 541,621 296,211 Vested (645,386) (1,084,141) Balance, end of the year 1,174,553 1,278,318 In March 2024, 645,386 RSUs vested with 374,324 being settled for a cash payment of $0.6 million and the remaining were settled via the issuance of Common Shares of the Company. The Company accounts for RSUs as share-based awards whereby the estimated fair value of the grant is expensed evenly throughout the remaining vesting period. In the year ended December 31, 2024, the Company recognized $0.6 million in share-based compensation relating to the RSUs (year ended December 31, 2022 - $1.0 million) with the decrease mainly caused by a lower Africa Oil share price. 18. Capital management: The Company’s objective when managing capital structure is to maintain balance sheet strength in order to ensure the Company’s strategic exploration, appraisal and business development objectives are met while providing an appropriate return to shareholders relative to the risk of the Company’s underlying assets. The Company manages its capital structure and makes adjustments to it based on changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may issue additional shares, issue debt, execute working interest farm-out arrangements and revise its capital expenditures program. In addition, the Company manages its cash and cash equivalents balances based on forecasted capital outlays and foreign exchange risks in order to ensure that the risk of negative foreign exchange effects are minimized while ensuring that interest yields on account balances are appropriate. The Company considers its capital structure to include shareholder’s equity, debt and working capital. The Company does not have externally imposed capital requirements. ===== SIDA 80 ===== PAGE 70 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 19. Related party transactions: A. Transactions with Africa Energy: On December 19, 2022, Africa Energy announced that it had secured a $5.0 million promissory note of which $2.0 million was provided by the Company and the remaining by other parties. On November 7, 2023, the promissory note provided by the Company and other parties to Africa Energy was increased by $3.3 million with $1.5 million of the increase to be provided by the Company of which $1.0 million was provided in the year ended December 31, 2024, and $0.5 million was provided in the year ended December 31, 2023. The note is unsecured and matures on March 31, 2025, when the principal and accrued interest are due in full. The note carries an annual interest rate of 15%. The note is repayable pro rata any time before maturity without penalty. In the year ended December 31, 2024, interest on the note amounted to $0.5 million (year ended December 31, 2023 - $0.3 million). The Company has technical and administrative cost sharing agreements with Africa Energy totaling $0.5 million in the year ended December 31, 2024 (year ended December 31, 2023 - $0.6 million). B. Transactions with Eco: During the year ended December 31, 2023, Africa Oil SA Corp. signed a legally binding Assignment and Transfer agreement with Azinam Limited (“Azinam”), a wholly owned subsidiary of Eco, to acquire an additional 6.25% interest in Block 3B/4B for a total cash consideration of up to $10.5 million, to be paid in tranches on the following milestones: • $2.5 million within 30 business days after July 10, 2023; • $2.5 million upon the SA government’s approval for the transfer of the 6.25% interest to Africa Oil SA Corp.; • $4.0 million upon the completion of a farm-out deal to a third party; and • $1.5 million upon spudding of the first exploration well on the Block. The first tranche was paid during 2023, the second and third tranches were paid during 2024. On July 26, 2024, the Company signed an agreement with Eco to acquire an additional 1.0% interest in Block 3B/4B from Azinam Limited, Eco’s wholly owned subsidiary, in exchange for all common shares and warrants over common shares held by the Company in Eco. On January 13, 2025, the Company announced that it had completed this transaction. The Company’s interest in Block 3B/4B increased by 1.0% to 18.0% and the Company ceased to be a shareholder in Eco. Africa Oil will benefit from the carry agreed between Eco, TotalEnergies and QatarEnergy for this incremental interest. C. Transactions with Impact: On March 24, 2023, the Company subscribed for 39,455,741 shares in Impact for $31.4 million, payable in two tranches, and directly following the transaction the Company held 31.1% of the enlarged share capital in Impact. The first tranche of $14.9 million was paid on April 21, 2023, and the final tranche of $16.5 million was paid on July 21, 2023. On October 6, 2023, the Company subscribed for 16,524,058 shares in Impact for $13.0 million and directly following the transaction the Company continued to hold 31.1% of the enlarged share capital in Impact. D. Transaction with Director: On November 23, 2023, the Company entered into an arm’s length agreement with Andrew Bartlett to acquire 106,500 shares in Impact at a price of £0.65 per share for a total amount of £69,225. This amount was paid during 2023 and the transaction completed on January 16, 2024. E. Remuneration of Directors and Senior Management: Remuneration of Non-Executive Directors and Senior Management includes all amounts earned and awarded to the Company’s Board of Directors and Senior Management. Senior Management includes the Company’s President and Chief Executive Officer, Chief Financial Officer, Chief Commercial Officer, Chief Operating Officer, Chief Technical Officer and the Chief Legal Officer. Directors’ fees include Board and Committee Chair retainers. Management’s short-term wages and benefits include salary, benefits, bonuses and any other cash-based compensation earned or awarded during the year. Share-based compensation includes expenses related to the Company’s share purchase option plan as well as the Long-Term Incentive Plan. For the years ended December 31, 2024 December 31, 2023 Non-Executive Directors' fees 0.5 0.5 Non-Executive Directors' share-based compensation 0.6 1.1 Managements’ short-term wages and benefits 7.3 5.4 Managements’ share-based compensation 0.5 6.5 8.9 13.5 ===== SIDA 81 ===== PAGE 71 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 20. Subsidiaries: The Company has the following wholly owned subsidiaries; Africa Oil Holdings B.V. (Netherlands), Africa Oil Turkana B.V. (Netherlands), Africa Oil Kenya B.V. (Netherlands), PetroVida Holding B.V. (Netherlands), Africa Oil Alpha B.V (Netherlands), Africa Oil Beta B.V (Netherlands), Africa Oil Gamma B.V (Netherlands), Africa Oil Turkana Ltd. (Kenya), Centric Energy (Kenya) Ltd. (Kenya), Africa Oil UK Limited (United Kingdom), Africa Oil Papa Corp. (British Columbia) and Africa Oil SA Corp. (British Columbia). 21. Financial risk management: The Company’s activities expose it to a variety of financial risks that arise as a result of its exploration, appraisal and financing activities such as: • credit risk; • liquidity risk; and • market risk. This note presents information about the Company’s exposure to each of the above risks, the Company’s objectives, policies and processes for measuring and managing risk, and the Company’s management of capital. Further quantitative disclosures are included throughout these consolidated financial statements. A. Credit risk: Credit risk is the risk of loss if counterparties do not fulfill their contractual obligations. The majority of the Company’s credit exposure relates to amounts due from the Company’s joint venture parties and a credit facility with Africa Energy. The risk of the Company’s joint venture parties defaulting on their obligations per their respective joint operating and farmout agreements is mitigated as there are contractual provisions allowing the Company to default joint venture parties who are non-performing and reacquire any previous farmed out working interests. The maximum exposure for the Company is equal to the sum of its cash and accounts receivable. As at December 31, 2024, the Company held $1.1 million (as at December 31, 2023 - $2.6 million) of cash in financial institutions outside of Canada, the Netherlands, Sweden and the UK. The Company also held $20.9 million (as at December 31, 2023 – $30.2 million) in short-term deposits in countries outside of Canada, the Netherlands and the UK with lending banks in the Corporate Facility with stable credit ratings. B. Liquidity risk: Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Liquidity describes a company’s ability to access cash. Companies operating in the upstream oil and gas industry, during the exploration and development phase, require sufficient cash in order to fulfill their work commitments in accordance with contractual obligations, deliver stated shareholder returns, and to be able to potentially acquire strategic oil and gas assets. The Company will potentially issue equity and debt and enter into farmout agreements with joint venture parties to ensure the Company has sufficient available funds to meet current and foreseeable financial requirements. The Company actively monitors its liquidity to ensure that its cash flows and working capital are adequate to support these financial obligations and the Company’s capital programs. The Company’s primary source of cash flow relates to dividends received from Prime. A significant reduction in or infrequent distributions could have an adverse effect on the Company’s ability to meet its commitments. The Company has senior members sitting on Prime’s Supervisory Board and Audit Committee, monitoring cash forecasts and setting financial and risk management policies to manage Prime’s dividend forecasts. At the date of this report, the Company has $65.0 million of the Corporate Facility available which improves the Company’s access to liquidity to fund operations and acquisitions as required. Any loan repayments are calculated to be protective of the Company’s liquidity position and if drawn, the Corporate Facility would be repaid from the proceeds of dividends received from Prime, while ensuring the Company preserves a sufficient minimum cash balance to conduct operations. The Corporate Facility is available until May 21, 2027, and has a maturity of May 21, 2027 (see note 12). The Company will also adjust the pace of its exploration and appraisal activities to manage its liquidity position. The existing cash balance, the undrawn amount of the Corporate Facility and expected dividends from its investment in Prime, are sufficient to fund the Company’s obligations as they become due. The Company has no maturities of its material contractual financial liabilities in excess of six months as at December 31, 2024, apart from the lease liability as mentioned in note 9 (as at December 31, 2023 – no maturities of its material contractual liabilities in excess of six months). C. Market risk: Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates, commodity prices and share prices, will affect the Company’s income or the value of the financial instruments. i. Foreign currency exchange rate risk: The Company is exposed to changes in foreign exchange rates as expenses in international subsidiaries, oil and gas expenditures, or financial instruments may fluctuate due to changes in rates. The Company’s exposure to foreign currency exchange risk is mitigated by the fact that the Company sources the majority of its capital projects and expenditures in US dollars. The Company has not entered into any instruments to manage foreign exchange risk. ===== SIDA 82 ===== PAGE 72 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED ii. Interest rate risk: The Corporate Facility has a variable interest rate, that is referenced to SOFR and will expose the Company to interest rate risk over the term of the loan if drawn. iii. Commodity price risk: The Company has an equity holding in Prime (see note 5), which has three producing fields within PMLs 2, 3 and 52, all with significant levels of production. A change in commodity prices may affect the dividends received from this investment. Prime employs a crude marketing strategy that maintains the 50% - 70% coverage target for the next 12-months’ scheduled cargoes. These contracts are with counterparties including oil supermajors. The counterparties are part of groups with investment grade credit ratings. iv. Share price risk: The Company has shareholdings in Africa Energy and Eco, which are entities listed on Canadian and European Stock Exchanges. The share price of these investments can be volatile and a change in share price may affect the amount that the Company can realize for these investments. 22. Financial instruments: As at December 31, 2024, and December 31, 2023, assets and liabilities that are measured at fair value are classified into levels reflecting the method used to make the measurements. Fair values of assets and liabilities included in Level 1 are determined by reference to quoted prices in active markets for identical assets and liabilities. Assets and liabilities in Level 2 include valuations using inputs other than quoted prices for which all significant inputs are observable, either directly or indirectly. Level 3 valuations are based on inputs that are unobservable and significant to the overall fair value measurement. The investment in Prime has been measured at fair value using Level 1 valuation methods. In 2023, the investment in Prime was fair valued using Level 3 valuation methods. The provision for contingent consideration has been measured at fair value using Level 2 valuation methods. The Company’s cash and cash equivalents, accounts receivable and prepaid expenses, loan to associate company, accounts payable and liabilities are recorded at amortized cost. The fair value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to the short-term maturity of these instruments. Assessment of the significance of a particular input to the fair value measurement requires judgement and may affect the placement within the fair value hierarchy level. 23. Income taxes: The tax rate consists of the combined federal and provincial statutory tax rates for the Company for the years ended December 31, 2024, and December 31, 2023. Substantially all of the differences between actual income tax expense and the expected Canadian federal and provincial statutory corporate income tax expense/ (recovery) related to losses not recognized. The following table reconciles the expected tax (recovery)/ expense calculated at the Canadian statutory rate with the actual tax recovery. For the years ended December 31, 2024 December 31, 2023 Net (loss)/ profit and comprehensive(loss)/ profit (279.1) 87.1 Combined federal and provincial statutory income tax rate 27.0% 27.0% Expected (recovery)/ expense (75.4) 23.5 Foreign rate differences 0.1 (0.1) Permanent differences 0.1 0.2 Share-based compensation 0.4 2.8 Equity earnings 67.4 (48.9) Non-taxable expense items - 16.8 Unrecognized tax losses 7.4 5.7 Tax charge - - The Company has estimated non-capital losses carried forward of $151.1 million in Canada which expire from 2025 through 2044. The Company has estimated capital losses carried forward of $12.9 million in Canada. The Company has estimated deductible temporary differences of $132.6 million in Canada. No deferred tax asset or liability is recognized at December 31, 2024. ===== SIDA 83 ===== PAGE 73 Report to Shareholders | December 31, 2024 Africa Oil Corp. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED 24. Supplementary information: The following table reconciles the changes in non-cash working capital as disclosed in the consolidated statement of cash flows: For the years ended December 31, 2024 December 31, 2023 Relating to Changes in current assets (1.5) (4.2) Changes in current liabilities (13.3) (24.6) Changes in non-cash working capital (14.8) (28.8) Relating to: Operating activities (9.9) (30.8) Investing activities (4.9) 2.0 Changes in non-cash working capital (14.8) (28.8) 25. Subsequent events: On January 13, 2025, the Company announced it completed a transaction with Eco and Azinam, a subsidiary of Eco, whereby Azinam has transferred a 1.0% interest in Block 3B/4B to Africa Oil. In consideration, Africa Oil has exchanged the shares and warrants that it held in Eco for cancellation. On January 22, 2025, Impact announced it would be paying a dividend of $0.0702 per share to its shareholders totalling approximately $80.0 million. On January 29, 2025, the dividend payment net to the Company’s shareholding of $31.6 million was received. From January 1, 2025, to February 21, 2025, a total of 5,023,853 Africa Oil Common Shares have been repurchased under the Normal Course Issuer Bid, for an amount of approximately $6.9 million and 2,475,600 shares have been cancelled. On February 27, 2025, the Company announced its intention to declare the first quarterly dividend, under its proposed new dividend policy, of $25 million or approximately $0.037 per share, on the closing of the Proposed Reorganization. This and other future dividend distributions are subject to customary board approval and consents. ===== SIDA 84 ===== AFRICAOILCORP .COM