Bengal Provides Initial Operational Update for Wareena and Caracal

Calgary, Alberta--(Newsfile Corp. - March 9, 2022) - Bengal Energy Ltd. (TSX: BNG) ("Bengal" or the "Company") has commenced field operations with the goal of transforming the Company into an operated producer in Australia. These field operations, at Wareena and Caracal, have the potential to materially increase Company production levels, with Bengal estimating that, on successful completion of the operations, corporate production may increase to up to 550 - 700 boe/d. The Company believes that any increased production, coupled with recent spikes in benchmark Brent crude oil and Australia's East Coast natural gas prices, has the potential to significantly improve Bengal's cash generating capability and position the Company for continuous growth.

At Wareena, the Company's 100% owned block, two wells (the "Wareena Wells") will be restarted with the goal of reducing or eliminating water production to promote gas production. Cumulative historic natural gas production from the two wells was more than six billion cubic feet^[1]. Bengal plans to reactivate the associated pipelines to allow sales and export of natural gas via the Coonaberry compression station into the Santos QNT Pty Ltd raw gas infrastructure, with natural gas transported to the Moomba processing facility. The Company anticipates that the Wareena Wells will be ready for extended production testing in April 2022, and, with success, the Company expects to start exporting natural gas via the recommissioned pipeline in late calendar Q3 2022. The Company will provide an update on expected rates after the initial testing phase.

At Caracal, the Company's 100% owned location, the Company plans to reinstate and stimulate the Caracal 1 well with the goal of producing commercial volumes of light oil. On success, commercial oil production would then be lifted by Bengal's refurbished Lufkin Roadrunner pumping unit (which the Company anticipates will be onsite at Caracal in April 2022), then gravity separated in a tank and offloaded into road tankers. Bengal recently signed an offtake agreement with the neighbouring Inland Oil Refinery in Eromanga. The tank farm is staged and sized for an expansion of the production site based on additional producing wells. Upon starting production, the Caracal production area is earmarked for further development of additional oil prospects.

"Bringing both of the Wareena and Caracal sites into production will be the culmination of several years of work in establishing the Company as an independent operator in the Cooper Basin with material production generating free cashflow. We are looking forward to growing our organic portfolio of innovative, cost effective, local and sustainable practices with our many regional partners," reflects Kai Eberspaecher, Chief Operating Officer.

"Bengal Energy is currently generating CAD$90-100/bbl in operating netback^[2] from our non-operated producing Cuisinier oil field. Our March 31, 2021, Reserves value is $0.14/per common share^[3] based on a $62/bbl Brent crude price compared to current Brent spot prices which are in excess of US$120/bbl. Achieving success with our planned near-term field operations, together with the recent increases in benchmark crude oil and natural gas prices, is expected to result in material additional cashflow and, we anticipate, increased enterprise value for our shareholders. As previously announced in our press release of March 8, 2022, on March 7, 2022, we closed our C$4.2 million equity financing, which included participation by certain of the Company's insiders. Our future growth lies in our operated assets, and we are excited to take the first step towards our growth this year with the commencement of the operated Wareena and Caracal project activities," added Chayan Chakrabarty, Chief Executive Officer.

About Bengal

Bengal Energy Ltd. is an international junior oil and gas exploration and production company with assets in Australia. The Company is committed to growing shareholder value through international exploration, production and acquisitions. Bengal's common shares trade on the TSX under the symbol "BNG". Additional information is available at www.bengalenergy.ca

CAUTIONARY STATEMENTS:

Forward-Looking Statements

This news release contains certain forward-looking statements or information ("forward-looking statements") as defined by applicable securities laws that involve substantial known and unknown risks and uncertainties, many of which are beyond Bengal's control. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. The use of any of the words "plan", "expect", "future", "project", "intend", "believe", "should", "would," "anticipate", "estimate", "new", "develop" or other similar words or statements that certain events "may" or "will" occur are intended to identify forward-looking statements. The projections, estimates and beliefs contained in such forward-looking statements are based on management's estimates, opinions, and assumptions at the time the statements were made, including assumptions relating to: the impact of economic conditions in North America, Australia and globally; industry conditions; changes in laws and regulations including, without limitation, the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; increased competition; the availability of qualified operating or management personnel; fluctuations in commodity prices, foreign exchange or interest rates; stock market volatility and fluctuation; results of exploration and testing activities, and the continued or anticipated performance of assets; and the ability to obtain required approvals and extensions from regulatory authorities.

We believe the expectations reflected in the forward-looking statements contained herein are reasonable but no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits, if any, Bengal will derive from them. As such, undue reliance should not be placed on forward-looking statements. In particular, forward-looking statements contained herein include, but are not limited to, statements regarding: the Company's focus, plans, priorities and strategies; the Company's position in the business environment, particularly in the Australian business environment; the Company's development plans for the Wareena and Caracal sites, the timing of the anticipated developments of such sites, any indications related to historical production, Bengal's cash generating ability, the positioning of the Company for continuous growth, the expectation of material production and that the same will generate free cash flow the anticipated performance of assets and equipment at the sites, the ability of the Company to reactivate certain pipelines, the ability of the Company to bring the sites into production and the expected benefits of such to the Company; the anticipated continued upswing in Brent crude pricing and Australia's East Coast natural gas prices and the expected benefits of such to the Company and its shareholders; and the ability of third parties to perform their obligations under contracts and the expected benefit of such contracts and performance to the Company. Bengal believes the expectations reflected in the forward-looking statements contained herein are reasonable but, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits Bengal will derive from them. As such, undue reliance should not be placed on forward-looking statements.

The forward-looking statements contained herein are subject to numerous known and unknown risks and uncertainties that may cause Bengal's actual performance or achievement in future periods to differ materially from those expressed in, or implied by, these forward-looking statements, including but not limited to, risks associated with: Bengal's development and exploration opportunities; the economic conditions in North America, Australia and globally; the impact of ongoing global events, including European tensions and the COVID-19 pandemic and the ability of the Company to carry on its operations as currently contemplated in light of the such events; the failure to obtain required regulatory approvals or extensions; determinations by OPEC and other countries as to production levels; the failure to satisfy the conditions under farm-in and joint venture agreements; the failure of third parties to performance their obligations under contracts with the Company; the failure to secure required equipment and personnel; increased competition; the availability of qualified operating or management personnel; fluctuations in commodity prices, foreign exchange or interest rates; changes in laws and regulations including, without limitation, the adoption of new environmental and tax laws and regulations and changes in how they are interpreted and enforced; the results of exploration and development drilling and related activities; the ability to access pipeline infrastructure; the ability to access sufficient capital from internal and external sources; and stock market volatility. The historical production information should not be construed as an estimate of future production levels or future resources/reserves of Bengal. Readers are encouraged to review the material risks discussed in Bengal's Annual Information Form under the heading "Risk Factors" and in Bengal's annual MD&A under the heading "Risk Factors". The Company cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. Additional information on these and other factors that could affect the Company are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). The forward-looking statements contained in this news release speak only as of the date hereof and Bengal does not assume any obligation to publicly update or revise them to reflect new events or circumstances, except as may be require pursuant to applicable securities laws.

This news release also contains information that may be considered a financial outlook under applicable securities laws about the Company's potential financial position, including, but not limited to, Bengal's cash generating ability, the positioning of the Company for continuous growth, the expectation of material production and that the same will generate free cash flow, all of which are subject to numerous assumptions, risk factors, limitations and qualifications, including those set forth in the above paragraphs. The actual results of operations of the Company and the resulting financial results will vary from the amounts set forth in this press release and such variations may be material. This information has been provided for illustration only and with respect to future periods are based on budgets and forecasts that are speculative and are subject to a variety of contingencies and may not be appropriate for other purposes. Accordingly, these estimates are not to be relied upon as indicative of future results. Except as required by applicable securities laws, the Company undertakes no obligation to update such financial outlook. The financial outlook contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about the Company's potential future business operations. Readers are cautioned that the financial outlook contained in this press release is not conclusive and is subject to change.

Barrels of Oil Equivalent

When converting natural gas to equivalent barrels of oil, Bengal uses the widely recognized standard of 6 mcf to one BOE. However, a BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 mcf: 1 bbl 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.

Oil and Gas Advisory

The reserves data set forth in this new release is based upon an independent reserve assessment and evaluation prepared by GLJ with an effective date of March 31, 2021 (the "GLJ Report"). The GLJ Report has been prepared in accordance with the standards contained in the Canadian Oil and Gas Evaluation Handbook and the reserve definitions contained in National Instrument 51-101 - Standards of Disclosure For Oil and Gas Activities.

Light crude oil is crude oil with a relative density greater than 31.1 degrees API gravity, medium crude oil is crude oil with a relative density greater than 22.3 degrees API gravity and less than or equal to 31.1 degrees API gravity, and heavy crude oil is crude oil with a relative density greater than 10 degrees API gravity and less than or equal to 22.3 degrees API gravity.

Non-GAAP and other Financial Measures

This press release contains the term "operating netback, which is provided on a per unit of production basis. Bengal employs this measure to analyze financial performance and cash flow. This non-GAAP financial measure does not have any standardized meaning prescribed under IFRS and therefore may not be comparable to similar measures presented by other entities. This non-GAAP financial measure should not be considered to be more meaningful than GAAP measures which are determined in accordance with IFRS as indicators of Bengal's performance.

We believe operating netback provides useful supplemental information enabling us to analyze operating performance and provides an indication of the results generated by the Corporation's principal business activities. Operating netback is calculated as equals total revenue (including realized gain (loss) on financial instruments)less royalties and operating expenses. Bengal's method of calculating this measure may differ from other companies, and accordingly, it may not be comparable to similar measures used by other companies.

Operating netback per unit of production measure is a common non-GAAP ratio used in the oil and natural gas industry which is a useful supplemental measure to evaluate the specific operating performance by product at the oil and gas lease level and one that provides investors with information that is also commonly presented by other crude oil and natural gas producers. Operating netback per unit of production is calculated as operating netback divided by weighted average daily production.

The most directly comparable GAAP measure to operating netback is Oil Sales.. A reconciliation of operating netback and operating netback to Oil Sales is set forth in Bengal's MD&A for the three and nine months ended December 31, 2021 under the heading "NON-IFRS MEASUREMENTS", which is incorporated by reference in this press release and available on SEDAR under the Company's profile at www.sedar.com.

This press release also presents certain supplementary financial measures to assist readers in understanding the Company's performance. These measures do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other issuers and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Management uses these supplementary financial measures, to analyze and evaluate operating performance and believes they assist the reader in understanding Bengal's results. Bengal also believes the financial measures defined below are commonly used by the investment community for valuation purposes, and are useful complementary measures of profitability, and provide metrics useful in the Bengal's industry. These supplementary financial measures are:

• reserves value per common share; and

Selected Definitions

The following terms used in this news release have the meanings set forth below:

bbl - barrel
boe - means barrel of oil equivalent of natural gas and crude oil on the basis of 1 boe for 6 mcf (this conversion factor is and industry accepted norm and is not based on either energy content or current prices)
boe/d - barrels of oil equivalent per day
$/bbl - dollars per barrel
"mcf" means one thousand cubic feet
"NVP" means net present value
Q2 - three months ended June 30, 2022
Q3 - three months ended September 31, 2022

FOR FURTHER INFORMATION PLEASE CONTACT:

Bengal Energy Ltd.
Chayan Chakrabarty, President & Chief Executive Officer
(403) 205-2526
Jerrad Blanchard, Chief Financial Officer
(403) 781-7021
Email: investor.relations@bengalenergy.ca
Website: www.bengalenergy.ca

^[1] Previous operator's internal assessment.

^[2] For the period ended December 31, 2021. Non-GAAP financial measure. See "Non-GAAP and Other Financial Measures".

^[3] See "Non-GAAP and Other Financial Measures". Based on the Company's most recent third-party Reserves evaluation dated March 31, 2021, $69.0 million proved plus probable after tax NPV₁₀ Reserves value translates to approximately $0.14 per share based on approximate 485 million common shares in the capital of Bengal outstanding as of March 9, 2022.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/116091