Calgary - Storm Resources Ltd. (TSX: SRX) Storm has also filed its unaudited condensed interim consolidated financial statements as at June 30, 2021 and for the three and six months then ended along with Management's Discussion and Analysis ('MD&A') for the same period.

This information appears on SEDAR at www.sedar.com and on Storm's website at www.stormresourcesltd.com.

Selected financial and operating information for the three and six months ended June 30, 2021 appears below and should be read in conjunction with the related financial statements and MD&A.

2021 SECOND QUARTER HIGHLIGHTS

Improving commodity prices continue to provide a 'tail wind' with funds flow exceeding capital investment for the second consecutive quarter which resulted in debt being reduced by $18 million from the previous quarter and by $30 million in the first half of 2021. Capital efficiencies remain strong with production increasing 4% from the previous quarter with only one new well starting production in early June.

Production was 26,862 Boe per day which is a 12% increase year over year and a 4% increase from the previous quarter. This was consistent with guidance for an average of 25,000 to 27,000 Boe per day.

Liquids production (condensate plus NGL) totaled 5,166 barrels per day which was 19% of total production and 35% of total revenue. Liquids production increased 7% from last year.

During the quarter, one new horizontal well started production in early June at Umbach and, year to date, three new horizontal wells started production, all at Umbach.

Performance of recent wells continues to be strong with the Nig Creek wells completed in 2020 having an average IP270 of 1,900 Boe per day sales (23% liquids) and the Umbach wells completed in 2021 having an average IP90 of 1,080 Boe per day sales (22% liquids).

Revenue net of transportation was $21.97 per Boe, a 163% increase from last year as a result of higher commodity prices and a 12% decrease in the per-Boe transportation cost. Liquids prices saw the biggest improvement with condensate and NGL prices rising 203% and 274% respectively.

Production, general and administrative, and interest and finance costs totaled $5.79 per Boe, a year-over-year reduction of 2%.

Realized hedging loss was $9.1 million, or $3.71 per Boe, which is a result of the rapid and unexpected improvement in commodity prices over the last 12 months.

Funds flow was $27.9 million, or $0.23 per share, an increase of 155% from last year. This was largely from higher production and higher commodity prices which were partially offset by the $9.1 million hedging loss.

The net loss was $11.8 million, or $0.10 per share, which was largely the result of an unrealized hedging loss of $30.3 million (change in the mark-to-market valuation of future hedging contracts).

Cash return on capital employed (CROCE) was 19% and return on capital employed (ROCE) was 2% with both calculated on a 12-month trailing basis. ROCE was reduced by non-cash hedging losses of $30.3 million in the quarter and $39.0 million for the year to date.

Capital investment was $10 million (versus guidance for $14 million). At Fireweed, investment included $2.2 million net for equipment deposits for the facility and $0.8 million net to complete the gathering and sales pipelines. At Nig Creek, $5.2 million was invested to purchase an inlet compressor for the gas plant which was installed in July.

Total debt including working capital surplus was $102 million which is a reduction of $18 million from the previous quarter and represents 0.9 X annualized quarterly funds flow.

Commodity price hedges protect revenue on approximately 47% of current production for the remainder of 2021 and on approximately 33% of current production for 2022. The financial liability for future hedging contracts totaled $47 million using forward strip pricing at the end of the quarter.

Forward-Looking Information

This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words 'will', 'would', 'expect', 'anticipate', 'intend', 'believe', 'plan', 'potential', 'outlook', 'forecast', 'estimate', 'budget' and similar expressions are intended to identify forward-looking statements or information. More particularly, and without limitation, this press release contains forward-looking statements and information concerning: current and future years' guidance in respect of certain operational and financial metrics, including, but not limited to, commodity pricing, estimated average production costs, estimated average royalty rate, estimated operations capital, estimated general and administrative costs, estimated quarterly and annual production and estimated number of horizontal wells drilled, completed and connected, capital investment plans, infrastructure plans, anticipated United States exports, pipeline capacity, price volatility mitigation strategy and cost reductions. Statements of 'reserves' are also deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and that the reserves can be profitably produced in the future.

The forward-looking statements and information in this press release are based on certain key expectations and assumptions made by Storm, including: prevailing commodity prices and exchange rates; applicable royalty rates and tax laws; future well production rates; reserve and resource volumes; the performance of existing wells; success to be expected in drilling new wells; the adequacy of budgeted capital expenditures to carry out planned activities; the availability and cost of services and the receipt, in a timely manner, of regulatory and other required approvals. Although the Company believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on these forward-looking statements and information because of their inherent uncertainty. In particular, there is no assurance that exploitation of the Company's undeveloped lands and prospects will result in the emergence of profitable operations.

Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to the risks associated with the oil and gas industry in general such as: general economic conditions in Canada, the United States and internationally; operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to reserves, production, costs and expenses; health, safety and environmental risks; commodity price and exchange rate fluctuations; marketing and transportation of petroleum and natural gas and loss of markets; competition; ability to access sufficient capital from internal and external sources; geopolitical risk; stock market volatility and changes in legislation, including but not limited to tax laws, royalty rates and environmental regulations.

Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the operations or financial results of the Company are included or are incorporated by reference in the Company's Annual Information Form dated March 31, 2021 and the MD&A dated August 11, 2021 for the period ended June 30, 2021 which are available on Storm's SEDAR profile at www.sedar.com and on Storm's website at www.stormresourcesltd.com.

The forward-looking statements and information contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Contact:

Carol Knudsen

Tel: (403) 817-6145

Web: www.stormresourcesltd.com

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