3R Petroleum – Renegotiation of Gas Contracts in the Potiguar Basin

RENEGOTIATION OF GAS CONTRACTS IN THE POTIGUAR BASIN

3R PETROLEUM ÓLEO E GÁS S.A. (“3R” or “Company”) informs its investors and the market in general that, through its subsidiaries 3R Macau S.A. (“3R Macau”) and 3R Pescada S.A.[1] (“3R Pescada”), signed on December 8, 2021 amendments to the purchase and sale agreements of pre-processed natural gas (“Amendments”) with Petróleo Brasileiro S.A. (“Petrobras”).

[1] The efficiency of the gas contract referring to 65% of the Pescada Cluster is subject to the conclusion of the assignment of concession rights, by ANP, from Petrobras to 3R, with the positive impact on cash generation calculated since January 1st, 2022.

The commercial terms negotiated in the amendments are detailed below, which refer exclusively to the natural gas produced by 3R Macau (Sanhaçu field) and Pescada Cluster, before the treatment of the gas in the Natural Gas Processing Units (UPGNs), located in Guamaré (RN). In line with the notice to the market released on August 27, 2021, 3R is under negotiation phase with Petrobras for the acquisition of Potiguar Cluster, asset that includes the UPGNs of Guamaré. The changes implemented through the amendments will take effect from January 1, 2022, with closing data on July 31, 2023.

The aforementioned Additives remunerate the natural gas producer (Company) in a competitive way and ensure access to a natural gas source to a relevant consumer in the State of Rio Grande do Norte, Petrobras in this case, which is an agreement that is beneficial for both parties.

For the 35% stake in Pescada Cluster, already held by 3R, the commercial terms remain the same as in the previous contract, keeping the pricing fixed, regardless of the Brent value. A clause that provides an automatic assignment of the contracts to the buyer of the Potiguar Cluster (which includes Guamaré’s UPGNs) was included, to address the scenario in which Petrobras completes this transaction during the term of the gas contract. The same clause was also included in the other amendments.

For Sanhaçu and 65% of the interest in Pescada Cluster (currently held by Petrobras and which is in the process of transitioning to the 3R[2]), the sales price conditions were defined materially higher when compared to the conditions of the original contracts, in two subsequent periods (1st from January to April 30, 2022 and May 1, 2022 to July 31, 2023), as illustrated in the graphs below:

[2] The cash generation referring to 65% of the interest in Pescada Cluster belongs to 3R since January 1st, 2020, the effective date of the transaction, and will be deducted from the installment to be paid at the closing of the acquisition.

3R Portfolio and Gas Strategy

3R was successful in building an integrated portfolio comprised of oil and natural gas production assets. The Company has 264.3 million barrels of oil equivalent certified as proved and probable reserves (2P), of which 18% or 47.0 million boe are natural gas reserves. The table below shows the composition of reserves by asset:

The gas contracts’ amendments in the Potiguar Basin are an important milestone in the strategy to generate value to shareholders, through better monetization of the gas production, as well as adding resilience and predictability in the Company’s revenue generation.

Additionally, this move strengthens the Company’s strategic position in the Potiguar Basin, as an important natural gas player in the State of Rio Grande do Norte and, consequently, in the Northeast region of the country.

Finally, 3R reinforces its commitment to keeping its investors and the market in general duly informed, in line with the best corporate governance practices and in strict compliance with current legislation.