Third Quarter Results And Director Retirement

Calgary, Alberta - November 29, 2023 - Southern Energy Corp. ("Southern" or the "Company") (TSXV:SOU) (AIM:SOUC)(OTCQX:SOUTF), an established producer with natural gas and light oil assets in Mississippi, announces its third quarter financial and operating results for the three and nine months ended September 30, 2023. Selected financial and operational information is outlined below and should be read in conjunction with the Company's unaudited consolidated financial statements and related management's discussion and analysis (the "MD&A") for the three and nine months ended September 30, 2023, which are available on the Company's website at www.southernenergycorp.com and have been filed under the Company's profile on SEDAR+ at www.sedarplus.ca.

THIRD QUARTER 2023 HIGHLIGHTS

• Petroleum and natural gas sales of $5.3 million in Q3 2023 and $14.2 million for the nine months ended September 30, 2023
• Generated $1.1 million of adjusted funds flow from operations[1] in Q3 2023 ($0.01 per share basic and fully diluted)
• Net loss of $2.4 million in Q3 2023 ($0.02 net loss per share basic and fully diluted)
• Q3 2023 average production of 16,881[2] Mcfe/d (2,814 boe/d) (95% natural gas)
• Average realized natural gas and oil prices for Q3 2023 of $2.83/Mcf and $82.65/bbl compared to $10.00/Mcf and $91.93/bbl in Q3 2022, and $2.18/Mcf and $72.83/bbl in the prior quarter
• Successfully renegotiated an increase of $2.0 million in the borrowing base of the Company's senior secured term loan (the "Credit Facility"), extended the availability of Tranche B to August 31, 2025 to match the term of the Credit Facility, and extended the principal amortization period of the Credit Facility by twelve months

SUBSEQUENT EVENTS

• On November 9, 2023, closed an equity financing raising aggregate gross proceeds of $5.0 million through the issuance of a total of 26,630,000 new Common Shares
• In early December 2023, the Company is mobilizing equipment to the field in Gwinville to start completion operations on the first drilled and uncompleted ("DUC") well at the 14-6 #3 (Upper Selma Chalk)

Ian Atkinson, President and Chief Executive Officer of Southern, commented:

"Southern is in an extremely strong position in the fourth quarter of 2023, with prevailing natural gas prices having significantly increased and our balance sheet capitalized, enabling us to go after the organic growth opportunities in our portfolio. In Q3 2023, we completed the synergistic infrastructure modifications at Gwinville connecting the newly acquired assets to our legacy Southern gathering system. We will have reduced field compression from five sites at the time of acquiring the assets to one site, which provides significant savings in both operating costs and fuel gas. In November 2023, we completed an equity fundraise to accelerate the completion of our four drilled and uncompleted wells at Gwinville. Initial cost estimates suggest that service costs are entering back into a deflationary period, and we are excited to execute our first slickwater fracture treatment in the Gwinville program.

"We continue to be encouraged by the outlook of supply and demand dynamics for U.S. natural gas, as at least two of the upcoming Gulf Coast LNG export projects, at Cheniere Energy's Corpus Christi expansion and Golden Pass LNG have recently announced they are ahead of schedule. Southern is well positioned to capitalize on natural gas prices with production behind pipe which can be brought on stream in a short time frame and we are excited to continue to grow the business with our new and longstanding shareholders."

Financial Highlights

Note:

• See "Reader Advisories - Specified Financial Measures".

Gwinville Development Update

With the net proceeds of the recent equity fundraise, the Company will accelerate the completion of the four Gwinville wells that were drilled in Q1 2023. The Company expects the first well to be on-line before the end of the year, with IP30 rates likely available towards the end of January 2024. Cost estimates for the completion of the 14-06 #3 well are anticipated to be $3 million or less as the Company intends to take advantage of the deflationary service cost pressures since the last wells were completed. Follow-on completions are anticipated in the first half of 2024, depending on natural gas pricing.

Outlook

The Company currently has $10.0 million of unused capacity on its Credit Facility, which can be utilized alongside its existing cash balance to complete the four drilled uncompleted horizontal wells at supportive natural gas prices.

As part of its risk management and sustainability strategy, Southern continuously monitors both the price of NYMEX, as well as the basis differentials, in order to mitigate some of the volatility of natural gas prices. Southern's current commodity hedge program includes:

Director Retirement

• Andrew McCreath has retired from the Company's board of directors effective today to focus on other commitments. The board and management team wish to express their gratitude to Mr. McCreath for his contributions during his 5 years of service. The Company does not have any immediate plans to appoint a replacement Non-Executive Director following Mr. McCreath's departure, though will keep this position under review.

Owen Roberts / Billy Clegg / Hugo Liddy

About Southern Energy Corp.

READER ADVISORIES

Throughout this press release, "crude oil" or "oil" refers to light and medium crude oil product types as defined by National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). References to "NGLs" throughout this press release comprise pentane, butane, propane, and ethane, being all NGLs as defined by NI 51-101. References to "natural gas" throughout this press release refers to conventional natural gas as defined by NI 51-101.

Abbreviations. Please see below for a list of abbreviations used in this press release.

bbl barrels

bbl/d barrels per day

boe barrels of oil

boe/d barrels of oil per day

IP30 average hydrocarbon production rate for the first 30 days of a well's life

Mcf thousand cubic feet

Mcf/d thousand cubic feet per day

MMcf million cubic feet

MMcf/d million cubic feet per day

Mcfe thousand cubic feet equivalent

Mcfe/d thousand cubic feet equivalent per day

MMBtu million British thermal units

MMBtu/d million British thermal units per day

NYMEX New York Mercantile Exchange

Forward Looking Statements. Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Forward-looking information typically contains statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", "project", "budget", "continue", "evaluate", "forecast", "may", "will", "can", "target" "potential", "result", "could", "should" or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information in this press release may include, but is not limited to statements concerning the Company's asset base including the development of the Company's assets, oil and natural gas production levels, the Company's capital budget, anticipated operational results, capital expenditures, drilling and completion plans and casing remediation activities, expectations regarding commodity prices and service costs, the performance characteristics of the Company's oil and natural gas properties, the Company's hedging strategy and execution thereof, the ability of the Company to achieve drilling success consistent with management's expectations, the Company's expectations regarding completion of the four drilled and uncompleted horizontal wells and timing thereof (including anticipated costs and the attainment and timing of well completion services relating thereto), the sources of funding for the Company's activities, the effect of market conditions on the Company's performance, the anticipated use of proceeds from Southern's recent equity financing, the Company's execution of and anticipated benefits of the planned slickwater treatment in the Gwinville program, outlook in respect of Gulf Coast LNG export projects at Cheniere Energy's Corpus Christi expansion and Golden Pass LNG, the Company's risk management activities including hedging positions and targets, expectations regarding the use of proceeds from all sources including the Credit Facility, the availability and renewal of the Credit Facility and future amendments, and the Company's risk management and sustainability strategy. Statements relating to "reserves" and "recovery" 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 contained in this press release are based on certain key expectations and assumptions made by Southern, including, but not limited to, the timing of and success of future drilling, development and completion activities, the performance of existing wells, the performance of new wells, the availability and performance of drilling rigs, facilities and pipelines, the geological characteristics of Southern's properties, the characteristics of the Company's assets, the successful integration of recently acquired assets into the Company's operations, the successful application of drilling, completion and seismic technology, the benefits of current commodity pricing hedging arrangements, Southern's ability to enter into future derivative contracts on acceptable terms, Southern's ability to secure financing on acceptable terms, prevailing weather conditions, prevailing legislation, as well as regulatory and licensing requirements, affecting the oil and gas industry, the Company's ability to obtain all requisite permits and licences, prevailing commodity prices, price volatility, price differentials and the actual prices received for the Company's products, royalty regimes and exchange rates, the impact of inflation on costs, the application of regulatory and licensing requirements, the Company's ability to obtain all requisite permits and licences, the availability of capital, labour and services, the creditworthiness of industry partners, the Company's ability to source and complete asset acquisitions, and the Company's ability to execute its plans and strategies.

Future Oriented Financial Information. This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about Southern's prospective results of operations, cash flow, adjusted funds flow, capital expenditures, tax rates, cost estimates, positive net cash (net debt), payout of wells, and prospective results of operations and production all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. FOFI contained in this document was approved by management as of the date of this document and was provided for the purpose of providing further information about Southern's future business operations. Southern and its management believe that FOFI has been prepared on a reasonable basis, reflecting management's best estimates and judgments, and represent, to the best of management's knowledge and opinion, the Company's expected course of action. However, because this information is highly subjective, it should not be relied on as necessarily indicative of future results. Southern disclaims any intention or obligation to update or revise any FOFI contained in this document, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this document should not be used for purposes other than for which it is disclosed herein. Changes in forecast commodity prices, differences in the timing of capital expenditures, and variances in average production estimates can have a significant impact on the key performance measures included in Southern's guidance. The Company's actual results may differ materially from these estimates.

"Positive Net Cash (Net Debt)" (capital management measure) is monitored by management, along with adjusted working capital, as part of its capital structure in order to fund current operations and future growth of the Company. Net debt is defined as long-term debt plus adjusted working capital surplus or deficit. Adjusted working capital is calculated as current assets less current liabilities, removing current derivative assets/liabilities, the current portion of bank debt, and the current portion of lease liabilities.

[1] See "Reader Advisories - Specified Financial Measures"

[2] Comprised of 144 bbl/d light and medium crude oil, 9 bbl/d NGLs and 15,963 Mcf/d conventional natural gas