President's Message 

I have spent thirty years operating in places where the geology is difficult,
the politics are complex, and the path forward is rarely straight - Turkey,
Ukraine, Georgia, Quebec, and Papua New Guinea. Each of those experiences taught
me something that the next one required. Looking back, I can see the thread
clearly now, even when I couldn't at the time.

That thread has brought our experienced international board and team here.

Since the oil crisis of the 1970s, the industry has pursued a way to unlock oil
shale - one of the largest hydrocarbon systems ever identified, with resource
potential measured in trillions of barrels(1). Driven by energy security
concerns that have once again come to the forefront, this effort has spanned
decades. Yet oil shale has consistently resisted commercial development. The
reasons are geological, technological, economic, and political - all at once.
That is exactly the kind of problem we have been preparing to solve.

This year, Questerre marked a meaningful step toward solving this problem.
Through the acquisition of PX Energy and the consolidation of our ownership in
Red Leaf Resources, with full control of the patented HCCO® technology, we now
have the assets, the platform, and the technical capabilities we believe we need
to advance this resource toward commercial development.

This is more than a turnaround opportunity. It transforms Questerre into an oil
shale operator with production and cash flow, extensive infrastructure, and a
highly capable team experienced in oil shale development. While we optimize the
existing operations and technology, the acquisition provides a unique platform
to advance the next generation of technology in an operating environment rather
than through stand-alone pilot projects.

Since closing the PX Energy acquisition, our focus has been on stabilizing
operations, improving performance, implementing safety reporting, and reducing
costs. We have identified $10 million in annual savings and are targeting a
further $10 million through operational efficiencies.

Concurrently, we plan to test a key element of the new process inside the
existing Petrosix retort vessel in the second quarter of this year. With
success, this could improve heat and mass balance, increase product yields and
reduce internal fuel consumption for the existing technology. Based on our
budget, this can be funded through internally generated cash flow as we
anticipate this could cost less than 10% of a field pilot. It can also be
implemented much sooner than a new field pilot. This demonstration at scale
would be a significant step toward transitioning to the new technology, and
ultimately commercialization.

The energy shortage in Quebec is growing and public debate on local gas
production has reopened(2). While development has been blocked by policy
restrictions, the current energy crisis and growing focus on security of supply
are reinforcing the importance of local resources. Independent studies,
including a peer-reviewed assessment by CIRAIG(3) (the International Reference
Center for Life Cycle Assessment and Sustainable Transition) and the Government
of Quebec's Strategic Environmental Assessment, support the view that impacts
can be responsibly managed. Based on this work, we believe this project could be
one of the most significant opportunities to deliver a net reduction in
greenhouse gas emissions in Canada.

What gives me confidence is not just the assets