IPC Second Quarter 2022 Financial and Operational Results and Sustainability Report 2021

International Petroleum Corporation (IPC or the Corporation) (TSX, Nasdaq Stockholm: IPCO) today released its financial and operational results and related management’s discussion and analysis (MD&A) for the three and six months ended June 30, 2022. IPC also released its Sustainability Report 2021, which details the Corporation's environmental, social and governance (ESG) performance.

Mike Nicholson, IPC's Chief Executive Officer, comments: “The second quarter results set a new high watermark for IPC across the board. Record high production levels in parallel with record high realized pricing paved the way for IPC to generate more than MUSD 150 of free cash flow. That represents an astonishing industry leading annualized 31% free cash flow yield. On the value front, IPC shares still trade at a significant discount to our 2P reserves value using conservative pricing, with no value assigned to our 1.4 billion barrels of oil equivalent (boe) of contingent resources. We were therefore very pleased to have followed through on our shareholder returns framework by successfully completing the substantial issuer bid (SIB) to repurchase approximately 8.3 million shares, or 5.5% of the shares outstanding, and then restarting the normal course issuer bid (NCIB) to purchase a further 3.3 million shares in July. Notwithstanding the material shareholder returns, IPC ends the second quarter in a net cash position. I give huge credit to the entire IPC team for delivering such excellence.”

Q2 2022 Business and Financial HighlightsQ2 2022 Achievements

• Successful conclusion of IPC’s first Substantial Issuer Bid (SIB) returning MUSD 100 to participating shareholders and 8,258,064 common shares being purchased and cancelled in early July 2022.
• Drilling operations on the A15 side-track well and three well pump upgrades at the Bertam field, Malaysia were successfully completed in April 2022.
• Front End Engineering Design (FEED) studies progressing on the Blackrod project, Canada.
• Release of IPC’s third Sustainability Report.
• On track with commitment to reduce IPC’s net greenhouse gas (GHG) emissions intensity by 50% by the end of 2025.

Q2 2022 Results

• Record average net production of approximately 49,400 barrels of oil equivalent (boe) per day (boepd) for the second quarter of 2022, above high end guidance (47% heavy crude oil, 20% light and medium crude oil and 33% natural gas).(1)
• Record net result of MUSD 105 for the second quarter of 2022.
• Operating costs per boe of USD 16.2 for the second quarter of 2022, in line with latest guidance.(2)
• Record high operating cash flow (OCF) generation for IPC of MUSD 193 for the second quarter of 2022.(2)
• Capital and decommissioning expenditures of MUSD 32 for the second quarter of 2022 and MUSD 72 for the first half of 2022.
• Record high free cash flow (FCF) generation for IPC of MUSD 152 for the second quarter of 2022.(2)
• Net cash of MUSD 14 as at June 30, 2022 (net of the MUSD 100 for SIB share repurchases), up from net debt of MUSD 94 as at December 31, 2021.(2)

2022 Annual Guidance

• Full year 2022 average net production guidance range is expected to be towards the upper end of the guidance range of 46,000 to 48,000 boepd.
• Full year 2022 operating costs guidance retained at between USD 16 to 17 per boe.(2)
• Full year 2022 OCF guidance increased to between MUSD 595 to 730 (Brent USD 85 to 115 per barrel for the remainder of 2022).(2)
• Full year 2022 capital and decommissioning expenditures guidance increased to MUSD 170 from MUSD 127, accelerating projects and adding additional capital activity in Canada and France given the high oil and gas prices.
• Full year 2022 FCF guidance increased to between MUSD 395 to 530 (Brent USD 85 to 115 per barrel for the remainder of2022).(2)

Reserves and Resources

• Proved plus probable (2P) reserves as at December 31, 2021 of 270 million boe (MMboe), with a reserves life index of 16 years.(1,3)
• Contingent resources (best estimate, unrisked) as at December 31, 2021 of 1,410 MMboe.(1,3)

Oil and gas prices continued to strengthen through the second quarter of 2022 as the tailwinds of tight supply and demand balances combined with very low inventory levels more than offset the headwinds of Strategic Petroleum Reserve (SPR) releases in the United States and Covid-19 lockdowns in China. Brent prices averaged USD 114 per barrel during the second quarter of 2022, higher than average first quarter Brent pricing of USD 102 per barrel. In Canada, second quarter 2022 Western Canadian Select (WCS) crude price differentials averaged USD 13 per barrel. Forward markets into late 2022 and 2023 are pricing the WCS differential wider at around USD 17 per barrel. Market commentators believe that higher natural gas prices for refiners as well as the SPR releases being heavier barrels are behind the increase in the WCS differential. IPC has positioned itself well to mitigate this forecast increase, with approximately two-thirds of our WCS differential exposure hedged at around USD 13 per barrel for the remainder of 2022. IPC has no other oil hedges in place providing full exposure to the strength we are seeing in both the Brent and West Texas Intermediate benchmarks. Gas markets have also remained very strong driven by a combination of increasing demand and below average storage levels in Canada. Second quarter 2022 average Empress prices were exceptionally high at around CAD 7.80 per Mcf and forward prices remain high at above CAD 5.00 per Mcf for the remainder of 2022 and into 2023. IPC has hedged AECO gas prices, 33,000 Mcf per day at CAD 3.60 per Mcf in Q3 2022. IPC benefits from a well balanced mix of production comprising approximately 46% Canadian Crude, 34% Canadian Natural Gas and 20% Brent weighted oil. With synchronized strength in pricing across the entire energy complex, combined with delivering operational excellence above the high end of our second quarter forecast, IPC has again been able to deliver our best ever quarterly financial performance since our launch in 2017. We have created significant value from acquisition for all of our stakeholders having concluded four acquisitions in the past four years and will remain opportunistic in our approach with respect to further M&A activity focusing on securing additional high quality resources, as well as maturing our significant contingent resource base in excess of 1.4 billion barrels.(3)

Second Quarter 2022 Highlights

During the second quarter of 2022, our assets delivered average net production of 49,400 boepd, above our high end guidance for the quarter and achieving a record high for the company. This was made possible by the very high uptime performance across all of our assets as well as the production contribution from our 2022 investment program in Malaysia and Canada. We now expect full year 2022 production to be towards the upper end of the guidance range of 46,000 to 48,000 boepd.(1) Our operating costs per boe for the second quarter of 2022 was USD 16.2, in line with our latest guidance. Year to date operating costs per boe was USD 16.9 and we are retaining our full year 2022 guidance of USD 16 to 17 per boe.(2) Operating cash flow (OCF) generation for the second quarter of 2022 was USD 193 million, a record high for IPC. Full year 2022 OCF guidance is being increased from USD 430 to 635 million (Brent USD 70 to 100 per barrel) to USD 595 to 730 million (Brent USD 85 to 115 per barrel for the remainder of 2022).(2) Capital and decommissioning expenditure for the second quarter of 2022 was USD 32 million. Full year 2022 capital and decommissioning expenditure guidance is being increased from USD 127 million to USD 170 million. Of the USD 43 million forecast increase, USD 10 million relates to schedule acceleration of our Villeperdue West drilling project in France, USD 23 million of the forecast increase relates to high value activity additions in France and Canada including the Onion Lake Thermal debottlenecking project in Canada in Q4 2022 and the remaining USD 10 million relates to a provision for inflationary pressures that we are seeing in the market. Free cash flow (FCF) generation was exceptionally strong at USD 152 million during the second quarter of 2022, a record quarterly result for IPC. Full year 2022 FCF guidance is being increased from USD 275 to 480 million (Brent USD 70 to 100 per barrel) to USD 395 to 530 million (Brent USD 85 to 115 per barrel for the remainder of 2022). This higher free cash flow guidance includes the increased capital expenditure guidance. This represents between 23% and 31% of IPC’s current market capitalization.(2,4) During the second quarter of 2022, IPC moved into a net cash position and by the end of the second quarter of 2022 IPC remained in a net cash position of USD 14 million after more than fully funding our successful USD 100 million Substantial Issuer Bid (SIB) out of free cash flow.(2) IPC forecasts cumulative FCF for 2022 to 2026 of approximately USD 900 to 1,800 million (based on forecast Brent oil prices of USD 65 to 95 per barrel) generating estimated average annual FCF yield over the five year period of between 11% and 21%.(2,4)

Share Repurchase ProgramsSubstantial Issuer Bid

We were very pleased to have concluded our first Substantial Issuer Bid in line with our capital allocation framework to materially increase returns to shareholders in the higher oil price environment. IPC returned USD 100 million to participating shareholders, with our remaining shareholders benefiting from the cancellation of the repurchased shares, being approximately 5.5% of the total number of issued and outstanding shares. In early July 2022, IPC completed the repurchase of 8,258,064 common shares at CAD 15.50 (approximately SEK 122) per share under the SIB and the cancellation of these shares.

Normal Course Issuer Bid

Following the completion of the SIB, we are continuing to distribute value to our shareholders by restarting share repurchases under our previously announced Normal Course Issuer Bid (NCIB). IPC implemented the current NCIB in December 2021. This program permits IPC to buy-back up to approximately 11.1 million shares, or approximately 7% of the total outstanding IPC shares at the time of launch, over the 12-month period up to December 2022. To date, IPC has purchased and cancelled approximately 8.3 million IPC shares under the program at a total purchase cost of approximately USD 65 million. The average price of IPC shares purchased to date under the NCIB is approximately SEK 80 per share. Since inception, IPC has repurchased a total of approximately 50 million IPC shares at an average price of SEK 55 per share. As at August 2, 2022, IPC had a total of 139,377,607 common shares issued and outstanding.

Environmental, Social and Governance (ESG) Performance

ESG performance remains a priority for all operational assets. Our objective is to reduce risk and eliminate hazards to prevent the occurrence of accidents, ill health and environmental damage, as these are essential to the success of our operations. During the second quarter of 2022, IPC recorded no material safety or environmental incidents.

Sustainability Reporting

Responsible operatorship and ensuring that we adhere to the highest principles of business conduct have been an integral part of how we do business since the creation of IPC in 2017. An important part of our sustainability journey involves the measurement and transparent reporting of a broad range of ESG metrics. Alongside the publication of our second quarter 2022 financial report, we are very pleased that IPC is today presenting to our stakeholders our third Sustainability Report. The Sustainability Report 2021 details the Corporation’s ESG performance. The Sustainability Report 2021 advances the Corporation’s non-financial sustainability disclosures and provides stakeholders with relevant operational and sustainability context in which IPC operates, as well as the Corporation’s management approach and performance with respect to these areas. The Corporation’s ESG disclosure follows the Global Reporting Initiative standards and is Task Force on Climate-Related Financial Disclosures (TCFD) aligned. It is also IPC’s third Communication on Progress to the UN Global Compact. The report is available on IPC’s website at www.international-petroleum.com.

Highlights of IPC’s sustainability performance for 2021 include:

Environment • On track with our commitment to reducing net GHG emissions intensity by 50% by the end of 2025 • 29,532 tonnes of CO2e credits generated through emission reduction initiatives • More than doubled carbon offsets compared to 2020 with 215,000 tonnes of CO2e Social • Strong health & safety performance with zero severe incidents and a lost time incident rate of 0.6 in 2021, and proactive COVID-19 management • Workforce drawn 99% from local hiring and composed of 31% women • Meaningful support and engagement with local communities such as working with First Nations businesses and contributing to community mental health programs Governance • Established Values and Vision following company-wide materiality assessment • Development of a new approach to sustainability • Alignment with the recommendations of the TCFD on climate-related risks and opportunities We encourage everyone to read IPC’s third Sustainability Report and see first-hand the sustainability work that is being done within our company.

Notes:

(1) See “Supplemental Information regarding Product Types” in “Disclosure of Oil and Gas Information” below. See also the annual information form for the year ended December 31, 2021 (AIF) available on IPC’s website at www.international-petroleum.com and under IPC’s profile on SEDAR at www.sedar.com.(2) Non-IFRS measure, see “Non-IFRS Measures” below.(3) See “Disclosure of Oil and Gas Information“ below. Further information with respect to IPC’s reserves, contingent resources and estimates of future net revenue, are further described in the AIF.(4) Estimated FCF generation is based on IPC’s current business plans over the period of 2022 to 2026. Assumptions include average net production over that period of approximately 47 Mboepd, average Brent oil prices of USD 65 to 95 per boe escalating by 2% per year, average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials as estimated by IPC’s independent reserves evaluator and as further described in the AIF. Free cash flow yield is based on IPC’s market capitalization at close July 29, 2022 (123.6 SEK/share, 10.2 SEK/USD, USD 1,688 million). IPC’s current business plans and assumptions, and the business environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts. See “Forward-Looking Statements” below.