Calgary, Alberta - Bengal Energy Ltd. (TSX: BNG) ('Bengal' or the 'Company') announces its financial and operating results for the third quarter of fiscal 2023 ended December 31, 2022.

THIRD QUARTER FISCAL 2023 HIGHLIGHTS:

The following is an overview of the financial and operational results during the three and nine-months ending December 31, 2022. All amounts are in Canadian funds unless otherwise noted:

Financial Summary:

Sales Revenue - Crude oil sales revenue was $1.6 million in the third quarter of fiscal 2023, which is 13% lower than the $1.9 million recorded in Q3 fiscal 2022. The lower sales revenue is due to decreased realized crude oil prices during the quarter, which impacted crude sales and resulted in a $0.5 million reduction in the accrued value of pipeline oil as defined on page 6 of the Company's December 31, 2022 MD&A.

Funds from (used in) Operations1 - Bengal used $35 thousand of funds from operations during Q3 fiscal 2023. During Q3 fiscal 2022, Bengal generated $0.8 of funds from operations. Bengal generated $0.7 million of cash from operations during Q3 fiscal 2023 compared to $0.6 million of cash from operations in Q3 fiscal 2022. The difference between funds from operations and cash flow from operations during Q3 fiscal 2022 is impacted by the reduction in value of accrued accounts receivable as described above.

Net Income - Bengal reported a net loss of $0.4 million for the current quarter compared to net loss of $0.5 million in Q3 fiscal 2022.

Operational Summary:

Production Volumes - The Company's share of total Cuisinier production in the current quarter was 16,532 barrels of crude oil ('bbls') or 180 barrels of oil per day ('bopd'), which is a 4% increase from the 15,966 bbls or 174 bopd produced in the previous quarter (Q2 fiscal 2023). Production resumed at the Cuisinier 29 and Barta North 1 wells during December 2022 and the Cuisinier waterflood pilot, which commenced activity in calendar Q4 2021 has started to demonstrate encouraging results. The Barta Joint Venture ('JV') has observed compelling evidence that the overall field decline has been temporarily arrested with a general upward trend in oil production rates at the wells surrounding the pilot injection location since December 2021.

Capital Expenditures - Bengal continued work on its development projects at Wareena 1 and Wareena 5 as well as its operational readiness program in anticipation of commencing 100% Bengal controlled operations during the year. These activities continued unexpectedly into the third quarter of fiscal 2023 due to unprecedented wet weather conditions in the Cooper Basin, which restricted access to the Company's assets and resulted in unplanned labour, mobilization and equipment costs.

Potential Commercial Area ('PCA') 332 - Bengal has been awarded PCA 332 over an area of 343 square kilometers that was previously covered by Bengal's Authority to Prospect ('ATP') 732. The grant of PCA 332 provides a 15-year term with no relinquishments for the company to pursue the development of its highly prospective oil and gas portfolio in Queensland's Cooper Basin.

BUSINESS OVERVIEW

Bengal's producing and non-producing assets are situated primarily in Australia's Cooper Basin, a region featuring large accumulations of very light and high-quality crude oil and natural gas. The Company's core Australian assets, Petroleum Lease ('PL') 303 Cuisinier, ATP 934 Barrolka, ATP 732 Tookoonooka, and its four 100% operated petroleum licenses (PL 114 Wareena, PL 157 Ghina, PL 188 Ramses, PL 411 Karnak) are situated within an area of the Cooper Basin that is well served with production infrastructure and take-away capacity for produced crude oil and natural gas. While still in early stages in terms of appraisal and development, Bengal believes these assets offer attractive upside potential for both oil and gas. Australia presents a stable political, fiscal and economic environment in which to operate, and a favourable royalty regime for oil and gas production.

Under the State of Queensland Regulatory process, ATPs are granted by the State generally for a period of twelve years with one third of the original grant area expiring every four years. At the end of the final term of the ATP, an application can be made to continue a portion of the permit in the form of a PCA. PCAs have a life span of five to fifteen years. PCA applications include a commercial viability report that indicates that the area is likely to be commercially viable within the applied term. This allows for extra time to commercialize the resource. These PCA's remain a part of the ATP until expiry. If a discovery of oil or gas is made, an application for a PL is made to allow for production. PLs are granted for up to a thirty-year term.

Bengal has two PLs on the former ATP 752 Barta block, PL 303 and PL 1028, in addition to three PCAs, PCA 206, PCA 207 Barta West and PCA 155 Wompi block-Nubba/Yilgarn. Bengal also holds four PLs including a pipeline license PPL 138 adjacent to the 100% owned ATP 934.

AUSTRALIA - Cooper Basin, Queensland

PL303 and PL 1028 Cuisinier (controlling permit ATP 752) (30.357% WI)

A pilot water injection-driven reservoir pressure maintenance scheme was initiated during the prior fiscal year and after resolving mechanical issues, water injection activities commenced during calendar Q4 2021. This project is located in the southeast quadrant of the Cuisinier pool, with injection of water taking place at the Cuisinier 24 well. The broad nature of the Cuisinier structure combined with variable flank aquifer pressure support has resulted in pressure depletion within the central portion of the Cuisinier pool. The injection of produced formation water is anticipated to both increase production in up to four offsetting wells and reduce water handling charges. On establishing success of the pilot, the JV will begin a multi-staged water injection scheme, targeted fracture stimulation, and more commercially efficient development drilling. The JV has observed compelling evidence that the overall field decline has been temporarily arrested with a modest upward trend in oil production rate in affected wells during the current quarter.

PL 114 Wareena, PL 157 Ghina, PL 188 Ramses, PL 411 Karnak, PPL 138 pipeline (100% WI)

The Company has a 100% working interest in four PLs and a natural gas pipeline connected to transportation infrastructure into the Eastern Australia Gas Market. These non-productive PLs are highly compatible with and in close proximity to ATP 934. Bengal continues to integrate subsurface data from the PLs to enhance the Company's understanding of ATP 934 and to finalize the selection of exploration and appraisal drilling locations.

Included in this program is the reinstatement of two gas wells and an existing gas pipeline to produce raw gas into existing infrastructure at PL 114 Wareena. The Company completed workover activities at Wareena 1 and Wareena 5 in November 2022. Initial test results indicate Wareena 1 would require additional stimulation and dewatering to yield commercial production rates. The Company is encouraged by wellhead pressure measured at Wareena 5 and therefore additional testing is planned subject to the availability of equipment. In the event that this testing yields commercial rates, Bengal will tie-in the producing well to pipeline PPL 138. The Company is investing in a proprietary proof of concept arrangement to allow commercial gas production prior to a pipeline connection with all required equipment now on site.

The 100% ownership of these assets presents an appraisal and development opportunity that will be operated by the Company and is seen as a key steppingstone for Bengal's natural gas platform upon which future development, appraisal at the existing PLs and exploration growth through ATP 934 can be undertaken.

ATP 732 Tookoonooka (100% WI)

In September 2019, the Company applied for an amendment to a Later Work Program ('LWP') for the third term of ATP 732 permit. On October 22, 2019, the Company received approval from the Queensland regulatory authority for an amended LWP for the third, four-year term commencing April 1, 2019, to March 31, 2023. The approved LWP was revised to minimum activities of reprocessing seismic and inversion work along with geological and geophysical investigation activities at an estimated cost of $0.5 million during the four-year term, all of which has been spent to date.

On the Caracal-1 well, the Company conducted an acid treatment to improve well bore inflow with positive results and moderate but not commercial inflow of very light 53 degree API gravity oil from the Wyandra zone. These results are being evaluated with a plan for fracture stimulation to further enhance productivity being put in place. Following fracture stimulation, the well could commence production using the Company's Early Oil Production System with the addition of storage and load-out infrastructure. Confirming the hydrocarbon flow potential of Caracal-1 allowed the Company to obtain the required proof of its geological migration model underpinning the lodgement of a PCA application.

ATP 732 reaches the end of its term in March of 2023 and the Company has lodged an application over the northern portion of the ATP for continuation in the form of PCA 332 for a further 15 years, which was approved on January 30, 2023. In addition, the Company is assessing farm-in interest on other 3D defined drilling targets on PCA 332. The PCA, granted by the Queensland Government in record time, provides much-needed certainty for Bengal to focus on its hydrocarbon projects in the Talgeberry-Tintaburra corridor. The majority of PCA 332 is covered by 3D seismic which has outlined the prospective targets as described in the Company's press release: 'Bengal Energy Announces Independent Oil and Natural Gas Resource Report' dated March 30, 2022.

Contact:

Bengal Energy Ltd.

Chayan Chakrabarty

President & Chief Executive Officer

Jerrad Blanchard

Chief Financial Officer

T: (403) 205-2526

Email: investor.relations@bengalenergy.ca

Website: www.bengalenergy.ca

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