# EDGAR Filing Document

**Accession Number:** 0001648636
**File Stem:** 0001493152-26-031307
**Filing Date:** 2026-6
**Character Count:** 158186
**Document Hash:** b405c7aae1d58de46cc3690721f1d54e
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-26-031307.hdr.sgml**: 20260630

**ACCESSION NUMBER**: 0001493152-26-031307

**CONFORMED SUBMISSION TYPE**: 6-K/A

**PUBLIC DOCUMENT COUNT**: 4

**CONFORMED PERIOD OF REPORT**: 20260630

**FILED AS OF DATE**: 20260630

**DATE AS OF CHANGE**: 20260630

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Trillion Energy International Inc.
- **CENTRAL INDEX KEY:** 0001648636
- **STANDARD INDUSTRIAL CLASSIFICATION:** CRUDE PETROLEUM & NATURAL GAS [1311]
- **ORGANIZATION NAME:** 01 Energy & Transportation
- **EIN:** 474488552
- **STATE OF INCORPORATION:** A1
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 6-K/A
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-55539
- **FILM NUMBER:** 261141403

**BUSINESS ADDRESS:**
- **STREET 1:** TURAN GUNES BULVARI,PARK ORAN OFIS PLAZA
- **STREET 2:** 180-Y, DAIRE:54, KAT:16
- **CITY:** ORAN, CANKAYA, ANKARA
- **STATE:** W8
- **ZIP:** 06450
- **BUSINESS PHONE:** 1 (250) 996-421

**MAIL ADDRESS:**
- **STREET 1:** TURAN GUNES BULVARI,PARK ORAN OFIS PLAZA
- **STREET 2:** 180-Y, DAIRE:54, KAT:16
- **CITY:** ORAN, CANKAYA, ANKARA
- **STATE:** W8
- **ZIP:** 06450

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Park Place Energy Inc.
- **DATE OF NAME CHANGE:** 20150720

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 6-K**

**REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934**

**June** **2026**

Commission File Number: 000-55539

**TRILLION ENERGY INTERNATIONAL INC.**

Suite 700, 838 W. Hastings Street, Vancouver, BC V6C 0A6

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

☒ Form 20-F ☐ Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes ☐ No ☒

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):

**Explanatory Note**

Trillion Energy International Inc. (the "Company") is furnishing this Form 6-K to provide its amended and restated condensed consolidated interim financial statements for the three months ended March 31, 2026, and 2025 and the amended and restated Management Discussion and Analysis ("MD&A") related thereto as filed in the SEDAR filing system.

The amended and restated MD&A and the amended and restated condensed consolidated interim financial statements for the three months ended March 31, 2026 supersede and replace the MD&A and the condensed consolidated interim financial statements for the same period that were filed on May 29, 2026 (together, the "originally filed Q1 documents")

The originally filed Q1 documents were prepared and filed without a review by the Company's auditors. Subsequent to that filing, the Company's auditors performed an interim review. Refer to Note 23 of the amended and restated condensed consolidated interim financial statements and the "Amended and Restated Financial Statements and MD&A" section of the amended and restated MD&A for details of the changes.

**Exhibits:**

**99.1** **[AMENDED AND RESTATED CONSOLIDATED INTERIM FINANCIAL STATEMENTs FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025](ex99-1.htm)** 

**99.2** **[AMENDED AND RESTATED MANAGEMENT DISCUSSION AND ANALYSIS](ex99-2.htm)** 

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **TRILLION ENERGY INTERNATIONAL INC.** | **TRILLION ENERGY INTERNATIONAL INC.** |
|  | (Registrant) | (Registrant) |
| Date: June 30, 2026 | By: | */s/ David Thompson* |
|  |  | David Thompson |
|  |  | Chief Financial Officer |

---

## Exhibit 99.1

**Exhibit 99.1**

**Trillion Energy International Inc.**

AMENDED AND RESTATED<sup>(1)</sup> CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025

*(Unaudited – Stated in United States dollars)*

**<sup>(1)</sup> Amended and Restated Condensed Consolidated Interim Financial Statements**

These condensed consolidated interim financial statements for the three months ended March 31, 2026 are amended and restated. They supersede and replace the condensed consolidated interim financial statements for the same period that were originally prepared by management and filed on May 29, 2026 (the "originally filed interim financial statements").

The originally filed interim financial statements were prepared and filed without a review by the Company's auditors. Subsequent to that filing, the Company's auditors performed an interim review. Refer to Note 23 for details of the changes.

**TRILLION ENERGY INTERNATIONAL INC.** 

**Index to the Amended and Restated Condensed Consolidated Interim Financial Statements**

---

| | |
|:---|:---|
|  | Page |
| [Consolidated interim statements of financial position (unaudited)](#FIN_001) | 2 |
| [Consolidated interim statements of income and comprehensive income (unaudited)](#FIN_002) | 3 |
| [Consolidated interim statements of stockholders' equity (unaudited)](#FIN_003) | 4 |
| [Consolidated interim statements of cash flows (unaudited)](#FIN_004) | 5 |
| [Notes to the condensed consolidated interim financial statements (unaudited)](#FIN_005) | 6 |

---

**TRILLION ENERGY INTERNATIONAL INC.**

Consolidated Interim Statements of Financial Position

(Expressed in U.S. dollars)

---

| | | | |
|:---|:---|:---|:---|
|  | **Notes** | <br> **(Restated – Note 23)**<br> **March 31,**<br> **2026**<br> **(Unaudited)** | **December 31,**<br> **2025**<br> **(Audited)** |
| **ASSETS** |  |  |  |
| **Current assets** |  |  |  |
| Cash and cash equivalents |  |  |  |
| Amounts receivable | 4 |  |  |
| Prepaid expenses and deposits | 5 |  |  |
| Assets held for sale | 3 |  |  |
| **Total current assets** |  |  |  |
| Oil and gas properties, net | 6 |  |  |
| Property and equipment, net | 7 |  |  |
| Long-term deposits |  |  |  |
| **TOTAL ASSETS** |  |  |  |
| **LIABILITIES AND STOCKHOLDERS' DEFICIENCY** |  |  |  |
| **Current liabilities** |  |  |  |
| Accounts payable and accrued liabilities | 816 |  |  |
| Loans payable | 916 |  |  |
| Convertible debt | 10 |  |  |
| Liabilities held for sale | 3 |  |  |
| **Total current liabilities** |  |  |  |
| Asset retirement obligation | 11 |  |  |
| **TOTAL LIABILITIES** |  |  |  |
| **Stockholders' deficiency** |  |  |  |
| Share capital |  |  |  |
| Warrant and option reserve |  |  |  |
| Obligation to issue shares | 16 |  |  |
| Accumulated other comprehensive loss |  |  |  |
| Accumulated deficit |  |  |  |
| **TOTAL STOCKHOLDERS' DEFICIENCY** |  |  |  |
| **TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY** |  |  |  |

---

Nature of operations (Note 1)

Commitments and Contingencies (Note 21)

Subsequent events (Note 22)

---

| | |
|:---|:---|
| APPROVED BY THE BOARD OF DIRECTORS ON MAY 29, 2026: | APPROVED BY THE BOARD OF DIRECTORS ON MAY 29, 2026: |
| *"Sean Stofer"* | *"David Thompson"* |
| Director | Director |

---

See accompanying notes to condensed consolidated interim financial statements.

**TRILLION ENERGY INTERNATIONAL INC.**

Consolidated Statements of Income and Comprehensive Income

(Expressed in U.S. dollars)

(Unaudited)

---

| | |
|:---|:---|
|  | **Notes** |
| **Expenses** |  |
| Depreciation | 7 |
| Stock-based compensation | 131415 |
| General and administrative | 17 |
| Total expenses |  |
| **Loss before other income (expenses)))** |  |
| **Other income (expenses)** |  |
| Interest (expense) income |  |
| Finance cost | 910) |
| Foreign exchange (loss) income |  |
| Gain on debt settlement | 12 |
| Gain on net monetary position | 2 |
| Gain on debt extinguishment | 10 |
| Fair value loss on remeasurement of convertible debenture | 10 |
| Total other income (expenses) |  |
| Net income (loss) from continuing operations |  |
| Net (loss) income from discontinued operations, net of tax | 3 |
| **Total net income** |  |
| **Other comprehensive income (loss)**<br>|  |
| Items that may be reclassified subsequently to net income (loss): |  |
| &nbsp;&nbsp;&nbsp;Continuing operations: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign currency translation |  |
| &nbsp;&nbsp;&nbsp;Discontinued operations: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign currency translation – foreign subsidiary held for sale |  |
| Total other comprehensive income (loss) |  |
| **Total comprehensive income** |  |
| **Total comprehensive income (loss) attributable to:** |  |
| Continuing operations) |  |
| Discontinued operations |  |
| **Total comprehensive income** |  |
| **Earnings (loss) per share** |  |
| Basic and diluted from continuing operations) |  |
| Basic and diluted from discontinued operations |  |
| **Weighted average shares outstanding** |  |
| Basic and diluted |  |

---

<sup>(1)</sup> The comparative information has been re-presented to account for a discontinued operation (Note 3).

See accompanying notes to condensed consolidated interim financial statements.

**TRILLION ENERGY INTERNATIONAL INC.**

Consolidated Interim Statements of Stockholders' Equity

(Expressed in U.S. dollars)

(Unaudited)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Shares** | **Share<br> capital** | **Warrant<br> and option<br> reserve** | **Receivables<br> for equity<br> issued** | **Obligation<br> to issue<br> shares** | **Shares<br> to be<br> cancelled** |
|  | | **$** | **$** | **$** | **$** | **$** |
| **Balance, December 31, 2024** | **31897753** | **78382631** | **7209546)** |  | **6000** | **7645))** |
| Stock issued for debt settlement | 351416 | 50811 |  |  |  |  |
| Stock issued for services | 351883 | 61385 |  |  |  |  |
| Net income and comprehensive income | – | – | – |  | – | – |
| **Balance, March 31, 2025** | **32601052** | **78494827** | **7209546)** |  | **6000** | **7645))** |
| **Balance, December 31, 2025** | **41624407** | **79611590** | **7228089** |  | **54042** | –**)))** |
| Obligation to issue shares for services |  |  |  |  | 20986 |  |
| Stock-based compensation – RSUs |  |  | 3438 |  |  |  |
| Net loss and comprehensive loss | – | – | – |  | – | – |
| **Balance, March 31, 2026 (Restated – Note 23)** | **41624407** | **79611590** | **7231527** |  | **75028** | – |

---

See accompanying notes to condensed consolidated interim financial statements.

**TRILLION ENERGY INTERNATIONAL INC.**

Consolidated Interim Statements of Cash Flows

(Expressed in U.S. dollars)

(Unaudited)

---

| |
|:---|
| **OPERATING ACTIVITIES** |
| Total net income |
| Adjustments to reconcile net loss to net cash used in operating activities: |
| &nbsp;&nbsp;&nbsp;Stock-based compensation |
| &nbsp;&nbsp;&nbsp;Stock issued for services |
| &nbsp;&nbsp;&nbsp;Depletion |
| &nbsp;&nbsp;&nbsp;Depreciation |
| &nbsp;&nbsp;&nbsp;Accretion of asset retirement obligation |
| &nbsp;&nbsp;&nbsp;Accretion and accrued interest expense |
| &nbsp;&nbsp;&nbsp;Change in asset retirement obligation estimate) |
| &nbsp;&nbsp;&nbsp;Unrealized foreign exchange loss |
| &nbsp;&nbsp;&nbsp;Gain on revaluation for assets held for sale) |
| &nbsp;&nbsp;&nbsp;Gain on debt settlement) |
| &nbsp;&nbsp;&nbsp;Loss (gain) on net monetary position |
| &nbsp;&nbsp;&nbsp;Deferred tax expense |
| &nbsp;&nbsp;&nbsp;Gain on debt extinguishment) |
| &nbsp;&nbsp;&nbsp;Fair value loss on remeasurement of convertible debenture |
| Changes in non-cash working capital items: |
| &nbsp;&nbsp;&nbsp;Amounts receivable |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and deposits) |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities |
| **Net cash (used in) provided by operating activities** |
| **INVESTING ACTIVITIES** |
| Oil and gas properties expenditures) |
| Advances from JV Partners |
| Changes in non-cash working capital items: |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and deposits) |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities |
| **Net cash used in investing activities** |
| **FINANCING ACTIVITIES** |
| Repayments of loans payable) |
| Lease payments |
| **Net cash used in financing activities** |
| Effect of exchange rate changes on cash and cash equivalents |
| Net decrease in cash and cash equivalents) |
| Cash and cash equivalents, beginning of period |
| Cash and cash equivalents included in assets held for sale |
| **Cash and cash equivalents, end of period** |
| **Supplemental cash flow information** |
| Interest paid on credit facilities |
| **Non-cash investing and financing activities:** |
| &nbsp;&nbsp;&nbsp;Stock issued for debt settlement |
| &nbsp;&nbsp;&nbsp;Stock issued for services |

---

Refer to Note 3 for disclosure of cash flows attributable to discontinued operations.

See accompanying notes to condensed consolidated interim financial statements.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**1.** **Organization and going concern** 

Trillion Energy International Inc. and its consolidated subsidiaries, (collectively referred to as the "Company") is a Canadian based oil and gas exploration and production company. Effective January 2022, the corporate headquarters moved to Suite 700, 838 West Hastings Street, Vancouver, B.C., Canada from Turan Gunes Bulvari, Park Oran Ofis Plaza, 180-y, Daire:54, Kat:14, 06450, Oran, Cankaya, Anakara, Turkey. The Company also has a registered office in Canada. The Company is incorporated in British Columbia. The Company's shares trade on the OTCQB under the symbol "TRLEF" and trade on the Canadian Securities Exchange (the "Exchange") under the symbol "TCF".

On January 21, 2022, the Company redomiciled from Delaware to a British Columbia corporation by way of an amalgamation transaction with the Company's British Columbian subsidiary, Trillion Energy Inc. (the "Repatriation Transaction"). Pursuant to the Repatriation Transaction, for every one common stock of Trillion Energy International Inc., the shareholders will receive one common stock of Trillion Energy Inc. The Company will continue to operate and report under the name of Trillion Energy International Inc.

As a result of the Repatriation Transaction, the Company meets the definition of a foreign private issuer, as defined under Rule 3b-4 of the Securities Exchange Act of 1934, as amended.

In April 2026, the Company consolidated its issued share capital on a ratio of five old common shares for every one new post-consolidated common share. All current and comparative references to the number of common shares, weighted average number of common shares, loss per share, stock options and warrants have been restated to give effect to this share consolidation.

**Discontinued operations:**

During the period, the Company committed to a plan to dispose of its wholly-owned subsidiary, Park Place Energy Turkey ("PPE Turkey"), which holds the Company's license interests in the SASB natural gas project and the Cendere oil field. Accordingly, the assets and liabilities of PPE Turkey have been classified as held for sale, and the results of PPE Turkey have been presented as a discontinued operation in these condensed consolidated interim financial statements in accordance with *IFRS 5, Non-current Assets Held for Sale and Discontinued Operations*. The consolidated interim statements of income (loss) and comprehensive income (loss) and the related notes for the comparative period have been re-presented to show the discontinued operation separately from continuing operations. In accordance with IFRS 5, the consolidated statement of financial position for the comparative period has not been re-presented.

Subsequent to the reporting date, in April 2026, the Company entered into a definitive agreement for the sale of all of the issued and outstanding shares of PPE Turkey. Further information regarding the discontinued operation and the subsequent sale agreement is provided in Note 3 and Note 22.

**Going concern:**

These condensed consolidated interim financial statements have been prepared on the assumption that the Company will continue as a going concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. As at March 31, 2026, the Company's current liabilities exceeded its current assets by $31,978,020 ($9,332,020 excluding assets and liabilities held for sale) (December 31, 2025 – $34,373,381) and its accumulated deficit amounts to $97,454,624 (December 31, 2025 – $103,230,389). For the three months ended March 31, 2026, cash used in operating activities was $147,515 (2025 – $462,943 net cash provided in operating activities). The Company's continuation as a going concern is dependent upon its ability to complete financing sufficient to meet current and future obligations, the successful results from its business activities, and its ability to operate profitably and generate funds. Although the Company raised capital in previous reporting periods, additional funding will be required to continue current operations and further advance its existing oil and gas assets in the upcoming 12 months. These factors indicate the existence of material uncertainty which raises substantial doubt about the Company's ability to continue as a going concern.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**2.** **Basis of Presentation and Material Accounting Policies** 

(a) Statement
 of Compliance

 

These unaudited condensed consolidated interim financial statements of the Company have been prepared in accordance with International Financial Reporting Standards ("IFRS") applicable to the preparation of condensed interim financial statements, including International Accounting Standards ("IAS") 34, Interim Financial Reporting, as issued by the International Accounting Standards Board ("IASB"), and the Interpretations of the International Financial Reporting Interpretations Committee ("IFRIC"). Accordingly, certain disclosures included in annual financial statements have been condensed or omitted and these unaudited condensed consolidated interim financial statements should be read in conjunction with the Company's audited consolidated financial statements for the year ended December 31, 2025.

(b) Use
 of Estimates and Judgments

The Company's management makes judgments in its process of applying the Company's accounting policies in the preparation of its unaudited condensed consolidated interim financial statements. In addition, the preparation of the financial data requires that the Company's management make assumptions and estimates of the effects of uncertain future events on the carrying amounts of the Company's assets and liabilities at the end of the reporting period and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates as the estimation process is inherently uncertain. Estimates are reviewed on an ongoing basis based on historical experience and other factors that are considered to be relevant under the circumstances. Revisions to estimates and the resulting effects on the carrying amounts of the Company's assets and liabilities are accounted for prospectively. The critical judgments and estimates applied in the preparation of the Company's condensed consolidated interim financial statements are consistent with those applied and disclosed in the Company's consolidated financial statements for the year ended December 31, 2025.

(c) Basis
 of Consolidation

These condensed consolidated interim financial statements include the accounts of the Company and its wholly owned subsidiaries Park Place Energy Corp. ("PPE Corp."), Park Place Energy Bermuda ("PPE Bermuda"), BG Exploration EOOD ("BG Exploration"), and PPE Turkey.

The Company's oil and gas operations are conducted jointly with its joint venture partner (Note 6). The joint arrangement meets the definition of a joint operation under IFRS 11, "Joint Arrangements" ("IFRS 11"); therefore, the Company's share of the assets, liabilities, revenues and expenses are recorded in the consolidated financial statements. All intercompany balances and transactions are eliminated on consolidation.

---

| | | | |
|:---|:---|:---|:---|
| Name of the joint <br>arrangement | Nature of the relationship <br>with the joint arrangement | Principal place of operation <br>of joint arrangement | Proportion of <br>participating share |
| South Akcakoca Sub-Basin ("SASB") | Operator | Turkey | 49% |
| Cendere | Participant | Turkey | 19.6% |

---

(d) Functional
 and Presentation Currency

The condensed consolidated interim financial statements are expressed in U.S. dollars. The functional currency of BG Exploration is the Bulgarian Lev. The functional currency of the Company's Turkish operations is the Turkish Lira ("₺"). The functional currency of the Company's Bermuda subsidiary is the United States dollar ("USD"), and the function currency of PPE Corp is the USD.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**2.** **Basis of Presentation and Material Accounting Policies (continued)** 

(e) Basis
 of Measurement

These condensed consolidated interim financial statements have been prepared on a historical cost basis except for certain derivative liabilities, which are measured at fair value.

(f) Hyperinflation

Due to various qualitative factors and developments with respect to the economic environment in Turkey, including but not limited to, the acceleration of multiple local inflation indices, the three-year cumulative inflation rate of the local Turkish wholesale price index exceeding 100% at the end of February 2022 and the significant devaluation of the Turkish Lira, Turkey has been designated a hyper-inflationary economy as of April 1, 2022 for accounting purposes.

Accordingly, IAS 29, Financial Reporting in Hyper-Inflationary Economies was adopted by the Company in its consolidated financial statements and applied to these consolidated financial statements in relation to PPE Turkey. The condensed consolidated interim financial statements are based on the historical cost approach in IAS 29.

The application of hyperinflation accounting requires restatement of PPE Turkey's non-monetary assets and liabilities, equity and comprehensive income (loss) items from the original transaction date when they were first recognized into the current purchasing power which reflects a general price index current at the end of the reporting period. To measure the impact of inflation on its financial statements and results, the Company has elected to use the consumer price index ("CPI") as published by the Turkish Statistical Institute "TURKSTAT".

IAS 29 also requires the restatement of comparative periods for the effects of hyperinflation unless the comparatives were previously presented in a different presentation currency of a non-hyperinflationary economy. The condensed consolidated interim financial statements of the Company are presented in US dollars, a stable currency, and as a result the comparative amounts do not require restatement.

On April 1, 2022, the Company recognized an adjustment of $473,907 for the impact of hyperinflation within accumulated other comprehensive loss related to the non-monetary assets held by PPE Turkey, which have been restated from the historic date when they were first recognized to the beginning of the reporting period (the "Opening Hyperinflation Adjustment"). On initial adoption of IAS 29, there is an accounting policy choice to recognize the Opening Hyperinflation Adjustment directly to opening equity or to other comprehensive income and the Company has elected to recognize this amount directly to opening equity.

The value of the CPI at March 31, 2026, was 121 (December 31, 2025 - 110) and the movement in the CPI for the three months ended March 31, 2026 was 11 (2025 – 8), an increase of approximately 10% (2025 – 10%). During FY2026 Turkstat updated the basis year for their CPI calculation from 2003 to 2025, the CPI figures have been updated to represent this change. As a result of the change in CPI, the Company recognized a gain on net monetary position of $5 in continuing operations for the three months ended March 31, 2026 (2025 – $Nil) to restate transactions into a measuring unit current as of each period end. In addition, the Company recognized a loss on net monetary position of $89,017 in discontinued operations for the three months ended March 31, 2026 (2025 – gain of $4,637,618) to restate transactions into a measuring unit current as of each period end.

(g) New
 Material Accounting Policies

The accounting policies applied in these condensed consolidated interim financial statements are consistent with those applied and disclosed in the Company's audited financial statements for the year ended December 31, 2025 except for the following not previously disclosed:

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**2.** **Basis of Presentation and Material Accounting Policies (continued)** 

<u>Assets and liabilities held for sale and discontinued operations:</u> 

Assets and disposal groups are classified as held for sale if their carrying amounts will be recovered through a sale transaction rather than through continuing use. This condition is met when the sale is highly probable, the asset is available for immediate sale in its present condition and the sale is expected to be completed within one year from the date of classification.

Assets and disposal groups are classified and presented as discontinued operations if the assets or disposal groups are disposed of or classified as held for sale and:

● The
 assets or disposal groups are a major line of business or geographical area of operations;

● The
 assets or disposal groups are part of a single coordinated plan to dispose of a separate major line of business or geographical area
 of operations; or,

● The
 assets or disposal groups are a subsidiary acquired solely for the purpose of resale.

A component that is a separate major line of business or geographical area of operations and has been disposed of, closed, abandoned or terminated is also classified as a discontinued operation.

The assets or disposal groups that meet these criteria are measured at the lower of carrying amount and fair value less cost of disposal, with impairments recognized in the consolidated statements of income (loss) and comprehensive income (loss). An impairment loss is recognized for any initial or subsequent write-down of the asset or disposal group to fair value less cost to dispose. Non-current assets and liabilities held for sale are presented separately in current assets and liabilities within the consolidated statement of financial position. Assets held for sale are not depreciated, depleted or amortized. The comparative period consolidated statement of financial position is not re-presented.

The results of discontinued operations, net of tax, are shown separately in the consolidated statements of income (loss) and comprehensive income (loss) and comparative figures are re-presented.

<u>Convertible debentures — modification and designation at fair value through profit or loss</u>

During the three months ended March 31, 2026, the Company and the holders of its 12.0% convertible debentures agreed to amend the terms of the debentures pursuant to a fourth supplemental debenture indenture. The Company assessed the amendment under IFRS 9 and concluded that it resulted in terms substantially different from those of the original debentures. Accordingly, the original financial liability was derecognized and a new financial liability was recognized at its fair value on the date of modification, with the difference between the carrying amount of the original liability and the fair value of the new liability recognized in profit or loss as a gain on extinguishment.

The new financial liability is a hybrid instrument comprising a debt host and an embedded conversion feature that would otherwise require separation. As permitted under IFRS 9, the Company has irrevocably designated the entire instrument as at fair value through profit or loss on initial recognition, rather than separating the embedded derivative, as this eliminates the measurement inconsistency that would otherwise arise. The instrument is subsequently measured at fair value at each reporting date, with changes in fair value recognized in profit or loss, except for any change attributable to the Company's own credit risk, which is recognized in other comprehensive income unless doing so would create or enlarge an accounting mismatch.

The fair value of the new instrument is determined using a probability-weighted expected present value technique and is classified within Level 3 of the fair value hierarchy, as the measurement relies on significant unobservable inputs, including the estimated probability of completing the related equity financing and the estimated recovery rate in the event the financing is not completed.

In April 2026, the Company, through a subsidiary, entered into an agreement (the "SPA") to sell all of the issued and outstanding shares of PPE Turkey, which holds the Company's license interests in the SASB natural gas project and the Cendere oil field.

Under the terms of the SPA, the purchaser will assume the assets and liabilities associated with PPE Turkey. In connection with the transaction, the Company will retain a 7% gross overriding royalty on future production revenues from the underlying licenses. The royalty becomes payable once cumulative gross revenues from the licenses following closing exceed $7.5 million and may also be realized upon any future disposition of the licenses by the purchaser.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**3.** **Assets and Liabilities Held for Sale and Discontinued Operations** 

From the date of closing, the Company does not hold any shareholding, voting rights, board representation or management role in PPE Turkey, and the Company has no power to direct or control the activities of PPE Turkey. All directors and officers of PPE Turkey affiliated with the Company resigned effective on or before the closing date.

The Company's continuing involvement with PPE Turkey following the disposal is limited to the following:

&nbsp;&nbsp;&nbsp;&nbsp;(a) Gross
 overriding royalty. The Company retained a 7% gross overriding royalty on production revenue
 from the SASB gas field and the Cendere oil field, together with related audit and information
 rights, including the receipt of monthly cumulative production revenue statements.

&nbsp;&nbsp;&nbsp;&nbsp;(b) Transition
 services agreement. Effective April 7, 2026, the Company entered into an agreement (the "Transition
 Agreement") with the purchaser under which the purchaser is responsible for the post-closing
 transition of PPE Turkey, including retaining Turkish legal counsel, notifying the General
 Directorate of Mining and Petroleum Affairs of the Republic of Türkiye ("MAPEG")
 of the change in ownership of PPE Turkey, completing the regulatory steps required for PPE
 Turkey's continued operation of its petroleum licences, and maintaining professional working
 relationships with the Turkish Petroleum Corporation ("TPAO"), MAPEG and other
 Turkish governmental authorities. The purchaser has agreed not to act in a manner adverse
 to the business, operations or regulatory standing of the Company or its subsidiaries operating
 in Türkiye, and the purchaser's liability under the Transition Agreement is uncapped.

In consideration, the Company agreed to pay (i) a service fee of CAD $25,000, which was earned upon execution of the agreement and is non-refundable, and (ii) CAD $25,000 on account of anticipated legal fees in connection with the regulatory filings described above, with the purchaser responsible for funding all legal fees and related costs incurred. The agreement has a term of six months from the effective date and may be terminated by the Company for convenience on 30 days' written notice.

&nbsp;&nbsp;&nbsp;&nbsp;(c) Transition
 assistance. Under the SPA and the Transition Agreement, the Company will provide reasonable
 commercial assistance with licence-transfer requirements, including joint applications to
 MAPEG and/or TPAO as required, and, during the six-month transition period, limited handover
 support on a question-and-answer basis, including referrals of PPE Turkey's counterparties,
 creditors and contacts to PPE Turkey's new management, the provision of certain historical
 information and presentations, and the provision of information relevant to existing PPE
 Turkey litigation. No additional consideration is receivable or payable by the Company in
 respect of this assistance.

The following table summarizes the major line items for PPE Turkey that are included in loss (income) from discontinued operations, in the consolidated statements income (loss) and comprehensive income (loss):

---

| |
|:---|
| **Revenue** |
| Oil and gas revenue, net |
| **Cost and expenses** |
| Production |
| Depletion |
| Depreciation |
| Accretion of asset retirement obligation |
| Geological and geophysical expenses |
| General and administrative |
| Total expenses |
| **Loss before other income (expenses)))** |
| **Other income (expenses)** |
| Finance cost) |
| Foreign exchange gain (loss) |
| Gain on revaluation for assets held for sale |
| Gain (loss) on net monetary position |
| Change in estimate of asset retirement obligation |
| Total other income (expenses) |
| Deferred tax expense |
| **Loss (income) from discontinued operations** |

---

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**3.** **Assets and Liabilities Held for Sale and Discontinued Operations (continued)** 

The following table summarizes the carrying amounts of major classes of assets and liabilities of discontinued operations as at March 31, 2026:

---

| |
|:---|
| **Assets** |
| Cash and cash equivalents |
| Amounts receivable |
| Long-term deposits |
| Prepaid expenses and deposits |
| Oil and gas properties, net |
| Property and equipment, net |
| **Total assets held for sale** |
| **Liabilities** |
| Loans payable |
| Accounts payable and accrued liabilities |
| Asset retirement obligation |
| **Total liabilities held for sale** |
| **Total assets and liabilities held for sale, net** |

---

The following represents the cash flows from operating, investing and financing activities of discontinued operations for the three months ended March 31, 2026 and 2025.

---

| | |
|:---|:---|
|  | **March 31, 2026** |
|  | **$** |
| Net cash provided by operating activities |  |
| Net cash used in investing activities) |  |
| Net cash used in financing activities |  |

---

**4.** **Amounts Receivable** 

---

| | | |
|:---|:---|:---|
|  | **March 31, 2026** | **December 31, 2025** |
|  | **$** | **$** |
| Accounts receivable |  | 711984 |
| GST receivable | 33003 | 20610 |
| Interest receivable |  |  |
| Other | 5055 | 5159 |
|  | **38058** | 737753 |

---

**5.** **Prepaid Expenses and Deposits** 

---

| | | |
|:---|:---|:---|
|  | **March 31, 2026** | **December 31, 2025** |
|  | **$** | **$** |
| Exploration and production advances |  | 39924 |
| Prepaid expenses | 9893 | 6985 |
| Close-Out Fund | – | 756634 |
|  | 9893 | 803543 |
| Prepaid expenses and deposits – Current | 9893 | 46909 |
| Long-term deposits | – | 756634 |

---

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**6.** **Oil and Gas Properties** 

---

| |
|:---|
| **Cost** |
| As at December 31, 2024 |
| Additions |
| Sale of O&G assets) |
| JV Contribution) |
| Change in ARO estimate and additions |
| Currency translation adjustment) |
| Impact of hyperinflation |
| As at December 31, 2025 |
| Change in ARO estimate and additions) |
| Currency translation adjustment) |
| Impact of hyperinflation |
| Transfer to assets held for sale |
| As at March 31, 2026 |
| **Accumulated depletion and impairment** |
| As at December 31, 2024 |
| Depletion |
| Impairment |
| Currency translation adjustment) |
| Impact of hyperinflation |
| As at December 31, 2025 |
| Depletion |
| Currency translation adjustment) |
| Impact of hyperinflation |
| Transfer to assets held for sale |
| As at March 31, 2026 |
| **Net book value** |
| As at December 31, 2025 |
| **As at March 31, 2026** |

---

 

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**7.** **Property and Equipment** 

---

| | |
|:---|:---|
|  | **Motor Vehicles** |
|  | **$** |
| **Cost** |  |
| As at December 31, 2024 |  |
| Additions |  |
| Disposals) |  |
| Currency translation adjustment) |  |
| Impact of hyperinflation |  |
| As at December 31, 2025 |  |
| Currency translation adjustment) |  |
| Impact of hyperinflation |  |
| Transfer to assets held for sale |  |
| As at March 31, 2026 |  |
| **Accumulated depreciation** |  |
| As at December 31, 2024 |  |
| Depreciation |  |
| Disposals) |  |
| Currency translation adjustment) |  |
| Impact of hyperinflation |  |
| As at December 31, 2025 |  |
| Depreciation |  |
| Currency translation adjustment) |  |
| Impact of hyperinflation |  |
| Transfer to assets held for sale |  |
| As at March 31, 2026 |  |
| **Net Book Value** |  |
| As at December 31, 2025 |  |
| **As at March 31, 2026** |  |

---

**8.** **Accounts Payable and Accrued Liabilities** 

---

| | | |
|:---|:---|:---|
|  | **March 31, 2026** | **December 31, 2025** |
|  | **$** | **$** |
| Accounts payable | 1287457 | 16310709 |
| Accrued liabilities | 482418 | 2371047 |
| Payroll, withholding and sales tax liabilities | 80 | 110726 |
|  | **1769955** | **18792482** |

---

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**9.** **Loans Payable** 

---

| |
|:---|
| Unsecured, interest-bearing loan at 6% per annum<sup>2</sup> |
| Unsecured, interest-bearing loan at 1% per month<sup>1</sup> |
| Unsecured, interest-bearing loan at 12% per annum<sup>3</sup> |
| Unsecured, interest-bearing loan at a variable interest rate<sup>4</sup> |
| Total loans payable |
| Current portion of loans payable |
| Long-term portion of loans payable |

---

The Company is in compliance with all debt covenants on loans payable, other than as noted below, and has not received any waivers from lenders:

&nbsp;&nbsp;&nbsp;&nbsp;(1) On
 July 1, 2023, the Company entered into agreements with TR1 Master Fund to borrow $1,065,000 and $1,597,500. The loans were issued
 with a $65,000 and $97,500 discount, respectively, and bear an interest rate of 1% per month. The maturity date was December 31,
 2023, and the Company is claiming that the principal of TR1 Master Fund agreed to extend the loans to December 31, 2024. In the event
 that the loan is repaid in full prior to the maturity date, the minimum interest payments on the loans are $40,000 and $60,000, respectively.
 If, during the period that any amount of the loan remains outstanding, the Company issues any equity, the Lender may demand repayment
 of all or part of the principal amount of the loan in an amount equal to the aggregate subscription price of the equity offering.
 Accrued interest in excess of the minimum interest payments of $31,950 and $47,925, respectively, were recorded during the three
 months ended March 31, 2026 (March 31, 2025 - $31,950 and $47,925, respectively). The Company is currently in default on these
 loans, however, the Company has filed claims in connection with the ongoing receivership proceedings of the lender and related entities,
 and is seeking to offset any amounts outstanding against damages claimed by the Company (Note 21).

(2) On
 July 20, 2023, the Company entered into a promissory note for CAD$300,000 (USD$228,023) with a company controlled by a related party.
 The promissory note bears an interest rate of 6% per annum. The principal plus all accrued unpaid interest is to be repaid on demand
 but no later than December 31, 2024, as a result the Company is currently in default on this loan. During the year ended December
 31, 2025, CAD$8,000 (USD$5,536) of the principal balance was repaid and CAD$2,693 (USD$1,965) in interest was accrued. During the
 three months ended March 31, 2026, $Nil of the principal balance was repaid and CAD$688 (USD$494) in interest was accrued (March
 31, 2025 - CAD$8,000 (USD$5,536) of the principal balance was repaid and CAD$651 (USD$454) in interest was accrued).

(3) On
 December 27, 2024, the Company entered into a loan agreement with an officer of the Company for CAD$200,000 (USD$138,782). The loan
 bears interest at 12% per annum and is due on demand. As at December 31, 2025, the loan accrued interest of CAD$2,031 (USD$1,617).
 During the three months ended March 31, 2026, the loan accrued interest of CAD$499 (USD$358) (March 31, 2025 - CAD$5,984 (USD$4,168).
 The Company is not in default on this loan.

(4) On
 July 17, 2025, PPE Turkey drew down ₺50,000,000 (or approximately USD$1,202,380) from their overdraft facility with Ziraat
 Bankasi. This balance bears interest at a variable rate based on the banks effective interest rate (approximately 31%) payable at
 the end of each quarter. As at and for the year ended December 31, 2025, the loan accrued interest expense of $164,588. During the
 three months ended March 31, 2026, the loan accrued interest of $173,797 (March 31, 2025 - $Nil). The total amount payable
 of $1,299,592 was transferred to liabilities held for sale on March 31, 2026. The Company is not in default on this loan.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**10.** **Convertible debentures** 

On April 20, 2023, the Company entered into an agreement to issue 15,000 units of the Company (the "Units") at a price of CAD$1,000 per unit, for gross proceeds of CAD$15,000,000 (USD$11,135,145). Each Unit will consist of CAD$1,000 (approximately USD$742) principal amount secured convertible debenture ("Debenture") and 333 common share purchase warrants of the Company (the "Warrants"). Each Warrant will be exercisable for one common share of the Company at an exercise price of CAD$2.50 (approximately USD$1.86 at initial recognition) and shall have an expiry date of June 29, 2025.

The Debentures matured on April 30, 2025 (the "Maturity Date") and accrued interest at the rate of 12% per annum, payable semi-annually. The Company had the ability to redeem the Debentures at any time between the dates of April 30, 2024 and April 30, 2025 at a redemption price of 105% of the principal amount plus any accrued interest. At the holders' option, the Debentures may be converted into common shares of the Company at any time, up to the earlier of the Maturity Date and the redemption of the Debentures, at a conversion price of CAD$3.00 (approximately USD$2.23 at initial recognition) per common share.

The convertible debentures were determined to be a financial instrument comprising a host debt component, a conversion feature classified as equity, and freestanding warrants classified as equity. The warrants and conversion features were determined to be equity components because the exercise prices are denominated in the functional currency of the Company. Thus, these components meet the criterion of an equity instrument.

During the year ended December 31, 2025, the Company signed a second and third supplemental debenture indenture with the debenture holders to make the following modifications to the original debenture:

<u>Second Supplemental Debenture</u> 

● The semi-annual interest due as at April 30, 2025 will be payable in either cash or common shares of the Company;

● The convertible debentures' maturity date was extended from April 30, 2025 to July 31, 2025; and

● The debenture holders received an extension fee in the aggregate amount of CAD$85,000 payable in common shares as compensation for the above modifications.

<u>Third Supplemental Debenture</u> 

● The convertible debentures' maturity date was extended from July 31, 2025 to October 31, 2025.

These modifications were accounted for as an adjustment to the existing liability as the discounted present value of the cash-flows under the new terms did not exceed the quantitative threshold to be considered a substantial modification.

<u>Fourth Supplemental Indenture</u>

On March 20, 2026, the Company entered into a fourth supplemental debenture indenture (the "Fourth Supplemental Indenture") related to the Company's unsecured convertible debentures issued on April 20, 2023, bearing interest at 12% per annum.

The total amount owing under the convertible debentures will be comprised of the principal of CAD15.0 million and accrued interest to March 20, 2026 (the "Amount Due"). Pursuant to the Fourth Supplemental Indenture, and conditional upon the Company completing an equity financing of not less than CAD10.0 million on or before September 30, 2026, the following settlement terms will apply:

&nbsp;&nbsp;&nbsp;&nbsp;(1) approximately
 CAD11.0 million of the Amount Due will be converted into common shares of the Company at the same price as the equity financing;
 and,

(2) the
 remaining balance including accrued interest will be forgiven by the debenture holders.

If the Company does not complete the required financing by September 30, 2026, the Fourth Supplemental Indenture will terminate and the full Amount Due will remain payable in accordance with the original terms of the debentures.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**10.** **Convertible debentures (continued)** 

The Company concluded that the amendment substantially modifies the terms of the debentures and accounted for it as an extinguishment of the original financial liability and recognition of a new financial liability. The new financial liability is a hybrid instrument containing an embedded contingent equity conversion feature. Rather than separate the embedded derivative, the Company has designated the entire instrument to be measured at fair value through profit and loss.

A continuity schedule of the Company's convertible debt measured at amortized cost is as follows:

---

| | |
|:---|:---|
| **Balance as at December 31, 2024** | $**10364993** |
| Repayment through the issuance of shares | (649851) |
| Extension fee | (61379) |
| Gain on modification | (503624) |
| Accretion | 858838 |
| Interest | 1288067 |
| Currency translation adjustment | 526771 |
| **Balance as at December 31, 2025** | $11823815 |
| Interest | 284015 |
| Currency translation adjustment | (7760) |
| Extinguishment of convertible debt | (12100070) |
| **Balance as at March 31, 2026** | $**-** |

---

A continuity schedule of the Company's convertible debt measured at fair value through profit or loss is as follows:

---

| | |
|:---|:---|
| **Balance as at December 31, 2025** | $**-** |
| Recognition at fair value | 4172157 |
| Fair value loss on remeasurement | 22108 |
| Currency translation adjustment | (64551) |
| **Balance as at March 31, 2026** | $**4129714** |
| Current | $4129714 |
| Long-term | $– |

---

The Company recorded a gain on extinguishment of $7,927,913 upon derecognition of the previous financial liability and recognition of the new financial liability under the modified terms of the Fourth Supplemental Indenture.

**Fair value measurement**

The new financial liability recognized on extinguishment is measured at fair value through profit or loss on a recurring basis and is classified within Level 3 of the fair value hierarchy, as its measurement relies on significant unobservable inputs. The fair value was determined using a probability-weighted expected present value technique that considers the two mutually exclusive outcomes contemplated by the Fourth Supplemental Indenture: completion of the equity financing, in which approximately CAD$11.0 million of the Amount Due converts into common shares at the financing price and the remaining balance is forgiven; and non-completion of the financing, in which the full Amount Due is reinstated and recovery is estimated on a distressed basis.

The significant unobservable inputs used in the fair value measurement as at March 20, 2026 (initial recognition) and March 31, 2026 were as follows:

---

| | | |
|:---|:---|:---|
| **Unobservable input** | **Input used** | **Relationship to fair value** |
| Probability of completing the equity financing | 50% | An increase raises fair value toward the value of shares issuable on conversion |
| Estimated recovery rate if the financing is not completed | 9% | An increase raises the fair value of the liability in the non-completion scenario |
| Credit-adjusted discount rate | 18% | An increase decreases fair value |
| Expected term to resolution | September 30, 2026 | A longer term decreases fair value |

---

The fair value measurement is most sensitive to the estimated probability of completing the equity financing and the estimated recovery rate in the event the financing is not completed. Holding all other inputs constant, an increase or decrease of 10% in the probability of completing the financing would change the fair value of the liability, and correspondingly change the gain recognized in profit or loss, by approximately $627,900. A change of 5% in the estimated recovery rate would change the fair value of the liability by approximately $275,100.

There were no transfers into or out of Level 3 during the period. The change in the fair value of the liability during the period is presented in the continuity schedule above.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**11.** **Asset Retirement Obligation** 

The following is a continuity of asset retirement obligations:

---

| | |
|:---|:---|
|  | **December 31, 2025** |
|  | **$** |
| Beginning balance |  |
| Accretion expense |  |
| Impact of hyperinflation) |  |
| Currency translation adjustment |  |
| Change in estimate) |  |
| Transfer to liabilities held for sale (Note 3) |  |
| **Ending balance** |  |

---

The Company's asset retirement obligations ("ARO") result from its interest in oil and gas assets including well sites. The total ARO is estimated based on the Company's net ownership interest in all sites, estimated costs to reclaim and abandon these wells and the estimated timing of the costs to be included in future years. The Company estimated the total undiscounted amount required to settle the ARO as at March 31, 2026 is $8 million (December 31, 2025 – $8 million). The ARO is calculated using an inflation rate of 2.5% (December 31, 2025 – 2.5%) and discounted using a risk-free rate of 4.58% (December 31, 2025 – 4.49%) between 10 and 20 years.

During 2023, the Company and TPAO agreed to establish a close out-fund (the "Close-Out Fund") in a US dollar bank account. The amounts accumulated in the Close-Out Fund will not be used for any purpose other than to cover the cost of close-out of the SASB project. The US dollar bank account is held by TPAO. Starting with the July 2023 natural gas revenue, each party agreed to transfer 10% of its revenue into the Close-Out Fund on a monthly basis, until an amount agreed to by both parties is attained. The Company accounted for its share in the Close-Out Fund as a long-term deposit. As at March 31, 2026, the Company share of the Close-Out Fund amounted to $756,634 (December 31, 2025 – $756,634). During the three months ended March 31, 2026 the $756,634 deposit was reclassified to assets held for sale (Note 3).

**12.** **Common Stock** 

The Company has an unlimited number of common shares authorized with no par value. As at March 31, 2026, 41,624,407 common shares were issued and outstanding (December 31, 2025 – 41,624,407).

*For the three months ended March 31, 2026*

During the three months ended March 31, 2026 there were no share issuances.

 

*For the three months ended March 31, 2025*

During the three months ended March 31, 2025, the Company issued 351,416 shares with a fair value of $50,811 to settle debt of $56,316 and recognized a gain on the settlement of $5,505.

During the three months ended March 31, 2025, the Company issued 351,883 shares valued at $61,385 for services rendered.

**13.** **Stock Options** 

The Board of Directors adopted the Trillion Energy International Inc. 2022 Long-Term Incentive Equity Plan (the "2022 Plan") effective as of December 1, 2022. The 2022 Plan permits grants of stock options and restricted stock awards and other stock-based awards.

Under the 2022 Plan, the maximum number of shares of authorized stock that may be delivered is 10% of the total number of shares of common stock issued and outstanding of the Company as determined on the applicable date of grant of an award under the 2022 Plan. Under the 2022 Plan, the exercise price of each option shall be determined by the Board of Directors, subject to any applicable Exchange approval or rules, at the time any option or other stock-based award is granted. In no event shall such exercise price be lower than the exercise price permitted by the Exchange. The vesting schedule for each option or other stock-based award shall be specified by the Board of Directors at the time of grant, subject to any applicable Exchange approval or rules.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**13.** **Stock Options (continued)** 

A continuity of the Company's outstanding stock options for the three months ended March 31, 2026 and the year ended December 31, 2025 is presented below:

---

| | | |
|:---|:---|:---|
|  | **Number of options** | **Weighted average** <br>**exercise price**<br> **(CAD)** |
|  | | **$** |
| Outstanding and Exercisable, December 31, 2024 | 2402800 | 1.05 |
| Expired | (62800) | 8.61 |
| Cancelled | (40000) | 1.00 |
| **Outstanding and Exercisable, December 31, 2025 and March 31, 2026** | **2300000** | **0.85** |

---

At March 31, 2026 the Company had the following outstanding stock options:

---

| | | | |
|:---|:---|:---|:---|
| Outstanding | Exercise Price | Expiry Date | Vested |
| 10000 | 9.50 CAD | June 6, 2026 | 10000 |
| 40000 | 1.50 CAD | January 2, 2027 | 40000 |
| 50000 | 1.00 CAD | February 15, 2027 | 50000 |
| 100000 | 1.25 CAD | February 28, 2027 | 100000 |
| 490000 | 1.00 CAD | March 8, 2027 | 490000 |
| 1610000 | 0.70 CAD | August 12, 2029 | 1610000 |
| 2300000 |  |  | 2300000 |

---

As at March 31, 2026, the weighted average remaining contractual life of outstanding stock options is 2.63 years (December 31, 2025 – 2.84 years).

**14.** **Warrants** 

A continuity of the Company's outstanding share purchase warrants for the three months ended March 31, 2026 and the year ended December 31, 2025 is presented below:

---

| | | |
|:---|:---|:---|
|  | **Number of warrants** | **Weighted average** <br>**exercise price**<br> **(CAD)** |
|  | | **$** |
| Outstanding, December 31, 2024 | 10003454 | 3.93 |
| Expired | (3046340) | 10.89 |
| **Outstanding, December 31, 2025 and March 31, 2026** | **6957114** | **0.89** |

---

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**14.** **Warrants (continued)** 

At March 31, 2026, the Company had the following outstanding share purchase warrants:

---

| | | |
|:---|:---|:---|
| Outstanding | Exercise Price | Expiry Date |
| 2646475 | 0.90 CAD | <sup>(1)</sup>May 28, 2026 |
| 104073 | 0.45 CAD | May 28, 2026 |
| 1228445 | 0.90 CAD | <sup>(1)</sup>May 31, 2026 |
| 72450 | 0.45 CAD | May 31, 2026 |
| 306496 | 0.90 CAD | <sup>(1)</sup>June 10, 2026 |
| 7819 | 0.45 CAD | June 10, 2026 |
| 452556 | 0.90 CAD | <sup>(1)</sup>June 19, 2026 |
| 12180 | 0.45 CAD | June 19, 2026 |
| 1694520 | 0.90 CAD | June 28, 2026 |
| 400000 | 0.90 CAD | July 3, 2026 |
| 30000 | 0.90 CAD | July 5, 2026 |
| 2100 | 0.45 CAD | July 5, 2026 |
| 6957114 |  |  |

---

As at March 31, 2026, the weighted average remaining contractual life of outstanding warrants is 0.19 years (December 31, 2025 – 0.44 years).

<sup>(1)</sup> On May 21, 2026, the Company extended the expiry date by one year from the original expiry date stated in the table above (Note 22).

**15.** **Restricted Stock Units** 

During the three months ended March 31, 2026 and 2025, the Company granted RSUs as follows:

● On January 1, 2026, the Company granted 67,200 RSU's which vest quarterly beginning January 1, 2026.

● On January 1, 2025, the Company granted 67,200 RSU's which vest quarterly beginning January 1, 2025.

For the three months ended March 31, 2026, the Company recognized $3,438 (2025 – $Nil) in stock-based compensation expense for RSUs granted and vested.

---

| | | |
|:---|:---|:---|
|  | **Number of unvested** <br> **restricted stock units** | **Weighted average**<br> **fair value per award** |
|  | | **$** |
| Balance, December 31, 2024 | 207700 | 0.15 |
| Granted | 67200 | 0.09 |
| **Balance, December 31, 2025** | **274900** | **0.14** |
| Granted | 67200 | 0.10 |
| **Balance, March 31, 2026** | **342100** | **0.13** |

---

As at March 31, 2026, the Company had 342,100 RSU's (December 31, 2025 – 274,900) outstanding.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**16.** **Related Party Transactions** 

At March 31, 2026, accounts payable and accrued liabilities included $1,267,759 (December 31, 2025 – $1,121,180) due to related parties. The amounts are unsecured, non-interest bearing and due on demand.

During the three months ended March 31, 2026, management fees and salaries of $170,508 (2025 – $88,431), director fees of $21,600 (2025 – $30,600), consulting fees of $201,977 (2025 – $63,060), and stock-based compensation of $3,438 (2025 – $4,034) were incurred to related parties.

During the three months ended March 31, 2026, the Company issued Nil shares (2025 – 43,200) to directors for services performed.

During the three months ended March 31, 2026, the Company issued Nil shares (2025 – 198,682) to officers for services performed.

As at March 31, 2026, loans payable included CAD$248,877 (USD$179,742) (December 31, 2025 – CAD$248,189 (USD$181,806)) due to related parties. The loans payable are unsecured, bears interest ranging from 6% - 12% per annum and have maturity dates ranging from December 31, 2024 to December 27, 2026.

As at March 31, 2026, $30,000 (December 31, 2025 – $24,000) in shares were owed to an officer of the Company.

**17.** **General and Administrative** 

---

| | | |
|:---|:---|:---|
|  | **For the three months ended** | **For the three months ended** |
|  | **March 31, 2026** | **March 31, 2025** |
|  | **$** | **$** |
| Salaries, consulting and compensation | 413864 | 236736 |
| Professional fees | 84425 | 67450 |
| Investor relations | 2455 | 3315 |
| Office | 21104 | 29472 |
| Advertising | 8961 | 32080 |
| Filing and transfer fees | 11487 | 8285 |
| Travel |  | 21429 |
| Bank charges and other | 1015 | 810 |
|  | **543311** | **399577** |

---

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**18.** **Segmented Information** 

During the three months ended March 31, 2026 and 2025, the Company's operations were in the resource industry in Turkey with head offices in Canada and a satellite office in Sofia, Bulgaria.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Canada** | **Turkey** | **Bulgaria** | **Total** |
|  | **$** | **$** | **$** | **$** |
| **Three months ended March 31, 2026** |  |  |  |  |
| Finance cost) |  |  | –) |  |
| Depreciation) |  |  | –) |  |
| Stock-based compensation) |  |  | –) |  |
| Gain on net monetary position |  |  |  |  |
| Gain on debt extinguishment |  |  |  |  |
| Fair value loss on remeasurement of convertible debenture |  |  | –) |  |
| Net loss from discontinued operations) |  |  | –) |  |
| Net income (loss) from continuing operations |  |  | – |  |
| **As at March 31, 2026** |  |  |  |  |
| Non-current assets |  |  | – |  |

---

---

| | | |
|:---|:---|:---|
|  | **Turkey** | **Bulgaria** |
|  | **$** | **$** |
| **Three months ended March 31, 2025** |  |  |
| Finance cost) |  | –) |
| Depreciation) |  | –) |
| Gain on debt settlement |  |  |
| Net income from discontinued operations | 3199278 |  |
| Net loss from continuing operations | – | – |
| **As at December 31, 2025** |  |  |
| Non-current assets | 1870843 | – |

---

**19.** **Capital Management** 

The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going concern to support its business plan, as well as to ensure that the Company is able to meet its financial obligations as they become due. The Company considers its capital for this purpose to be its stockholders' equity. As at March 31, 2026, the Company is in a stockholders' deficiency position of $31,963,199 (December 31, 2025 – stockholders' deficiency position of $38,897,470).

The basis for the Company's capital structure is dependent on the Company's expected business growth and changes in business environment. To maintain or adjust the capital structure, the Company may issue new shares through private placement, incur debt or return capital to members.

The Company is dependent upon external financings to fund activities. In order to carry future projects and pay administrative costs, the Company will utilize its existing working capital and raise additional funds as needed. Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. The Company is not subject to externally imposed capital requirements.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**20.** **Financial Instruments and Risk Management** 

The Company is exposed, through its operations, to the following financial risks:

a) Market
 risk

b) Credit
 risk

c) Liquidity
 risk

The Company is exposed to risks that arise from its use of financial instruments. This note describes the Company's objectives, policies, and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these condensed consolidated interim financial statements.

There have been no substantive changes in the Company's exposure to financial instrument risks, its objectives, polices and processes for managing those risks or the methods used to measure them from previous reported periods unless otherwise stated in the note. The overall objective of management is to set policies that seek to reduce risk as far as possible without unduly affecting the Company's competitiveness and flexibility. Further details regarding these policies are set out below.

a) Market
 risk

Market risk is the risk of loss that may arise from changes in market factors such as foreign currency exchange, interest rates and equity price risk.

 

*Foreign currency risk:*

Foreign currency risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because they are denominated in currencies that differ from the respective functional currency. The Company and its subsidiaries are exposed to currency risk as it has transactions denominated in currencies that are different from their functional currencies. The Company does not hedge its exposure to fluctuations in foreign exchange rates.

As at March 31, 2026 and December 31, 2025, significant foreign exchange currency exposure on its financial instruments, expressed in USD was as follows:

---

| |
|:---|
| Cash and cash equivalents |
| Accounts receivable |
| Accounts payable) |
| Loans payable |
| **Total** |

---

If the CAD strengthened or weakened against the USD by 10% the exchange rate fluctuation would impact net loss from continuing operations by $414,947, at March 31, 2026. If the Turkish Lira strengthened or weakened against the USD by 10% the exchange rate fluctuation would impact net loss from continuing operations by $3,083, at March 31, 2026.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**20.** **Financial Instruments and Risk Management (continued)** 

*Interest rate risk:*

 

Interest rate risk is the risk that future cash flows will fluctuate because of changes in market interest rates. The interest earned on cash is insignificant and the Company does not rely on interest income to fund its operations. The Company is exposed to interest rate risk through the variable interest debt facility it holds through its subsidiary PPE Turkey. A sustained increase or decrease in the variable interest rate by 5% would result in an increase or decrease in net loss from discontinued operations of approximately $56,202 per year based on the principal balance outstanding as at March 31, 2026.

*Other price risk:*

Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The Company does not hold equity investments in other entities and therefore is not exposed to a significant risk.

b) Credit
 risk

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations.

The Company is subject to credit risk on its cash and cash equivalents and amounts receivable which consists primarily of trade receivables and notes and amounts receivable for equity issued. The Company limits its exposure to credit loss on cash and cash equivalents by placing its cash with a high-quality financial institution. Exposure to credit loss notes and amounts receivable for equity issued is limited by entering into these types of transactions with related parties and entities that are well known to the Company.

The Company only has two customers. The Company mitigates credit risk by evaluating the creditworthiness of customers prior to conducting business with them and monitoring its exposure for credit losses with existing customers. One of the customers is the largest oil refinery in Turkey. The other customer provides letters of credit to

be used by the Company in the event of default. As at March 31, 2026, all of the Company's trade receivables are current (< 30 days outstanding).

The Company's maximum credit exposure is $245,793 (December 31, 2025 – $1,147,456).

c) Liquidity
 risk

Liquidity risk arises from the Company's general and capital financing needs. The Company continuously monitors and reviews both actual and forecasted cash flows, and also matches the maturity profile of financial assets and liabilities, when feasible. The Company anticipates increases in revenue in future periods resulting from the completion of an additional well subsequent to the period end. Historically, the Company's sources of funding has been through equity and debt financings. The Company's access to financing is uncertain. There can be no assurance of continued access to significant debt or equity funding.

The table below summarizes the maturity profile of the Company's undiscounted contractual cashflows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **As at March 31, 2026** | **Less than 1**<br> **year** | **1 – 2 years** | **Later than 2**<br> **years** | **Total** |
| Accounts payable and accrued liabilities | 1769955 |  |  | 1769955 |
| Loans payable | 3721040 |  |  | 3721040 |
| Convertible debt | 11952785 |  |  | 11952785 |
|  | **17443780** |  |  | **17443780** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| **As at December 31, 2025** | **Less than 1**<br> **year** | **1 – 2 years** | **Later than 2**<br> **years** | **Total** |
| Accounts payable and accrued liabilities | 18792482 |  |  | 18792482 |
| Loans payable | 4972059 |  |  | 4972059 |
| Convertible debt | 11823815 |  |  | 11823815 |
|  | **35588356** |  |  | **35588356** |

---

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**21. Commitments and Contingencies**

<u>TR1 Master Fund loans</u>

The Company has filed claims in connection with ongoing receivership proceedings against certain Traynor Ridge Capital entities (Note 9), alleging that improper and unlawful trading activities in the Company's securities caused a significant decline in its share price and resulted in substantial financial losses, including impairment of a planned equity financing. The Company is seeking damages of up to $25 million per respondent on a joint and several basis. A threshold hearing is scheduled to determine whether the claims disclose a valid cause of action. At this stage, the outcome of the proceedings is uncertain, and no amounts have been recognized in the consolidated financial statements. The Company is seeking to offset any amounts outstanding under the TR1 Master Fund loans (Note 9) against damages claimed by the Company.

<u>Close-out Fund</u>

The Company's subsidiary PPE Turkey, committed to contribute to the Close-Out Fund (Note 11) where it has deposited 10% of natural gas revenue from the SASB project into the Close-Out Fund until an amount agreed to by both parties is attained. PPE Turkey did not meet its commitment since the beginning of 2025 and as a result its contribution to the Close-Out Fund is short by approximately $33,000. PPE Turkey was disposed of in April 2026 (Note 3).

<u>Arbitration</u>

The Company through its' subsidiary PPE Turkey has advanced arbitration against an offshore drilling rig contractor for $20.3 million for gross negligent and breach of contact involving health and safety issues during the prior year drilling program resulting in loss and damages to Company (the "Trillion Losses"). Liability is not admitted, the litigation is at the inception, and thus, legal counsel has advised that it is too soon to predict the outcome or the quantum of damages that will be assessed. In accordance with guidance for contingent assets and liabilities, no provision for any potential recovery of the Trillion Losses will be made until recovery is virtually certain. If the Company's claim is successful, the award will exceed the amount, if any, that is payable to the drilling contractor in its claim.

The Company's subsidiary PPE Turkey is defending an action brought by the same drilling contractor in Europe to which it has advanced an arbitration claim, for drilling services seeking $3 million. This amount has fully been recorded in accounts payable in accordance with guidance as there is significant uncertainty as to the outcome of the arbitration. PPE Turkey was disposed of in April 2026 (Note 3) and the amount is reflected as part of liabilities held for sale as at March 31, 2026.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**21.** **Commitments and Contingencies (continued)** 

<u>Third party liability claim</u>

As at December 31, 2024, the Company included in accounts payable and accrued liabilities a potential liability for an invoice in the amount of $144,247, issued to a 3rd party with whom the Company previously had a farm-in arrangement. The vendor is claiming that the Company is liable given the previous relationship. As at December 31, 2025, the Company included in accounts payable and accrued liabilities an additional $1,880,855 related to additional claims for invoices issued to the 3rd party. The claims and related accruals were held within PPE Turkey that was disposed of in April 2026 (Note 3) and the amounts are reflected as part of liabilities held for sale as at March 31, 2026. The Company disputes the asserted claims, and the ultimate resolution of these matters remains uncertain.

<u>Dispute with former employees</u>

The Company has filed claims against, and has received counter claims from former employees of PPE Turkey which was disposed of in April 2026 (Note 3). Management believes the claims against the Company are without merit. Accordingly, no provision has been recognized as at period end. The ultimate outcome of the proceedings cannot presently be determined.

**22.** **Subsequent events** 

<u>Sale of PPE Turkey</u>

In April 2026, the Company, through a subsidiary, entered into an agreement to sell all of the issued and outstanding shares of PPE Turkey, which holds the Company's license interests in the SASB natural gas project and the Cendere oil field.

Under the terms of the agreement, the purchaser will assume the assets and liabilities associated with PPE Turkey. In connection with the transaction, the Company will retain a 7% gross overriding royalty on future production revenues from the underlying licenses. The royalty becomes payable once cumulative gross revenues from the licenses following closing exceed $7.5 million and may also be realized upon any future disposition of the licenses by the purchaser.

<u>Unit issuance</u>

Subsequent to year end, the Company issued 2,000,000 units for gross proceeds of CAD$300,000 (USD $219,525). Each unit consists of one common share in the capital of the Company and one half of one common share purchase warrant. Each whole warrant is exercisable at CAD $0.25 and shall be exercisable for a period of one (1) year from the date of issue.

<u>Warrant expiration date extension</u> 

On May 21, 2026, the Company extended the expiry date of an aggregate of 4,633,965 outstanding common share purchase warrants originally issued in connection with a non-brokered private placement completed in tranches between May and June 2024. The extension is for one additional year from the original expiry date. The exercise price of CAD $0.90 per share remains unchanged.

**TRILLION ENERGY INTERNATIONAL INC.**

Notes to the Amended and Restated Condensed Consolidated Interim Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in U.S. dollars)

(Unaudited)

**23.** **Amended and Restated Condensed Consolidated Interim Financial Statements** 

These condensed consolidated interim financial statements for the three months ended March 31, 2026 are amended and restated. They supersede and replace the condensed consolidated interim financial statements for the same period that were originally prepared by management and filed on May 29, 2026 (the "originally filed interim financial statements").

The originally filed interim financial statements were prepared and filed without a review by the Company's auditors. Subsequent to that filing, the Company's auditors performed an interim review. As a result of that review, the Company reassessed the accounting treatment of the amendment to its 12.0% convertible debentures effected by the Fourth Supplemental Indenture dated March 20, 2026 (Note 10).

In the originally filed interim financial statements, the Company had concluded that the Fourth Supplemental Indenture did not result in a substantial modification of the convertible debentures as the modifications were contingent on an uncertain future event, and the debentures continued to be measured at amortized cost. On reassessment, the Company concluded that the amendment substantially modifies the terms of the debentures and is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. The new financial liability is a hybrid instrument containing an embedded contingent equity conversion feature, which the Company has irrevocably designated, in its entirety, as a financial liability at FVTPL on initial recognition, rather than separating the embedded derivative. This change in accounting treatment, and the related measurement of the new financial liability, are described in Note 10.

The effect of the restatement on the previously reported amounts, for the three months ended and as at March 31, 2026, is summarized in the table below. There is no effect on the comparative period for the three months ended March 31, 2025, or on the statement of financial position as at December 31, 2025.

---

| | | | |
|:---|:---|:---|:---|
|  | **As originally filed** | **Adjustment** | **As restated** |
| **Condensed Interim Statement of financial position** |  |  |  |
| Convertible debt | 11952785 | (7823071) | 4129714 |
| Total current liabilities | 42344495 | (7823071) | 34521424 |
| Total liabilities | 42344495 | (7823071) | 34521424 |
| Accumulated deficit | (105399977) | 7945353 | (97454624) |
| Accumulated other comprehensive loss | (21304438) | (122282) | (21426720) |
| **Total stockholders' deficiency** | **(39786270)** | **7823071** | **(31963199)** |
| **Condensed interim Statement of income and comprehensive income** |  |  |  |
| Finance cost | (404304) | 39548 | (364756) |
| Gain on debt extinguishment |  | 7927913 | 7927913 |
| Fair value loss on remeasurement of convertible debenture |  | (22108) | (22108) |
| Net income (loss) from continuing operations | (993156) | 7945353 | 6952197 |
| **Total net income** | **(2169588)** | **7945353** | **5775765** |
| **Total comprehensive income** | **(913224)** | **7823071** | **6909847** |
| **Earnings (loss) per share** |  |  |  |
| Basic and diluted – continuing operations | (0.02) | 0.19 | 0.17 |

---

The restatement increased net income for the three months ended March 31, 2026 by $7,945,353, principally as a result of the recognition of a gain on debt extinguishment of $7,927,913 on derecognition of the original convertible debentures and recognition of the new financial liability at its fair value, together with a reduction in finance cost of $39,548 and a fair value loss on remeasurement of the new financial liability of $22,108. The carrying amount of the convertible debt at March 31, 2026 decreased by $7,823,071, and the Company's total stockholders' deficiency decreased by the same amount.

In addition to the restatement described above, certain note disclosures in these amended and restated consolidated interim financial statements have been expanded or revised, including the accounting policy for the convertible debentures and the related fair value measurement disclosures (Note 10). These revisions did not affect the restated amounts presented in the table above.

There was also no change to the net cash flow previously presented for operating, investing and financing activities.

## Exhibit 99.2

**Exhibit 99.2**

![](ex99-2_001.jpg)

**TRILLION ENERGY INTERNATIONAL INC.**

**AMENDED AND RESTATED<sup>(1)</sup>** **MANAGEMENT DISCUSSION & ANALYSIS**

**For the three months ended March 31, 2026 and 2025**

*(Stated in United States dollars)*

**<sup>(1)</sup> Amended and Restated Management Discussion & Analysis**

This MD&A, and the condensed consolidated interim financial statements for the three months ended March 31, 2026 to which it relates, are amended and restated. They supersede and replace the MD&A and the condensed consolidated interim financial statements for the same period that were filed on May 29, 2026 (together, the "originally filed Q1 documents")

The originally filed Q1 documents were prepared and filed without a review by the Company's auditors. Subsequent to that filing, the Company's auditors performed an interim review. Refer to the "Amended and Restated Financial Statements and MD&A" section below.

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
| Amended and Restated Financial Statements and MD&A | 2 |
| Caution Regarding Forward-Looking Statements | 3 |
| Management's Responsibility for Financial Statements | 3 |
| Overview | 3 |
| Overall Performance | 6 |
| Results of Continuing Operations | 7 |
| Results of Discontinued Operations | 8 |
| Summary of Quarterly Results | 9 |
| Liquidity and Capital Resources | 11 |
| Transactions with Related Parties | 13 |
| Risk Management | 14 |
| Off-Balance Sheet Arrangements | 18 |
| Disclosure of Outstanding Share Data | 18 |
| Critical Accounting Policies and Estimates | 19 |
| Commitments and Contingencies | 23 |
| Events Subsequent to the Three Months Ended March 31, 2026 | 25 |

---

**TRILLION ENERGY INTERNATIONAL INC.**

**AMENDED AND RESTATED** **MANAGEMENT DISCUSSION & ANALYSIS**

**For the three months ended March 31, 2026 and 2025**

**(Expressed in United States Dollars)**

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide readers of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity, and certain other factors that may affect our future results. This MD&A was prepared effective May 29, 2026.

This MD&A was originally prepared effective May 29, 2026 and has been amended and restated. This amended and restated MD&A supersedes and replaces the MD&A for the three months ended March 31, 2026 that was filed on May 29, 2026.

Our MD&A should be read in conjunction with our unaudited amended and restated condensed interim consolidated financial statements of Trillion Energy International Inc., ("Trillion Energy", the "Company", "we", and "our") and the related notes thereto for the three months ended March 31, 2026 and 2025, and the audited consolidated financial statements for the years ended December 31, 2025 and 2024 and the related notes thereto. Unless otherwise noted, all currency amounts are in US dollars.

Amended and Restated Financial Statements and MD&A

This MD&A, and the condensed consolidated interim financial statements for the three months ended March 31, 2026 to which it relates, are amended and restated. They supersede and replace the MD&A and the condensed consolidated interim financial statements for the same period that were filed on May 29, 2026 (together, the "originally filed Q1 documents").

The originally filed Q1 documents were filed without a review by the Company's auditors. Following that filing, the Company's auditors completed an interim review. As a result of that review, the Company reassessed the accounting treatment of the amendment to its 12.0% convertible debentures effected by the fourth supplemental debenture indenture dated March 20, 2026 (the "Fourth Supplemental Indenture").

In the originally filed Q1 documents, the Company had concluded that the Fourth Supplemental Indenture did not result in a substantial modification of the convertible debentures as the modifications were contingent on an uncertain future event, and the debentures continued to be measured at amortized cost. On reassessment, the Company concluded that the amendment substantially modifies the terms of the debentures and is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. The new financial liability is a hybrid instrument containing an embedded contingent equity conversion feature, which the Company has irrevocably designated, in its entirety, as a financial liability at fair value through profit or loss on initial recognition, rather than separating the embedded derivative.

The effect of the restatement on the previously reported amounts, for the three months ended and as at March 31, 2026, is summarized below. There is no effect on the comparative period for the three months ended March 31, 2025, or on the financial position as at December 31, 2025. Amounts are in United States dollars.

---

| | | | |
|:---|:---|:---|:---|
|  | **As originally filed** | **Adjustment** | **As restated** |
| Convertible debt | 11952785 | (7823071) | 4129714 |
| Total liabilities | 42344495 | (7823071) | 34521424 |
| Gain on debt extinguishment |  | 7927913 | 7927913 |
| Total net income (loss) | (2169588) | 7945353 | 5775765 |
| Total comprehensive income (loss) | (913224) | 7823071 | 6909847 |
| Working capital deficit | (39801091) | 7823071 | (31978020) |
| Stockholders' deficiency | (39786270) | 7823071 | (31963199) |
| Net income (loss) per share – basic and diluted | (0.05) | 0.19 | 0.14 |

---

The restatement increased net income for the three months ended March 31, 2026 by $7,945,353, principally as a result of a gain on debt extinguishment of $7,927,913 recognized on derecognition of the original convertible debentures and recognition of the new financial liability at its fair value, together with a $39,548 reduction in finance cost and a $22,108 fair value loss on remeasurement of the new financial liability. The carrying amount of the convertible debt decreased by $7,823,071 and the Company's stockholders' deficiency and working capital deficit each decreased by the same amount. The change in accounting treatment is described further under "Results of Continuing Operations" below and in Note 10 to the condensed consolidated interim financial statements.

Caution Regarding Forward-Looking Statements

Certain statements in this report are forward-looking statements which reflect management's expectations regarding future growth, results of operations, performance, business prospects and opportunities, the Company's ability to meet financial commitments and its ability to raise funds when required. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations, or intentions regarding the future. Such statements are subject to risks and uncertainties that may cause actual results, performance, or developments to differ materially from those contained in the statements. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. These forward-looking statements reflect management's current views and are based on certain assumptions and speak only as of the date of this report. These assumptions, which include management's current expectations, the global economic environment, and the Company's ability to manage its operating costs, may prove to be incorrect. Several risks and uncertainties could cause actual results to differ materially from those expressed or implied by the forward-looking statements.

There is a significant risk that such forward-looking statements will not prove to be accurate. Investors are cautioned not to place undue reliance on these forward-looking statements. No forward-looking statement is a guarantee of future results. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Actual performance, achievement or other realities could differ materially from those expressed in, or implied by, any forward-looking statements or information in this MD&A and, accordingly, investors should not place undue reliance on any such forward-looking statements or information. Further, any forward-looking statement or information speaks only as of the date on which such statement is made, and the Company does not undertake any obligation to update any forward-looking statements or information to reflect information, events, results, circumstances, realities or otherwise after the date on which such statement is made or to reflect the occurrence of unanticipated events, except as required by law, including securities laws. All forward-looking statements and information contained in this MD&A and other documents of the Company are qualified by such cautionary statements. New factors emerge from time to time, and it is not possible for management to predict all such factors and to assess in advance the impact of each such factor on the Company's business or the extent to which any factor, or combination of factors, may cause actual realities to differ materially from those contained in any forward-looking statements.

In addition, forward-looking statements, and information herein, including financial information, is based on certain assumptions relating to the business and operations of the Company. Although the Company has attempted to identify important factors that could cause actual actions, events, or results to differ materially from those described in forward-looking statements and forward-looking information in this MD&A, and the documents incorporated by reference herein, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There is no assurance that such statements and information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information contained in this MD&A.

Management's Responsibility for Financial Statements

The information provided in this MD&A, including the audited consolidated financial statements and the unaudited condensed consolidated interim financial statements, are the responsibility of management. In the preparation of consolidated financial statements, estimates are sometimes necessary to make a determination of the future values for certain assets or liabilities. Management believes such estimates have been based on careful judgments and have been properly reflected in the accompanying audited consolidated financial statements and unaudited condensed consolidated interim financial statements.

Overview

Trillion Energy International Inc. and its consolidated subsidiaries, (collectively referred to as the "Company") is a Canadian based oil and gas exploration and production company with operations primarily in Turkiye. The Company's shares trade on the Canadian Securities Exchange under the symbol "TCF". The Company also trades on the OTCQB under the symbol "TRLEF" and the Frankfurt exchange under the symbol Z620. A class of the Company's warrants trade on the CSE under the symbol TCF.WT.

The Company is focused on oil and gas exploration in Turkiye. The Company pivoted its strategic asset mix during the quarter, to focus principally on an earn-in on the M47 Oil Block in Turkiye, through an agreement to farmin made during Q1 2026. After quarter end, the Company recently disposed of its license interests in the SASB natural gas project and the Cendere oil field which were its principal operating assets during the quarter and in prior years.

In connection with the sale of its subsidiary (PPE Turkey) in Turkey after the quarter end, the Company disposed of its conventional natural gas project, the SASB gas field located in the Black Sea, Turkiye. Trillion had a 49% interest in the SASB gas field. In addition, the Company disposed of its interest in the Cendere field in Turkiye, a long-term low decline oil field where it held a 19.6% (except three wells with 9.8%) interest.

In January 2026 and in connection with the Company's strategic asset pivot, the Company, through a wholly owned subsidiary, entered into an agreement to earn a 29% working interest in the M47 Oil Block in exchange for total funding commitments of approximately $15.0 million. The earn-in is subject to the Company funding certain work program costs, including approximately $9.5 million for the 2026 work program and approximately $5.5 million for the 2027 work program. As part of the agreement, the Company is expected to fund a significant portion of the costs of initial drilling and seismic programs, after which costs will be shared based on participating interests. The earn-in is contingent upon the Company meeting its funding commitments.

In April 2026, the Company, through a subsidiary, entered into an agreement to sell all of the issued and outstanding shares of PPE Turkey, which holds the Company's license interests in the SASB natural gas project and the Cendere oil field. Under the terms of the agreement, the purchaser will assume the assets and liabilities associated with PPE Turkey. In connection with the transaction, the Company will retain a 7% gross overriding royalty on future production revenues from the underlying licenses. The royalty becomes payable once cumulative gross revenues from the licenses following closing exceed $7.5 million and may also be realized upon any future disposition of the licenses by the purchaser.

In this MD&A, we report both on the "discontinued operations" of PPE Turkey and on "continuing operations" of the Company.

 

**Strategic Pivot**

Trillion's strategic focus has recently shifted with the sale of its subsidiary PPE Turkey, which owned license interests in the SASB natural gas project and the Cendere oil field. The disposition of PPE Turkey in April 2026 is further to a general restructuring and includes the disposition of the full operating unit for Cendere and SASB, respective licenses and all related assets and liabilities of PPE Turkey. The PPE Turkey disposition improves the Company's working capital position, significantly reduces the consolidated entity's debt load, and paves the way for refocusing on the M47c,d oil exploration block, where an oil discovery was made during 2025.

The Company is now focused on meeting its earning in obligations for a 29% working interest in the M47 Oil Block and raising the necessary funding to meet funding commitments for the 2026 and 2027 work programs. The Company has advanced after the quarter end, US $500,000 in furtherance of its commitments.

With the shift in strategic focus to the M47 Oil Block, and the need to strengthen the Company's balance sheet to raise funds for the earn-in funding commitments, the decision was made to sell all of the issued and outstanding shares of PPE Turkey, which held the Company's license interests in the SASB natural gas project and the Cendere oil field.

**Other Developments of the Business**

<u>Restructuring of convertible debentures:</u>

During the year ended December 31, 2025, in lieu of paying cash, the Company issued 5,454,181 shares to settle CAD$899,940 (US$649,851) in interest accrued on the Company's convertible debentures. The Company also issued 515,151 shares to the convertible debentures holders as at extension fee for the extension of the maturity date from April 30, 2025 to July 31, 2025. On July 24, 2025, the maturity date was further extended to October 31, 2025.

On March 20, 2026, the Company entered into a fourth supplemental debenture indenture (the "Fourth Supplemental Indenture") related to the Company's convertible debentures.

The total amount owing under the convertible debentures will be comprised of the principal of CAD15.0 million and accrued to March 20, 2026 (the "Amount Due"). Pursuant to the Fourth Supplemental Indenture, and conditional upon the Company completing an equity financing of not less than CAD10.0 million on or before September 30, 2026, the following settlement terms will apply:

&nbsp;&nbsp;&nbsp;&nbsp;(1) approximately
 CAD11.0 million of the Amount Due will be converted into common shares of the Company at the same price as the equity financing;
 and,

(2) the
 remaining balance including accrued interest will be forgiven by the debenture holders.

If the Company does not complete the required financing by September 30, 2026, the Fourth Supplemental Indenture will terminate and the full Amount Due will remain payable in accordance with the original terms of the debentures.

The Company concluded that the amendment substantially modifies the terms of the debentures and accounted for it as an extinguishment of the original financial liability and recognition of a new financial liability. The new financial liability is a hybrid instrument containing an embedded contingent equity conversion feature. Rather than separate the embedded derivative, the Company has designated the entire instrument to be measured at fair value through profit and loss.

**Exit of PPE Turkey - Cendere oil field and SASB Gas Field – Discontinued Operations**

Both the Cendere oil field and SASB gas field assets were sold as a result of the sale of the Company's subsidiary, PPE Turkey on April 6, 2026.

*SASB*

 

Until disposed of in April 2026, the Company had a 49% interest in the SASB Gas Field which has several natural gas fields, four production platforms plus 18 kilometers of subsea pipelines connecting the gas fields to an onshore gas processing facility. SASB is located off the North West coast of Turkey in the Black Sea. Total gross production to date from the four fields is over 43 billion cubic feet ("Bcf"). The Company sold its interest in the SASB Gas Field during April 2026 as part of the sale of all the outstanding shares of PPE Turkey.

The Company commenced the SASB re-Development Program during September 2022 where five wells were drilled off different tripods. Those 5 new wells and one recompletion were put on production, thus generating revenue for the Company. In 2024, the Company was required to transfer operatorship to TPAO, the state operator. Subsequently, the SASB Gas Field has incurred significant downtime due to water loading issues, despite having considerable reserves, and production significantly diminished during 2025. The SASB Gas Field was not able to be restarted with cooperation and commitment from TPAO.

*Cendere*

 

Prior to the sale of PPE Turkey in April 2026, the Company had a 19.6% interest in the Cendere oil field located in Southeast Turkey all except certain wells. The Company sold its interest in the Cendere oil field as part of the sale of all the outstanding shares of PPE Turkey.

 

**Oil Exploration Licence M47 ("M47 Oil Block")**

In January 2026, the Company, through a new wholly owned subsidiary, signed a new agreement to earn a 29% working interest in the M47 Block located in SE Turkey in exchange for a total investment of US $15 million over two years' time. The earn-in is subject to, inter alia, the Company paying for certain work program costs on a timely basis. The work program is expected to include new exploration wells and acquisition of seismic data.

The total work program cost for the M47 Oil Block shared between the existing parties is approximately $35 million, of which approximately $18 million has been expended to date. As part of the contemplated earn-in, the Company will bear 80% of the cost of the next two wells as well as certain seismic costs.

The Company is responsible for advancing two funding tranches: the first tranche is $9.5 million for the 2026 work program, and the second tranche is $5,500,000 for the 2027 work program. The 29% earn-in interest is subject to the Company meeting its funding commitments as set out herein.

A Joint Operating Committee will determine all drilling decisions, planning and procurement matters.

Following the Company's investment, the parties to the M47 Oil Block shall thereafter bear costs in proportion to their participating interests. The Company's cost contribution shall thereafter be reduced to its pro rata interest.

The previously announced farm in agreements on M47 and M46C and M46D blocks have been cancelled.

Overall Performance

During the three months ended March 31, 2026, the Company recognized net income of $5,775,765. This is comprised of net income from continuing operations of $6,952,197 and net loss from discontinued operations of $1,176,432. This compares to a net income of $2,195,682 during the three months ended March 31, 2025, which is comprised of a net loss from continuing operations of $1,003,596 and net income from discontinued operations of $3,199,278. The change for continuing operations is primarily due to a gain on debt extinguishment of $7,927,913 recorded as a result of the restructuring of the convertible debentures in accordance with the Fourth Supplemental Indenture. The change for discontinued operations is primarily due to a decrease in oil and gas revenue from $938,936 for the three months ended March 31, 2025, to oil gas revenue of $609,245 for the three months ended March 31, 2026. In addition, reflected in discontinued operations, there was a significant gain on net monetary position of $4,637,618 in the 2025 period compared to a $89,017 loss on net monetary position during the three months ended March 31, 2026.

The Company's cash flow for the three months ended March 31, 2026 yielded a net decrease of $182,007 primarily as a result of operating activities. The Company did not complete any stock offerings during the current period.

The Company's total assets decreased from $3,102,943 to $2,558,225 primarily as a result of a decrease in cash and amounts receivable. The assets of PPE Turkey is presented as assets held for sale as at March 31, 2026.

The Company's total liabilities decreased from $42,000,413 to $34,521,424 due to the restructuring of the convertible debentures in accordance with the Fourth Supplemental Indenture.

The unaudited condensed interim consolidated financial statements of the Company have been prepared in accordance with International Financial Reporting Standards ("IFRS") applicable to the preparation of condensed interim financial statements, including International Accounting Standards ("IAS") 34, Interim Financial Reporting and are expressed in United States dollars.

***Total Assets***

 ****

As at March 31, 2026, total assets decreased by $544,718 from $3,102,943 as at December 31, 2025 to $2,558,225 as at March 31, 2026. The decrease in total assets was primarily a result of a decrease in cash equivalents and amounts receivable. This reflects the decreased operations during the quarter.

***Total Non-current Liabilities***

 ****

Total non-current liabilities as at March 31, 2026 decreased from $6,412,057 as at December 31, 2025 to $Nil as at March 31, 2026. The decrease in total non-current financial liabilities was due to the non-current liabilities which were fully comprised of asset retirement obligations being reclassified to liabilities held for sale, a current liability.

***Assets and Liabilities Held For Sale***

 ****

The assets and liabilities of PPE Turkey is presented as held for sale as at March 31, 2026. Assets held for sale of $2,254,715, offset by liabilities held for sale of $24,900,715, represent net liabilities of $22,646,000 attributable to PPE Turkey which was sold in April 2026.

Results of Continuing Operations

**Three months and ended March 31, 2026, compared to the three months ended March 31, 2025**

The net income from continuing operations for the three months ended March 31, 2026 improved by $7,955,793 to a net income of $6,952,197, compared to the net loss from continuing operations of $1,003,596 recognized during the three months ended March 31, 2025.

 

Factors contributing to the net income from continuing operations for the three-month periods included the following:

***Expenses***

 ****

For the three months ended March 31, 2026, the Company had general and administrative expenses of $543,311, compared to $399,577 for the three months ended March 31, 2025. The increase is primarily due to an increase in salaries and compensation from management and consulting fees.

***Other Income (Expense)***

For the three months ended March 31, 2026, the Company had other income of $7,501,007 compared to other expenses of $602,050 for the three months ended March 31, 2025. Other income for the three months ended March 31, 2026 consists mainly a gain on debt extinguishment of $7,927,913 (2025 - $nil) partially offset by a foreign exchange loss of $40,036 (2025 – $2,020 foreign exchange gain) and finance costs of $364,756 (2025 – $611,105) primarily as a result of interest recognized on convertible debentures issued in 2023. The gain on debt extinguishment is due to the restructuring of the convertible debentures in accordance with the Fourth Supplemental Indenture. The decrease in finance cost is due to the Company recording interest at the contractual rate and accretion at the effective interest rate during 2025, compared to only interest during 2026 as the convertible debentures were past due during 2026.

Results of Discontinued Operations

**Three months and ended March 31, 2026, compared to the three months ended March 31, 2025**

The net loss from discontinued operations for the three months ended March 31, 2026 increased by $4,375,710 to a net loss of $1,176,432 compared to the net income from discontinued operations of $3,199,278 recognized during the three months ended March 31, 2025.

 

Factors contributing to the net loss (income) from discontinued operations for the three-month periods included the following:

***Revenue***

 ****

Revenues decreased by $329,691 from $938,936 for the three months ended March 31, 2025 to $609,245 for the three months March 31, 2026. The decrease observed is due to water loading of the SASB Gas Field wells.

 **

***Expenses***

 **

For the three months ended March 31, 2026, the Company incurred production expenses related to its Turkey discontinued operations of $453,142 (2025 - $591,568), depletion charges of $4,647 (2025 - $99,497), depreciation expense of $7,638 (2025 - $13,767) and asset retirement obligation accretion expense of $68,465 (2025 - $64,806). Production expenses decreased by $138,426 as a result of a decrease in operations during the three months ended March 31, 2026. Depletion decreased by $94,850 as a result of the significant impairment of the SASB property recorded at December 31, 2025. The change in accretion of asset retirement costs of $3,659 was recognized primarily due to a change in estimate in 2026 relating to the discount rates used in the calculation.

For the three months ended March 31, 2026, the Company had general and administrative expenses of $370,899, compared to $365,556 for the three months ended March 31, 2025.

Geological and geophysical expenses decreased to $Nil for the three months ended March 31, 2026 from $27,321 during the same period in 2025. This was a result of decreased activity due to water loading of wells.

***Other Income (Expense)***

 ****

For the three months ended March 31, 2026, the Company had other expenses of $880,886 compared to other income of $3,560,685 for the three months ended March 31, 2025. Other expenses for the three months ended March 31, 2026 consists mainly of a foreign exchange loss of $679,518 (2025 – $1,002,967), finance costs of $192,818 (2025 – $100,398) primarily as a result of interest recognized on loans payable and a loss on net monetary position of $89,017 (2025 – $4,637,618 gain on net monetary position). The gain or loss on net monetary position is a result of Turkey being designated a hyper-inflationary economy as of April 1, 2022 for accounting purposes.

Summary of Quarterly Results

The financial information in the following tables summarizes selected financial information for the Company for the last eight quarters which was derived from annual and interim financial statements prepared in accordance with IFRS and are expressed in United States dollars.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **March 31,**<br> **2026**<br> **($)** | **December 31,**<br> **2025**<br> **($)** | **September 30,**<br> **2025**<br> **($)** | **June 30,**<br> **2025**<br> **($)** |
| Revenue (from discontinued operations) | 609245 | 627402 | 677790 | 636530 |
| Net Income (Loss) | 5775765 | (46865592) | (3991878) | (559113) |
| Net Income (Loss) per share (basic and diluted) | 0.14 | (1.14) | (0.10) | (0.00) |
| Net and comprehensive income (Loss) | 6909847 | (47770104) | (4595832) | (2478213) |

---

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **March 31,**<br> **2025**<br> **($)** | **December 31,**<br> **2024**<br> **($)** | **September 30,**<br> **2024**<br> **($)** | **June 30,**<br> **2024**<br> **($)** |
| Revenue (from discontinued operations) | 938936 | 2110078 | 2325694 | 1243119 |
| Net Income (Loss) | 2195682 | (9620515) | (1177731) | 349748 |
| Net Income (Loss) per share (basic and diluted) | 0.07 | (0.30) | (0.05) | (0.00) |
| Net and comprehensive income (Loss) | 419147 | (9640143) | (2358571) | 1208526 |

---

\*In April 2026 the outstanding shares were consolidated on a 5 to 1 basis.

*Summary of Results During Prior Eight Quarters*

Net income improved for the three months ended March 31, 2026 by $52,641,357 compared to the three months ended December 31, 2025, from a net loss of $46,865,592 to a net income of $5,775,765. The improvement is primarily due to an impairment of oil and gas assets of $48,067,394 recognized in the three months ended December 31, 2025, there were no such impairment amount recognized during the three months ended March 31, 2026. In addition, the Company recorded a gain on debt extinguishment of $7,927,913 during the three months ended March 31, 2026 due to the restructuring of the convertible debentures in accordance with the Fourth Supplemental Indenture.

Net loss increased for the three months ended December 31, 2025 by $42,873,714 compared to the three months ended September 30, 2025, from a net loss of $3,991,878 to a net loss of $46,865,592. The increase is primarily due to an impairment of oil and gas assets of $48,067,394 recognized in the three months ended December 31, 2025. This was partially offset by the gain on net monetary position of $2,128,533 recognized in the current period as a result of hyperinflationary accounting.

Net loss increased for the three months ended September 30, 2025 by $3,432,765 compared to the three months ended June 30, 2025, from a net loss of $559,113 to a net loss of $3,991,878. The increase is primarily due to an impairment of oil and gas assets of $6,431,000 recognized in the three months ended September 30, 2025, no such impairment was recognized during the three months ended June 30, 2025. This was partially offset by the gain of $3,520,731 recognized in the current period as a result of hyperinflationary accounting compared to a gain of $2,504,987 in the three months ended June 30, 2025.

Net income decreased for the three months ended June 30, 2025 by $2,754,795 compared to the three months ended March 31, 2025, from a net income of $2,195,682 to a net loss of $559,113. The decrease is primarily due to a deferred tax expense of $1,161,339 recognized in the three months ended June 30, 2025 compared to a deferred tax expense of $137,828 during the three months ended March 31, 2025. The Company also recognized a gain of $2,504,987 recognized in the current period as a result of hyperinflationary accounting compared to a gain of $4,637,618 in the three months ended March 31, 2025.

Net income increased for the three months ended March 31, 2025 by $11,816,197 compared to the three months ended December 31, 2024, from a net loss of $9,620,515 to a net income of $2,195,682. The Company did not recognize impairment on its oil and gas assets in the current period, compared to an impairment charge of $9,892,000 recognized in the previous quarter. The Company also recognized a gain of $4,637,618 recognized in the current period as a result of hyperinflationary accounting compared to a gain of $2,259,183 in the three months ended December 31, 2024.

Net loss increased for the three months ended December 31, 2024, by $8,442,784 compared to the three months ended September 30, 2024, from a net loss of $1,177,731 to a net loss of $9,620,515. The increase is primarily due to an impairment on oil and gas assets of $9,892,000 recognized in the current period, coupled with a gain of $2,259,183 recognized in Q4 as a result of hyperinflationary accounting compared to a gain of $4,125,084 in the three months ended September 30, 2024. Furthermore, a foreign exchange loss of $1,154,268 was recorded for the three months ended December 31, 2024 compared to a loss of $720,213 in the prior quarter. Furthermore, the Company earned $2,110,078 in revenues during the current quarter compared to $2,325,694 in the prior quarter.

Net loss increased for the three months ended September 30, 2024, by $1,527,479 compared to the three months ended June 30, 2024, from a net income of $349,748 to a net loss of $1,177,731. The decrease is primarily due to a gain of $4,125,084 recognized in Q3, 2024 as a result of hyperinflationary accounting compared to a gain of $5,697,856 in the three months ended June 30 2024. Furthermore, the Company recorded deferred income tax expense of $2,030,631 in Q3 compared to $1,067,016 in Q2 2024.

Net income decreased for the three months ended June 30, 2024, by $970,108 compared to the three months ended March 31, 2024, from a net income of $1,319,856 to a net income of $349,748. The decrease is primarily due to a gain of $5,697,856 recognized in Q2 2024 as a result of hyperinflationary accounting compared to a gain of $6,349,365 in the three months ended March 31, 2024. Furthermore, a foreign exchange loss of $1,341,115 was recorded for the three months ended June 30, 2024 compared to a loss of $565,913 in the prior quarter. Furthermore, the Company earned $1,243,119 in revenues during the current quarter compared to $1,321,945 in the prior quarter. Additionally, the Company recorded deferred income tax expense of $1,067,016 in Q2 2024 compared to $854,952 in Q1 2024.

Liquidity and Capital Resources

The following table summarizes our liquidity position in USD:

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| | | |
|:---|:---|:---|
|  | **March 31,**<br> **2026** | December 31, <br>2025 |
| Cash and cash equivalents | 240738 | 430313 |
| Working capital deficit | (31978020) | (34373381) |
| Working capital deficit (excluding net assets and liabilities held for sale) | (9332020) | (34373381) |
| Total assets | 2558225 | 3102943 |
| Total liabilities | 34521424 | 42000413 |
| Stockholders' equity (deficit) | (31963199) | (38897470) |

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As at March 31, 2026, working capital deficit was $31,978,020 in comparison to a working capital deficit of $34,373,381 as at December 31, 2025. The $2,395,361 decrease in working capital deficit is primarily attributable to the decrease in convertible debt, due to the restructuring of the convertible debentures in accordance with the Fourth Supplemental Indenture, partly offset by the $6.4 million asset retirement obligation moving from a non-current liability to a current liability included as part or liabilities held for sale.

Based on the amounts recorded as at March 31, 2026, the sale of PPE Turkey is expected to improve working capital by approximately $22.6 million (see working capital deficit excluding net assets and liabilities held for sale above). In addition, the Company has restructured the convertible debentures with a fair value of $4,129,714 as at March 31, 2026 (December 31, 2025 - $11,823,815 amortized cost), such that approximately CAD11.0 million will be converted into common shares of the Company, and the remaining balance including accrued interest will be forgiven by the debenture holders, subject to the Company completing an equity financing of not less than CAD10.0 million on or before September 30, 2026.

The Company is seeking to raise significant funds through equity financing in order to meet the terms of the convertible debenture restructuring agreement and to fund the work program commitments on the M47 Oil Block earn-in arrangement.

***Operating, Investing and Financing Activities***

 ****

The chart below highlights the Company's cash flows:

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| | | |
|:---|:---|:---|
|  | **March 31, 2026** | March 31, 2025 |
| Net cash provided by (used in): |  |  |
| Operating activities | (147515) | 462943 |
| Investing activities | (25654) | (237776) |
| Financing activities |  | (494121) |
| Effect of exchange rate on cash and cash equivalents | (8838) | (37582) |
| Decrease in cash and cash equivalents | (182007) | (306536) |

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***Cash Used in Operating Activities***

Net cash used in operating activities for the three months ended March 31, 2026 was $147,515, compared to net cash provided by of $462,943 for the three months ended March 31, 2025. The current period's net income of $5,775,765 was coupled with $327,757 in changes in working capital items and offset by $6,251,037 in net non-cash items. The previous period's net income of $2,195,682 was coupled with $925,363 in changes in working capital items and offset by $2,658,102 in net non-cash items for the three months ended March 31, 2025.

***Cash Provided by and Used in Investing Activities***

Net cash used in investing activities for the three months ended March 31, 2026, was $25,654, compared to $237,776 used for the three months ended March 31, 2025. Oil and gas properties expenditures decreased to $Nil from $455,611 in the comparative period. The Company received $Nil in advances from its JV partners in comparison to $300,741 in the comparative period.

***Cash Used in Financing Activities***

We have funded our business to date from sales of our common stock through private placements and loans.

Net cash from financing activities for the three months ended March 31, 2026, was $Nil. Net cash used in financing activities for the three months ended March 31, 2025 was $494,121. This was comprised entirely of $494,121 in loan and lease payments made in 2025.

***Future Operating Requirements***

As of March 31, 2026, the Company had unrestricted cash of $240,738 and current liabilities of $34,521,424 ($9,620,709 excluding liabilities held for sale), which is not sufficient to cover its plan of operations over the next 12 months. In April 2026, the Company sold all of the issued and outstanding shares of PPE Turkey which will significantly improve the Company's working capital deficiency position, an estimated improvement of approximately $22.6 million based on amounts recorded as at March 31, 2026. In addition, the restructuring of the convertible debentures with a fair value of $4,129,714 as at March 31, 2026, will not result in any cash outflow to the Company, subject to the Company completing an equity financing of not less than CAD10.0 million on or before September 30, 2026.

The Company is seeking to raise significant funds through equity financing in order to meet the terms of the convertible debenture restructuring agreement and to fund the work program commitments on the M47 Oil Block earn-in arrangement.

 ****

In addition, the Company is looking for additional opportunities both in Turkey and internationally to develop the Company's asset base.

***Cash Flows Attributable to Discontinued Operations***

 ****

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| | |
|:---|:---|
|  | **March 31, 2026** |
|  | **$** |
| Net cash provided by operating activities |  |
| Net cash used in investing activities) |  |
| Net cash used in financing activities |  |

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 ****

Transactions with Related Parties

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| | | | | |
|:---|:---|:---|:---|:---|
| **Name** | **Relationship** | **Share based**<br> **('000)**<br> **$** | **Salary, bonuses**<br> **& directors fees**<br> **('000)**<br> **$** | **Total**<br> **('000)**<br> **$** |
| David M. Thompson | Director and Interim CFO | 1 | 60 | 61 |
| Burak Terzi | Chief Commercial Officer ("CCO") |  | 117 | 117 |
| Scott Lower | President |  | 75 | 75 |
| Sean Stofer | Director & Chairman | 1 | 53 | 54 |
| Jay Park | Director | 1 | 43 | 44 |
| Other | Close family |  | 47 | 47 |

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At March 31, 2026, accounts payable and accrued liabilities included $1,267,759 (December 31, 2025 – $1,121,180) due to related parties. The amounts are unsecured, non-interest bearing and due on demand.

During the three months ended March 31, 2026, management fees and salaries of $170,508 (2025 – $88,431), director fees of $21,600 (2025 – $30,600), consulting fees of $201,977 (2025 – $63,060), and stock-based compensation of $3,438 (2025 – $4,034) were incurred to related parties.

During the three months ended March 31, 2026, the Company issued Nil shares (2025 – 43,200) to directors for services performed.

During the three months ended March 31, 2026, the Company issued Nil shares (2025 – 198,682) to officers for services performed.

As at March 31, 2026, loans payable included CAD$248,877 (USD$179,742) (December 31, 2025 – CAD$248,189 (USD$181,806)) due to related parties. The loans payable are unsecured, bears interest ranging from 6% - 12% per annum and have maturity dates ranging from December 31, 2024 to December 27, 2026.

As at March 31, 2026, $30,000 (December 31, 2025 – $24,000) in shares were owed to an officer of the Company.

Risk Management

The Company is exposed to varying degrees to a variety of financial instrument and other risks:

*Foreign currency risk*

Foreign currency risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because they are denominated in currencies that differ from the respective functional currency. The Company and its subsidiaries are exposed to currency risk as it has transactions denominated in currencies that are different from their functional currencies. The Company does not hedge its exposure to fluctuations in foreign exchange rates.

As at March 31, 2026 and December 31, 2025, significant foreign exchange currency exposure on its financial instruments, expressed in USD was as follows:

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| |
|:---|
| Cash and cash equivalents |
| Accounts receivable |
| Accounts payable) |
| Loans payable |
| **Total** |

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If the CAD strengthened or weakened against the USD by 10% the exchange rate fluctuation would impact net loss from continuing operations by $414,947, at March 31, 2026. If the Turkish Lira strengthened or weakened against the USD by 10% the exchange rate fluctuation would impact net loss from continuing operations by $3,083, at March 31, 2026.

*Credit risk*

 

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations.

The Company is subject to credit risk on its cash and cash equivalents and amounts receivable which consists primarily of trade receivables and notes and amounts receivable for equity issued. The Company limits its exposure to credit loss on cash and cash equivalents by placing its cash with high-quality financial institutions.

The Company only has two customers. The Company mitigates credit risk by evaluating the creditworthiness of customers prior to conducting business with them and monitoring its exposure for credit losses with existing customers. One of the customers is the largest oil refinery in Turkey. The other customer provides letters of credit to be used by the Company in the event of default. As at March 31, 2026, all of the Company's trade receivables are current (< 30 days outstanding).

The Company's maximum credit exposure is $245,793 (December 31, 2025 – $1,147,456).

*Interest rate risk:*

 

Interest rate risk is the risk that future cash flows will fluctuate because of changes in market interest rates. The interest earned on cash is insignificant and the Company does not rely on interest income to fund its operations. The Company is exposed to interest rate risk through the variable interest debt facility it holds through its subsidiary PPE Turkey. A sustained increase or decrease in the variable interest rate by 5% would result in an increase or decrease in net loss from discontinued operations of approximately $56,202 per year based on the principal balance outstanding as at March 31, 2026.

*Other price risk:*

 

Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The Company does not hold equity investments in other entities and therefore is not exposed to a significant risk.

 

*Liquidity risk*

 

Liquidity risk arises from the Company's general and capital financing needs. The Company continuously monitors and reviews both actual and forecasted cash flows, and also matches the maturity profile of financial assets and liabilities, when feasible. The Company anticipates increases in revenue in future periods resulting from the completion of an additional well subsequent to the period end. Historically, the Company's sources of funding has been through equity and debt financings. The Company's access to financing is uncertain. There can be no assurance of continued access to significant debt or equity funding.

*Earn-in commitment risk*

 

The Company's principal asset following its strategic pivot is its right to earn a 29% working interest in the M47 Oil Block in Turkiye, which is contingent upon the Company funding approximately $15.0 million in work program costs, comprised of approximately $9.5 million for the 2026 work program and approximately $5.5 million for the 2027 work program. As at the date of this report, the Company has advanced US$500,000 toward these obligations and remains required to source the balance. Failure by the Company to meet its funding commitments on a timely basis, in whole or in part, could result in the Company forfeiting all or a portion of its earned interest in the M47 Oil Block, a reduction in the working interest ultimately earned, dilution, penalties, or the loss of the opportunity altogether. Any such outcome would have a material adverse effect on the Company's business, financial condition, results of operations and prospects, particularly given that the M47 Oil Block represents substantially all of the Company's go-forward operating asset base following the disposition of PPE Turkey.

*Funding and capital availability risk*

 

The Company's ability to meet its earn-in commitments on the M47 Oil Block and the terms of its convertible debenture restructuring arrangement is dependent on its ability to raise significant additional capital through equity financing or other sources. There can be no assurance that such financing will be available on acceptable terms, on a timely basis, or at all. Adverse equity market conditions, volatility in commodity prices, the Company's share price, dilution concerns, and general macroeconomic conditions may each impair the Company's ability to raise capital. A failure to secure sufficient funding would directly jeopardize the Company's ability to meet its earn-in obligations and the convertible debenture restructuring terms, and could ultimately threaten the Company's ability to continue as a going concern.

*Exploration and reserves risk*

 

The M47 Oil Block is an exploration-stage asset and the planned work program includes the drilling of new exploration wells and the acquisition of seismic data. Oil and gas exploration is inherently speculative and involves a high degree of risk. There is no assurance that the planned wells will encounter commercial quantities of hydrocarbons, that any discovered resources will prove to be economically recoverable, or that the Company will recover any of its invested capital. Even where commercial discoveries are made, production volumes, reserves estimates, decline rates and ultimate recoveries may differ materially from expectations. The Company's reliance on a single exploration-stage block significantly concentrates this risk.

*Non-operator risk*

 

The Company does not act as operator of the M47 Oil Block. Drilling decisions, planning, procurement and other operational matters in respect of the block are to be determined by a Joint Operating Committee. As a non-operating, minority working-interest participant, the Company has limited ability to control the timing, scope, cost, execution or success of work programs, including the wells and seismic acquisition on which its earn-in is based. Cost overruns, schedule delays, technical decisions, sub-optimal operating practices, or disputes among working-interest participants could each adversely affect the Company's costs, the timing of its funding obligations, and ultimately the value of its interest.

*Commodity price risk*

 

The Company's revenues, cash flows and the economic viability of its current and future operations are directly affected by prevailing prices for crude oil, and historically natural gas. Commodity prices are volatile and are influenced by numerous factors beyond the Company's control, including global supply and demand, OPEC+ production decisions, geopolitical events, sanctions, currency movements, weather, transportation constraints, the energy transition and changes in regulatory and fiscal regimes. Sustained low oil prices could render the M47 Oil Block work program uneconomic, impair the Company's ability to attract financing for its earn-in funding commitments, and adversely affect the Company's financial condition and prospects. The Company does not currently hedge its commodity price exposure.

*Country and political risk*

 

The Company's operations are located entirely in Turkiye. As such, the Company is exposed to political, economic, regulatory, fiscal, legal and currency risks particular to that jurisdiction, including changes in petroleum legislation, royalty and tax regimes, licensing requirements, foreign investment restrictions, currency convertibility and repatriation of funds, inflation and interest rate volatility (including in respect of the Turkish Lira), and broader geopolitical developments in the region. Any adverse change in these conditions could materially affect the Company's title to or interest in its assets, its operating costs, its access to capital, and its overall results of operations.

*Litigation and contingent liability risk*

 

The Company and its former subsidiary PPE Turkey are party to ongoing legal and arbitration proceedings, including an arbitration claim advanced against an offshore drilling rig contractor, a related defence of an action brought by the same contractor in Europe, and claims by a third party in respect of a former farm-in arrangement. While certain of these matters relate to PPE Turkey, which has been disposed of, the outcome of any such proceedings is inherently uncertain. There is no solid guarantee that any creditor of PPE Turkey will not attempt to commence an action against the Company. Adverse outcomes, including in matters where liability is presently disputed or recovery is not virtually certain, could result in material monetary judgments or settlements, indemnification obligations, or reputational harm, any of which could adversely affect the Company's financial condition and ability to fund its earn-in commitments.

*General risks*

 

Petroleum and natural gas exploration and production can involve environmental risks such as litigation, physical and regulatory risks. Physical risks include the pollution of the environment, climate change and destruction of natural habitat, as well as safety risks such as personal injury. The Company works hard to identify the potential environmental impacts of its new projects in the planning stage and during operations. The Company conducts its operations with high standards in order to protect the environment, its employees and consultants, and the general public. We maintain current insurance coverage for comprehensive and general liability as well as limited pollution liability. The amount and terms of this insurance are reviewed on an ongoing basis and adjusted as necessary to reflect current corporate requirements, as well as industry standards and government regulations. Without such insurance, and if the Company becomes subject to environmental liabilities, the payment of such liabilities could reduce or eliminate its available funds or could exceed the funds the Company has available and result in financial distress.

*Climate change risks*

 

Our exploration and production infrastructure and other operations and activities emit greenhouse gasses ("GHG") which may require us to comply with federal and/or provincial GHG emissions legislation. Climate change policy is evolving at regional, national and international levels, and political and economic events may significantly affect the scope and timing of climate change measures that are ultimately put in place to prevent climate change or mitigate our effects. The direct or indirect costs of compliance with GHG-related regulations may have a material adverse effect on our business, financial condition, results of operations and prospects. Some of our significant facilities may ultimately be subject to future regional, provincial and/or federal climate change regulations to manage GHG emissions. In addition, climate change has been linked to long-term shifts in climate patterns and extreme weather conditions both of which pose the risk of causing operational difficulties.

Off-Balance Sheet Arrangements

During 2018 the Company entered into an agreement to grant to a consultant of the Company a 2% (two percent) gross overriding royalty on petroleum substances produced from certain of its currently undeveloped exploration properties, namely: Block 1-11 Vranino situated in Dobrich District, Bulgaria. The Grant of the royalty agreement was for services involving technical and corporate advisory services.

Disclosure of Outstanding Share Data

The Company's authorized share capital consists of an unlimited number of common shares of which 41,624,407 were issued and outstanding as of March 31, 2026. As of the date of this MD&A, the total number of outstanding common shares is 43,624,407.

As at March 31, 2026 and as at the date of this MD&A, the following stock options were outstanding, entitling the holders thereof the right to purchase one common share for each option held as follows:

---

| | | | |
|:---|:---|:---|:---|
| Outstanding | Exercise Price | Expiry Date | Vested |
| 10000 | 9.50 CAD | June 6, 2026 | 10000 |
| 40000 | 1.50 CAD | January 2, 2027 | 40000 |
| 50000 | 1.00 CAD | February 15, 2027 | 50000 |
| 100000 | 1.25 CAD | February 28, 2027 | 100000 |
| 490000 | 1.00 CAD | March 8, 2027 | 490000 |
| 1610000 | 0.70 CAD | August 12, 2029 | 1610000 |
| 2300000 |  |  | 2300000 |

---

As at the date of this MD&A, the following warrants were outstanding, entitling the holders thereof the right to purchase one common share for each warrant held as follows:

---

| | | |
|:---|:---|:---|
| Outstanding | Exercise Price | Expiry Date |
| 2646475 | 0.90 CAD | <sup>(1)</sup>May 28, 2026 |
| 104073 | 0.45 CAD | May 28, 2026 |
| 1228445 | 0.90 CAD | <sup>(1)</sup>May 31, 2026 |
| 72450 | 0.45 CAD | May 31, 2026 |
| 306496 | 0.90 CAD | <sup>(1)</sup>June 10, 2026 |
| 7819 | 0.45 CAD | June 10, 2026 |
| 452556 | 0.90 CAD | <sup>(1)</sup>June 19, 2026 |
| 12180 | 0.45 CAD | June 19, 2026 |
| 1694520 | 0.90 CAD | June 28, 2026 |
| 400000 | 0.90 CAD | July 3, 2026 |
| 30000 | 0.90 CAD | July 5, 2026 |
| 2100 | 0.45 CAD | July 5, 2026 |
| 1000000 | 0.25 CAD | <sup>(2)</sup>April 27, 2027 |
| 7957114 |  |  |

---

<sup>(1)</sup> On May 21, 2026, the Company extended the expiry date by one year from the original expiry date stated in the table above.

<sup>(2)</sup> Issued on April 27, 2026 as part of the private placement of 2,000,000 units.

Critical Accounting Policies and Estimates

Our consolidated financial statements and accompanying notes have been prepared in accordance with IFRS. The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our consolidated financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

We believe that our critical accounting policies and estimates include the following:

*Revenue Recognition*

*Revenue from Contracts with Customers*

The Company recognizes revenue when it satisfies its performance obligation(s) by transferring control over a product to a customer. Revenue is measured based on the consideration the Company expects to receive in exchange for those products.

*Performance Obligations and Significant Judgments*

The Company sells oil and natural gas products in Turkey. The Company enters into contracts that generally include one type of distinct product in variable quantities and priced based on a specific index related to the type of product.

The oil and natural gas are typically sold in an unprocessed state to processors and other third parties for processing and sale to customers. The Company recognizes revenue at a point in time when control of the oil is transferred. For oil sales, control is typically transferred to the customer upon receipt at the wellhead or a contractually agreed upon delivery point. Under the Company's natural gas contracts with processors, control transfers upon delivery at the wellhead or the inlet of the processing entity's system. For the Company's other natural gas contracts, control transfers upon delivery to the inlet or to a contractually agreed upon delivery point. In the cases where the Company sells to a processor, the Company has determined that the Company is the principal in the arrangement and the processors are the Company's customers. The Company recognizes the revenue in these contracts based on the net proceeds received from the processor.

For the Company's product sales that have a contract term greater than one year, the Company uses the practical expedient in IFRS 15 Paragraph 121(a) which states the Company is not required to disclose the transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to an unsatisfied performance obligation. Under these sales contracts, each unit of product represents a separate performance obligation; therefore, future volumes are unsatisfied, and disclosure of the transaction price allocated to remaining performance obligations is not required. The Company has no unsatisfied performance obligations at the end of each reporting period.

The Company does not believe that significant judgments are required with respect to the determination of the transaction price, including any variable consideration identified. There is a low level of uncertainty due to the precision of measurement and use of index-based pricing with predictable differentials. Additionally, any variable consideration identified is not constrained.

*Amounts Receivable*

Amounts receivable consist of oil and gas receivables. The Company has classified these as short-term assets in the balance sheet because the Company expects repayment or recovery within the next 12 months. The Company evaluates these accounts receivable for collectability and, when necessary, records allowances for expected unrecoverable amounts. The Company deems all accounts receivable to be collectable and has not recorded any allowance for doubtful accounts.

*Exploration and Evaluation Assets*

 

Pre-license exploration costs are recognized in the consolidated statement of operations and comprehensive loss as incurred.

The costs to acquire non-producing oil and gas properties or licenses to explore, drill exploratory wells and the costs to evaluate the commercial potential of underlying resources, including related borrowing costs, are initially capitalized as exploration and evaluation assets.

Exploration and evaluation assets are subject to technical, commercial and management review to confirm the continued intent to develop and extract the underlying resources. If an area or exploration well is no longer considered commercially viable, the related capitalized costs are charged to exploration expense.

Exploration and evaluation assets are not subject to depreciation, depletion and amortization.

When management determines with reasonable certainty that an exploration and evaluation asset will be developed, as evidenced by the classification of proved or probable reserves and the appropriate internal and external approvals, the asset is transferred to oil and gas properties.

*Oil and gas properties*

Oil and gas properties ("O&G") include development and productions costs, less accumulated depletion and depreciation and accumulated impairment loss. O&G are grouped into cash generating units for impairment testing.

When significant parts of an item of O&G have different useful lives, they are accounted for as separate items (major components).

Costs incurred subsequent to the determination of technical feasibility and commercial viability and the costs of replacing parts of O&G are capitalized only when they increase the future economic benefits embodied in the specific asset to which they relate. All other expenditures are recognized in profit or loss as incurred. Such capitalized items generally represent costs incurred in developing proved and/or probable reserves and bringing on or enhancing production from such reserves and are accumulated on a field or geotechnical area basis. The carrying amount of any replaced or sold component is derecognized. The costs of the day-to-day servicing of oil ang gas properties are recognized in profit or loss as incurred.

The net carrying value of oil and gas properties is depleted using the unit-of-production method by reference to the ratio of production in the year to the related proved reserves, taking into account estimated future development costs necessary to bring those reserves into production. These estimates are reviewed by independent reservoir engineers at least annually.

*Stock-based compensation*

Under the company's share-based compensation plans, share-based awards may be granted to executives, employees and non-employee directors. The Company grants restricted share units ("RSUs") and stock options to directors, officers, employees, and consultants. An individual is classified as an employee when the individual is an employee for legal or tax purposes or provides services like those performed by an employee.

The costs of equity-settled transactions with employees are measured by reference to the fair value at the date on which they are granted, using the Black Scholes valuation model. The costs of equity-settled transactions are recognized, together with a corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (the "vesting date"). For cash settled share-based compensation, the expense is determined based on the fair value of the liability at the end of the reporting period until the award is settled.

In situations where equity instruments are issued to non-employees and some or all of the goods or services received by the entity as consideration cannot be specifically identified, they are measured at fair value of the share-based payment.

The cumulative expense is recognized for equity-settled transactions at each reporting date until the vesting date reflects the Company's best estimate of the number of equity instruments that will ultimately vest. The profit or loss charge or credit for a period represents the movement in cumulative expense recognized as at the beginning and end of that period, and the corresponding amount is represented in contributed surplus. At the end of each reporting period, the Company re-assesses its estimates of the number of awards that are expected to vest and recognizes the impact of the revisions in the consolidated statements of loss.

No expense is recognized for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, which are treated as vesting irrespective of whether or not the market condition is satisfied provided that all other performance and/or service conditions are satisfied.

Where the terms of an equity settled award are modified, the minimum expense recognized is the grant date fair value of the unmodified award, provided the original terms of the award are met. An additional expense or its reduction is recognized for any modification which increases or decreases the total fair value of the share-based payment arrangement or is otherwise beneficial to the employee as measured at the date of modification. Where an award is cancelled by the Company or the counterparty, any remaining element of the fair value of the award is expensed immediately or reversed through profit or loss, depending on the type of cancellation. The dilutive effect of outstanding options is reflected as additional dilution in the computation of earnings per share whereas anti-dilutive options are ignored.

Consideration paid to the Company on exercise of hare-based awards is credited to share capital and the associated amount in option reserve is reclassified to share capital.

*Unit Offerings*

Common shares are classified as equity. Proceeds from unit placements are allocated between shares and warrants issued using the residual method. The residual method first allocates fair value to the component with the best evidence of fair value and then the residual value, if any, to the less easily measurable component. The fair value of the common shares, measured on date of issue, was determined to be the component with the best evidence of fair value. The balance, if any, was allocated to the attached warrants. Costs directly identifiable with share capital financing are charged against share capital. If the subscription is not funded upon issuance, the Company records a receivable as a contra account to shareholders' equity.

*Hyperinflation in a subsidiary's functional currency*

 

IAS 29 provides guidance on when a hyperinflation economic environment exists. When hyperinflation is deemed to exist, the subsidiary's financial statements are first restated before being translated into the consolidated financial statements. Comparative amounts are excluded from the restatement requirement when the presentation currency of the ultimate financial statements into which they will be included (USD) is non-hyperinflationary.

Monetary items are not restated because they are already expressed in terms of the monetary unit current at the end of the reporting period. Certain non-monetary items are carried at amounts current at the end of the reporting period, such as net realizable value and fair value, so they also are not restated. All other non-monetary assets and liabilities are restated in their functional currency so that all the items presented are equivalent to their current purchasing power at the end of the current reporting period. A non-monetary item once restated, in accordance with the appropriate IFRS's, cannot exceed its recoverable amount.

*Assets and liabilities held for sale and discontinued operations:*

 

Assets and disposal groups are classified as held for sale if their carrying amounts will be recovered through a sale transaction rather than through continuing use. This condition is met when the sale is highly probable, the asset is available for immediate sale in its present condition and the sale is expected to be completed within one year from the date of classification.

Assets and disposal groups are classified and presented as discontinued operations if the assets or disposal groups are disposed of or classified as held for sale and:

● The
 assets or disposal groups are a major line of business or geographical area of operations;

● The
 assets or disposal groups are part of a single coordinated plan to dispose of a separate major line of business or geographical area
 of operations; or,

● The
 assets or disposal groups are a subsidiary acquired solely for the purpose of resale.

A component that is a separate major line of business or geographical area of operations and has been disposed of, closed, abandoned or terminated is also classified as a discontinued operation.

The assets or disposal groups that meet these criteria are measured at the lower of carrying amount and fair value less cost of disposal, with impairments recognized in the consolidated statements of income (loss) and comprehensive income (loss). An impairment loss is recognized for any initial or subsequent write-down of the asset or disposal group to fair value less cost to dispose. Non-current assets and liabilities held for sale are presented separately in current assets and liabilities within the consolidated statement of financial position. Assets held for sale are not depreciated, depleted or amortized. The comparative period consolidated statement of financial position is not re-presented.

The results of discontinued operations, net of tax, are shown separately in the consolidated statements of income (loss) and comprehensive income (loss) and comparative figures are re-presented.

Commitments and Contingencies

<u>TR1 Master Fund loans</u>

The Company has filed claims in connection with ongoing receivership proceedings against certain Traynor Ridge Capital entities, alleging that improper and unlawful trading activities in the Company's securities caused a significant decline in its share price and resulted in substantial financial losses, including impairment of a planned equity financing. The Company is seeking damages of up to $25 million per respondent on a joint and several basis. A threshold hearing is scheduled to determine whether the claims disclose a valid cause of action. At this stage, the outcome of the proceedings is uncertain, and no amounts have been recognized in the consolidated financial statements. The Company is seeking to offset any amounts outstanding under the TR1 Master Fund loans against damages claimed by the Company.

<u>Close-out Fund</u>

The Company's former subsidiary PPE Turkey contributed to the Close-Out Fund held by the operator where it has deposited 10% of natural gas revenue from the SASB project into the Close-Out Fund until an amount agreed to by both parties is attained. PPE Turkey did not meet its commitment since the beginning of 2025 and as a result its contribution to the Close-Out Fund is short by approximately $33,000. PPE Turkey was disposed of in April 2026

<u>Arbitration</u>

The Company through its' subsidiary PPE Turkey has advanced arbitration against an offshore drilling rig contractor for $20.3 million for gross negligent and breach of contact involving health and safety issues during the prior year drilling program resulting in loss and damages to Company (the "Trillion Losses"). Liability is not admitted, the litigation is at the inception, and thus, legal counsel has advised that it is too soon to predict the outcome or the quantum of damages that will be assessed. In accordance with guidance for contingent assets and liabilities, no provision for any potential recovery of the Trillion Losses will be made until recovery is virtually certain. If the Company's claim is successful, the award will exceed the amount, if any, that is payable to the drilling contractor in its claim.

The Company's subsidiary PPE Turkey is defending an action brought by the same drilling contractor in Europe to which it has advanced an arbitration claim, for drilling services seeking $3 million. This amount has fully been recorded in accounts payable in accordance with guidance as there is significant uncertainty as to the outcome of the arbitration. PPE Turkey was disposed of in April 2026 (Note 3) and the amount is reflected as part of liabilities held for sale as at March 31, 2026.

<u>Third party liability claim</u>

As at December 31, 2024, the Company included in accounts payable and accrued liabilities a potential liability for an invoice in the amount of $144,247, issued to a 3rd party with whom the Company previously had a farm-in arrangement. The vendor is claiming that the Company is liable given the previous relationship. As at December 31, 2025, the Company included in accounts payable and accrued liabilities an additional $1,880,855 related to additional claims for invoices issued to the 3rd party. The claims and related accruals were held within PPE Turkey that was disposed of in April 2026 and the amounts are reflected as part of liabilities held for sale as at March 31, 2026. The Company disputes the asserted claims, and the ultimate resolution of these matters remains uncertain.

<u>Dispute with former employees</u>

The Company's former subsidiary PPE Turkey filed claims against, and has received counter claims from former employees of PPE Turkey which was disposed of in April 2026. Management believes the claims against the Company are without merit. Accordingly, no provision has been recognized as at period end. The ultimate outcome of the proceedings cannot presently be determined.

Events Subsequent to the Three Months Ended March 31, 2026

<u>Sale of PPE Turkey</u>

In April 2026, the Company, through a subsidiary, entered into an agreement to sell all of the issued and outstanding shares of PPE Turkey, which holds the Company's license interests in the SASB natural gas project and the Cendere oil field.

Under the terms of the agreement, the purchaser will assume the assets and liabilities associated with PPE Turkey. In connection with the transaction, the Company will retain a 7% gross overriding royalty on future production revenues from the underlying licenses. The royalty becomes payable once cumulative gross revenues from the licenses following closing exceed $7.5 million and may also be realized upon any future disposition of the licenses by the purchaser.

<u>Unit issuance</u>

Subsequent to March 31 2026, the Company issued 2,000,000 units for gross proceeds of CAD $300,000 (USD $219,525). Each unit consists of one common share in the capital of the Company and one half of one common share purchase warrant. Each whole warrant is exercisable at CAD $0.25 and shall be exercisable for a period of one (1) year from the date of issue.

<u>Warrant expiration date extension</u>

On May 21, 2026, the Company extended the expiry date of an aggregate of 4,633,965 outstanding common share purchase warrants originally issued in connection with a non-brokered private placement completed in tranches between May and June 2024. The extension is for one additional year from the original expiry date. The exercise price of CAD $0.90 per share remains unchanged.