"Inside Trillion Energy: Production, Progress & Future Potential".

Location is one of the most powerful risk reducers in the oil business. If you're exploring in an unproven basin, you're trying to answer some fundamental questions about whether the petroleum system even works, but if you're sitting in a proven trend with active production all around you, many of those questions have already been answered. So, that's what makes M47 so compelling. We're not drilling a concept conceptual idea. Uh we're operating within one of the most active and successful oil fairways in Turkey. >> [music] [music] >> Hi, how's everybody doing today? I'm your host Richard De Souza here on behalf of the Rich TV Show with our very special guest, the Vice President of Trillion Energy, Tolga Barac. How you doing today, Tolga? >> I'm very good. How are you? >> I'm doing fantastic. Very excited to have you on the show. And the last time we covered the discovery itself, today I want to focus on where M47 sits because in this business, location can de-risk a play before you ever drill. There's an old principle that the best place to find oil is right beside where it is already being found. So, why does that matter so much? And how well does M47 fit it? >> Yeah, thanks for having me, Rich. So, location is one of the most powerful risk reducers in the oil business. If you're exploring in an unproven basin, you're trying to answer some fundamental questions about whether the petroleum system even works, but if you're sitting in a proven trend with active production all around you, many of those questions have already been answered. So, that's what makes M47 so compelling. We're not drilling a concept conceptual idea. Uh we're operating within one of the most active and successful oil uh fairways in Turkey. Uh we've got producing fields all around our block, solid infrastructure in place, and uh plenty of nearby wells showing the same petroleum system. When geologists talk about close analogy, they're really talking about the probability, right? So, uh if your geology, reservoir, your fluids, and and the structure are similar to nearby producing fields, then the geological risk is much lower. M47 checks all of those boxes. Our our two uh two wells that has been drilled in 2025 confirmed the same high-quality light oil seen uh through the trend, and the independent resource assessment also demonstrates that it's a potentially a very meaningful accumulation. So, M47 is positioned exactly where you would want a new discovery to be. >> We love to hear that. And can you set the scale of the Cudi Gabar region for people hearing about it for the first time? Four years ago, it produced almost nothing, and today over half of Turkey's entire oil production comes from fields right beside your block. How does this become one of the fastest-growing oil regions in the world? >> Yeah, what has happened in the Mount Gabar region uh over the last few years has been extraordinary. The region that was contributing a very little to national production, almost zero, has rapidly became the center of Turkey's oil growth story. Through systematic exploration and development, multiple large discoveries have been made, production has expanded dramatically, and the region is now accounts for a substantial portion of uh country's oil output. The reason is quite simple, actually. The industry gained uh much better understanding of the regional geology and uh the productivity of Cretaceous carbonate reservoirs. Once those discoveries began proving commercial success, our neighbor TPAO has pushed the gas pedal and accelerated development across the trend. For us, this is very important because M47 sits directly within the same regional petroleum system. Uh we are benefiting from a geological model that has already been validated repeatedly by nearby production. You know, investors usually try to get in early in emerging oil provinces while they are still in the early stages of growth, which is very normal. And the Mankabir region is one of the rare places globally uh where the production growth, infrastructure expansion, and uh ongoing discoveries are all happening simultaneously at the same time. And that's a very attractive backdrop for a company like Trillion Energy. So, put it that way, TPAO is operating with 40 plus drilling rigs at the moment, and major service companies like Schlumberger, Baker Hughes, Halliburton, Weatherford are operating there. There are met along with many local uh rig contractors, there are some foreign rig contractors as well, and there are at least 3 to 5,000 people working at the same time, and the place literally looks like an oil province. Probably within a couple years, the area uh will be expanded more and surrounded with upgraded infrastructure. So, everything seems to be on track right now. >> I know we love to hear as investors location, location, location. Now, M47 is about 12 km from Sahit I Bukey Yasin, Turkey's largest onshore oil field at roughly 8 billion barrels in place announced by President Erdogan himself, and the structure you're on extends east into that same field. How directly does that tie M47 into a proven giant? >> Yeah, so there two large oil fields which are very popular. So, Sahit I Bukey Altun and Sahit Esma Cevik fields are the most popular ones, but it is not only those two fields, but there are some other new field new field discoveries, and and some new field new field discoveries which has been discovered in 2024 and 2025, which is a couple years after after TPAO discovered those two fields, and the new ones are closer than the first ones. So, investors should understand that we are not saying M47 is the same field, and we cannot assume all the reserve continues across the license boundaries as same as the other side of the block, but we can say that proximity matters a lot. So, being located around 10 12 km away from the largest onshore oil discovery in modern Turkish history is significant because it demonstrates the effectiveness of the regional petroleum system. The source rocks, migration pathways, reservoir intervals, and the trapping mechanisms have all have been proven uh at a very large scale. What is particularly encouraging for us is that our block lies along the same regional trend and our wells encounter the same type of light oil that has made nearby fields so successful. So, for example, when we're when we are reviewing the projects around the world, one of the first things that we look at is whether whether there are producing fields nearby and whether infrastructure is already in place. That gives you a strong evidence of the area's potential and what it may be capable of delivering. M47 is surrounded by exactly that kind of evidence. And ultimately, every field must stand on on its own merits, but being located beside one of the country's most important oil discoveries certainly increases our confidence in the long-term potential of the area. >> That makes a lot of sense. I mean, you guys are located beside a giant, and that's exactly what investors want to hear. Now, there are roughly 100 analog producing wells within 10 to 12 km of your block, all of the same carbonate, all producing 32 to 36° light oil. For an investor trying to understand risk, what does that density of successful wells right next door do to the odds of M47? >> Yeah, obviously the density of successful wells is one of the strongest data that we can point to, right? In exploration, every producing well is effectively another piece of evidence that the petroleum system works. I mean, in geology, the reservoirs and everything. So, when you have approximately 100 producing wells within such a short distance, you're no longer relying solely on on theory or seismic interpretation. You're looking at a real-world production history from the same regional trend. For investors, of course, that doesn't eliminate the risk because every structure is unique, but significantly reduces the uncertainty. We know the reservoir produces, we know the oil quality there, we know operators are developing these reservoirs successfully across the area. This is so critical for the investors. We never say that all the wells that we will drill would produce this much amount of oil, but they should understand the risk is relatively lower, many times lower. As you can literally see producing wells or drilling rigs when you look towards to the neighbor blocks. What we are doing in 47 is evaluating and advancing a discovery within an environment that already demonstrated commercial success many, many times over. >> We'd love to hear that, and proximity is one thing, but you're also drilling the exact same carbonate as your producing neighbors, the Cretaceous, Mardin, and Beloka Group. And your two wells confirmed the same 32.4 degree light oil that flows right across the trend. Beyond the reservoir mechanics, why does sharing the neighbors formation de-risk M-47 more than the location alone? >> Yeah, that's that's an important distinction. So, location alone is, of course, helpful, but reservoir equivalence is, I think, even more important. Our wells encountered the same Cretaceous carbonate system that hosts production throughout the trend. We also confirmed with our wells light oil characteristic that are consistent with the nearby producing wells. So, from a technical standpoint, that's valuable because it allows us to compare our results against a large database of uh of analog production uh production performance. It It helps us better understand expected recovery factors, development concepts, production profiles, and and also economics. So, in other words, we're not just near successful fields, but we're evaluating the same reservoir system that has already proven capable of generating significant commercial production throughout the region. That substantially improves our ability to forecast outcomes uh compared with a discovery an entirely new or untested formation or unknown location. >> That's great. And who is actually operating around you? These are the state oil companies and serious players with about 40 active rigs operating in the region. And how does a company of trillion size end up holding a working interest in the middle of them? >> Well, uh the operators around us include some of the most active and experienced companies working in Turkia today, of course led by uh national oil company TPAO. They have the biggest success there. Uh in Turkia the local legislation, so our petroleum law is so friendly. As long as you fulfill your commitments to the government, I mean uh you drill the number of wells in your working program in a that you submit to the government in advance in the first place, you'll define your license will be extended. So, there is no uh problem with the, you know, losing the license or so as long as you fulfill your commitments. And uh on the other side, especially national oil company has a substantial ongoing investment through the region with drilling hundreds of wells and shooting kilometers of seismic data every year. So, the location is uh around 50 to 70 km away from Syrian border and 80 to 100 km away from Iraqi border. So, the government has invested a lot into security. There are stations in every couple kilometers, so it is safer than anywhere. Also, the government intercity highways are renewed by the government. Local roads are well constructed. So, from a well to well, you can easily access. And Turkey's national pipeline company has completed a pipeline from from Gabar region to Mediterranean coast to ship the oil directly to the refineries in Istanbul and Izmir provinces. So, those investments are not done for us, but as companies operating in Turkey, especially in the region, we're we're taking advantage of them, of course. And with the presence of 40-plus active drilling rigs tells you something very important. So, the capital continues to flow into this basin because operators are generating attractive results. For a company of Trillion size, securing a position within such an active and successful region is extremely valuable. It gives us exposure to one of the country's highest priority oil development areas, while allowing us to leverage knowledge being generated across the trend. So, we are operating along alongside companies that are continuously validating, thanks to TPAO, of course, national oil company, and the regional geology through drilling and production production activities. >> I love hearing that, and we love identifying companies that are undervalued, underappreciated, underexposed, but that are located in the right regions. And you mentioned it's safer than ever. So, here's what stands out to me. Those operators aren't something an ordinary investor can buy as a play on this region. Is it fair to say Trillion is the only public company investors can use to get exposure to this region and that you're likely to stay the only one. >> Yeah, this is a this is a very good question though. So, yeah, Trillion Energy is currently the only publicly traded company offering direct exposure to this particular development trend in the region. So, most of the activity is being conducted by state-owned company or some private entities, private companies that investors cannot easily access through public markets. That creates an interesting situation because investors who recognize the significance of what's happening in the Mount Cavor region have a very limited avenues through which they can participate. So, as long as that remains the case, we believe our position in in M47 provides a unique strategic value that extends beyond the discovery itself. >> This makes this company a unicorn for investors that are watching. This could be your only opportunity to get exposure to this region as a public company. So, that's why you need to put Trillion Energy on your radar and on your watch list. Now, this isn't a mature basin that's leveling off either. New fields keep being discovered on trend and the field next door jumped from about 10,000 to 27,000 barrels a day in a single year. What does that tell you about how much room is left to run here? >> Well, exactly. I mean, one of the things that excites us more most that this appears to be a growth story rather than a major basin story. So, we're already watching a live history here in Turkey like a documentary which may change a big country like Turkey. So, we're continuing to see new discoveries, increasing production and ongoing infrastructure investments across the region. When when our neighbor fields are delivering substantial production growth in relatively short periods of time, which has happened within like 5-6 years, not not longer than that, it tells you the operators are still unlocking the value and expanding their understanding of the basin. This is what exactly we are planning here, unlocking the value and expanding the understand our understanding of the basin. The more we understand the basin, the more we understand the geology, the more we understand the drilling, we'll have more successful wells and and get more production from our wells. For for our investors, that means M47 is participating in a trend that continues to evolve positively. So, the basin is still revealing its potential. It's not completed yet. And historically, those environments tend to create some of the most significant value creation opportunities in the industry. >> You said unlocking value. And what we do here at Rich TV is we love to unlock value for investors. So, thank you for that. And the resource itself is independently validated at 27.6 million barrels on a 2C basis net to Trillion with an unrisked value north of 730 million dollars. And even risk down, it remains well into the hundreds of millions. How much weight should investors, especially institutions, put on having a third-party standards-based number behind a discovery this early? And what does it take to move that 2C resource up to a book reserve? >> Yeah. So, third-party validation is extremely important because it's it proves an objective assessment using recognizing industry standard. On the other hand, we are a public company and and getting third-party validation reports is is is mandatory, right? It's an obligation. But as management, we can always be optimistic about our assets. But independent resource evaluators apply discipline methodology that institutions understand and trust. So, the 27 million barrel 2C resource gives investors a credible benchmark which to evaluate the opportunity. It demonstrates that this is not a simple geological concept. There is a quantified resource resource supported by by independent analysis. So, the next step is continuing appraisal and development work that can further reduce uncertainty and ultimately support reserve bookings. So, this is how the value typically advance in the industry. So, resource identification, this is done. Appraisal, this is what we're up to. Reserve conversion is the next step. Production growth, hopefully it will happen. And ultimate cash flow generation, of course. This is everyone is waiting for it. And each stage tends to reduce risks and increase the market recognition. >> I can't wait to see you guys get to those next steps. I will be watching very closely on all of your news to see as it happens and unfolds. Now, on getting it to market, you can already truck oil about 130 km to the Batman refinery, but there's more to this picture because you're inside an established producing region. The bigger midstream is being built, too. A regional pipeline and the Botas connection into a country that imports more than 85% of its oil, how much does sitting inside a proven oil-hungry market de-risk the off-take side for M47? >> Yeah, generally a discovery only creates value if you can move the product to the market efficiently. This is not only for oil and gas industry, but applicable for all industries. So, one of the advantages of operating in an established producing region is that the infrastructure uh conversation has already begun long before you arrive. So, today uh oil can be transported to existing refinery capacity, and longer term, we continue to see infrastructure development across the region, including pipeline expansion and broader integration into the national energy network. So, uh let me give you some some uh some some figures. Turkey remains a significant importer of crude oil. We're a country uh with around 90 million people, and we import 1 to 1.2 million barrels of oil every day, but we only produce 130 to 140,000 barrels of oil every day. That means domestic production carries strategic value for the country. We need to work very hard, stay focused, and be diligent in order to meet the country's imports need. This is why the government is making substantial investment itself and operating with 40 million 50 million at the same time, while also supporting private companies that are willing to make these investments. When you combine a growing production region with strong domestic demand, the off-take environment becomes considerably more attractive than in many uh frontier jurisdictions. So, the country is hungry for oil and gas, and we have we have no off-take problems or any off-take future problems as long as we produce as much as we produce. >> I love hearing that the country is hungry for oil and Trillion Energy is hungry to give them that oil. Now, let's put real numbers on the economics. Lifting costs around $10 a barrel, operating costs near eight, and net back in the range of $55 and a payback of roughly a month per well, about 5.5 million dollars of net backs per well in year one. Walk investors through why a proven region like this delivers economics that strong. >> Yeah, what makes this region particularly attractive is that strong well economics are being supported by proven operating results from the nearby fields. We have a lot of examples, which some of them are literally a couple hundred meters away. Some of them some fields are a couple kilometers away. So, we know we know uh some some certain costs. I I usually hesitate to get to to make to give to give some figures about the production or net paybacks or something like that because it could be lower, it could be higher, uh but in Turkey, despite the high demand for field services, drilling costs are still relatively cheaper than neighboring countries. In addition, we have a skilled, knowledgeable, and experienced workforce in the petroleum industry, which would allow us uh to work continuously without an interruption for all of our operations. The combination of relatively low lifting costs, uh attractive operating margins, and strong production rates creates uh the potential for very rapid capital recovery. That's for sure. For example, a well cost is around two to three million dollars USD in Turkey if you know that you're if you know what you're doing, uh but the oil that you're producing worth the same with worth the same price with any oil. So, uh, the the the cost is cheaper, but the oil is the same price. And when investors hear figures such as up to approximately one-month payback periods or multi-million dollar first-year net back net backs per well, what they're really hearing is operational efficiency. Our job is to do the operations in a very efficient way. The the The reason those economics are possible because the reservoir quality, oil quality, and the regional operating environment all work together. Ultimately, resource size matters, but economics determine the value. Right? That's That's why we spent so much of time, uh, focusing on both. >> Well, we love the fact you've been spending that time focusing on both and taking the time to explain exactly what the opportunity is for us and our community here at Rich TV. And the valuation gap is stark against a direct comp. Shamaran produces from the same Zagros Basin carbonate and trades at many times trillions value per barrel, more than a 90% discount on a 2C basis. What closes that gap and how quickly could it move as the market catches up to the story? >> Yeah, this is uh, again, a very good question. So, the market typically rewards the companies as uncertainty declines, especially in oil and gas, right? There are lots of uncertainties, and the more you lower your uncertainties, you get rewarded by by the market. So, today, investors can see a substantial difference between the value implied by our independently assessed resource base, which is more more $700 million, dollars and the company's current market valuation. So, that gap exists because markets generally wait for additional milestones before assigning the full value. They want to see uh further appraisal, reserve conversion, development execution, and and production growth. As those milestones are achieved, investors have more confidence in future cash flows and valuation metrics often being moving closer to industry comparable. We're not just not just focused on short-term share price movements. Our objective is to continue advancing the asset and systematically reducing the risk. Historically, that's what tends to drive sustainable re-rating in the market and then the investors would award the company and and and we and we we'll all get awarded by by our system. >> I agree. I agree. It's all about the fundamentals. And it looks like you guys understand that very, very clearly. Now, Tolga, to close, if there's one thing about M47's location, the neighbors, the trend, the proven region around you that you'd want a new investor to remember after this conversation, what is it? >> If investors remember one thing from this interview, it is this. M47 is not an isolated exploration concept. It sits inside one of the most active and successful oil development trends in Turkey. And we're surrounded by producing fields operating in the same reservoir system producing the same quality crude producing supported by supported by growing infrastructure and of course backed by an independently assessed resource. So, in our industry, discoveries are always important, of course, but the context matters. The context around M47 is what makes it so compelling. When you combine the location, analog production, resource scales, economics, potential valuation, uh upside, we do believe M47 represents a unique opportunity for most uh for the most exciting emerging oil regions in the world. So, just just to sum up, we have a good producing neighboring block, uh and and we have a good infrastructure in there, so we know what we are doing. All we need All we need is to focus on what we are doing and and spend our time and spend our money on a very efficient way. So, that's it. The success will come. >> Oh, we'd love to hear the story. We're going to be watching very very closely, watching all of your news, your financials, and any other future interviews that we do. I'm sure we'll learn more, and our investors will get an opportunity to learn more about this very exciting, undervalued, underappreciated, underexposed story. Thank you for joining us today, the Vice President of Trillion Energy, Tolga Burak. Thank you for joining us today, Tolga. >> Thanks for having me, Rich. >> Always a pleasure. Now, for those of you that are watching, if you don't know the symbol, the symbol in Canada on the Canadian Securities Exchange is TCF. The symbol in America on the OTCQB Exchange is TRLEF, and the symbol in Frankfurt, Germany, is Z62. If you're not winning, you're probably not watching. We bring you the winners, CEO interviews, breaking news, trending topics in the world of finance, and we bring it to you first. Thank you for watching, everybody. Have yourselves a great day. >> Mhm.