Vermilion Energy Inc._December 31, 2024

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Management’s Report to Shareholders

Management’s Responsibility for Financial Statements

The accompanying consolidated financial statements of Vermilion Energy Inc. are the responsibility of management and have been approved by the Board of Directors of Vermilion Energy Inc. The consolidated financial statements have been prepared in accordance with the accounting policies detailed in the notes to the consolidated financial statements and are prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. Where necessary, management has made informed judgments and estimates of transactions that were not yet completed at the balance sheet date. Financial information throughout the Annual Report is consistent with the consolidated financial statements.

Management ensures the integrity of the consolidated financial statements by maintaining high-quality systems of internal control. Procedures and policies are designed to provide reasonable assurance that assets are safeguarded and transactions are properly recorded, and that the financial records are reliable for preparation of the consolidated financial statements. Deloitte LLP, Vermilion’s Independent Registered Public Accounting Firm, have conducted an audit of the consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States) and have provided their report.

The Board of Directors is responsible for ensuring that management fulfills its responsibility for financial reporting and internal control. The Board of Directors carries out this responsibility principally through the Audit Committee, which is appointed by the Board of Directors and is comprised entirely of independent Directors. The Committee meets periodically with management and Deloitte LLP to satisfy itself that each party is properly discharging its responsibilities and to review the consolidated financial statements, Management’s Discussion and Analysis and the Report of the Independent Registered Public Accounting Firm before they are presented to the Board of Directors.

Management’s Report on Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining an adequate system of internal control over financial reporting. Management, under the supervision and with the participation of the principal executive officer and principle financial officer, conducted an evaluation of the effectiveness of the system of internal control over financial reporting based on the criteria established in “Internal Control - Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management has assessed the effectiveness of Vermilion’s internal control over financial reporting as defined in Rule 13a-15(f) and 15d-15(f) under the US Securities Exchange Act of 1934 and as defined in Canada by National Instrument 52-109, Certification of Disclosure in Issuers’ Annual and Interim Filings. Management concluded that Vermilion’s internal control over financial reporting was effective as of December 31, 2024.

Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements and even those systems determined to be effective can provide only reasonable assurance with respect to the financial statement preparation and presentation.

The effectiveness of Vermilion’s internal control over financial reporting as of December 31, 2024 has been audited by Deloitte LLP, the Company’s Independent Registered Public Accounting Firm, who also audited the Company’s consolidated financial statements for the year ended December 31, 2024.


(“Dion Hatcher”)	(“Lars Glemser”)

Dion Hatcher	Lars Glemser
President & Chief Executive Officer	Vice President & Chief Financial Officer
March 5, 2025

Vermilion Energy Inc. ∎ Page 1 ∎ 2024 Financial Statements

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Vermilion Energy Inc.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Vermilion Energy Inc. and subsidiaries (the “Company”) as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report dated March 5, 2025, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report to Shareholders. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.


/s/ Deloitte LLP
Chartered Professional Accountants
Calgary, Canada
March 5, 2025

Vermilion Energy Inc. ∎ Page 2 ∎ 2024 Financial Statements

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Vermilion Energy Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Vermilion Energy Inc. and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of net loss and comprehensive loss, cash flows and changes in shareholders' equity for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and its financial performance and its cash flows for each of the two years in the period ended December 31, 2024, in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 5 2025, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Capital Assets – Refer to Notes 2 and 7 to the financial statements

Critical Audit Matter Description

The Company’s capital assets includes oil and gas properties. Oil and gas properties are depleted using the unit of production method (“depletion”) by reference to the ratio of production in the period to the total proved and probable reserves, taking into account the future development costs necessary to bring the applicable reserves into production. The Company engages an independent reserve engineer to estimate reserves using estimates, assumptions and engineering data. The determination of the Company’s proved plus probable reserves used to determine depletion requires management to make significant estimates and assumptions related to future oil, natural gas liquids and natural gas prices (“future commodity prices”), reserves, and future operating and development costs.

Given the significant judgments made by management related to future commodity prices, reserves, and future operating and development costs, these estimates and assumptions are subject to a high degree of estimation uncertainty. This required a high degree of auditor judgment and resulted in an increased extent of audit effort.

Vermilion Energy Inc. ∎ Page 3 ∎ 2024 Financial Statements

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to future commodity prices, reserves, and future operating and development costs used to determine the depletion of all oil and gas properties included the following, among others:

•

Evaluated the effectiveness of the relevant controls, including those over the determination of the future commodity prices, reserves, and future operating and development costs.

•

Evaluated the Company’s independent reserve evaluator by examining reports and assessing their scope of work and findings; and assessing the competence, capability, and objectivity by evaluating their relevant professional qualifications and experience.

•

Evaluated future commodity prices by independently developing a reasonable range of forecasts based on reputable third-party forecasts and market data and comparing those to the future commodity prices selected by management.

•

Evaluated the reasonableness of reserves by testing the source financial information underlying the reserves and comparing the reserve volumes to historical production volumes.

•

Evaluated the reasonableness of future operating and development costs by testing the source financial information underlying the estimate, comparing future operating and development costs to historical results, and evaluating whether they are consistent with evidence obtained in other areas of the audit.

Valuation of Deferred Tax Assets - Refer to Notes 2 and 12 to the financial statements

Critical Audit Matter Description

The Company recognizes deferred income taxes for differences between the financial statement and tax basis of assets and liabilities at substantively enacted statutory tax rates in effect for the years in which the differences are expected to reverse. Deferred income tax assets are reduced to the amounts expected to be realized based on forecasts of future taxable income, specifically forecasts of future revenue (commodity price forecasts and forecasted reserves). The Company recorded deferred income tax assets for Canada and Ireland primarily arising from past taxable losses in these jurisdictions.

To determine whether it is probable that the deferred income tax assets in these jurisdictions will be realized, management makes assumptions related to the forecasts of future taxable income, specifically forecasts of future revenue (commodity price forecasts and forecasted reserves). Auditing the probability of the deferred income tax assets being realized and management’s commodity price forecasts and forecasted reserves involved a high degree of auditor judgement as the estimations made by management contain significant measurement uncertainty. This resulted in an increased extent of audit effort, which included the need to involve income tax specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to assessing the probability of the deferred income tax assets being realized and management’s forecasts of taxable income, specifically forecasts of future revenue (commodity price forecasts and forecasted reserves) to evaluate the deferred income tax assets in Canada and Ireland included the following, among others:

•

Evaluated the effectiveness of relevant controls, including those over the determination of the forecasts of future revenue, specifically commodity price forecasts and forecasted reserves.

•

Evaluated management’s ability to accurately forecast future taxable income by comparing management’s assumptions to historical data and available market trends.

•

Evaluated the reasonableness of management’s forecasts of future revenue by:

•

Comparing the forecasts prepared by management’s expert to third party forecasts; and

•

Evaluating whether management’s estimates of commodity price forecasts and estimated reserves were consistent with the requirements of IAS 12 – Income taxes relating to the probability of forecasted future revenue and the length of the forecast period.

Vermilion Energy Inc. ∎ Page 4 ∎ 2024 Financial Statements


/s/ Deloitte LLP
Chartered Professional Accountants
Calgary, Canada
March 5, 2025

We have served as the Company’s auditor since 2000.

Vermilion Energy Inc. ∎ Page 5 ∎ 2024 Financial Statements

Consolidated Financial Statements

Consolidated Balance Sheet

thousands of Canadian dollars


	Note	December 31, 2024	December 31, 2023
Assets
Current
Cash and cash equivalents	20	131,730	141,456
Accounts receivable	20	298,493	242,926
Crude oil inventory	20	40,694	57,333
Derivative instruments	10	40,312	313,792
Prepaid expenses	20	71,097	68,007
Total current assets		582,326	823,514

Derivative instruments	10	13,927	76,107
Investments	6	78,862	73,261
Deferred taxes	12	197,714	182,051
Exploration and evaluation assets	8	224,286	198,379
Capital assets	7	5,018,461	4,882,509
Total assets		6,115,576	6,235,821

Liabilities
Current
Accounts payable and accrued liabilities	20	425,410	380,370
Dividends payable	14	18,521	16,227
Derivative instruments	10	52,944	732
Income taxes payable	20	113,715	298,745
Total current liabilities		610,590	696,074

Derivative instruments	10	86,036	21,050
Long-term debt	13	963,456	914,015
Lease obligations	11	54,991	33,001
Asset retirement obligations	9	1,224,718	1,159,063
Deferred taxes	12	364,796	380,970
Total liabilities		3,304,587	3,204,173

Shareholders’ Equity
Shareholders' capital	14	3,918,898	4,142,566
Contributed surplus		45,225	43,348
Accumulated other comprehensive income		135,847	109,302
Deficit		(1,288,981)	(1,263,568)
Total shareholders' equity		2,810,989	3,031,648
Total liabilities and shareholders' equity		6,115,576	6,235,821

Approved by the Board

(Signed “Manjit Sharma”)		(Signed “Dion Hatcher”)

Manjit Sharma, Director		Dion Hatcher, Director

Vermilion Energy Inc. ∎ Page 6 ∎ 2024 Financial Statements

Consolidated Statements of Net Loss and Comprehensive Loss

thousands of Canadian dollars, except share and per share amounts


		Year Ended
	Note	Dec 31, 2024	Dec 31, 2023
Revenue
Petroleum and natural gas sales		1,981,407	2,022,555
Royalties		(177,950)	(191,694)
Sales of purchased commodities		92,843	177,000
Petroleum and natural gas revenue		1,896,300	2,007,861

Expenses
Purchased commodities		92,843	177,000
Operating	20	567,913	513,381
Transportation		98,933	88,856
Equity based compensation	16	29,930	42,756
Loss (gain) on derivative instruments	10	107,540	(414,072)
Interest expense		84,606	85,212
General and administration	20	99,503	80,716
Foreign exchange loss (gain)		50,736	(7,906)
Other expense		13,101	420
Accretion	9	74,541	78,187
Depletion and depreciation	6, 7	683,240	712,619
Impairment expense	7	—	1,016,094
Gain on business combination	5	—	(439,487)
Loss on disposition	6	—	352,367
		1,902,886	2,286,143
Loss before income taxes		(6,586)	(278,282)

Income tax expense (recovery)
Deferred	12	(37,991)	(190,193)
Current		78,144	149,498
		40,153	(40,695)

Net loss		(46,739)	(237,587)

Other comprehensive loss
Currency translation adjustments		23,004	(16,468)
Hedge accounting reserve, net of tax		5,284	6,357
Fair value adjustment on investment in securities, net of tax	6	(1,743)	(4,092)
Comprehensive loss		(20,194)	(251,790)

Net loss per share	17
Basic		(0.30)	(1.45)
Diluted		(0.30)	(1.45)

Weighted average shares outstanding ('000s)	17
Basic		158,068	163,719
Diluted		158,068	163,719

Vermilion Energy Inc. ∎ Page 7 ∎ 2024 Financial Statements

Consolidated Statements of Cash Flows

thousands of Canadian dollars


		Year Ended
	Note	Dec 31, 2024	Dec 31, 2023
Operating
Net loss		(46,739)	(237,587)
Adjustments:
Accretion	9	74,541	78,187
Depletion and depreciation	6, 7	683,240	712,619
Impairment expense	7	—	1,016,094
Gain on business combination	5	—	(439,487)
Loss on disposition	6	—	352,367
Unrealized loss (gain) on derivative instruments	10	452,858	(179,707)
Equity based compensation	16	15,569	42,756
Unrealized foreign exchange loss (gain)		58,471	(12,438)
Unrealized other expense		5,834	—
Deferred tax recovery	12	(37,991)	(190,193)
Asset retirement obligations settled	9	(55,334)	(56,966)
Changes in non-cash operating working capital	20	(182,698)	(61,117)
Cash flows from operating activities		967,751	1,024,528

Investing
Drilling and development	7	(586,962)	(569,110)
Exploration and evaluation	8	(36,018)	(21,081)
Acquisitions, net of cash acquired	7	(12,728)	(142,281)
Acquisition of securities	6	(9,373)	(21,603)
Dispositions	7	—	197,007
Changes in non-cash investing working capital	20	10,213	(19,367)
Cash flows used in investing activities		(634,868)	(576,435)

Financing
Net repayments on the revolving credit facility	13	—	(146,324)
Repurchases of senior unsecured notes	13	(31,561)	—
Payments on lease obligations	11	(101,539)	(17,094)
Repurchase of shares	14	(140,707)	(94,838)
Cash dividends	14	(73,033)	(62,080)
Changes in non-cash financing working capital		2,756	—
Cash flows used in financing activities		(344,084)	(320,336)
Foreign exchange gain (loss) on cash held in foreign currencies		1,475	(137)

Net change in cash and cash equivalents		(9,726)	127,620
Cash and cash equivalents, beginning of period		141,456	13,836
Cash and cash equivalents, end of period	20	131,730	141,456

Supplementary information for cash flows from operating activities
Interest paid		85,649	84,471
Income taxes paid		263,048	306,911

Vermilion Energy Inc. ∎ Page 8 ∎ 2024 Financial Statements

Consolidated Statements of Changes in Shareholders’ Equity

thousands of Canadian dollars


		Year Ended
	Note	December 31, 2024	December 31, 2023
Shareholders' capital	14
Balance, beginning of year		4,142,566	4,243,794
Vesting of equity based awards		12,707	23,575
Equity based compensation		985	11,242
Share-settled dividends on vested equity based awards		1,382	1,179
Repurchase of shares		(238,742)	(137,224)
Balance, end of year		3,918,898	4,142,566
Contributed surplus	14
Balance, beginning of year		43,348	35,409
Equity based compensation		14,584	31,514
Vesting of equity based awards		(12,707)	(23,575)
Balance, end of year		45,225	43,348
Accumulated other comprehensive income
Balance, beginning of year		109,302	123,505
Currency translation adjustments		23,004	(16,468)
Hedge accounting reserve		5,284	6,357
Fair value adjustment on investment in securities, net of tax	6	(1,743)	(4,092)
Balance, end of year		135,847	109,302
Deficit
Balance, beginning of year		(1,263,568)	(1,001,650)
Net loss		(46,739)	(237,587)
Dividends declared		(75,327)	(65,248)
Share-settled dividends on vested equity based awards		(1,382)	(1,179)
Repurchase of shares	14	98,035	42,096
Balance, end of year		(1,288,981)	(1,263,568)

Total shareholders' equity		2,810,989	3,031,648

Vermilion Energy Inc. ∎ Page 9 ∎ 2024 Financial Statements

Description of equity reserves

Shareholders’ capital

Represents the recognized amount for common shares issued (net of equity issuance costs and deferred taxes) less the weighted-average carrying value of shares repurchased. The price paid to repurchase common shares is compared to the carrying value of the shares and the difference is recorded against deficit.

Contributed surplus

Represents the recognized value of unvested equity based awards that will be settled in shares. Once vested, the value of the awards are transferred to shareholders’ capital.

Accumulated other comprehensive income

Represents currency translation adjustments, hedge accounting reserve and fair value adjustments on investments.

Currency translation adjustments result from translating the balance sheets of subsidiaries with a foreign functional currency to Canadian dollars at period-end rates. These amounts may be reclassified to net loss if there is a disposal or partial disposal of a subsidiary.

The hedge accounting reserve represents the effective portion of the change in fair value related to cash flow and net investment hedges recognized in other comprehensive income, net of tax and reclassified to the consolidated statement of net loss in the same period in which the transaction associated with the hedged item occurs.

Fair value adjustment on investment in securities, net of tax, are a result of changes in the fair value of investments that have been elected to be subsequently measured at fair value through other comprehensive income.

Deficit

Represents the cumulative net loss less distributed earnings and surplus of the price paid to repurchase common shares of Vermilion Energy Inc. over the weighted-average carrying value of the shares repurchased.

Vermilion Energy Inc. ∎ Page 10 ∎ 2024 Financial Statements

Notes to the Consolidated Financial Statements for the year ended December 31, 2024 and 2023

tabular amounts in thousands of Canadian dollars, except share and per share amounts

1.	Basis of presentation

Vermilion Energy Inc. and its subsidiaries (the “Company” or “Vermilion”) are engaged in the business of petroleum and natural gas exploration, development, acquisition, and production.

Vermilion was incorporated in Canada and the Company’s registered office and principal place of business is located at 3500, 520, 3rd Avenue SW, Calgary, Alberta, Canada.

These consolidated financial statements were approved and authorized for issuance by Vermilion’s Board of Directors on March 5, 2025.

Prior period amounts have been restated to conform with current period presentation as a result of the voluntary and retroactively applied change in the presentation of windfall taxes, as combined with current income taxes.

2. Material accounting policies

Accounting framework

The consolidated financial statements are prepared in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”).

Principles of consolidation

The consolidated financial statements include the accounts of Vermilion Energy Inc. and its subsidiaries. Vermilion’s subsidiaries include entities in each of the jurisdictions that Vermilion operates as described in Note 4 (Segmented information) including: Canada, France, Netherlands, Germany, Ireland, Australia, the United States, and Central and Eastern Europe (Hungary, Slovakia, and Croatia). Vermilion Energy Inc. directly or indirectly through holding companies owns all of the voting securities of each material subsidiary. Transactions between Vermilion Energy Inc. and its subsidiaries have been eliminated.

Vermilion accounts for joint operations by recognizing the Company’s share of assets, liabilities, income, and expenses.

Investment in associate

Associates are entities for which the company has significant influence, but not control or joint control over the financial and operational decisions. Investments in associates are accounted for using the equity method of accounting and are initially recognized at cost and adjusted thereafter for the change in the company’s share of the associate’s net income and comprehensive income less distributions received until the date that significant influence ceases, within other expense on the consolidated statements of net earnings and comprehensive income. When the associate's financial information has not yet been made publicly available, management estimates the associate's financial information based on most recent and publicly available information, adjusted for market factors, including but not limited to market pricing.

Investments are tested for impairment when objective evidence of impairment is identified. Investments are reviewed for objective evidence of impairment at each reporting date. If a potential impairment exists, the investment's carrying value is compared to its recoverable amount. An investment’s recoverable amount is the higher of its fair value less costs of disposal and its value-in-use. If the carrying amount of an investment exceeds its recoverable amount, an impairment loss is recognized to reduce the carrying value of the investment to its recoverable amount.

If an impairment loss has been recognized in a prior period, an assessment is performed at each reporting date to determine if there are indicators that the circumstances which led to the impairment loss have reversed. If the change in circumstances results in the recoverable amount being higher than the carrying value after the impairment loss, then the impairment loss is reversed.

Vermilion Energy Inc. ∎ Page 11 ∎ 2024 Financial Statements

Exploration and evaluation assets

Vermilion classifies costs as exploration and evaluation (“E&E”) assets when they relate to exploring and evaluating an area for which the Company has the license or right to explore and extract resources. E&E costs may include: geological and geophysical costs; land and license acquisition costs; and costs for the drilling, completion, and testing of exploration wells.

E&E costs are reclassified to capital assets if the technical feasibility and commercial viability of the area can be determined. E&E assets are assessed for impairment prior to any reclassification. The technical feasibility and commercial viability of extracting the reserves is considered to be determinable when proved and probable reserves are identified.

Costs incurred prior to the acquisition of the legal rights to explore an area are expensed as incurred. If reserves are not found within the license area or the area is abandoned, the related E&E costs are depreciated over a period not greater than five years. If an exploration license expires prior to the commencement of exploration activities, the cost of the exploration license is written off through depreciation in the year of expiration.

Capital assets

Vermilion recognizes capital assets at cost less accumulated depletion, depreciation, and impairment losses. Costs include directly attributable costs incurred for the drilling, completion, and tie-in of wells and the construction of production and processing facilities.

When components of capital assets are replaced, disposed of, or no longer in use, they are derecognized. Gains and losses on disposal of capital assets are determined by comparing the proceeds of disposal compared to the carrying amount.

Depletion and depreciation

Capital assets are grouped into depletion units, which are groups of assets within a specific production area that have similar economic lives. Depletion units represent the lowest level of disaggregation for which costs are accumulated for the purposes of calculating depletion and depreciation.

The net carrying value of each depletion unit is depleted using the unit of production method by reference to the ratio of production in the period to the total proved and probable reserves, taking into account the future development costs necessary to bring the applicable reserves into production. For the purposes of the depletion calculations, oil and gas reserves are converted to a common unit of measure on the basis of their relative energy content based on a conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent.

Impairment of capital assets and exploration and evaluation assets

Depletion units are aggregated into cash generating units (“CGUs”) for impairment testing. CGUs are the lowest level for which there are identifiable cash inflows that are largely independent of cash inflows of other groups of assets. CGUs are reviewed for indicators of potential impairment at each reporting date.

E&E assets are tested for impairment when reclassified to capital assets or when indicators of potential impairment are identified. E&E assets are reviewed for indicators of potential impairment at each reporting date. If indicators of potential impairment are identified, E&E assets are tested for impairment as part of the CGU attributable to the jurisdiction in which the exploration area resides.

If an indicator of potential impairment exists, the CGU’s carrying value is compared to its recoverable amount. A CGU’s recoverable amount is the higher of its fair value less costs of disposal and its value-in-use. If the carrying amount of a CGU exceeds its recoverable amount, an impairment loss is recognized to reduce the carrying value of the CGU to its recoverable amount.

Lease obligations and right-of-use assets

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. At the lease commencement date, a lease obligation is recognized at the present value of future lease payments, typically using the applicable incremental borrowing rate. A corresponding right-of-use asset is recognized at the amount of the lease obligation, adjusted for lease incentives received and initial direct costs. Vermilion does not recognize leases for short-term leases with a lease term of 12 months or less, or leases for low-value assets.

Vermilion Energy Inc. ∎ Page 12 ∎ 2024 Financial Statements

Payments are applied against the lease obligation and interest expense is recognized on the lease obligations using the effective interest rate method. Depreciation is recognized on the right-of-use asset over the lease term.

Cash and cash equivalents

Cash and cash equivalents include cash on deposit with financial institutions and guaranteed investment certificates.

Crude oil inventory

Crude oil inventory is valued at the lower of cost or net realizable value. The cost of crude oil inventory produced includes related operating expense, royalties, and depletion determined on a weighted-average basis.

Asset retirement obligations

Vermilion recognizes a provision for asset retirement obligations when an event occurs giving rise to an obligation of uncertain timing or amount. Asset retirement obligations are recognized on the consolidated balance sheet as a long-term liability with a corresponding increase to E&E or capital assets.

Asset retirement obligations reflect the present value of estimated future settlement costs. The discount rate used to calculate the present value is specific to the jurisdiction the obligation relates to and is reflective of current market assessment of the time value of money and risks specific to the liabilities that have not been reflected in the cash flow estimates.

Asset retirement obligations are remeasured at each reporting period to reflect changes in market rates and estimated future settlement costs. Asset retirement obligations are increased each reporting period to reflect the passage of time with a corresponding charge to accretion expense.

Revenue recognition

Revenue associated with the sale of crude oil and condensate, natural gas, and natural gas liquids is measured based on the consideration specified in contracts with customers.

Revenue from contracts with customers is recognized when or as Vermilion satisfies a performance obligation by transferring control of crude oil and condensate, natural gas, or natural gas liquids to a customer at contractually specified transfer points. This transfer coincides with title passing to the customer and the customer taking physical possession of the commodity. Vermilion principally satisfies its performance obligations at a point in time and the amounts of revenue recognized relating to performance obligations satisfied over time are not significant.

Vermilion invoices customers for delivered products monthly and payment occurs shortly thereafter. Vermilion does not have any contracts where the period between the transfer of control of the commodity to the customer and payment by the customer exceeds one year. As a result, Vermilion does not adjust its revenue transactions to reflect significant financing components.

Financial instruments

On initial recognition, financial instruments are measured at fair value. Measurement in subsequent periods depends on the classification of the financial instrument as described below:

●

Fair value through profit or loss ("FVTPL"): Financial instruments under this classification include cash and cash equivalents and derivative assets and liabilities. Transaction costs under this classification are expensed as incurred.

●

Fair value through other comprehensive income ("FVTOCI"): Financial instruments under this classification include derivative assets, investment in securities, and liabilities where hedge accounting is applied. Transaction costs under this classification are expensed as incurred.

●

Amortized cost: Financial instruments under this classification include accounts receivable, accounts payable and accrued liabilities, dividends payable, lease obligations, and long-term debt. Transaction costs under this classification are included in the measurement of the financial instrument.

Accounts receivable are measured net of a loss allowance equal to the lifetime expected credit loss.

Equity based compensation

Equity based compensation expense results from equity-settled awards issued under Vermilion’s long-term share-based compensation plans as well as the grant date fair value of Vermilion common shares issued under the Company’s bonus and employee share savings plans.

Vermilion Energy Inc. ∎ Page 13 ∎ 2024 Financial Statements

Vermilion’s long-term share-based compensation plans consist of the Long-term Incentive Plan (“LTIP”) and the Deferred Share Unit Plan ("DSU"). Equity-settled awards issued under the LTIP vest over a period of one to three years and awards issued under the DSU vest immediately upon granting.

Equity based compensation expense for equity-settled plans is recognized over the vesting period with a corresponding adjustment to contributed surplus. The expense recognized is based on the grant date fair value of the awards, an estimate of the performance factor that will be achieved (if applicable), and an estimate of forfeiture rates based on historical vesting data. Dividends notionally accrue to the LTIP and are excluded in the determination of grant date fair values. When the awards are converted to Vermilion common shares, the amount recognized in contributed surplus is reclassified to shareholders’ capital.

The grant date fair value of awards or Vermilion common shares issued is determined as the closing price of Vermilion’s common shares on the Toronto Stock Exchange on the grant date.

Per share amounts

Basic net loss per share is calculated by dividing net loss by the weighted-average number of shares outstanding during the period.

Diluted net loss per share is calculated by dividing net loss by the diluted weighted-average number of shares outstanding during the period. The diluted weighted-average number of shares outstanding is the sum of the basic weighted-average number of shares outstanding and (to the extent inclusion reduces diluted net loss per share) the number of shares issuable for equity-settled awards determined using the treasury stock method. The treasury stock method assumes that the unrecognized equity based compensation expense are deemed proceeds used to repurchase Vermilion common shares at the average market price during the period.

Foreign currency translation

Vermilion Energy Inc.’s functional and presentation currency is the Canadian dollar. Vermilion has subsidiaries that transact and operate in countries other than Canada and have functional currencies other than the Canadian dollar.

Foreign currency translation includes the translation of foreign currency transactions and the translation of foreign operations.

Foreign currency transaction translation occurs when translating transactions and balances in foreign currencies to the applicable functional currency of Vermilion Energy Inc. and its subsidiaries. Gains and losses from foreign currency transactions are recorded as foreign exchange gains or losses in the statement of Net loss. Foreign currency transaction translation occurs as follows:

●

Income and expenses are translated at the prevailing rates on the date of the transaction.

●

Non-monetary assets or liabilities are carried at the prevailing rates on the date of the transaction.

●

Monetary items, including intercompany loans that are not deemed to represent net investments in a foreign subsidiary, are translated at the prevailing rates at the balance sheet date.

Foreign operation translation occurs when translating the financial statements of non-Canadian functional currency subsidiaries to the Canadian dollar and when translating intercompany loans that are deemed to represent net investments in a foreign subsidiary. Gains and losses from foreign operation translations are recorded as currency translation adjustments in the statement of comprehensive income. Foreign operation translation occurs as follows:

●

Income and expenses are translated at the average exchange rates for the period.

●

Assets and liabilities are translated at the prevailing rates on the balance sheet date.

Income taxes

Deferred tax assets and liabilities are calculated using the balance sheet method. Deferred tax assets and liabilities are recognized for the estimated effect of any temporary differences between the amounts recognized on Vermilion’s consolidated balance sheet and the respective tax basis. This calculation uses enacted or substantively enacted tax rates that are expected to be in effect when the temporary differences are expected to reverse. The effect of a change in tax rates on deferred taxes is recognized in the period the related legislation is substantively enacted.

Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which the deductible temporary differences can be used. Deferred tax assets are reviewed at each reporting date and are reduced to the extent it is no longer probable that the related tax benefit will be realized.

Vermilion Energy Inc. ∎ Page 14 ∎ 2024 Financial Statements

Business combinations

Acquisitions of corporations or groups of assets are accounted for as business combinations using the acquisition method if the acquired assets constitute a business. Under the acquisition method, assets acquired and liabilities assumed in a business combination (with the exception of deferred tax assets and liabilities) are measured at their fair values. Deferred tax assets or liabilities arising from the assets acquired and liabilities assumed are measured in accordance with the policies described in "Income taxes" above.

If applicable, the excess or deficiency of the fair value of net assets acquired compared to consideration paid is recognized as a gain on business combination or as goodwill on the consolidated balance sheet. Acquisition-related costs incurred to effect a business combination are expensed in the period incurred.

As part of the assessment to determine if the acquisition constitutes a business, Vermilion may elect to apply the concentration test on a transaction by transaction basis. The test is met if substantially all of the fair value related to the gross assets acquired is concentrated in a single identifiable asset (or group of similar assets) resulting in the acquisition not being deemed a business and recorded as an asset acquisition.

Segmented information

Vermilion has a decentralized business unit structure designed to manage assets in each country the Company operates. Each of Vermilion’s operating segments derives its revenues solely from the production and sale of petroleum and natural gas.

Vermilion’s chief operating decision maker regularly reviews fund flows from operations generated by each of Vermilion’s operating segments. Fund flows from operations is a measure of profit or loss that provides the chief operating decision maker with the ability to assess the profitability of each operating segment and, correspondingly, the ability of each operating segment to fund its share of dividends, asset retirement obligations, and capital investments.

Management judgments and estimation uncertainty

The preparation of the consolidated financial statements in accordance with IFRS Accounting Standards requires management to make judgments, estimates, and assumptions that affect the reported amount of assets, liabilities, income, and expenses. Actual results could differ significantly from these estimates. Key areas where management has made judgments, estimates, and assumptions are described below.

The determination of whether indicators of impairment or impairment reversals:

●

Determining whether there are indicators of impairment or impairment reversals are based on management's assessments of the changes in estimates for future commodity prices, costs, discount rates, or reserves. Changes in these estimates and assumptions can directly impact the calculated fair value of capital assets and therefore could be indicators of impairment or impairment reversals. In addition, change in the Vermilion's market capitalization relative to its book value could be an indicator of impairment.

The measurement of the fair value of capital assets acquired in a business combination and the determination of the recoverable amount of cash generating units ("CGU"):

●

Calculating the fair value of capital assets acquired in a business combination and the recoverable amount of CGUs (in the assessment of impairments or reversals of previous impairments if indicators of impairment or impairment reversal are identified) are based on estimated future commodity prices, discount rates and estimated reserves. Reserve estimates are based on: engineering data, estimated future commodity prices, expected future rates of production, and assumptions regarding the timing and amount of future expenditures. Changes in these estimates and assumptions can directly impact the calculated fair value of capital assets acquired (and thus the resulting goodwill or gain on business combination) and the recoverable amount of a CGU (and thus the resulting impairment loss or recovery).

●

In addition, the recoverable amount of a CGU is impacted by the composition of CGUs, which are subject to management’s judgment of the lowest level at which there are identifiable cash inflows that are largely independent of the cash inflows of other groups of assets. The factors used by Vermilion to determine CGUs vary by jurisdiction due to their unique operating and geographic conditions. In general, Vermilion will assess the following factors: geographic proximity of the assets within a group to one another, geographic proximity of the group of assets to other groups of assets, homogeneity of the production from the group of assets and the sharing of infrastructure used to process and/or transport production. Changes in these judgments can directly impact the calculated recoverable amount of a CGU (and thus the resulting impairment loss or recovery).

Vermilion Energy Inc. ∎ Page 15 ∎ 2024 Financial Statements

The measurement of the carrying value of asset retirement obligations on the balance sheet, including the fair value and subsequent carrying value of asset retirement obligations assumed in a business combination:

●

Asset retirement obligations are based on judgments regarding regulatory requirements, estimates of future costs, assumptions on the expected timing of expenditures, and estimates of the underlying risk inherent to the obligation. The carrying balance of asset retirement obligations and accretion expense may differ due to changes in: laws and regulations, technology, the expected timing of expenditures, and market conditions affecting the discount rate applied.

The recognition and measurement of deferred tax assets and liabilities:

●

Tax interpretations, regulations, and legislation in the various jurisdictions in which Vermilion and its subsidiaries operate are subject to change and interpretation. Changes in laws and interpretations can affect the timing of the reversal of temporary tax differences, the tax rates in effect when such differences reverse and Vermilion’s ability to use tax losses and other tax pools in the future. The Company’s income tax filings are subject to audit by taxation authorities in numerous jurisdictions and the results of such audits may increase or decrease the tax liability. The determination of tax amounts recognized in the consolidated financial statements are based on management’s assessment of the tax positions, which includes consideration of their technical merits, communications with tax authorities and management’s view of the most likely outcome.

●

The extent to which deferred tax assets are recognized are based on estimates of future profitability. These estimates are based on estimated future commodity prices and estimates of reserves. Judgments, estimates, and assumptions inherent in reserve estimates are described above.

The measurement of lease obligations and corresponding right-of-use assets:

●

The measurement of lease obligations are subject to management’s judgments of the applicable incremental borrowing rate and the expected lease term. The carrying balance of the right-of-use assets, lease obligations, and the resulting interest and depletion and depreciation expense, may differ due to changes in the market conditions and expected lease terms. Applicable incremental borrowing rates are based on judgments of the economic environment, term, currency, and the underlying risk inherent to the asset. Lease terms are based on assumptions regarding cancellation and extension terms that allow for operational flexibility based on future market conditions.

3. Changes in accounting pronouncements

Amendments to IAS 1 Presentation of Financial Statements

On January 1, 2024, Vermilion adopted the amendments to IAS 1 Presentation of Financial Statements, as issued by the International Accounting Standards Board (“IASB”) that clarify the requirements for the presentation of liabilities as current or non-current in the statement of financial position and specify the classification and disclosure of a liability with covenants. There was no impact to Vermilion's financial statements.

Issuance of IFRS 18 - Presentation and Disclosure in Financial Statements

In April 2024, the IASB issued the new accounting standard, IFRS 18 ‘Presentation and Disclosure in Financial Statements’. IFRS 18 will replace IAS 1 'Presentation of Financial Statements' and provides a defined structure to the statement of comprehensive income and related disclosure requirements. The new standard is effective for annual reporting periods beginning on or after January 1, 2027 and is required to be adopted retrospectively. Vermilion is currently reviewing the impact the standard will have on the consolidated financial statements.

Amendments to IFRS 9 - Financial Instruments and IFRS 7 Financial Instruments: Disclosure

In May 2024, the IASB issued amendments to IFRS 9 'Financial Instruments' and IFRS 7 'Financial Instruments: Disclosures' relating to settling financial liabilities using an electronic payment system and assessing contractual cash flow characteristics of financial assets. The amendments will be effective for annual reporting periods beginning on January 1, 2026, but are not expected to have a material impact on the consolidated financial statements.

Vermilion Energy Inc. ∎ Page 16 ∎ 2024 Financial Statements

4. Segmented information

Substantially all sales in the France operating segment for the years ended December 31, 2024 and December 31, 2023 were to one customer. In 2024 and 2023, France contributed more than 10% of Vermilion's consolidated revenues.


	Year Ended December 31, 2024
	Canada	USA	France	Netherlands	Germany	Ireland	Australia	CEE	Corporate	Total
Total assets	2,075,273	269,686	630,120	190,023	469,295	921,331	283,880	95,908	1,180,060	6,115,576
Drilling and development	374,892	35,472	45,671	25,905	66,545	4,355	29,284	4,838	—	586,962
Exploration and evaluation	—	—	—	—	28,043	—	—	7,975	—	36,018

Crude oil and condensate sales	556,375	118,198	314,232	2,515	48,275	—	182,847	37	—	1,222,479
NGL sales	64,934	14,622	—	—	—	—	—	—	—	79,556
Natural gas sales	89,981	4,743	—	136,795	101,450	311,325	—	35,078	—	679,372
Sales of purchased commodities	—	—	—	—	—	—	—	—	92,843	92,843
Royalties	(84,337)	(39,849)	(41,585)	(244)	(5,703)	—	—	(6,232)	—	(177,950)
Revenue from external customers	626,953	97,714	272,647	139,066	144,022	311,325	182,847	28,883	92,843	1,896,300
Purchased commodities	—	—	—	—	—	—	—	—	(92,843)	(92,843)
Transportation	(54,091)	(1,465)	(23,106)	—	(11,853)	(8,418)	—	—	—	(98,933)
Operating	(240,333)	(26,887)	(69,376)	(41,127)	(53,129)	(54,177)	(80,347)	(2,537)	—	(567,913)
General and administration	(23,080)	(13,493)	(18,214)	(8,327)	(13,053)	(8,029)	(8,087)	(7,220)	—	(99,503)
Petroleum resource rent tax	—	—	—	—	—	—	(11,702)	—	—	(11,702)
Corporate income tax (expense) recovery	19	—	(12,225)	(32,592)	(18,558)	(1,403)	(3,022)	7	1,332	(66,442)
Interest expense	—	—	—	—	—	—	—	—	(84,606)	(84,606)
Equity based compensation	—	—	—	—	—	—	—	—	(14,361)	(14,361)
Realized gain on derivative instruments	—	—	—	—	—	—	—	—	345,318	345,318
Realized foreign exchange gain	—	—	—	—	—	—	—	—	7,735	7,735
Realized other expense	—	—	—	—	—	—	—	—	(7,267)	(7,267)
Fund flows from operations	309,468	55,869	149,726	57,020	47,429	239,298	79,689	19,133	248,151	1,205,783


	Year Ended December 31, 2023
	Canada	USA	France	Netherlands	Germany	Ireland	Australia	CEE	Corporate⁽¹⁾	Total
Total assets	1,805,049	254,884	587,824	237,326	425,532	1,137,648	280,532	80,388	1,426,638	6,235,821
Drilling and development	288,223	91,977	48,297	44,147	48,463	20,283	26,005	1,715	—	569,110
Exploration and evaluation	—	—	—	—	11,248	—	—	9,833	—	21,081

Crude oil and condensate sales	621,985	129,775	285,626	2,306	57,464	74	36,381	—	—	1,133,611
NGL sales	68,753	15,240	—	—	—	—	—	—	—	83,993
Natural gas sales	170,653	6,143	—	184,548	138,017	302,330	—	3,260	—	804,951
Sales of purchased commodities	—	—	—	—	—	—	—	—	177,000	177,000
Royalties	(103,511)	(41,487)	(37,425)	(1,567)	(5,993)	—	—	(1,711)	—	(191,694)
Revenue from external customers	757,880	109,671	248,201	185,287	189,488	302,404	36,381	1,549	177,000	2,007,861
Purchased commodities	—	—	—	—	—	—	—	—	(177,000)	(177,000)
Transportation	(43,163)	(751)	(24,511)	—	(13,333)	(7,098)	—	—	—	(88,856)
Operating	(233,417)	(23,424)	(80,134)	(39,157)	(43,857)	(39,464)	(52,360)	(1,568)	—	(513,381)
General and administration	(96,296)	(9,734)	(20,642)	(8,317)	(13,104)	(19,054)	(8,182)	(7,150)	101,763	(80,716)
Petroleum resource rent tax	—	—	—	—	—	—	20,860	—	—	20,860
Corporate income tax (expense) recovery	(53)	—	(14,313)	(48,349)	(28,533)	(715)	13	(14)	(78,394)	(170,358)
Interest expense	—	—	—	—	—	—	—	—	(85,212)	(85,212)
Realized gain on derivative instruments	—	—	—	—	—	—	—	—	234,365	234,365
Realized foreign exchange loss	—	—	—	—	—	—	—	—	(4,532)	(4,532)
Realized other expense	—	—	—	—	—	—	—	—	(420)	(420)
Fund flows from operations	384,951	75,762	108,601	89,464	90,661	236,073	(3,288)	(7,183)	167,570	1,142,611

⁽¹⁾Central and Eastern Europe and Corporate have been presented separately in the prior year for comparability with current year presentation.

Vermilion Energy Inc. ∎ Page 17 ∎ 2024 Financial Statements

Reconciliation of fund flows from operations to net loss:


	Year Ended
	Dec 31, 2024	Dec 31, 2023
Fund flows from operations	1,205,783	1,142,611
Equity based compensation	(15,569)	(42,756)
Unrealized (loss) gain on derivative instruments	(452,858)	179,707
Unrealized foreign exchange (loss) gain	(58,471)	12,438
Accretion	(74,541)	(78,187)
Depletion and depreciation	(683,240)	(712,619)
Deferred tax recovery	37,991	190,193
Gain on business combination	—	439,487
Loss on disposition	—	(352,367)
Impairment expense	—	(1,016,094)
Unrealized other expense	(5,834)	—
Net loss	(46,739)	(237,587)

5. Business combination

Equinor Energy Ireland Limited

On March 31, 2023, Vermilion purchased 100% of the shares outstanding of Equinor Energy Ireland Limited ("EEIL") from Equinor ASA. The acquisition adds an incremental 36.5% interest in the Corrib Natural Gas Project, increasing Vermilion's operated interest to 56.5%.

The total consideration paid and the fair value of the assets acquired and liabilities assumed at the date of acquisition are detailed in the table below.


		Consideration
Cash consideration paid		488,893


		Allocation of consideration
Cash acquired		400,002
Capital assets		768,026
Acquired working capital deficit		(109,134)
Asset retirement obligations		(42,277)
Derivative liability		(51,789)
Deferred tax liability		(36,448)
Net assets acquired		928,380
Gain on business combination		(439,487)
Total net assets acquired, net of gain on business combination		488,893

The gain on the business combination primarily resulted from increases in working capital and the fair value of capital assets from when the purchase and sale agreement was entered into in November 2021 and when the acquisition closed in March 2023 due to significant increases in European natural gas prices throughout 2022 and Q1 2023.

The results of operations from the assets acquired and liabilities assumed have been included in Vermilion's consolidated financial statements beginning March 31, 2023 and have contributed revenues net of royalties of $161.7 million and net earnings of $43.6 million. Had the acquisition occurred on January 1, 2023, consolidated petroleum and natural gas revenue would have been $2,098.2 million and consolidated net loss would have been 182.6 million for the year ended December 31, 2023.

Vermilion Energy Inc. ∎ Page 18 ∎ 2024 Financial Statements

6. Investments

Investments are comprised of Vermilion's ownership interest in Coelacanth Energy Inc. ("CEI"), an oil and natural gas company, actively engaged in the acquisition, development, exploration, and production of oil and natural gas reserves in northeastern British Columbia, Canada.

In February 2024, Vermilion acquired additional securities, increasing its ownership to approximately 21% of the issued and outstanding common shares of CEI. As such, Vermilion concluded it had acquired significant influence over the entity and should prospectively be accounted for using the equity method of accounting subsequently, recording Vermilion's share of CEI's profit or loss. Prior to acquiring significant influence, this investment was accounted for under IFRS 9 as an investment in securities using the fair value method of accounting. The transaction was treated as a disposal of the original investment at fair value and an acquisition of an investment in associate, with no resulting gain or loss recognized in the consolidated statement of net earnings.

The following table reconciles the change in Vermilion's investments:


	2024	2023
Balance at January 1	73,261	56,366
Acquisition of securities	9,373	21,603
Fair value adjustment ⁽¹⁾	(2,203)	(4,708)
Investment in securities prior to reclassification to investment in associate	80,431	73,261
Vermilion's share of net loss ⁽²⁾	(1,569)	—
Balance at December 31	78,862	73,261

(1)	The investment was classified as a level 1 instrument on the fair value hierarchy and used observable inputs when making fair value adjustments and was recorded until the date of significant influence, on February 29, 2024.

(2)	Investment losses are recognized within other expense on the consolidated statements of net earnings and comprehensive income.

The following table summarizes the net assets of CEI based on their most recent and publicly available financial statements as at September 30, 2024, and Vermilion's respective share:


Current assets	49,905
Non-current assets	142,374
Current liabilities	(14,235)
Non-current liabilities	(22,163)
Net assets	155,881
Vermilion’s ownership	20.8	%
Vermilion’s share of net assets	32,398

For the ten months ended December 31, 2024, or the period the investment was accounted for under the equity method of accounting, Vermilion adjusted the value of the investment for its share of CEI's profit or loss. The following table summarizes CEI's estimated revenue and net loss and Vermilion's respective share, based on CEI's most recent and publicly available financial statements for the nine months ended September 30, 2024 and other market factors, including but not limited to, relevant market prices:


	Ten Months Ended
	December 31, 2024
Total revenue	9,248
Net loss	(7,537)
Vermilion’s ownership	20.8	%
Vermilion’s share of net loss	(1,569)

At December 31, 2024, the fair value of Vermilion's investment in CEI is $88.1 million or $0.80/share (December 31, 2023 - $73.3 million or $0.75/share).

Vermilion Energy Inc. ∎ Page 19 ∎ 2024 Financial Statements

7. Capital assets

The following table reconciles the change in Vermilion’s capital assets:


	2024	2023
Balance at January 1	4,882,509	5,691,522
Acquisitions	12,728	836,295
Dispositions	—	(676,471)
Additions	586,962	569,110
Increase in right-of-use assets	38,290	3,103
Lease purchase	78,832	—
Transfers from exploration and evaluation assets	14,110	40,521
Impairment expense	—	(1,016,094)
Depletion and depreciation	(673,475)	(699,343)
Changes in asset retirement obligations	27,906	138,239
Foreign exchange	50,599	(4,373)
Balance at December 31	5,018,461	4,882,509

Cost	13,760,503	12,966,256
Accumulated depletion, depreciation, and impairment	(8,742,042)	(8,083,747)
Balance at December 31	5,018,461	4,882,509

In May 2024, Vermilion recognized a seven-year lease for a processing facility, in December 2024, Vermilion exercised the right to purchase the processing facility for $78.8 million, extinguishing the lease obligation and resulting in the transfer from right-of-use assets to depletable assets.

Impairment

In the fourth quarter of 2023, indicators of impairment were present in our France CGU due to changes in forecasted cost assumptions and in our Saskatchewan and United States CGUs due to negative technical revisions. As a result of the indicators of impairment, the Company performed impairment calculations on the identified CGUs and the recoverable amounts were determined using fair value less costs to sell, which considered future after-tax cash flows from proved plus probable reserves and an after-tax discount rate of 13% for Saskatchewan and 15.0% for France and United States. Based on the results of the impairment tests completed, the Company recognized non-cash impairment charges of $1.0 billion. Inputs used in the measurement of capital assets are not based on observable market data and fall within level 3 of the fair value hierarchy.

The following benchmark price forecasts were used to calculate the recoverable amounts:


	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033 ⁽²⁾
Brent Crude ($ US/bbl) ⁽¹⁾	78.00	79.18	80.36	81.79	83.41	85.09	86.79	88.52	90.29	92.10
WTI Crude ($ US/bbl) ⁽¹⁾	73.67	74.98	76.14	77.66	79.22	80.80	82.42	84.06	85.75	87.46
Light Sour Crude ($/bbl) ⁽¹⁾	93.35	95.50	96.53	98.46	100.43	102.44	104.49	106.58	108.71	110.88
SK Plant Gate Gas - Spot Gas ($/MMbtu) ⁽¹⁾	1.98	3.15	3.83	3.91	3.99	4.08	4.16	4.25	4.34	4.43
Henry Hub Gas ($ US/MMbtu) ⁽¹⁾	2.75	3.64	4.02	4.10	4.18	4.27	4.35	4.44	4.53	4.62

⁽¹⁾	The forecast benchmark prices listed are adjusted for quality differentials, heat content, transportation and marketing costs and other factors specific to the Company’s operations when determining recoverable amounts.

⁽²⁾	In 2033 and beyond, commodity price forecasts are inflated at a rate of 2.0% per annum.

Vermilion Energy Inc. ∎ Page 20 ∎ 2024 Financial Statements

The following are the results of tests completed, recoverable amounts, and sensitivity impacts which would increase the impairments taken:


Operating Segment	CGU	Impairment	Recoverable Amount	1% increase in discount rate	5% decrease in pricing
Canada	Saskatchewan	542,937	704,636	42,657	79,452
France	France⁽¹⁾	226,858	523,303	24,653	70,035
United States	United States	246,299	239,179	12,819	38,290
Total		1,016,094	1,467,118	80,129	187,777

⁽¹⁾

During 2023, Vermilion finalized an evaluation of the management and organization of Vermilion’s assets in France resulting in a combination of its Neocomian, Chaunoy, Champotran, and Aquitaine Basin CGUs into the France CGU. If these CGUs were not combined, impairment recognized would have increased by $23.2 million.

Southeast Saskatchewan disposition

In March 2023, Vermilion sold non-core assets in southeast Saskatchewan for net proceeds of $182.2 million and resulted in a loss on disposition of $226.8 million. The book value of the net assets disposed of was $409.0 million and consisted of $534.0 million of capital assets, $25.9 million of exploration and evaluation assets, and $150.9 million of asset retirement obligations.

United States disposition

In December 2023, Vermilion sold non-core assets in Wyoming for net proceeds of $16.3 million and resulted in a loss on disposition of $125.5 million.

Minor acquisition

In March 2023, Vermilion completed a minor acquisition of Alberta assets for total consideration of $19.0 million where $33.9 million of capital assets and $14.9 million of asset retirement obligations were recognized.

Right-of-use assets

The following table discloses the carrying balance and depreciation charge relating to right-of-use assets by class of underlying asset as at and for the year ended December 31, 2024 and December 31, 2023:


	As at Dec 31, 2024		As at Dec 31, 2023
($M)	Depreciation	Balance	Depreciation	Balance
Office space	6,899	49,340	8,115	25,893
Processing facilities	16,178	3,367	7,691	6,326
Oil storage facilities	2,627	4,385	2,667	7,037
Vehicles and equipment	1,685	4,631	5,433	9,760
Total	27,389	61,723	23,906	49,016

In July 2024, Vermilion signed an extension of its existing head office lease from 2027 to 2035. The lease increased right-of-use assets by $30.9 million offset with changes to lease liabilities (current portion reduced by $3.4 million; non-current portion increased by $34.4 million). Vermilion's incremental borrowing rate at the time of signing the lease was 7.0%.

Vermilion Energy Inc. ∎ Page 21 ∎ 2024 Financial Statements

8. Exploration and evaluation assets

The following table reconciles the change in Vermilion’s exploration and evaluation assets:


	2024	2023
Balance at January 1	198,379	270,593
Additions	36,018	21,081
Dispositions	—	(25,862)
Changes in asset retirement obligations	—	(980)
Transfers to capital assets	(14,110)	(40,521)
Depreciation	(335)	(27,386)
Foreign exchange	4,334	1,454
Balance at December 31	224,286	198,379

Cost	460,331	432,345
Accumulated depreciation	(236,045)	(233,966)
Carrying amount at December 31	224,286	198,379

9. Asset retirement obligations

The following table reconciles the change in Vermilion’s asset retirement obligations:


	2024	2023
Balance at January 1	1,159,063	1,087,757
Additional obligations recognized	5,431	60,012
Dispositions	—	(151,566)
Changes in estimated abandonment timing and costs	(32,606)	1,159
Obligations settled	(55,334)	(56,966)
Accretion	74,541	78,187
Changes in rates	55,081	133,575
Foreign exchange	18,542	6,905
Balance at December 31	1,224,718	1,159,063

Vermilion calculated the present value of the obligations using a credit-adjusted risk-free rate, calculated using a credit spread of 2.6% as at December 31, 2024 (December 31, 2023 – 3.6%) added to risk-free rates based on long-term, risk-free government bonds. Vermilion’s credit spread is determined using the Company’s expected cost of borrowing at the end of the reporting period.

The country-specific risk-free rates used as inputs to discount the obligations were as follows:


	Dec 31, 2024		Dec 31, 2023
Canada	3.2	%	3.0	%
United States	4.8	%	4.2	%
France	3.7	%	3.0	%
Netherlands	2.7	%	2.1	%
Germany	2.6	%	2.3	%
Ireland	2.8	%	2.7	%
Australia	4.6	%	4.0	%
Central and Eastern Europe	4.7	%	4.4	%

Vermilion has estimated the asset retirement obligations based on current cost estimates of $2.3 billion (2023 - $2.2 billion). Current cost estimates are inflated to the estimated time of abandonment using inflation rates of between 1.5% and 3.6% (2023 - between 1.3% and 5.5%), resulting in inflated cost estimates of $3.5 billion (2023 - $3.4 billion). These payments are expected to be made over the next 55 years, with the majority of the costs incurred in the first 35 years.

Vermilion Energy Inc. ∎ Page 22 ∎ 2024 Financial Statements

A 0.5% increase/decrease in the discount rate applied to asset retirement obligations would decrease/increase asset retirement obligations by approximately $85.1 million. A one-year increase/decrease in the expected timing of abandonment spend would decrease/increase asset retirement obligations by approximately $45.4 million.

10. Derivative instruments

The following table reconciles the change in the fair value of Vermilion’s derivative instruments:


	Year Ended
	Dec 31, 2024	Dec 31, 2023
Fair value of contracts, beginning of year	368,117	239,596
Reversal of opening contracts settled during the year	(284,096)	(43,267)
Assumed in acquisitions	—	51,866
Realized gain on contracts settled during the year	345,318	234,365
Unrealized (loss) gain during the year on contracts outstanding at the end of the year	(168,762)	171,448
Unwinding of contracts assumed in acquisitions	—	(51,526)
Net receipt from counterparties on contract settlements during the year	(345,318)	(234,365)
Fair value of contracts, end of year	(84,741)	368,117
Comprised of:
Current derivative asset	40,312	313,792
Current derivative liability	(52,944)	(732)
Non-current derivative asset	13,927	76,107
Non-current derivative liability	(86,036)	(21,050)
Fair value of contracts, end of year	(84,741)	368,117

The loss (gain) on derivative instruments for 2024 and 2023 were comprised of the following:


	Year Ended
	Dec 31, 2024	Dec 31, 2023
Realized gain on contracts settled during the year	(345,318)	(234,365)
Reversal of opening contracts settled during the year	284,096	43,267
Unwinding of contracts assumed in acquisitions	—	(51,526)
Unrealized loss (gain) on contracts outstanding at the end of the year	168,762	(171,448)
Loss (gain) on derivative instruments	107,540	(414,072)

Vermilion executes derivative instruments where there is an underlying exposure to offset the position. Consistent with the Company's accounting policy, Vermilion does not match unrealized gains or losses on these contracts with the underlying exposure. Please refer to Note 20 (Supplemental information) for a listing of Vermilion's outstanding derivative instruments as at December 31, 2024.

Vermilion Energy Inc. ∎ Page 23 ∎ 2024 Financial Statements

11. Leases

Vermilion had the following future commitments associated with its lease obligations:


	As at
($M)	Dec 31, 2024	Dec 31, 2023
Less than 1 year	16,530	24,029
1 - 3 years	20,632	31,077
3 - 5 years	15,217	4,591
After 5 years	37,551	2
Total lease payments	89,930	59,699
Amounts representing interest	(22,733)	(5,630)
Present value of net lease payments	67,197	54,069
Current portion of lease obligations	(12,206)	(21,068)
Non-current portion of lease obligations	54,991	33,001

Total cash outflow	112,977	21,002
Interest on lease liabilities	11,438	3,908

12. Taxes

The following table reconciles Vermilion’s deferred tax asset and liability:


	As at
	Dec 31, 2024	Dec 31, 2023
Deferred tax assets:
Non-capital losses	516,947	632,870
Derivative contracts	20,685	(89,619)
Other	(30)	(437)
Stock based compensation	7,018	6,757
Asset retirement obligations	90,941	77,292
Capital assets	(448,180)	(447,463)
Unrealized foreign exchange	10,333	2,651
Deferred tax assets	197,714	182,051
Deferred tax liabilities:
Derivative contracts	—	—
Asset retirement obligations	112,790	105,147
Capital assets	252,425	279,889
Stock based compensation	—	—
Other	230	6,275
Unrealized foreign exchange	—	—
Non-capital losses	(649)	(10,341)
Deferred tax liabilities	364,796	380,970

Vermilion Energy Inc. ∎ Page 24 ∎ 2024 Financial Statements

Income tax expense differs from the amount that would have been expected if the reported earnings had been subject only to the statutory Canadian income tax rate as follows:


	Year Ended
	Dec 31, 2024		Dec 31, 2023
Loss before income taxes	(6,586)		(278,282)
Canadian corporate tax rate	24.41	%	24.35	%
Expected tax recovery	(1,608)		(67,762)
(Decrease) increase in taxes resulting from:
Petroleum resource rent tax (PRRT) rate differential ⁽¹⁾	5,468		(14,177)
Foreign tax rate differentials ^{(2) (3)}	19,657		33,404
Equity based compensation expense	(3,542)		(1,914)
Amended returns and changes to estimated tax pools and tax positions	4,597		(7,664)
Statutory rate changes and the estimated reversal rates on temporary differences ⁽³⁾	—		(17,474)
Derecognition of deferred tax assets	29,433		202,216
Non-taxable amounts related to business combination	—		(172,692)
Windfall tax (recovery) expense ⁽³⁾	(9,074)		78,426
Other non-deductible items	(4,778)		(73,058)
Provision for income tax expense (recovery)	40,153		(40,695)

(1)	In Australia, current taxes include both corporate income tax rates and PRRT. For both 2024 and 2023, corporate income tax rates were applied at a rate of 30% and PRRT was applied at a rate of 40%.

(2)	The applicable tax rates for 2024 were: 25.8% in France, 50.0% in the Netherlands, 31.1% in Germany, 25.0% in Ireland, and 21.0% in the United States (2023: 25.8% in France, 50.0% in the Netherlands, 31.2% in Germany, 25.0% in Ireland, and 21.0% in the United States).

(3)

On October 6, 2022 the Council of the European Union adopted a regulation that implemented a temporary windfall tax on the profits of oil and gas producers resident in the European Union. This windfall tax was referred to as a temporary solidarity contribution and was calculated on the amount by which the taxable profits for the elected years exceeded the greater of zero and 120% of the average taxable profits for the 2018 to 2021 period. The regulation required Member States to implement the temporary solidarity contribution at a minimum rate of 33% while providing Member States with the option to apply the temporary solidarity contribution to fiscal years beginning on or after January 1, 2022, January 1, 2023, or both. The temporary solidarity contribution does not apply to 2024 or later years and is considered a tax pursuant to IAS 12 “Income Taxes”.

The following table summarizes the manner of implementation of the temporary solidarity contribution by the Member States in which Vermilion operates:


Jurisdiction	2024	2023
France	N/A	N/A
Netherlands ⁽¹⁾	N/A	N/A
Germany	N/A	33.0	%
Ireland	N/A	75.0	%

(1)	For 2023 and 2024, Netherlands has implemented a windfall royalty which, for natural gas sales, is calculated as 65% of the excess of the realized price for a subject year versus the threshold price of €0.50/Nm3 (€13.40/mcf). This royalty is deductible against current income taxes.

At December 31, 2024, Vermilion had $2.9 billion (December 31, 2023 - $3.2 billion) of unused tax losses of which $1.3 billion (December 31, 2023 - $1.4 billion) relates to Vermilion's Canada segment and expire between 2031 and 2043. The majority of the remaining unused tax losses relate to Vermilion's Ireland segment and do not expire.

At December 31, 2024, Vermilion derecognized $29.4 million (December 31, 2023 - derecognized $202.2 million) of deferred income tax assets relating to the Canada, USA, Ireland and Australia segments as there is uncertainty as to the Company's ability to fully utilize such losses based on the forecasted commodity prices in effect as at December 31, 2024.

The aggregate amount of temporary differences associated with investments in subsidiaries for which deferred tax liabilities have not been recognized as at December 31, 2024 is approximately $1.3 billion (December 31, 2023 – approximately $1.0 billion).

In December 2021, the Organization for Economic Co-operation and Development (“OECD”) issued model rules for a new global minimum tax framework (“Pillar Two”). The objective of Pillar Two is to ensure that large multinational enterprises are subjected to a minimum 15% effective tax rate in each jurisdiction in which they operate.

Vermilion Energy Inc. ∎ Page 25 ∎ 2024 Financial Statements

Most of the countries where Vermilion operates have enacted tax legislation to comply with Pillar Two with effect from January 1, 2024. During the year ended December 31, 2024, the Company recorded $6.5 million of income tax expense relating to Pillar Two.

In May 2023, the IASB issued amendments to IAS 12, “Income Taxes” (“IAS 12”) to address the impacts and additional disclosure requirements related to Pillar Two. Vermilion has applied the mandatory exception required by IAS 12 and accordingly has not accounted for any related deferred income tax assets or liabilities.

13. Long-term debt

The following table summarizes Vermilion’s outstanding long-term debt:


	As at
	Dec 31, 2024	Dec 31, 2023
2025 senior unsecured notes	398,275	395,839
2030 senior unsecured notes	565,181	518,176
Long-term debt	963,456	914,015

The fair value of the 2025 senior unsecured notes as at December 31, 2024 was $397.8 million (December 31, 2023 - $392.7 million). The fair value of the 2030 senior unsecured notes as at December 31, 2024 was $571.2 million (December 31, 2023 - $511.7 million).

At December 31, 2024 Vermilion's revolving credit facility was undrawn.

The following table reconciles the change in Vermilion’s long-term debt:


	2024	2023
Balance at January 1	914,015	1,081,351
Net repayments on the revolving credit facility	—	(146,324)
Repurchases of senior unsecured notes	(31,561)	—
Amortization of transaction costs	2,276	60,004
Foreign exchange	78,726	(81,016)
Balance at December 31	963,456	914,015

Revolving credit facility

As at December 31, 2024, Vermilion had in place a bank revolving credit facility maturing May 26, 2028 with the following terms:


	As at
	Dec 31, 2024	Dec 31, 2023
Total facility amount	1,350,000	1,600,000
Letters of credit outstanding	(22,731)	(18,116)
Unutilized capacity	1,327,269	1,581,884

The facility can be extended from time to time at the option of the lenders and upon notice from Vermilion. If no extension is granted by the lenders, the amounts owing pursuant to the facility are due at the maturity date. The facility is secured by various fixed and floating charges against the subsidiaries of Vermilion.

On May 17, 2024, the maturity date of the facility was extended to May 26, 2028 (previously May 28, 2027) and the total facility amount of $1.6 billion was reduced to $1.35 billion, with an accordion feature to increase the aggregate amount available under the facility to $1.6 billion. As at December 31, 2024, the revolving credit facility was undrawn.

The facility bears interest at a rate applicable to demand loans plus applicable margins.

Vermilion Energy Inc. ∎ Page 26 ∎ 2024 Financial Statements

As at December 31, 2024, the revolving credit facility was subject to the following financial covenants:


		As at
Financial covenant	Limit	Dec 31, 2024	Dec 31, 2023
Consolidated total debt to consolidated EBITDA	Less than 4.0	0.72	0.65
Consolidated total senior debt to consolidated EBITDA	Less than 3.5	—	—
Consolidated EBITDA to consolidated interest expense	Greater than 2.5	16.59	17.33

The financial covenants include financial measures defined within the revolving credit facility agreement that are not defined under IFRS Accounting Standards. These financial measures are defined by the revolving credit facility agreement as follows:

●	Consolidated total debt: Includes all amounts classified as “Long-term debt” and “Lease obligations” (including the current portion included within “Accounts payable and accrued liabilities” but excluding operating leases as defined under IAS 17) on the consolidated balance sheet.

●	Consolidated total senior debt: Consolidated total debt excluding unsecured and subordinated debt.

●	Consolidated EBITDA: Consolidated net loss before interest, income taxes, depreciation, accretion and certain other non-cash items, adjusted for the impact of the acquisition of a material subsidiary.

●	Consolidated total interest expense: Includes all amounts classified as “Interest expense”, but excludes interest on operating leases as defined under IAS 17.

In addition, Vermilion's revolving credit facility has provisions relating to its liability management ratings in Alberta and Saskatchewan whereby if Vermilion's security adjusted liability management ratings fall below specified limits in a province, a portion of the asset retirement obligations are included in the definitions of consolidated total debt and consolidated total senior debt. An event of default occurs if Vermilion's security adjusted liability management ratings breach additional lower limits for a period greater than 90 days. As of December 31, 2024, Vermilion’s liability management ratings were higher than the specified levels, and as such, no amounts relating to asset retirement obligations were included in the calculation of consolidated total debt and consolidated total senior debt.

As at December 31, 2024 and December 31, 2023, Vermilion was in compliance with the above covenants.

2025 senior unsecured notes

On March 13, 2017, Vermilion issued US $300.0 million of senior unsecured notes at par. The notes bear interest at a rate of 5.625% per annum, to be paid semi-annually on March 15 and September 15. The notes mature on March 15, 2025. As direct senior unsecured obligations of Vermilion, the notes rank equally with existing and future senior unsecured indebtedness of the Company.

The senior unsecured notes were recognized at amortized cost and include the transaction costs directly related to the issuance.

Subsequent to March 15, 2023, Vermilion may redeem some or all of the senior unsecured notes at a 100.00% redemption price plus any accrued and unpaid interest.

During the year ended December 31, 2024, Vermilion purchased $31.6 million of senior unsecured notes on the open market which were subsequently cancelled.

The Company has the right to roll over the senior unsecured notes under the existing revolving credit facility which matures May 26, 2028 thus has continued to classify the senior unsecured notes as non-current.

2030 senior unsecured notes

On April 26, 2022, Vermilion closed a private offering of US $400.0 million of senior unsecured notes, priced at 99.241% of par. The notes bear interest at a rate of 6.875% per annum, to be paid semi-annually on May 1 and November 1. The notes mature on May 1, 2030. As direct senior unsecured obligations of Vermilion, the notes rank equally with existing and future senior unsecured indebtedness of the Company.

The senior unsecured notes were recognized at amortized cost and include the transaction costs directly related to the issuance.

Vermilion Energy Inc. ∎ Page 27 ∎ 2024 Financial Statements

Vermilion may, at its option, redeem the notes prior to maturity as follows:

●

Prior to May 1, 2025, Vermilion may redeem up to 35% of the original principal amount of the notes with an amount of cash not greater than the net cash proceeds of certain equity offerings at a redemption price of 106.875% of the principal amount of the notes, together with accrued and unpaid interest.

●

Prior to May 1, 2025, Vermilion may also redeem some or all of the notes at a price equal to 100% of the principal amount of the notes, plus a “make-whole premium,” together with applicable premium, accrued and unpaid interest.

●

On or after May 1, 2025, Vermilion may redeem some or all of the senior unsecured notes at the redemption prices set forth below, together with accrued and unpaid interest.


Year	Redemption price
2025	103.438	%
2026	102.292	%
2027	101.146	%
2028 and thereafter	100.000	%

14. Shareholders’ capital

The following table reconciles the change in Vermilion’s shareholders’ capital:


	2024		2023
Shareholders’ capital	Shares (‘000s)	Amount ($M)	Shares (‘000s)	Amount ($M)
Balance at January 1	162,271	4,142,566	163,227	4,243,794
Vesting of equity based awards	1,181	12,707	3,657	23,575
Shares issued for equity based compensation	72	985	655	11,242
Share-settled dividends on vested equity based awards	87	1,382	64	1,179
Repurchase of shares	(9,267)	(238,742)	(5,332)	(137,224)
Balance at December 31	154,344	3,918,898	162,271	4,142,566

Vermilion is authorized to issue an unlimited number of common shares with no par value.

Dividends declared to shareholders for the year ended December 31, 2024 were $75.3 million or $0.48 per common share (2023 - $65.2 million or $0.40 per share).

On July 8, 2024, the Toronto Stock Exchange approved the Company's notice of intention to renew its normal course issuer bid ("the NCIB"). The NCIB renewal allows Vermilion to purchase up to 15,689,839 common shares (representing approximately 10% of outstanding common shares) beginning July 12, 2024 and ending July 11, 2025. Common shares purchased under the NCIB will be cancelled.

In 2024, Vermilion purchased and cancelled 9.3 million common shares under the NCIB for total consideration of $140.7 million (2023 - 5.3 million common shares for total consideration of $94.8 million). The surplus between the total consideration and the carrying value of the shares repurchased was recorded as a decrease to deficit.

Subsequent to December 31, 2024, Vermilion purchased and cancelled 0.9 million common shares under the NCIB for total consideration of $12.1 million.

15. Capital disclosures

Vermilion defines capital as net debt (long-term debt (excluding unrealized foreign exchange on swapped USD borrowings) plus adjusted working capital (defined as current assets less current liabilities, excluding current derivatives and current lease liabilities)) and shareholders’ capital. In managing capital, Vermilion reviews whether fund flows from operations is sufficient to fund capital expenditures, dividends, and asset retirement obligations.

Vermilion Energy Inc. ∎ Page 28 ∎ 2024 Financial Statements

Vermilion monitors the ratio of net debt to fund flows from operations. As at December 31, 2024, our ratio of net debt to trailing fund flows from operations is 0.8 (December 31, 2023 - 0.9). Vermilion manages the ratio of net debt to fund flows from operations (refer to Note 4 - Segmented information) by monitoring capital expenditures, dividends, and asset retirement obligations with expected fund flows from operations. Vermilion intends for the ratio of net debt to fund flows from operations to trend towards 1.0 over time.

The following table calculates Vermilion’s ratio of net debt to fund flows from operations:


	Year Ended
	Dec 31, 2024	Dec 31, 2023
Long-term debt	963,456	914,015
Adjusted working capital ⁽¹⁾	3,426	164,552
Net debt	966,882	1,078,567

Ratio of net debt to four quarter trailing fund flows from operations	0.8	0.9

⁽¹⁾	Adjusted working capital is defined as current assets (excluding current derivatives), less current liabilities (excluding current derivatives and current lease liabilities).

16. Equity based compensation

The following table summarizes the number of awards outstanding under the LTIP:


Number of LTIP Awards (‘000s)	2024	2023
Opening balance	4,478	5,503
Granted	1,917	1,694
Vested	(2,061)	(2,476)
Forfeited	(408)	(243)
Closing balance	3,926	4,478

For the year ended December 31, 2024, the awards had a weighted average grant date fair value of $16.62 (2023 - $18.19). Equity based compensation expense for the awards is calculated based on the number of awards outstanding multiplied by the estimated performance factor that will be realized upon vesting (2024 - 1.0; 2023 - 1.0) adjusted by an estimated annual forfeiture rate (2024 – 7.2%; 2023 – 5.3%). Equity based compensation expense of $27.5 million was recorded during the year ended December 31, 2024 (2023 - $29.2 million) relating to the awards.

As at December 31, 2024, there were 568,826 DSUs outstanding with a weighted average grant date fair value of $14.32. In 2023, there were 470,952 DSUs granted with a weighted average grant date fair value of $14.26. Equity based compensation expense of $1.4 million was recorded during the year ended December 31, 2024 (2023 - $2.3 million) relating to the DSUs.

17. Per share amounts

Basic and diluted net loss per share have been determined based on the following:


	Year Ended
	Dec 31, 2024	Dec 31, 2023
Net loss	(46,739)	(237,587)

Basic weighted average shares outstanding (‘000s)	158,068	163,719
Diluted weighted average shares outstanding ('000s)	158,068	163,719

Basic loss per share	(0.30)	(1.45)
Diluted loss per share	(0.30)	(1.45)

Vermilion Energy Inc. ∎ Page 29 ∎ 2024 Financial Statements

18. Financial instruments

Classification of financial instruments

The following table summarizes the carrying value relating to Vermilion’s financial instruments:


	As at Dec 31, 2024				As at Dec 31, 2023
			Amortized				Amortized
($M)	FVTPL	FVTOCI	Cost	Total	FVTPL	FVTOCI	Cost	Total
Cash and cash equivalents	131,730	—	—	131,730	141,456	—	—	141,456
Derivative assets	54,239	—	—	54,239	389,899	—	—	389,899
Investments⁽¹⁾	—	—	—	—	—	73,261	—	73,261
Derivative liabilities	(138,980)	—	—	(138,980)	(21,782)	—	—	(21,782)
Accounts receivable	—	—	298,493	298,493	—	—	242,926	242,926
Accounts payable and accrued liabilities	—	—	(425,410)	(425,410)	—	—	(380,370)	(380,370)
Dividends payable	—	—	(18,521)	(18,521)	—	—	(16,227)	(16,227)
Lease obligations	—	—	(54,991)	(54,991)	—	—	(33,001)	(33,001)
Long-term debt ⁽²⁾	—	—	(963,456)	(963,456)	—	—	(914,015)	(914,015)

(1)	The investment was classified as a level 1 instrument on the fair value hierarchy and used observable inputs when making fair value adjustments and was recorded until significant influence was acquired, on February 29, 2024. The investment was subsequently accounted for under IAS 28.

(2)	The carrying value of the above equals fair value except for long-term debt. The fair value of long-term debt was $969,050 (2023 - $904,418).

The carrying value of accounts receivable, accounts payable and accrued liabilities, dividends payable and lease obligations are a reasonable approximation of their fair value due to the short maturity of these financial instruments. The carrying value of long-term debt outstanding on the revolving credit facility approximates its fair value due to the use of short-term borrowing instruments at market rates of interest.

Fair value measurements are categorized into a fair value hierarchy based on the lowest level input that is significant to the fair value measurement:

●

Level 1 inputs are determined by reference to unadjusted quoted prices in active markets for identical assets or liabilities. Inputs used in fair value measurement of cash and cash equivalents , investment in securities, the revolving credit facility, and the senior unsecured notes are categorized as Level 1.

●

Level 2 inputs are determined based on inputs other than unadjusted quoted prices that are observable, either directly or indirectly. The fair value of Vermilion’s derivative assets and liabilities are determined using pricing models that incorporate future price forecasts (supported by prices from observable market transactions) and credit risk adjustments.

●

Level 3 inputs are not based on observable market data. Vermilion does not have any financial instruments classified as Level 3.

There were no transfers between levels in the hierarchy in the years ended December 31, 2024 and 2023.

Nature and extent of risks associated with financial instruments

Vermilion is exposed to financial risks from its financial instruments. These financial risks include: market risk (includes commodity price risk, interest rate risk, and currency risk), credit risk, and liquidity risk.

Commodity price risk

Vermilion is exposed to commodity price risk on its derivative assets and liabilities which are used as part of the Company’s risk management program to mitigate the effects of changes in commodity prices on future cash flows. While transactions of this nature relate to future petroleum and natural gas production, Vermilion does not designate these derivative assets and liabilities as accounting hedges. As such, changes in commodity prices impact the fair value of derivative instruments and the corresponding gains or losses recognized on derivative instruments.

Currency risk

Vermilion is exposed to currency risk on its financial instruments denominated in foreign currencies. These financial instruments include cash and cash equivalents, accounts receivables, accounts payables, lease obligations, long-term debt, derivative assets and derivative liabilities. These financial instruments are primarily denominated in the US dollar and the Euro. Vermilion monitors its exposure to currency risk and reviews whether the use of derivative financial instruments is appropriate to manage potential fluctuations in foreign exchange rates.

Vermilion Energy Inc. ∎ Page 30 ∎ 2024 Financial Statements

Interest rate risk

Vermilion is exposed to interest rate risk on its revolving credit facility, which consists of short-term borrowing instruments that bear interest at market rates. Thus, changes in interest rates could result in an increase or decrease in the amount paid by Vermilion to service this debt.

The following table summarizes the increase (positive values) or decrease (negative values) to net loss before tax due to a change in the value of Vermilion’s financial instruments as a result of a change in the relevant market risk variable. This analysis does not attempt to reflect any interdependencies between the relevant risk variables.


($M)	Dec 31, 2024	Dec 31, 2023
Currency risk - Euro to Canadian dollar
$0.01 increase in strength of the Canadian dollar against the Euro	4,893	5,855
$0.01 decrease in strength of the Canadian dollar against the Euro	(4,893)	(5,855)

Currency risk - US dollar to Canadian dollar
$0.01 increase in strength of the Canadian dollar against the US $	4,209	6,816
$0.01 decrease in strength of the Canadian dollar against the US $	(4,209)	(6,816)

Commodity price risk - Crude oil
US $5.00/bbl increase in crude oil price used to determine the fair value of derivatives	(13,370)	(27,573)
US $5.00/bbl decrease in crude oil price used to determine the fair value of derivatives	13,370	27,573

Commodity price risk - European natural gas
€ 5.0/GJ increase in European natural gas price used to determine the fair value of derivatives	(428,223)	(256,731)
€ 5.0/GJ decrease in European natural gas price used to determine the fair value of derivatives	310,629	262,862

Share price risk - Equity swaps
$1.00 increase from initial share price of the equity swap	3,750	3,750
$1.00 decrease from initial share price of the equity swap	(3,750)	(3,750)

Credit risk

Vermilion is exposed to credit risk on accounts receivable and derivative assets in the event that customers, joint operation partners, or counterparties fail to discharge their contractual obligations. As at December 31, 2024, Vermilion’s maximum exposure to receivable credit risk was $352.7 million (December 31, 2023 - $632.8 million) which is the value of accounts receivable and derivative assets on the balance sheet.

Vermilion’s accounts receivable primarily relates to customers and joint operations partners in the petroleum and natural gas industry. These amounts are subject to normal industry payment terms and credit risks. Vermilion manages these risks by monitoring the creditworthiness of customers and joint operations partners and, where appropriate, obtaining assurances such as parental guarantees and letters of credit. Vermilion determines the lifetime expected credit losses recognized on accounts receivable using a provision matrix. In preparing the provision matrix, the Company takes into account historical credit loss experience based on the aging of accounts receivable, adjusted as necessary for current and future petroleum and natural gas prices to the extent that changes in pricing may negatively impact the Company’s customers and joint operations partners. The lifetime expected credit losses on accounts receivable as at December 31, 2024 and 2023 is not material. As at the balance sheet date, approximately 1.1% (2023 –3.7%) of the accounts receivable balance was outstanding for more than 90 days. Vermilion considers the balance of accounts receivable to be collectible.

Vermilion’s derivative assets primarily relates to the fair value of financial instruments used as part of the Company’s risk management program to mitigate the effects of changes in commodity prices on future cash flows. Vermilion manages this risk by monitoring the creditworthiness of counterparties, transacting primarily with counterparties that have investment grade third party credit ratings, and by limiting the concentration of financial exposure to individual counterparties. As a result, Vermilion has not obtained collateral or other security to support its financial derivatives.

Vermilion’s cash deposited in financial institutions and guaranteed investment certificates are also subject to counterparty credit risk. Vermilion mitigates this risk by transacting with financial institutions with high third party credit ratings.

Vermilion Energy Inc. ∎ Page 31 ∎ 2024 Financial Statements

Liquidity risk

Liquidity risk is the risk that Vermilion will encounter difficulty in meeting obligations associated with its financial liabilities. Vermilion does not consider this to be a significant risk as its financial position and available committed borrowing facility provide significant financial flexibility and allow Vermilion to meet its obligations as they come due.

The following table summarizes Vermilion’s undiscounted non-derivative financial liabilities and their contractual maturities:


		1 month to	3 months to	1 year to
($M)	1 month	3 months	1 year	5 years
December 31, 2024	155,444	639,211	28,120	35,624
December 31, 2023	134,381	235,396	26,820	430,993

19. Related party disclosures

The compensation of directors and management is reviewed annually by the independent Governance and Human Resources Committee against industry practices for oil and gas companies of similar size and scope.

The following table summarizes the compensation of directors and other members of key management personnel during the years ended December 31, 2024 and 2023:


	Year Ended
	Dec 31, 2024	Dec 31, 2023
Short-term benefits	4,326	5,451
Equity based compensation	6,372	8,015
Total compensation	10,698	13,466
Number of individuals included in the above amounts	14	15

20. Supplemental information

Changes in non-cash working capital was comprised of the following:


	Year Ended
	Dec 31, 2024	Dec 31, 2023
Changes in:
Accounts receivable	(55,567)	130,725
Crude oil inventory	16,639	(37,676)
Prepaid expenses	(3,090)	76,452
Accounts payable and accrued liabilities	45,040	(101,074)
Income taxes payable	(185,030)	(42,953)
Dividends payable	2,294	3,169
Working capital assumed in acquisitions	—	(109,134)
Foreign exchange	9,985	7
Changes in non-cash working capital	(169,729)	(80,484)

Changes in non-cash operating working capital	(182,698)	(61,117)
Changes in non-cash investing working capital	10,213	(19,367)
Changes in non-cash financing working capital	2,756	—
Changes in non-cash working capital	(169,729)	(80,484)

Vermilion Energy Inc. ∎ Page 32 ∎ 2024 Financial Statements

Cash and cash equivalents was comprised of the following:


	As at
	Dec 31, 2024	Dec 31, 2023
Cash on deposit with financial institutions	124,938	140,795
Guaranteed investment certificates	6,792	661
Cash and cash equivalents	131,730	141,456

Wages and benefits included in operating expenses and general and administration expenses were:


	Year Ended
	Dec 31, 2024	Dec 31, 2023
Operating expense	92,062	87,418
General and administration expense	73,817	61,550
Wages and benefits	165,879	148,968

As at December 31, 2024, Vermilion had the following contractual obligations and commitments:


($M)	Less than 1 year	1 - 3 years	3 - 5 years	After 5 years	Total
Long-term debt⁽¹⁾	448,303	79,140	79,140	595,345	1,201,928
Lease obligations⁽²⁾	33,527	38,315	32,665	49,010	153,517
Processing and transportation agreements	59,431	93,441	113,089	759,853	1,025,814
Purchase obligations	29,318	16,391	369	418	46,496
Drilling and service agreements	32,691	22,259	—	—	54,950
Total contractual obligations and commitments	603,270	249,546	225,263	1,404,626	2,482,705

(1)	Includes interest on senior unsecured notes.

(2)	Includes undiscounted IFRS 16 - Leases obligations of $89.9 million as at December 31, 2024, surface lease rental commitments of $61.9 million and other of $1.6 million that are not considered leases under IFRS 16 and are not represented on the balance sheet.

(3)	Commitments denominated in foreign currencies have been translated using the related spot rates on December 31, 2024.

Vermilion Energy Inc. ∎ Page 33 ∎ 2024 Financial Statements

The following tables summarize Vermilion’s outstanding risk management positions as at December 31, 2024:


				Weighted		Weighted		Weighted		Weighted	Daily	Weighted
			Daily	Average	Daily	Average	Daily	Average	Daily	Average	Bought	Average
			Bought Put	Bought Put	Sold Call	Sold Call	Sold Put	Sold Put	Sold Swap	Sold Swap	Swap	Bought
	Unit	Currency	Volume	Price	Volume	Price	Volume	Price	Volume	Price	Volume	Swap Price
Dated Brent
Q1 2025	bbl	USD	—	—	—	—	—	—	4,000	73.25	—	—
WTI
Q1 2025	bbl	USD	—	—	—	—	—	—	8,000	73.11	—	—
Q2 2025	bbl	USD	—	—	—	—	—	—	3,000	68.72	—	—
AECO
Q1 2025	mcf	CAD	4,739	3.17	4,739	4.22	—	—	23,695	3.89	—	—
Q2 2025	mcf	CAD	4,739	3.17	4,739	4.22	—	—	23,695	3.89	—	—
Q3 2025	mcf	CAD	4,739	3.17	4,739	4.22	—	—	23,695	3.89	—	—
Q4 2025	mcf	CAD	4,739	3.17	4,739	4.22	—	—	39,407	3.55	—	—
Q1 2026	mcf	CAD	4,739	3.17	4,739	4.22	—	—	47,391	3.46	—	—
Q2 2026	mcf	CAD	4,739	3.17	4,739	4.22	—	—	47,391	3.46	—	—
Q3 2026	mcf	CAD	4,739	3.17	4,739	4.22	—	—	47,391	3.46	—	—
Q4 2026	mcf	CAD	4,739	3.17	4,739	4.22	—	—	47,391	3.46	—	—
Q1 2027	mcf	CAD	—	—	—	—	—	—	23,695	3.03	—	—
Q2 2027	mcf	CAD	—	—	—	—	—	—	23,695	3.03	—	—
Q3 2027	mcf	CAD	—	—	—	—	—	—	23,695	3.03	—	—
Q4 2027	mcf	CAD	—	—	—	—	—	—	23,695	3.03	—	—
AECO Basis (AECO less NYMEX Henry Hub)
Q1 2025	mcf	USD	—	—	—	—	—	—	10,000	(1.15)	—	—
Q2 2025	mcf	USD	—	—	—	—	—	—	10,000	(1.15)	—	—
Q3 2025	mcf	USD	—	—	—	—	—	—	10,000	(1.15)	—	—
Q4 2025	mcf	USD	—	—	—	—	—	—	10,000	(1.15)	—	—
NYMEX Henry Hub
Q1 2025	mcf	USD	24,000	3.50	24,000	4.49	—	—	10,000	3.20	—	—
Q2 2025	mcf	USD	24,000	3.50	24,000	4.49	—	—	10,000	3.20	—	—
Q3 2025	mcf	USD	24,000	3.50	24,000	4.49	—	—	10,000	3.20	—	—
Q4 2025	mcf	USD	24,000	3.50	24,000	4.49	—	—	10,000	3.20	—	—
Q1 2026	mcf	USD	24,000	3.50	24,000	4.49	—	—	—	—	—	—
Q2 2026	mcf	USD	24,000	3.50	24,000	4.49	—	—	—	—	—	—
Q3 2026	mcf	USD	24,000	3.50	24,000	4.49	—	—	—	—	—	—
Q4 2026	mcf	USD	24,000	3.50	24,000	4.49	—	—	—	—	—	—
Q1 2027	mcf	CAD	—	—	—	—	—	—	24,000	3.76	—	—
Q2 2027	mcf	CAD	—	—	—	—	—	—	24,000	3.76	—	—
Q3 2027	mcf	CAD	—	—	—	—	—	—	24,000	3.76	—	—
Q4 2027	mcf	CAD	—	—	—	—	—	—	24,000	3.76	—	—

Vermilion Energy Inc. ∎ Page 34 ∎ 2024 Financial Statements


				Weighted		Weighted		Weighted		Weighted	Daily	Weighted
			Daily	Average	Daily	Average	Daily	Average	Daily	Average	Bought	Average
			Bought Put	Bought Put	Sold Call	Sold Call	Sold Put	Sold Put	Sold Swap	Sold Swap	Swap	Bought
	Unit	Currency	Volume	Price	Volume	Price	Volume	Price	Volume	Price	Volume	Swap Price
TTF
Q1 2025	mcf	EUR	19,654	10.21	19,654	14.93	13,512	4.69	39,308	14.52	—	—
Q2 2025	mcf	EUR	22,111	8.31	22,111	12.88	22,111	4.01	24,567	12.99	—	—
Q3 2025	mcf	EUR	22,111	8.31	22,111	12.88	22,111	4.01	24,567	12.99	—	—
Q4 2025	mcf	EUR	31,938	8.05	31,938	12.50	31,938	3.67	20,882	11.87	—	—
Q1 2026	mcf	EUR	24,567	7.39	24,567	11.66	24,567	3.02	20,882	11.87	—	—
Q2 2026	mcf	EUR	24,567	7.39	24,567	11.66	24,567	3.02	18,426	9.60	—	—
Q3 2026	mcf	EUR	24,567	7.39	24,567	11.66	24,567	3.02	18,426	9.60	—	—
Q4 2026	mcf	EUR	28,253	7.43	28,253	11.66	28,253	2.93	4,913	8.54	—	—
Q1 2027	mcf	EUR	28,253	7.43	28,253	11.66	28,253	2.93	4,913	8.54	—	—
THE
Q1 2025	mcf	EUR	—	—	—	—	—	—	2,457	14.95	—	—
Q2 2025	mcf	EUR	—	—	—	—	—	—	2,457	14.95	—	—
Q3 2025	mcf	EUR	—	—	—	—	—	—	2,457	14.95	—	—

VET Equity Swaps

Initial Share Price

Share Volume

Swap

Jan 2020 - Apr 2025

20.9788

CAD

2,250,000

Swap

Jan 2020 - Jul 2025

22.4587

CAD

1,500,000

Foreign

Monthly
Bought Put

Weighted
Average

Monthly Sold Call

Weighted
Average

Monthly
Sold Swap

Weighted Average

Exchange

Period

Amount

Bought Put Price

Amount

Sold Call Price

Amount

Sold Swap Price

Collar

Sell USD, Buy CAD

Jan 2025 - Jun 2025

5,000,000

USD

1.3740

5,000,000

USD

1.4551

—

Collar

Sell USD, Buy CAD

Jan 2025 - Dec 2025

12,500,000

USD

1.3637

12,500,000

USD

1.4133

—

The following sold option instruments allow the counterparties, at the specified date, to enter into a derivative instrument contract with Vermilion at the detailed terms:

Weighted

Option

Daily

Average

Daily

Average

Daily

Average

Daily Sold

Average

Expiration

Bought Put

Sold Call

Sold Put

Swap

Sold Swap

Period if Option Exercised

Unit

Currency

Date

Volume

Price

Volume

Price

Volume

Price

Volume

Price

TTF

Apr 2025 - Mar 2027

mcf

EUR

31-Mar-2025

—

2,457

10.99

21. Subsequent events

Acquisition of Westbrick Energy Ltd.

On December 23, 2024, Vermilion announced it entered into an arrangement agreement to acquire Westbrick Energy Ltd. ("Westbrick"), a private company with assets located adjacent to Vermilion's existing Alberta assets. On February 26, 2025,Vermilion completed the acquisition for total consideration (before closing adjustments) of $1.075 billion in exchange for all the issued and outstanding Westbrick shares.

Concurrent with the completion of the Westbrick acquisition, Vermilion’s credit facility was amended to incorporate a new $450 million term loan (the "Term Loan") which was immediately drawn. The Term Loan does not require principal repayments prior to its May 26, 2028 maturity, is non-revolving, and is subject to the same financial covenants as Vermilion’s revolving credit facility. The Term Loan bears interest based on a reference rate plus an applicable margin.

Total consideration was comprised of $14.2 million of share consideration with the balance paid in cash.

As of the date of the financial statements, sufficient information was not yet available to calculate a preliminary purchase price allocation.

Vermilion Energy Inc. ∎ Page 35 ∎ 2024 Financial Statements

Issuance of 2033 senior unsecured notes

On February 11, 2025, Vermilion closed a private offering of US $400.0 million of senior unsecured notes. The notes bear interest at a rate of 7.250% per annum, to be paid February 15 and August 15, commencing on August 15, 2025. The notes mature on February 15, 2033. As direct senior unsecured obligations of Vermilion, the notes rank equally with existing and future senior unsecured indebtedness of the Company.

Proceeds from the notes may be used at the Company's discretion to redeem or repay the outstanding 2025 senior notes, fund a portion of the Westbrick acquisition, repay a portion of any credit facility borrowings, or a combination thereof.

Vermilion Energy Inc. ∎ Page 36 ∎ 2024 Financial Statements

DIRECTORS

Myron Stadnyk ¹

Calgary, Alberta

Dion Hatcher

Calgary, Alberta

James J. Kleckner Jr. ^7,9

Edwards, Colorado

Carin Knickel ^4,7,11

Golden, Colorado

Stephen P. Larke ^3,5,10

Calgary, Alberta

Timothy R. Marchant ^6,9,11

Calgary, Alberta

Robert Michaleski ^3,5

Calgary, Alberta

William Roby ^7,8,11

Katy, Texas

Manjit Sharma ^2,5

Toronto, Ontario

Judy Steele ^3,5,11

Halifax, Nova Scotia

Chairman (Independent)

Audit Committee Chair (Independent)

Audit Committee Member (Independent)

Governance and Human Resources Committee Chair (Independent)

Governance and Human Resources Committee Member (Independent)

Health, Safety and Environment Committee Chair (Independent)

Health, Safety and Environment Committee Member (Independent)

Technical Committee Chair (Independent)

Technical Committee Member (Independent)

Sustainability Committee Chair (Independent)

Sustainability Committee Member (Independent)

OFFICERS / CORPORATE SECRETARY

Dion Hatcher *

President & Chief Executive Officer

Lars Glemser *

Vice President & Chief Financial Officer

Tamar Epstein

General Counsel & Corporate Secretary

Terry Hergott

Vice President Marketing

Yvonne Jeffery

Vice President Sustainability

Darcy Kerwin *

Vice President International & HSE

Geoff MacDonald

Vice President Geosciences

Randy McQuaig *

Vice President North America

Kyle Preston

Vice President Investor Relations

Averyl Schraven

Vice President People & Culture

Gerard Schut

Vice President European Operations

* Principal Executive Committee Member

AUDITORS

Deloitte LLP

Calgary, Alberta

BANKERS

The Toronto-Dominion Bank

The Bank of Nova Scotia

Canadian Imperial Bank of Commerce

National Bank of Canada

Royal Bank of Canada

Wells Fargo Bank N.A., Canadian Branch

ATB Financial

Bank of America N.A., Canada Branch

Export Development Canada

Fédération des caisses Desjardins du Québec

Citibank, N.A., Canadian Branch

Canadian Western Bank

JPMorgan Chase Bank, N.A., Toronto Branch

Goldman Sachs Lending Partners LLC

EVALUATION ENGINEERS

McDaniel & Associates

Calgary, Alberta

LEGAL COUNSEL

Norton Rose Fulbright Canada LLP

Calgary, Alberta

TRANSFER AGENT

Odyssey Trust Company

STOCK EXCHANGE LISTINGS

The Toronto Stock Exchange (“VET”)

The New York Stock Exchange (“VET”)

INVESTOR RELATIONS

Kyle Preston

Vice President Investor Relations

403-476-8431 TEL

403-476-8100 FAX

1-866-895-8101 IR TOLL FREE

investor_relations@vermilionenergy.com

Vermilion Energy Inc. ∎ Page 37 ∎ 2024 Financial Statements