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1 Ikkuma Resources Corp. (TSX-V:IKM) Last Close: $0.70 OIL & GAS RESEARCH 12-Month Target: $1.15 Recommendation: Speculative Buy Implied Total Return: 64% COMPANY DESCRIPTION: Ikkuma Resources Corp is a technically driven company focused on the exploitation of conventional bypassed zones in the Western Canadian Foothills. Trevor Reynolds Oil and Gas Research Analyst (403) treynolds@acumencapital.com Ted Bobier Associate Analyst (403) tbobier@acumencapital.com August 17, 2017 IKM Announces Transformational Acquisition IKM announced a strategic acquisition (which appears to be from Husky) which increases the company s ability to delineate their light oil Cardium play at Narraway; Acquired acreage located in the foothills and deep basin is a strong fit with management s skill set; Acquisition completed at rock bottom metrics based on lack of activity on the asset base, high natural gas weighting, and minimal competition based on the required skillset; Deal accretive on production per share, CF, reserves, and NAV per share; Deal being funded through the sale of underutilized (by IKM) legacy infrastructure for $20 MM along with a $10 MM flow through share deal; Disposition has minimal to no impact on base economics but results in a reserve dedication and manageable $12 MM recompletion commitment; Proforma CF expected to be in the range of $20-$30 MM annually which will be focused on further delineation activity at Narraway; We make adjustments to our estimates based on the information available to date; and, We maintain a Speculative Buy recommendation but increase our target price to $1.15/sh (6.7x 2018F EV/DACF multiple) from $1.00/sh (8.3x 2018F EV/DACF multiple). Market Information (C$) Market Cap (MM) $66.0 Basic Shares (MM) 94.2 F.D. Shares (MM) week High/Low $1.10-$ day Avg Daily Trading Vol 51,892 Implied Return 64% Financial Data E 2018E Oil/Liquids (bbl/d) ,000 Gas (mmcf/d) Boe/d (6:1) 6,311 8,500 21,000 % Oil & NGL's 2% 4% 5% Cash Flow (MM) $10.4 $8.6 $22.8 CFPS (FD) $0.12 $0.09 $0.21 Net Debt YE (MM) $32.5 $49.2 $56.4 Capex (MM) $17.6 $35.0 $30.0 Valuation 2017E 2018E EV/DACF 10.1x 4.9x EV/Production (boe/d) $13,549 $5,829 Price/CF 8.0x 3.3x Net Debt/CF 5.7x 2.5x ACUMEN CAPITAL FINANCE PARTNERS LIMITED SUITE 800, 500 4th AVENUE SW CALGARY, AB T2P 2V6 MAIN PHONE: TOLL FREE:

2 Page 2 of 6 IKM Acquisition, Divestiture & Financing. IKM announced a series of transformational events which we expect to result in a significant improvement in the company s financial position moving forward. The strategic deal provides strong accretion on essentially all metrics, and will allow Management to direct an increase in base cash flow towards their oil play at Narraway. The $34 MM acquisition is being funded through the sale of infrastructure, including a 51% WI in the company s main foothills trunk line, along with associated facilities to TWM for $20 MM. In addition the company has entered into a $10 MM non-brokered FT share Overall we view the announcement as positive for IKM. Acquisition Summary. We believe the acquisition is from Husky Energy based on the combined releases from IKM and TWM. Highlights of the deal include; Purchase Price $34 MM, On-stream production at close 14,300 boe/d (92% natural gas) excludes ~4,400 boe/d of sour gas which will be shut-in, PDP Reserves 33.4 MMboe, 2P Reseves 43.9 MM MMboe, PDP10% of $126.8 MM. Figure 1: Acquisition Overview Source: Acumen Capital, Company Reports Deal Metrics. Deal metrics reflect an extremely tough A&D market along with the fact that the assets have not seen any activity in a number of years. In addition, foothills assets require a certain skillset which not many companies have, and IKM specializes in. Metrics are highlighted by; $1.01/boe PDP or $0.17/mcf, $0.77/boe 2P or $0.13/mcf, $2,369/boe/d, ~$86/acre acquired,

3 Page 3 of 6 2.2x Purchase price/operating netback. Proforma. The assets are clearly a strong fit with IKM s current asset base. Highlights of the deal impact, and IKM proforma include; Production increase of 220% to 20,800 boe/d, with a decreased decline rate of ~11%, Management calculates a CF per share increase of 130% (basic), PDP reserves increase by 246% (207% on a per share basis) with no PUDS booked on the asset base, 2P reserves increase by 135% (108% on a per share basis), LLR Rating improves by 65% to 7.62, Net undeveloped acreage increases by 139% to 423,307 acres, Deal adds another 8 oil sections at Narraway which remains the focus moving forward, IKM has identified over 28,000 boe/d of bypassed opportunities on the acquired asset base, Operating costs of $13-$15/boe will increase IKM s corporate rate in the near term, but synergies expected to be realized. Addition of underutilized infrastructure including ~1,300 km s of pipelines, 5 major facilities, and 10 minor facilities, 2D and 3D seismic with a replacement value in excess of $50 MM. Expected increase in the unutilized credit facility from $25 MM to $40 MM. Disposition. Over half the acquisition is being funded through a $20 MM disposition of legacy IKM infrastructure including a 51% WI in the main trunk line, and a WI in various plants. We view the disposition as a potential win/win for the two parties as TWM is likely to increase throughput on the assets and in turn create value for both parties. The disposition has little to no impact on IKM s revenue at this time. With the disposition, IKM has committed to a very manageable $12 MM recompletion program over the coming years, along with a reserve dedication agreement. Flow Through Financing. IKM has also entered into a $10 MM non-brokered flow through share financing at $0.82/sh. Proceeds from the financing will be used to further de-risk/delineate the Cardium light oil play at Narraway. Reserves Update. We outline the impact on reserves and the reserve based PV10 NAV in figures 2 and 3 respectively. Figure 2: Change in Reserves 2016 Reserves Proforma Acquisition 2016 Reserves Reserve Type Gas Oil/NGL BOE Oil & NGL's % of 2P Reserves 2016 BOE Oil & NGL's % of 2P Reserves (bcf) (mmbbl) (mmboe) (%) (mmboe) (%) (%) (%) (%) Proved Producing % 73% % 50% 246% 207% Proved n-producing % 10% 6.3 4% 23% 0% -11% Total Proved % 83% % 72% 169% 138% Probable % 17% 7.6 4% 28% 48% 31% Proved + Probable % 100% % 100% 135% 108% Source: Acumen Capital, Company reports Change Per-Share Change

4 Page 4 of 6 Figure 3: PV10 NAV Update 2016 Proforma Net Asset Value PDP Proved P+P ($M M ) ($M M ) ($M M ) NPV 10% Reserves $230.4 $258.6 $351.0 Undeveloped Land $0.0 $0.0 $0.0 Total Assets $230.4 $258.6 $351.0 Less Net Debt ($48.6) ($48.6) ($48.6) Total $181.8 $210.0 $302.4 Shares Outstanding (basic) Proforma NAVPS $1.71 $1.97 $ NAVPS $0.75 $1.05 $1.67 Change 126% 87% 70% Source: Acumen Capital, Company reports Updated Estimates. We adjust our estimates to account for the information provided at this time. IKM reports their quarter next week, and we anticipate more information will be available on the go forward numbers at that time. The capital focus moving forward will remain on the Cardium oil play at Narraway and the recompletion commitment of ~$12 MM to TWM over the coming years. The acquisition is expected to close at the beginning of vember with an effective date of July 1, We outline our updated numbers in figure 4. Figure 4: Estimate Update 2017F 2018F New Old change New Old change Oil & NGL's (boe/d) % 1, % Gas (mmcf/d) % % Total (boe/d) 8,500 6, % 21,000 7, % Oil & NGL's (%) 4% 5% -35.7% 5% 9% -49.0% Net Debt ($MM) % % Net Debt/CF 5.7x 3.5x 62.6% 2.5x 3.9x -36.5% E&D Capex ($MM) % % Net Capex ($MM) % % Cash Flow ($MM) % % CFPS (b) % % Operating Netback ($/boe) % % Corporate Netback ($/boe) % % Source: Acumen Capital, Company reports RECOMMENDATION AND INVESTMENT CONCLUSION Management s technical ability in the foothills remains key to the IKM story. We continue to view IKM as a catalyst rich stock with a focus on Cardium activity in 2017 along with successful integration of the acquired assets. We maintain a Speculative Buy recommendation but increase our target to $1.15/sh (6.7x 2018F EV/DACF multiple) from $1.00/sh (8.3x 2018F EV/DACF multiple).

5 Page 5 of 6 Company: Ikkuma Resource Corp. Disclosure Requirements Is this an issuer related or industry related publication? Issuer Industry Does the Analyst/Associate have a financial interest in securities of the subject issuer? If yes, nature of interest: Is Acumen Capital Partners a market maker in the issuer s securities at the date of this report? Does Acumen Capital Partners beneficially own more than 1% of any class of common equity of the issuer? Does Acumen Capital Partners or the Analyst/Associate have any actual material conflicts of interest with the issuer? Explanation: Does the Analyst/Associate or Household member serve as a Director, Officer, or Advisory Board Member of the issuer? Has the Analyst/Associate received any direct compensation from the subject Company in the past 12 months?* Has Acumen Capital Partners managed or co-managed an offering of securities by the issuer in the past 12 months? Has Acumen Capital Partners received compensation for investment banking and related services from the issuer in the past 12 months? Other disclosures: * Acumen has a pool for compensation purposes, which includes research analysts, investment banking personnel and institutional traders. Revenue in the pool includes trading commissions, advisory fees, new issue commissions and broker warrant proceeds. Acumen Recommendation Structure: Buy Speculative Buy Hold Reduce Under Review Tender Full Recommendation Structure explanation can be found at the Acumen Capital Partners website: The information transmitted is privileged, confidential, may be subject to copyright and is intended solely for the use of the individual or entity to which the transmission is addressed. This transmission is provided for informational purposes only, and does not constitute an offer or solicitation to buy or sell any securities discussed herein in any jurisdiction where such would be prohibited, nor in any jurisdiction where Acumen is not registered to do so. Views expressed are those of the sender and not necessarily those of Acumen Capital Finance Partners Limited or its subsidiaries. Any unauthorized use, distribution, review or disclosure is prohibited. If you received this in error, please notify the sender and delete or destroy this message and any copies. Acumen does or seeks to do business with companies covered in our research comments and reports. As a result, investors should be aware that the firm may be in a conflict of interest. Investors should consider this report as only a single factor in making their investment decision.

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