6-K

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

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REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of March 2024.

Commission File Number 001-41810

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GreenfireResources Ltd.

(Exact name of Registrant as specified in its charter)

N/A

(Translation of Registrant’s name)

Suite 1900, 205 – 5^th^ Avenue SW

Calgary, Alberta T2P 2V7

(403) 264-9046

(Address and telephone number of registrant’s principal executive offices)

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

Form 20-F ☒ Form 40-F ☐

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GREENFIRE RESOURCES LTD.

DOCUMENTS INCLUDED AS PART OF THIS REPORT

Exhibit

99.1	Consolidated Financial Statements (Audited) as at, and for the year ended, December 31, 2023
99.2	Management’s Discussion and Analysis for the year ended December 31, 2023
99.3	Form 51-101 Statement of Reserves Data and Other Oil and Gas Information
99.4	News Release dated March 20, 2024

1

SIGNATURES

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

Greenfire Resources Ltd.
By:	/s/ Tony Kraljic
Name:	Tony Kraljic
Title:	Chief Financial Officer

Date: March 21, 2024

2

Exhibit 99.1

CONSOLIDATEDFINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023, 2022 AND 2021

Greenfire Resources Ltd.

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Greenfire Resources Ltd.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Greenfire Resources Ltd., and subsidiaries (the “Company”) as at December 31, 2023 and 2022, the related consolidated statements of comprehensive income (loss), changes in shareholders’ equity and cash flows, for each of the three years in the period ended December 31, 2023, 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 at December 31, 2023 and 2022, and its financial performance and its cash flows for each of the three years in the period ended December 31, 2023, in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.

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 Public Company Accounting Oversight Board (United States) (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. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

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.

/s/ Deloitte LLP

Chartered Professional Accountants

Calgary, Canada

March 20, 2024

We have served as the Company’s auditor since 2021

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 1 |

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Greenfire Resources Ltd

Consolidated Balance Sheets

As at December 31
($CAD thousands)	note	2023		2022
Assets
Current assets
Cash and cash equivalents	7	$	109,525	$	35,363
Restricted cash	8		-		35,313
Accounts receivable	14		34,680		34,308
Inventories	9		13,863		14,568
Prepaid expenses and deposits			5,746		3,975
			163,814		123,527
Non-current assets
Property, plant and equipment	10		941,374		963,050
Deferred income tax asset	12		68,295		87,681
			1,009,669		1,050,731
			1,173,483		1,174,258
Liabilities
Current liabilities
Accounts payable and accrued liabilities	22		59,850		46,569
Current portion of long-term debt	15		44,321		63,250
Warrant liability	20		18,630		-
Taxes payable	5		1,063		-
Current portion of lease liabilities	11		6,002		98
Risk management contracts	14		417		27,004
			130,283		136,921
Non-current liabilities
Long-term debt	15		332,029		191,158
Lease liabilities	11		7,722		865
Decommissioning liabilities	13		8,449		7,543
			348,200		199,566
			478,483		336,487
Shareholders’ equity
Share capital	5,19		158,515		15
Contributed surplus	5,19		9,788		44,674
Retained earnings (deficit)			526,697		793,082
			695,000		837,771
		$	1,173,483	$	1,174,258

Commitments and contingencies (note 18)

See accompanying notes to the consolidatedfinancial statements

These Consolidated Financial Statements wereapproved by the Board of Directors.

Robert Logan, Director	Derek Aylesworth, Director

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 2 |

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Greenfire Resources Ltd.

Consolidated Statements of Comprehensive Income (Loss)

($CAD thousands, except per share amounts)	note	Year ended<br><br> December 31, <br><br>2023			Year ended<br><br> December 31, <br><br>2022			Year ended<br><br> December 31, <br><br>2021
Revenues
Oil sales	16	$	675,970		$	998,849		$	270,674
Royalties	16		(23,706	)		(50,064	)		(9,543	)
Oil sales, net of royalties			652,264			948,785			261,131
Gain (loss) on risk management contracts	14		16,405			(121,478	)		(39,291	)
			668,669			827,307			221,840
Expenses
Diluent expense			304,740			368,015			94,623
Transportation and marketing			55,673			67,842			24,057
Operating expenses			148,965			160,826			59,710
General and administrative			11,536			9,836			3,285
Stock-based compensation			9,808			1,183			-
Financing and interest	17		110,214			77,074			25,050
Depletion and depreciation	10		68,054			68,027			27,071
Exploration and other expenses			3,852			1,825			350
Other (income) expenses			(2,905	)		(206	)		8,373
Transaction costs	5,6		12,172			2,769			10,318
Listing expense	5		106,542			-			-
Gain on revaluation of warrants	20		(34,973	)		-			-
Gain on acquisitions	6		-			-			(693,953	)
Foreign exchange (gain) loss			(8,724	)		26,099			1,512
Total expenses			784,954			783,290			(439,604	)
Net income (loss) before taxes			(116,285	)		44,017			661,444
Income tax recovery (expense)	12		(19,386	)		87,681			-
Net income (loss) and comprehensive income (loss)		$	(135,671	)	$	131,698		$	661,444
Net income (loss) per share
Basic^1^	19	$	(2.49	)	$	2.69		$	15.52
Diluted^1^	19	$	(2.49	)	$	1.88		$	13.75
^1^	^For the yearsended December 31, 2022 and 2021 the Company’s basic and diluted earnings per share is the net income per common share of GreenfireResources Inc (see Note 1)., and the weighted average common shares outstanding has been recast by the applicable exchange ratio followingthe completion of the De-Spac Transaction with MBSC (Note 5.)^
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See accompanying notes to the consolidatedfinancial statements

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 3 |

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Greenfire Resources Ltd.

Consolidated Statements of Changes in Shareholders’ Equity

($CAD Thousands, except per share amounts)	note	Year ended<br><br> December 31, <br><br>2023			Year ended<br><br> December 31,<br><br> 2022		Year ended<br><br> December 31, <br><br>2021
Share capital
Balance, beginning of year		$	15		$	15	$	-
Issuance on exercise of bond warrants	5,19		38,911			-		-
Issuance to MBSC shareholders	5,19		62,959			-		-
Issuance of shares for PIPE investment	5,19		56,630			-		-
Shares issued during year	19		-			-		15
Balance, end of year			158,515			15		15
Contributed surplus
Balance, beginning of year			44,674			43,491		-
Stock based compensation	19		9,808			1,183		-
Exercise of performance warrants	5,19		(1,203	)		-		-
Issuance and exercise of bond warrants	5,19		(43,491	)		-		43,491
Balance, end of year			9,788			44,674		43,491
Retained earnings (deficit)
Balance, beginning of year			793,082			661,384		(60	)
Common shares repurchased and cancelled	5,19		(41,464	)		-		-
Dividend on De-Spac transaction	5,19		(59,388	)		-		-
Exercise of bond warrants	5,19		4,580			-		-
Exercise of performance warrants	5,19		1,202			-		-
Issuance of warrants	20		(35,644	)		-		-
Net income (loss) and comprehensive (loss)			(135,671	)		131,698		661,444
Balance, end of year			526,697			793,082		661,384
Total shareholders’ equity		$	695,000		$	837,771	$	704,890

See accompanying notes to the consolidatedfinancial statements

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 4 |

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Greenfire Resources Ltd.

Consolidated Statements of Cash Flows

($CAD Thousands, except per share amounts)	note	Year ended<br><br> December 31, <br><br>2023			Year ended<br><br>December 31, <br><br>2022			Year ended<br><br> December 31, <br><br>2021
Operating activities
Net income (loss)		$	(135,671	)	$	131,698		$	661,444
Items not affecting cash:
Deferred income taxes	12		19,386			(87,681	)		-
Gain on acquisitions	6		-			-			(693,953	)
Unrealized (gain) loss on risk management contracts	14		(26,587	)		(8,673	)		35,677
Foreign exchange (gain) loss			(8,967	)		26,099			1,512
Depletion and depreciation	10		67,893			67,868			27,996
Stock based compensation	19		9,808			1,183			-
Other non-cash expenses			68			66			3,769
Accretion	13		906			743			298
Amortization of debt issuance costs	17		43,478			29,854			2,152
Debt redemption premium	15,17		19,152			-			-
Gain on revaluation of warrants	20		(34,973	)		-			-
Listing expense	5		106,542			-			-
Change in non- cash working capital	24		25,513			3,570			(6,910	)
Cash provided by operating activities			86,548			164,727			31,985
Financing activities
Issuance of long-term debt net of issuance costs	15		382,454			-			365,591
Repayment of long-term debt	15		(294,647	)		(123,612	)		-
Debt redemption premium	15,17		(19,152	)		-			-
Issuance of common shares	19		67,115			-			15
Common shares repurchased	5,19		(41,464	)		-			-
Dividend on De-Spac transaction	5,19		(59,388	)		-			-
De-Spac transaction costs	5,19		(34,817	)		-			-
Payment of lease liabilities	11		(99	)		(26	)		-
Cash provided (used) by financing activities			2			(123,638	)		365,606
Investing activities
Property, plant and equipment expenditures	10		(33,428	)		(39,592	)		(4,594	)
Cash and cash equivalents acquired in acquisitions	6		-			-			6,918
Acquisitions	6		-			-			(366,454	)
Restricted cash	8		35,313			(26,613	)		(8,140	)
Change in non-cash working capital (accrued additions to PP&E)	24		(13,988	)		2,459			35,742
Cash used in investing activities			(12,103	)		(63,746	)		(336,528	)
Exchange rate impact on cash and cash equivalents held in foreign currency			(285	)		(2,849	)		(194	)
Change in cash and cash equivalents			74,162			(25,506	)		60,869
Cash and cash equivalents, beginning of year			35,363			60,869			-
Cash and cash equivalents, end of year		$	109,525		$	35,363		$	60,869

See accompanying notes to the consolidatedfinancial statements

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 5 |

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Notes to the Consolidated Financial Statements

1. CORPORATE INFORMATION

Greenfire Resources Ltd. (the “Company” or “Greenfire”) was incorporated under the laws of Alberta on December 9, 2022. On September 20, 2023, the Company participated in a De-Spac transaction involving a number of entities, including Greenfire Resources Inc. (“GRI”) and M3-Brigade Acquisition III Corp (“MBSC”) (the “De-Spac Transaction”). Refer to Note 5 De-Spac Transaction for additional information. These audited consolidated financial statements are comprised of the accounts of Greenfire and its wholly owned subsidiaries, GRI and MBSC. The prior period amounts presented are those of GRI, which continued as the operating entity, concurrent with recapitalization. As of January 1, 2024, GRI was amalgamated with Greenfire Resources Operation Corporation (“GROC”).

The Company and its subsidiaries are engaged in the exploration, development and operation of oil and gas properties, focused primarily in the Athabasca oil sands region of Alberta. The Company’s corporate head office is located at 1900, 205 5th Avenue SW, Calgary, AB T2P 2V7.

2. BASIS OF PRESENTATION AND STATEMENT OF COMPLIANCE

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”). In these consolidated financial statements, all dollars are expressed in Canadian dollars, which is the Company’s functional currency, unless otherwise indicated. These consolidated financial statements have been prepared on a historical cost basis, except for certain financial instruments which are measured at fair value. The consolidated financial statements were approved by the Board of Directors on March 20, 2024.

3. MATERIAL ACCOUNTING POLICIES

Principles of consolidation

These consolidated financial statements consist of financial records of the Company and its wholly owned subsidiaries. The Company has two direct subsidiaries, MBSC and GROC which are 100% wholly owned by the Company, as well as several indirect subsidiaries, including, Hangingstone Expansion Limited Partnership (“HELP”) and Hangingstone Demo Limited Partnership (“HDLP”), which were formed by GROC and their general partners Hangingstone Expansion General Partner (“HEGP”) and Hangingstone Demo General Partner (“HDGP”), respectively. The units of HELP and HDLP are allocated at 99.99% to GROC for both entities and 0.01% to HEGP and HDGP, respectively. HEGP and HDGP are wholly owned subsidiaries of GROC, along with Greenfire Resources Employment Corporation. Intercompany transactions and balances between the entities are eliminated upon consolidation.

Joint arrangements

The Company undertakes certain business activities through joint arrangements. Interests in joint arrangements have been classified as joint operations. Joint control exists for contractual arrangements governing the Company’s assets whereby Greenfire has less than 100 per cent working interest, all of the partners have control of the arrangement collectively, and spending on the project requires unanimous consent of all parties that collectively control the arrangement and share the associated risks. A joint operation is established when the Company has rights to the assets and obligations for the liabilities of the arrangement. The Company only recognizes its proportionate share in assets, liabilities, revenues and expenses associated with its joint operations.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 6 |

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Cash and cash equivalents

Cash and cash equivalents include cash-on-hand, deposits held with banks, and other short-term highly liquid investments such as bankers’ acceptances, commercial paper, money market deposits or similar instruments, with a maturity of 90 days or less.

Foreign currency translation

Foreign currency transactions are translated into Canadian Dollars at exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the rate of exchange on the balance sheet date. Any resulting exchange differences are included in the Consolidated Statement of Comprehensive Income (Loss). Nonmonetary assets and liabilities denominated in a foreign currency are measured at historical cost and are translated into the functional currency using the rates of exchange as at the dates of the initial transactions.

Operating segments

The Company has one reportable operating segment which is made up of its oil sands operations based on geographic location (Athabasca oil sands region of Alberta, Canada), nature of the products sold and integration of facilities and operations. The chief operating decision maker is the President and CEO, who reviews operating results at this level to assess financial performance and make resource allocation decisions. The Company determines its operating segments based on the differences in the nature of operations, products sold, economic characteristics and regulatory environments and management. All of the Company’s non-current assets are located in and revenue is earned in Canada.

Financial instruments

Financial assets and financial liabilities are recognized in the Company’s balance sheet when the Company becomes a party to the contractual provisions of the instrument.

Financial assets and financial liabilities are initially measured at fair value, except for trade receivables that do not have a significant financing component which are measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. Regular way purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace.

All recognized financial assets are measured subsequently in their entirety at either amortized cost or fair value, depending on the classification of the financial assets.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 7 |

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Financial assets that meet the following conditions are measured subsequently at amortized cost:

●	the<br> financial asset is held within a business model whose objective is to hold financial assets<br> in order to collect contractual cash flows; and
●	the<br> contractual terms of the financial asset give rise on specified dates to cash flows that<br> are solely payments of principal and interest on the principal amount outstanding.
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Financial assets that meet the following conditions are measured subsequently at fair value through other comprehensive income (FVTOCI):

●	the<br> financial asset is held within a business model whose objective is achieved by both collecting<br> contractual cash flows and selling the financial assets; and
●	the<br> contractual terms of the financial asset give rise on specified dates to cash flows that<br> are solely payments of principal and interest on the principal amount outstanding.
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By default, all other financial assets are measured subsequently at fair value through profit or loss (FVTPL).

Classifications are not changed subsequent to initial recognition, except in limited circumstances.

Credit risk arises from the potential that the Company may incur a loss if a counterparty fails to meet its obligations in accordance with agreed terms. Financial assets are assessed at each reporting date to determine whether there is any evidence that credit losses are expected. Credit loss of financial assets is determined by assessing and measuring the expected credit losses of the instruments at each reporting period. The Company measures expected credit losses using a lifetime expected loss allowance model for all trade receivables and contract assets. The credit-loss model groups receivables based on similar credit risk characteristics and the number of days past due in order to estimate and recognize bad debt expenses. When measuring expected credit losses, the Company considers a variety of factors including: evidence of the debtor’s financial condition, history of collections, the term of the receivable and any recent and expected future changes in economic conditions. The Company has not experienced any write-offs of uncollectible receivables; as a result, there are no expected credit losses recognized as at December 31, 2023 (nil for 2022 and 2021).

Financial liabilities

On initial recognition, financial liabilities are classified at amortized cost or FVTPL. A financial liability is classified as FVTPL if it is classified as held-for-trading, is a derivative or is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. A financial liability is derecognized when its contractual obligations are discharged or canceled or expire. The Company also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 8 |

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The Company may, from time to time, enter into certain financial derivative contracts to manage exposure from fluctuating commodity prices, interest rates or foreign exchange rates between the Canadian and US dollar. Such risk management contracts are not used for trading or speculative purposes. The Company has not designated its risk management contracts as effective hedges and has not applied hedge accounting even though the Company considers all financial derivate contracts to be economic hedges, as such all risk management contracts have been recorded at fair value with changes in fair value being recorded through profit or loss.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants who are independent, knowledgeable and willing and able to transact would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. The Company is able to classify fair value balances based on the observability of these inputs. The authoritative guidance for fair value measurements establishes three levels of the fair value hierarchy, defined as follows:

●	Level1: Unadjusted, quoted prices for identical assets or liabilities in active markets;
●	Level2: Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable,<br>either directly or indirectly for substantially the full term of the asset or liability; and
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●	Level3: Significant, unobservable inputs for use when little or no market data exists, requiring a significant degree of judgment.
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The following table summarizes the method by which the Company measures its financial instruments on the consolidated balance sheets and the corresponding hierarchy rating for their derived fair value estimates:

Financial Instrument	Classification & Measurement
Cash and cash equivalents	Amortized cost
Restricted cash	Amortized cost
Accounts receivable	Amortized cost
Risk management contracts	FVTPL
Accounts payable and accrued liabilities	Amortized cost
Warrant liability	FVTPL
Long-term debt	Amortized cost

The carrying values of cash and cash equivalents, restricted cash, accounts receivable and accounts payable and accrued liabilities included on the consolidated balance sheets approximates the fair values of the respective assets and liabilities due to the short-term nature of those instruments.

The estimated fair value of long-term debt has been determined based on period-end trading prices of long-term borrowings on the secondary market (level 2), for further information please refer to Note 15.

The warrants issued were classified as financial liabilities due to a cashless exercise feature and are measured at fair value upon issuance and at each subsequent reporting period with the changes in fair value recorded in the consolidated statement of income (loss). The fair value of these warrants is determined using the Black-Scholes option valuation model.

Common shares are classified as shareholders’ equity. The Company may issue share purchase warrants as a part of debt and/or equity financings. These financial instruments are assessed at the date of issue, based on their underlying terms and conditions, as to whether they are an equity instrument or a derivative financial instrument and if determined to be an equity instrument they are initially recognized in shareholder’s equity at fair value on date of issue. Classifications are not changed after initial recognition and only reassessed when there is a modification in the terms and conditions of the underlying share purchase warrant. Incremental costs directly attributable to the issuance of equity instruments as a deduction from equity, net of any tax effects.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 9 |

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Revenue

Revenue is measured based on consideration to which the Company expects to be entitled in a contract with a customer. The Company recognizes revenue primarily from the sale of diluted and non- diluted bitumen. Revenue is recognized when its single performance obligation is satisfied. This occurs when the product is delivered, control of the product and title or risk of loss transfers to the customer at contractually specified transfer points. This transfer coincides with title passing to the customer and the customer taking physical possession of the commodity. The Company principally satisfies its single performance obligations at a point in time. Transaction prices are determined at inception of the contract and allocated to the performance obligations identified. Payment is generally received in the following month after the sale has occurred.

The Company sells its production pursuant to fixed and variable-priced contracts. The transaction price for variable-priced contracts is based on the commodity price, adjusted for quality, location, or other factors, whereby each component of the pricing formula can be either fixed or variable, depending on the contract terms. Revenue is recognized when a unit of production is delivered to the contract counterparty. The amount of revenue recognized is based on the agreed upon transaction. Royalty expenses are recognized as production occurs.

The Company has long-term marketing agreements with a single counterparty (“Sole Petroleum Marketer”), which has exclusive marketing rights over the Company’s production and diluent purchases at Hangingstone Expansion (“Expansion”), until October 2028 and at Hangingstone Demo (“Demo”), until April 2026. Fees paid to the Sole Petroleum Marketer as part of these agreements include marketing, incentive and royalty fees. These fees are expensed as incurred as transportation and marketing expenses. In addition, the Sole Petroleum Marketer provided letters of credit in support of the Company’s long-term transportation commitment until November 2023. As a result of these marketing agreements, the Company is exposed to concentration and credit risks, as all sales are to a single counterparty.

Inventories

Inventories consist of crude oil products and warehouse materials and supplies. The carrying value of inventory includes direct and indirect expenditures incurred in the normal course of business in bringing an item or product to its existing condition and location. The Company values inventories at the lower of cost and net realizable value on a weighted average cost basis. Net realizable value is the estimated selling price less applicable selling expenses. If the carrying value exceeds net realizable value, a write-down is recognized. A change in circumstances could result in a reversal of the write-down for the inventory that remains on hand in a subsequent period.

Property, plant and equipment (“PP&E”)

PP&E is measured at the cost to acquire, less accumulated depletion and depreciation, and net of any impairment losses. The Company begins capitalizing oil exploration costs after the right to explore has been obtained and includes land acquisition costs, geological and geophysical activities, drilling expenditures and costs incurred for the completion and testing of exploration wells. The Company capitalizes all subsequent investments attributable to the development of its oil assets if the expenditures are considered a betterment and provide a future benefit beyond one year. Costs of planned major inspections, overhaul and turnaround activities that maintain PP&E and benefit future years of operations are capitalized and depreciated on a straight-line basis over the period to the next turnaround. Recurring planned maintenance activities performed on shorter intervals are expensed. Replacements of equipment are capitalized when it is probable that future economic benefits will flow to the Company. The Company’s capitalized costs primarily consist of pad construction, drilling activities, completion activities, well equipment, processing facilities, gathering systems and pipelines. Borrowing costs attributable to long-term development projects are also capitalized.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 10 |

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Capitalized costs are classified as exploration and evaluation (“E&E”) assets if technical feasibility and commercial viability have not yet been established. Technical feasibility and commercial viability are generally deemed to exist when proved reserves are present and the Company has sanctioned the project for commercial development. Capitalized costs are classified as PP&E assets if they are attributable to the development of oil reserves after technical feasibility and commercial viability have been achieved. Once the technical feasibility and commercial viability of E&E assets have been established, the E&E assets are tested for impairment and reclassified to PP&E. The majority of the Company’s PP&E is depleted using the unit-of-production method relative to the Company’s estimated total recoverable proved plus probable (2P) reserves. The depletion base consists of the historical net book value of capitalized costs, plus the estimated future costs required to develop the Company’s estimated recoverable proved plus probable reserves. The depletion base excludes E&E and the cost of assets that are not yet available for use in the manner intended by Management. Corporate assets and other capitalized costs are depreciated over their estimated useful lives primarily using the declining-balance method.

There were no E&E costs as at December 31, 2023, 2022 and 2021.

Provisions and contingent liabilities

A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the statement of financial position date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. The Company’s provisions primarily consist of decommissioning liabilities associated with dismantling, decommissioning, and site disturbance remediation activities related to its oil assets.

At initial recognition, the Company recognizes a decommissioning asset and corresponding liability on the balance sheet. Decommissioning liabilities are measured at the present value of expected future cash outflows required to settle the obligations at the balance sheet date, using managements best estimate of expenditures required to settle the liability. Decommissioning liabilities are measured based on the estimated future inflation rate and then discounted to net present value using a credit adjusted risk-free discount rate. Any change in the present value, as a result of a change in discount rate or expected future costs, of the estimated obligation is reflected as an adjustment to the provision and the corresponding item of property, plant and equipment. The liability for decommissioning costs is increased each period through the unwinding of the discount, which is included in finance and interest costs in the consolidated statements of comprehensive income (loss). Decommissioning liabilities are remeasured at each reporting period primarily to account for any changes in estimates or discount rates. Actual expenditures incurred to settle the obligations reduce the liability.

Contingent liabilities reflect a possible obligation that may arise from past events and the existence of which can only be confirmed by the occurrence or non-occurrence of one or more uncertain future events, not wholly within the control of the Company. Contingent liabilities are not recognized on the balance sheet unless they can be measured reliably and the possibility of an outflow of economic benefits in respect of the contingent obligation is considered probable. Disclosure of contingent liabilities is provided when there is a less than probable, but more than remote, possibility of material loss to the Company.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 11 |

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Impairment of non-financial assets

For the purpose of estimating the asset’s recoverable amount, PP&E assets are grouped into Cash Generating Units (“CGU”). A CGU is the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets. The Company’s PP&E assets are currently held in two CGUs. Our Hangingstone Expansion and Demo assets represent our two CGU’s at December 31, 2023 and December 31, 2022.

PP&E assets are reviewed at each reporting date to determine whether there is any indication of impairment. If indicators of impairment exist, the recoverable amount of the asset or CGU is estimated as the greater of value-in-use (“VIU”) and fair value less costs of disposal (“FVLCOD”). VIU is estimated as the discounted present value of the expected future cash flows from continuing use of the asset or CGU. FVLCOD is the amount that would be realized from the disposition of an asset or CGU in an arm’s length transaction between knowledgeable and willing parties. An impairment loss is recognized in earnings or loss if the carrying amount of the asset or CGU exceeds its estimated recoverable amount.

At each reporting period, PP&E, E&E and right-of-use (“ROU”) assets are tested for impairment reversal at the CGU level when facts and circumstances suggest that the recoverable amount of the CGU may exceed the carrying value. Impairment reversal is limited to the carrying amount which would have been recorded had no historical impairment been recorded.

Business combinations

Business combinations are accounted for using the acquisition method of accounting in which identifiable assets acquired and liabilities assumed in a business combination are recognized and measured at their fair value at the date of the acquisition. If the cost of the acquisition is less than the fair value of the net asset acquired, the difference is recognized in net income (loss). If the cost of the acquisition is greater than the fair value of the net assets acquired, the difference is recognized as goodwill.

Leases

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. A lease obligation and corresponding ROU asset are recognized at the commencement of the lease. Lease liabilities are initially measured at the present value of the unavoidable lease payments and discounted using the Company’s incremental borrowing rate when an implicit rate in the lease is not readily available. Interest expense is recognized on the lease obligations using the effective interest rate method. The ROU assets are recognized at the amount of the lease liabilities, adjusted for lease incentives received and initial direct costs, on commencement of the leases. ROU assets are depreciated on a straight-line basis over the lease term. The Company is required to make judgments and assumptions on incremental borrowing rates and lease terms. The carrying balance of the leased assets and lease liabilities, and related interest and depreciation expense, may differ due to changes in market conditions and expected lease terms. Short-term and low value leases have not been included in the measurement of lease liabilities.

Income taxes

Income tax is comprised of current and deferred tax. Income tax expense (recovery) is recognized in the consolidated statement of comprehensive income (loss) except to the extent that it relates to share capital, in which case it is recognized in equity. Current tax is the expected tax payable (receivable) on the taxable income (loss) for the period, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 12 |

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Deferred tax is recognized using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized on the initial recognition of assets or liabilities in a transaction that is not a business combination and does not affect profit, other than temporary differences that arise in shareholder’s equity. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are offset on the consolidated balance sheet if there is a legally enforceable right to offset and they relate to income taxes levied by the same tax authority. A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are not recognized until such time that it is more likely than not that the related tax benefit will be realized.

Stock-based compensation

The Company’s stock-based compensation plans for employees consist of performance warrants. The Company’s stock-based compensation plans are accounted for as equity-settled share-based compensation plans. The fair values of the equity settled awards are initially measured at the date of issuance using the Black-Scholes model using an estimated forfeiture rate, volatility, dividend yield, risk-free rate and expected life. The fair value is recorded as stock-based compensation over the vesting period with a corresponding amount reflected in contributed surplus. When performance warrants are exercised, the cash proceeds along with the amount previously recorded as contributed surplus are recorded as share capital.

Per share information

Basic per share information is calculated using the weighted average number of common shares outstanding during the year. Diluted per share information is calculated using the basic weighted average number of common shares outstanding during the year, adjusted for the number of shares that could have had a dilutive effect on net income during the year had in the-money and outstanding equity compensation units been exercised.

New and amended IFRS Accounting Standards that are effective for the current year

In the current year, the Company has applied a number of amendments to IFRS that are mandatorily effective as of January 1, 2023. These adopted amendments are as follows, with their adoption having no significant impact on the Company’s consolidated financial statements.

Amendments to IAS 1 — Presentation ofFinancial Statements

The amendments change the requirements in IAS 1 with regard to disclosure of accounting policies. The amendments replace all instances of the term ‘significant accounting policies’ with ‘material accounting policy information’. Accounting policy information is material if, when considered together with other information included in an entity’s financial statements, it can reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements.

Amendments to IAS 12 — Income Taxes

The amendments introduce a further exception from the initial recognition exemption. Under the amendments, an entity does not apply the initial recognition exemption for transactions that give rise to equal taxable and deductible temporary differences. Depending on the applicable tax law, equal taxable and deductible temporary differences may arise on initial recognition of an asset and liability in a transaction that is not a business combination and affects neither accounting profit nor taxable profit.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 13 |

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Future accounting pronouncements

The Company plans to adopt the following amendments that are effective for annual periods beginning on or after January 1, 2024. The pronouncements will be adopted on their respective effective dates; however, each is not expected to have a material impact on the financial statements.

Amendments to IAS 1 — Presentation of Financial Statements - Classification of Liabilities as Current or Non-current

The amendments clarify that the classification of liabilities as current or non-current is based on rights that are in existence at the end of the reporting period, specify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability, explain that rights are in existence if covenants are complied with at the end of the reporting period, and introduce a definition of ‘settlement’ to make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services.

Amendments to IAS 1 — Presentation ofFinancial Statements - Classification of Liabilities as Current or Non-current

The amendments specify that only covenants that an entity is required to comply with on or before the end of the reporting period affect the entity’s right to defer settlement of a liability for at least twelve months after the reporting date (and therefore must be considered in assessing the classification of the liability as current or noncurrent). Such covenants affect whether the right exists at the end of the reporting period, even if compliance with the covenant is assessed only after the reporting date (e.g. a covenant based on the entity’s financial position at the reporting date that is assessed for compliance only after the reporting date).

4. ACCOUNTING JUDGEMENTS AND ESTIMATES

The timely preparation of the consolidated financial statements requires that management make estimates and assumptions and use judgement regarding the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during that period. Such estimates primarily relate to unsettled transactions and events as of the date of the consolidated financial statements. The estimated fair value of financial assets and liabilities are subject to measurement uncertainty. In addition, climate change and the evolving worldwide demand for alternative sources of energy that are not sourced from fossil fuels could result in a change in assumptions used in determining the recoverable amount and could affect the carrying value of the related assets. As these issues advance and regulations change, future financial performance may be impacted. This also presents uncertainty and risk with respect to the Company, its performance and estimates and assumptions. The timing in which global energy markets transition from carbon-based sources to alternative energy or when new regulatory practices may be implemented is highly uncertain.

The ongoing geopolitical risks and conflicts have resulted in significant commodity price volatility and increased the level of uncertainty in the Company’s future cash flow. The Company’s gains and losses from its commodity price risk management contracts is likely to be volatile in the current market environment and there is greater emphasis on ensuring operations is uninterrupted and production volumes are delivered to meet these obligations. Additionally, the higher degree of commodity price volatility may increase systemic risk to the global commodities trading and banking businesses, which in turn may increase the Company’s counterparty risk. The Company has not experienced impairment of its receivables and currently has no information that indicates there is elevated risk of impairment in the future.

Accordingly, actual results may differ materially from estimated amounts as future confirming events occur. Significant judgements, estimates and assumptions made by management in the preparation of these consolidated financial statements are outlined below.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 14 |

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Inventories

The Company evaluates the carrying value of its inventory at the lower of cost and net realizable value. The net realizable value is estimated based on current market prices that the Company would expect to receive from the sale of its inventory.

Decommissioning liabilities

The provision for decommissioning liabilities is based upon numerous assumptions including settlement amounts, inflation factors, credit-adjusted discount rates, timing of settlement and changes in the legal, regulatory, environmental and political environments. Actual costs and cash outflows could differ from the estimates as a result of changes in any of the above noted assumptions.

Risk management contracts

The Company utilizes commodity risk management contracts to manage commodity price risk on oil sales and operating expenses. The Company may also utilize foreign exchange risk management contracts to reduce its exposure to foreign exchange risk associated with its interest payments on its US dollar denominated term debt. The calculated fair value of the risk management contracts relies on external observable market data including quoted forward commodity prices and foreign exchange rates. The resulting fair value estimates may not be indicative of the amounts realized at settlement and as such are subject to measurement uncertainty.

Deferred income taxes

The provision for income taxes is based on judgments in applying income tax law and estimates on the timing and likelihood of reversal of temporary differences between the accounting and tax bases of assets and liabilities. The provision for income taxes is based on the Company’s interpretation of the tax legislation and regulations which are also subject to change. The Company recognizes a tax provision when a payment to tax authorities is considered more likely than not. A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilized. Income tax filings are subject to audits and reassessments and changes in facts, circumstances and interpretations of the standards which may result in a material increase or decrease in the Company’s provision for income taxes.

Long-term debt

The measurement of the current portion of long-term debt includes assumptions of expected excess cashflows that are based on management’s estimates.

Bitumen reserves

The estimation of reserves involves the exercise of judgment. Forecasts are based on engineering data, estimated future prices, expected future rates of production and the cost and timing of future capital expenditures, all of which are subject to many uncertainties and interpretations. The Company expects that over time its reserves estimates will be revised either upward or downward based on updated information such as the results of future drilling and production. Reserves estimates can have a significant impact on net earnings, as they are a key component in the calculation of depletion and for determining potential asset impairment.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 15 |

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Impairments

CGUs are defined as the lowest grouping of assets that generate identifiable cash inflows that are largely independent of the cash inflows of other assets or groups of assets. The classification of assets into CGUs requires significant judgment and interpretations with respect to the integration between assets, the existence of active markets, external users, shared infrastructures, and the way in which management monitors the Company’s operations. The recoverable amounts of CGUs and individual assets have been determined as the higher of the CGUs or the asset’s fair value less costs of disposal and its value in use. These calculations require the use of estimates and significant assumptions and are subject to changes as new information becomes available including information on future commodity prices, expected production volumes, quantity of proved and probable reserves and discount rates as well as future development and operating expenses. Changes in assumptions used in determining the recoverable amount could affect the carrying value of the related assets and CGUs.

Property, plant and equipment

Producing assets within PP&E are depleted using the unit-of-production method based on estimated total recoverable proved plus probable reserves and future costs required to develop those reserves. There are several inherent uncertainties associated with estimating reserves. By their nature, these estimates of reserves, including the estimates of future prices and costs, and related future cash flows are subject to measurement uncertainty, and the impact on the consolidated financial statements of future periods could be material.

Share purchase warrants

The Company has and may, from time to time, issue share purchase warrants (“warrants”) as a part of debt and or equity financings. These warrants may be initially classified as shareholders’ equity or a derivative financial liability based on the terms and conditions of the underlying agreement. The determination of fair value of the share purchase warrants are primarily derived from the fair value of the underlying common shares. The determination of which methodology is most appropriate to determine the fair value of these warrants involves judgement.

The estimation of fair value could be determined using the binomial model, the Black Scholes model, the residual method or a relative fair value method depending on the terms of the warrant. The inputs to any of these models require estimates related to share price, share price volatility, interest rates, cash flow multiples, dividend yields, and expected life, all subject to judgment and estimation uncertainty due to both internal and external market factors. Changes in assumptions can impact the fair value estimated for such warrants.

5. De-Spac Transaction

On September 20, 2023, Greenfire, GRI, MBSC, DE Greenfire Merger Sub Inc. (“DE Merger Sub”) and 2476276 Alberta ULC (“Canadian Merger Sub”), completed a De-Spac Transaction pursuant to a business combination agreement dated December 14, 2022, as amended (the “Business Combination Agreement”) with MBSC. DE Merger Sub and Canadian Merger Sub were incorporated in December 2022 for the purposes of completing the De-Spac Transaction.

Pursuant to the De-Spac Transaction (i) Canadian Merger Sub amalgamated with and into GRI pursuant to a statutory plan of arrangement (the “Plan of Arrangement”) under the Business Corporations Act (Alberta), with GRI continuing as the surviving corporation and becoming a direct, wholly-owned subsidiary of Greenfire and (ii) DE Merger Sub merged with and into MBSC pursuant to a Delaware statutory merger (the “Merger) with MBSC continuing as the surviving corporation and becoming a direct, wholly-owned subsidiary of Greenfire.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 16 |

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As a result of the De-Spac Transaction, the following occurred:

●	Of<br> the GRI 8,937,518 common shares outstanding, 7,996,165 were converted to 43,690,534 common<br> shares of Greenfire and 941,353 were cancelled in exchange for cash consideration of $70.8<br> million. Cash consideration was comprised of a dividend paid of $59.4 million and $11.4 million<br> for shares repurchased and cancelled by the Company. The $70.8 million cash consideration<br> was recorded as a reduction to retained earnings.
●	312,500<br> outstanding GRI bondholder warrants were exchanged for 3,225,810 GRI common shares of which<br> 2,886,048 were converted to 15,769,183 common shares of Greenfire and 339,245 were cancelled<br> in exchange for cash consideration of $25.5 million. This $25.5 million was recorded as a<br> reduction to retained earnings. In conjunction with the share conversion and cancellation,<br> $43.5 million was reclassified from contributed surplus to share capital ($38.9 million)<br> and retained earnings ($4.6 million).
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●	Of<br> the 739,912 GRI performance warrants outstanding, 661,971 were converted into 3,617,016 Greenfire<br> performance warrants and 77,941 were cancelled for cash consideration of $4.5 million, which<br> was the fair value of the warrants. The $4.5 million was recorded as a reduction to retained<br> earnings. In conjunction with the cancellation, $1.2 million was reclassified from contributed<br> surplus to retained earnings.
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●	Greenfire<br> issued an additional 5,000,000 Greenfire warrants to former GRI shareholders, GRI bond warrant<br> holders and performance warrant holders that entitle the holder of each warrant to purchase<br> one common share of Greenfire. The warrants were recorded as a warrant liability on the consolidated<br> balance sheet, see Note 20.
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●	755,707<br> MBSC Class A common shares held by MBSC’s public shareholders were converted into 755,707<br> Greenfire common shares.
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●	4,250,000<br> Class B MBSC common shares were converted into 4,250,000 Greenfire common shares.
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●	2,526,667<br> MBSC private placements warrants were converted into 2,526,667 Greenfire warrants, which<br> were recorded as a warrant liability on the consolidated balance sheet, see Note 20.
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●	Concurrent<br> with the execution of the Business Combination Agreement, the Company and MBSC had entered<br> into subscription agreements with certain investors (the “PIPE Investors”) pursuant<br> to which the PIPE Investors agreed to purchase Class A common shares of MBSC at a purchase<br> price of US$10.10 per share. MBSC issued 4,177,091 Class A common shares to the PIPE Investors<br> for proceeds of $56.6 million (US$42.2 million) which were converted into Greenfire common<br> shares at the closing of the De-Spac Transaction.
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| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 17 |

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Greenfire has been identified as the acquirer for accounting purposes. As MBSC does not meet the definition of a business under IFRS 3 Business Combinations, the transaction is accounted for pursuant to IFRS 2, Share Based Payment. On closing of the De-Spac Transaction, the Company accounted for the excess of the fair value of Greenfire common shares issued to MBSC shareholders as consideration, over the fair value of MBSC’s identifiable net assets at the date of closing, resulting in $106.5 million (US$79.4 million) being recognized as a listing expense. The fair value of MBSC Class B common shares exchanged for Greenfire common shares was measured at the market price of MBSC’s publicly traded Class A common shares on September 20, 2023, which was US$9.37 per share. The fair value of MBSC Class A common shares exchanged for Greenfire common shares was measured at the market price of MBSC’s publicly traded Class A common shares on September 20, 2023, which was US$9.37 per share. As part of the De-Spac Transaction, Greenfire acquired marketable securities held in trust, prepaid expenses, accrued liabilities, taxable payable, other liabilities, warrant liability and deferred underwriting fees. The following table reconciles the elements of the listing expense:

( thousands)
Total fair value of consideration deemed to have been issued by Greenfire:
4,250,000 MBSC Class B common shares at US9.37 per common share (US39.8 million)	53,454
755,707 MBSC Class A common shares at US9.37 per common share (US7.1 million)	9,505
Less the following:
Fair value of identifiable net assets of MBSC
Marketable securities held in Trust Account	10,485
Prepaid expenses and deposits	8
Accounts payable and accrued liabilities	(16,262	)
Warrant liability	(17,960	)
Other liability	(5,369	)
Deferred underwriting fee	(13,422	)
Taxes payable	(1,063	)
Fair value of identifiable net assets of MBSC	(43,583	)
Total listing expense	106,542

All values are in US Dollars.

The listing expense is presented in the Consolidated Statement of Comprehensive Income (Loss). For the year ended December 31, 2023, the Company expensed $12.2 million (2022 - $2.8 million) in transaction costs related to the De-Spac.

6. ACQUISITIONS

Acquisition	Acquisition date	Cash consideration (thousands)
GHOPCO	April 5, 2021
JACOS	September 17, 2021
December 31, 2021

All values are in US Dollars.

The Company acquired all the assets of GHOPCO on April 5, 2021 for total cash consideration of $19.7 million. The assets acquired from GHOPCO include oil sands property located in the Hangingstone area of the Athabasca region. The acquisition has been accounted for as a business combination using the acquisition method of accounting. The assets and liabilities assumed are recorded at the estimated fair value on the acquisition date of April 5, 2021.

The Company acquired all the issued and outstanding common shares of JACOS on September 17, 2021 for total cash consideration of $346.7 million. The assets acquired from JACOS include various oil sands properties located in the Hangingstone area of the Athabasca region, which contain various working interest participants. One of the properties acquired, which is a developed and producing oil sands property and generates all of the acquired revenues, includes a 75% interest in a joint operation. The acquisition has been accounted for as a business combination using the acquisition method of accounting. The assets and liabilities assumed are recorded at the estimated fair value on the acquisition date of September 17, 2021.

Both acquisitions were undertaken to increase the Company’s production and reserve base in the Athabasca region, which is its core focus area.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 18 |

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The net assets acquired is based on the estimated fair value of the underlying assets and liabilities acquired as follows:

($ thousands)	GHOPCO Amount			JACOS Amount			Total
Net assets acquired:
PP&E	$	159,000		$	851,389		$	1,010,389
Deferred tax asset		-			32,435			32,435
Cash and cash equivalents		2,507			4,412			6,919
Accounts receivable		188			56,671			56,859
Inventories		-			8,992			8,992
Other current assets		1,111			7,846			8,957
Accounts payable and accrued liabilities		(1,847	)		(27,221	)		(29,068	)
Other current liabilities		-			(684	)		(684	)
Decommissioning liabilities		(217	)		(1,740	)		(1,957	)
Deferred tax liability		(32,435	)		-			(32,435	)
Net assets acquired		128,307			932,100			1,060,407
Less: Gain on acquisitions		108,586			585,367			693,953
Total cash purchase consideration	$	19,721		$	346,733		$	366,454

There was $10.3 million of acquisition transaction costs incurred by the Company and expensed through earnings in the year ended December 31, 2021.

A gain of $108.6 million was recognized on the acquisition of GHOPCO and a gain of $585.4 million was recognized on the acquisition of JACOS. These gains were driven by an increase in oil prices between the offer and closing dates, and optimized views on production and proved and probable reserves. In addition, the market was distressed from low oil prices due to volatility associated with the COVID-19 pandemic at the time of the acquisition.

The estimated proved and probable oil reserves and related cash flows were discounted at a rate based on what a market participant would have paid, which was based on market metrics on recent market transactions at the date of acquisition.

7. CASH AND CASH EQUIVALENTS

As at December 31, 2023, the Company held cash and cash equivalents of $109.5 million (December 31, 2022- $35.4 million). The credit risk associated with the Company’s cash and cash equivalents was considered low as the Company’s balances were held with large Canadian chartered banks.

8. RESTRICTED CASH AND CREDIT FACILITY

During the year ended December 31, 2023, the Company had a $46.8 million credit facility with its Petroleum Marketer (“Credit Facility”), used for issuing letters of credit related to long-term pipeline transportation agreements. The terms required the Company to contribute cash to a cash-collateral account (“Reserve Account”) over 24 months, starting in October 2021. As at December 31, 2022, the Company held $35.3 million in restricted cash. During the year ended December 31, 2023, the Company contributed $8.0 million in restricted cash to the Reserve Account. On November 8, 2023 $43.3 million of restricted cash was released. This release was due to entering a letter of credit facility guaranteed by Export Development Canada (“EDC Facility”), leading to the termination of both the Credit and Demand Facility (see Note 15).

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 19 |

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9. INVENTORIES

As at December 31<br> <br>($ thousands)	2023		2022
Oil inventories	$	6,183	$	7,560
Warehouse materials and supplies		7,680		7,008
Inventories	$	13,863	$	14,568

During the year ended December 31, 2023, approximately $567.1 million (December 31, 2022 - $559.8 million. 2021 -$149.8 million) of inventory was recorded within the respective cost components, which are composed of operating expenses, diluent expense, transportation expense and depletion and depreciation in the consolidated statements of comprehensive income (loss). For the years ended December 31, 2023, 2022 and 2021 the Company had no inventory write downs.

10. PROPERTY, PLANT AND EQUIPMENT (“PP&E”)

($ thousands)	Developed<br><br> and<br><br> producing		Right-of-use<br><br> assets		Corporate<br><br> assets			Total
Cost
Balance as at December 31, 2020	$	-	$	-	$	-		$	-
Acquisitions		1,010,014		-		375			1,010,389
Expenditures on PP&E		4,507		-		87			4,594
Change in decommissioning liabilities		2,133		-		-			2,133
Balance as at December 31, 2021		1,016,654		-		462			1,017,116
Additions		39,425		-		167			39,592
Right-of-use asset additions		-		969		-			969
Change in decommissioning liabilities		1,237		-		-			1,237
Balance as at December 31, 2022		1,057,316		969		629			1,058,914
Expenditures on PP&E		33,439		-		(11	)		33,428
Right-of-use asset additions		-		12,789		-			12,789
Balance as at December 31, 2023		1,090,755		13,758		618			1,105,131
Accumulated Depletion, Depreciation and Amortization
Balance as at December 31, 2020		-		-		-			-
Depletion and depreciation ^(1)^		27,949		-		47			27,996
Balance as at December 31, 2021		27,949		-		47			27,996
Depletion and depreciation ^(1)^		67,623		60		185			67,868
Balance as at December 31, 2022		95,572		60		232			95,864
Depletion and depreciation ^(1)^		67,580		183		130			67,893
Balance as at December 31, 2023		163,152		243		362			163,757
Net book Value
Balance at December 31, 2022		961,744		909		397			963,050
Balance at December 31, 2023	$	927,603	$	13,515	$	256		$	941,374
(1)	As at December 31, 2023 $161 of DD&A was capitalized to inventory<br>(December 31, 2022- $766 and 2021 - 925).
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No indicators of impairment were identified at December 31, 2023 and 2022, and as such no impairment test was performed.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 20 |

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11. LEASE LIABILITIES

The Company has recognized the following leases:

($ thousands)	2023			2022			2021
Balance, beginning of year	$	963		$	-		$	-
Additions		12,789			970			-
Interest expense		71			19			-
Payments		(99	)		(26	)		-
Balance, end of year	$	13,724		$	963		$	-
Current portion	$	6,002		$	98		$	-
Non-current portion	$	7,722		$	865		$	-

The Company’s minimum lease payments are as follows:

As at December 31<br> <br>($ thousands)	2023			****<br><br>2022
Within 1 year	$	6,002		$	98
Within 2 to 5 years		9,252			581
Later than 5 years		1,015			492
Minimum lease payments		16,269			1,171
Amounts representing finance charges		(2,545	)		(208	)
Present value of net minimum lease payments	$	13,724		$	963

During the year ended December 31, 2022, the Company entered into a 7-year term finance lease for new office space, which has been recognized as a right-of-use asset and lease liability at inception in the consolidated balance sheets. During the year ended December 31, 2023, the initial 7-year lease was extended an additional 3 years. The liability was measured at the present value of the remaining lease payments discounted at the Company’s estimated incremental borrowing rate.

During the year ended December 31, 2023, the Company entered into a 2-year drilling contract under which the Company has committed to drill 550 days over 2 years. The lease liability was measured at the present value of the day rate payments discounted at the Company’s estimated incremental borrowing rate.

12. INCOME TAXES

The following table reconciles the expected income tax (recovery) expense calculated at the Canadian statutory rate of 23% (2022 and 2021 – 23%) to the actual income tax (recovery) expenses.

****<br><br>($ thousands)	Year ended<br><br> December 31,<br><br> 2023			Year ended<br> <br>December 31, 2022			Year ended<br> <br>December 31, 2021
Income (loss) before taxes	$	(116,285	)	$	44,017		$	661,444
Expected statutory income tax rate		23.00	%		23.00	%		23.00	%
Expected income tax expense (recovery)		(26,746	)		10,124			152,132
Gain on business combination		-			-			(159,609	)
Permanent differences		24,149			7,327			15,401
Unrecognized deferred income tax (asset) liability		21,983			(105,132	)		(7,924	)
Deferred income tax expense (recovery)	$	19,386		$	(87,681	)	$	-

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 21 |

| --- | --- |

![](ex99-1_003.jpg)

****<br><br>($ thousands)	Year ended<br><br> December 31,<br><br> 2023			Year ended<br> <br>December 31, 2022			Year ended<br> <br>December 31, 2021
Deferred tax asset (liability) related to:
Oil producing assets related to property, plant & equipment	$	(135,800	)	$	(145,838	)	$	(157,900	)
Resource related pools		10,647			11,478			9,815
Corporate non-capital losses carried forward		285,325			291,078			329,650
Corporate capital tax losses carried forward		2,609			3,211			270
Unrealized loss (gain) on financial derivatives		96			6,211			8,206
Share issuance costs		2,594			683			-
Senior secured debenture		6,793			1,792			(3,052	)
Deferred tax asset not recognized		(103,969	)		(80,934	)		(186,989	)
Deferred tax asset	$	68,295		$	87,681		$	-

The Company has approximately $1.8 billion in tax pools and loss carry forwards in the year ended December 31, 2023 (December 31, 2022 – $1.8 billion) including approximately $1.4 billion in non-capital losses available for immediate deduction against future income. The Company’s non-capital losses have an expiry profile between 2033 and 2043.

As at December 31, 2023 the Company had the following federal income tax pools, which may be used to reduce taxable income in future years, limited to the applicable rates of utilization:

****<br><br>($ thousands)	Rate of<br><br> Utilization (%)		Amount
Undepreciated capital cost		7-100	$	328,682
Canadian oil and gas property expenditures		10		10,230
Canadian development expenditures		30		34,632
Federal income tax losses carried forward^(1) (2)^		100		1,376,813
Other^(3)^		Various		90,103
			$	1,840,460
(1)	Federal income tax losses carried forward expire in the following years<br>2033 - $4.3 million; 2034 - $58.7 million; 2035 - $30.0 million; 2037 - $36.2 million; 2038 - $8.3 million; 2039 - $1,232.8 million; 2042<br>- $2.9 million; 2043 - $3.6 million.
---	---
(2)	Provincial income tax losses carry forward is $985.0 million which is<br>lower than the federal income tax losses carried forward due to differences in historical claims at the provincial level.
---	---
(3)	Other includes $27.6 million in capital losses that have been recognized<br>at the full amount as at December 31, 2023.
---	---

As at December 31, 2023, the Company has $27.6 million (December 31, 2022 – $2.8 million) of capital losses carried forward that can only be claimed against taxable capital gains.

13. DECOMMISSIONING LIABILITIES

The Company’s decommissioning liabilities result from net ownership interests in oil assets including well sites, gathering systems and processing facilities. The Company estimates the total undiscounted escalated amount of cash flows required to settle its decommissioning liabilities to be approximately $206.5 million (December 31, 2022- $206.5 million). A credit-adjusted discount rate of 12% (December 31, 2022-12%) and an inflation rate of 2.0% (December 31, 2022- 2.0%) were used to calculate the decommissioning liabilities. A 1.0% change in the credit-adjusted discount rate would impact the discounted value of the decommissioning liabilities by approximately $1.1 million with a corresponding adjustment to PP&E or net income (loss). The decommissioning liabilities are estimated to be settled in periods up to year 2071.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 22 |

| --- | --- |

![](ex99-1_003.jpg)

A reconciliation of the decommissioning liabilities is provided below:

As at December 31<br> <br>($ thousands)	2023		2022		2021
Balance, beginning of year	$	7,543	$	5,517	$	-
Initial recognition		-		-		1,957
Change in estimated future costs		-		1,283		3,262
Accretion expense		906		743		298
Balance, end of year	$	8,449	$	7,543	$	5,517

14. FINANCIAL INSTRUMENTS, FAIR VALUES AND RISK MANAGEMENT

a)	Fair Values of Financial Instruments
	2023				2022
---	---	---	---	---	---	---	---	---
As at December 31<br><br> ($ thousands)	Fair Value		Carrying Value		Fair Value		Carrying Value
Financial assets at amortized cost:
Cash		109,475		109,475		35,363		35,363
Restricted cash		50		50		35,313		35,313
Accounts receivable		34,680		34,680		34,308		34,308
Financial liabilities at amortized cost:
Accounts payable and accrued liabilities		59,850		59,850		46,569		46,569
Long-term debt (Note 15)		394,082		396,780		315,718		295,173
Financial liabilities at fair value through profit or loss
Risk management contracts		417		417		27,004		27,004
Warrant liability		18,630		18,630		-		-

The fair value of long-term debt was determined based on estimates as at December 31, 2023 and 2022 and is expected to fluctuate given the volatility in the debt markets.

Risk management contracts are level 2 in the fair value hierarchy. The estimated fair value of risk management contracts is derived using third-party valuation models which require assumptions concerning the amount and timing of future cash flows and discount rates. Management's assumptions rely on external observable market data including forward prices for commodities. The observable inputs may be adjusted using certain methods, which include extrapolation to the end of the term of the contract.

Warrant liabilities are a level 3 in the fair value hierarchy is calculated using a Black-Scholes calculation.

b)	Commodity Risk Management

The Company is exposed to commodity price risk on its oil sales due to fluctuations in market prices. The Company continues to execute a consistent risk management program that is primarily designed to reduce the volatility of revenue and cash flow, generate sufficient cash flows to service debt obligations, and fund the Company’s operations. The Company’s risk management liabilities may consist of hedging instruments such as fixed price swaps and option structures, including costless collars on WTI, WCS differentials, condensate differential, natural gas and electricity swaps. The Company does not use financial derivatives for speculative purposes.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 23 |

| --- | --- |

![](ex99-1_003.jpg)

During the year ended December 31, 2023, the Company’s obligations under its New Notes (see note 15) includes a requirement to implement a 12-month forward commodity price risk management program encompassing not less than 50% of the hydrocarbon output under the proved developed producing reserves (“PDP”) forecast in the Company's most recent reserves report, as determined by a qualified and independent reserves evaluator. This requirement is assessed on a monthly basis for the duration of time that the New Notes remain outstanding.

The Company’s commodity price risk management program does not involve margin accounts that require posting of margin with increased volatility in underlying commodity prices. Financial risk management contracts are measured at fair value, with gains and losses on re-measurement included in the consolidated statements of comprehensive income (loss) in the period in which they arise.

The Company’s financial risk management contracts are subject to master netting agreements that create the legal right to settle the instruments on a net basis. The following table summarizes the gross asset and liability positions of the Company’s individual risk management contracts that are offset in the consolidated balance sheets:

As at December 31	2023					2022
($ thousands)	Asset		Liability			Asset			Liability
Gross amount	$	-	$	(417	)	$	21,375		($	48,379	)
Amount offset		-		-			(21,375	)		21,375
Risk Management contracts	$	-	$	(417	)	$	-		$	(27,004	)

The following table summarizes the financial commodity risk management gains and losses:

****<br><br>($ thousands)	Year ended<br><br> December 31,<br><br> 2023			Year ended<br> <br>December 31, 2022			Year ended<br> <br>December 31, 2021
Realized gain (loss) on risk management contracts	$	(10,182	)	$	(122,408	)	$	(3,614	)
Unrealized gain (loss) on risk management contracts		26,587			930			(35,677	)
Gain (loss) on risk management contracts	$	16,405		$	(121,478	)	$	(39,291	)

As at December 31, 2023, the following financial commodity risk management contracts were in place:

	WTI- Costless Collar				Natural Gas- Fixed<br><br> Price Swaps
Term	Volume<br><br> (Bbls)		Put Strike<br> Price<br> (US/Bbl)	Call Strike<br> Price<br> (US/Bbl)	Volume<br><br> (GJ)		Swap Price<br> (/GJ)
Q1 2024		877,968				455,000
Q2 2024		877,968				-
Q3 2024		887,800				-
Q4 2024		887,800				-

All values are in US Dollars.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 24 |

| --- | --- |

![](ex99-1_003.jpg)

Subsequent to December 31, 2023, Greenfire terminated the above WTI Costless Collar risk management contracts and entered into the following financial commodity risk management contracts:

	WTI- Costless Collar				WTI Fixed Price Swaps
Term	Volume<br><br> (Bbls)		Put Strike<br> Price<br> (US/Bbl)	Call Strike<br> Price<br> (US/Bbl)	Volume<br><br> <br>(bbls/d)		Swap Price<br> (US/bbl))
Jan – Dec 2024		-				11,500
Q1 2025		640,700				-

All values are in US Dollars.

The following table illustrates the potential impact of changes in commodity prices on the Company’s net income, before tax, based on the financial risk management contracts in place at December 31, 2023:

	Change in WTI		Change in Natural Gas
As at December 31, 2023<br><br> ($ thousands)	Increase of 5.00/bbl	Decrease of 5.00/bbl	Increase of 1.00/GJ	Decrease of 1.00/GJ
Increase (decrease) to fair value of commodity risk management contracts					)

All values are in US Dollars.

The Company’s commodity risk management contracts are held with two large reputable financial institution. As a result, the Company concluded that credit risk associated with its commodity risk management contracts is low.

c)	Credit Risk
As at December 31<br> <br>($ thousands)	2023		2022
---	---	---	---	---
Trade receivables	$	22,452	$	22,428
Joint interest receivables		12,228		11,880
Accounts receivable	$	34,680	$	34,308

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Company’s accounts receivable. The Company is primarily exposed to credit risk from receivables associated with its oil sales. The Company manages its credit risk exposure by transacting with high-quality credit worthy counterparties and monitoring credit worthiness and/or credit ratings on an ongoing basis. Trade receivables from oil sales are generally collected on 25th day of the month following production. Joint interest receivables are typically collected within one to three months of the invoice being issued. The Company has not previously experienced any material credit losses on the collection of accounts receivable.

At December 31, 2023, and December 31, 2022 the Company was exposed to concentration risk associated with its outstanding trade receivables and joint interest receivables balances. Of the Company’s trade receivables at December 31, 2023, 100% was receivable from a single company each (December 31, 2022- 100% was receivable from two companies at approximately 64% and 36% each). At December 31, 2023, 100% of the Company’s joint interest receivables were held by a single company (December 31, 2022- 100% by a single company). Maximum exposure to credit risk is represented by the carrying amount of accounts receivable on the balance sheet. Subsequent to December 31, 2023, the Company has received $4.4 million from its joint interest partner, with the remaining outstanding balance expected to be paid within a reasonable time, as a result there are no material financial assets that the Company considers past due and no accounts have been written off.

d)	Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company’s objective in managing liquidity risk is to maintain sufficient available reserves to meet its financial obligations at any point in time. The Company expects to achieve this objective through prudent capital spending, an active commodity risk management program and through strategies such as continuously monitoring forecast and actual cash flows from operating, financing and investing activities, and available credit facilities. Management believes that future cash flows generated from these sources will be adequate to settle Greenfire’s financial liabilities.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 25 |

| --- | --- |

![](ex99-1_003.jpg)

The following table details the Company’s contractual maturities of its financial liabilities at December 31, 2023, and December 31. 2022:

	Year ended<br> <br>December31, 2023				Year ended<br> <br>December31, 2022
($ thousands)	Less than<br><br> one year		Greater<br><br> than one<br><br> year		Less than<br><br> one year		Greater<br><br> than one<br><br> year
Accounts payable and accrued liabilities	$	59,850	$	-	$	46,569	$	-
Risk management contracts^(1)^		417		-		27,004		-
Lease liabilities^(1)^		6,002		7,722		98		1,075
Long-term debt^(2)^		44,321		332,029		63,250		231,921
Total financial liabilities	$	110,590	$	339,751	$	136,921	$	232,996
(1)	Amounts represent the expected undiscounted cash payments.
---	---
(2)	Amounts represent undiscounted principal only and exclude accrued interest and transaction costs.
---	---

As at December 31, 2023 all material financial liabilities are current except for the long-term portion of the New Notes (Notes 15 and 21) and drilling contract (Note 11). In addition, the Company has provisions and other liabilities as disclosed in Note 20. The Company’s future unrecognized commitments are disclosed in Note 18.

e)	Foreign Currency Risk Management

Foreign currency risk is the risk that a variation in exchange rates between the Canadian dollar and foreign currencies will affect the fair value or future cash flows of the Corporation’s financial assets or liabilities. The Corporation has U.S. dollar denominated long-term debt as described in Note 15. As of December 31, 2023, a 10% change to the value of the Canadian dollar relative to the US dollar would result in a foreign exchange gain (loss) of approximately $39.7 million (December 31, 2022 - $29.3 million, December 31, 2021 - $39.6 million).

f)	Interest Rate Risk

Interest rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates. The Company is exposed to interest rate risk related to borrowings drawn under the Senior Credit Facility, as the interest charged on the credit facility fluctuates with floating interest rates, Currently no amounts are drawn on the Senior Credit Facility. The New Notes and letters of credit issued are subject to fixed interest rates and are not exposed to changes in interest rates.

15. LONG-TERM DEBT

Senior Secured Notes

On September 20, 2023 in conjunction with the closing of the De-Spac Transaction and the issuance of the New Notes as described below, GRI redeemed the outstanding balance of $294.6 million (US$217.9 million) on the US$312.5 million 12% senior notes that were issued on August 12, 2021 (the “2025 Notes”) at a redemption premium of 106.5%. The total premium paid as a result of the early redemption was $19.2 million (US$14.2 million) plus accrued interest of $3.4 million (US$2.5 million). Unamortized debt costs of $42.1 million were also expensed in conjunction with the extinguishment of the debt.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 26 |

| --- | --- |

![](ex99-1_003.jpg)

On September 20, 2023, Greenfire issued US$300 million of senior secured notes (the “New Notes”). The New Notes bear interest at the fixed rate of 12.00% per annum, payable semi-annually on April 1 and October 1 of each year commencing on April 1, 2024, and mature on October 1, 2028. The New Notes are secured by a first priority lien on substantially all the assets of the Company and its wholly owned subsidiaries. Subject to certain exceptions and qualifications, the indenture governing the New Notes contain certain covenants that limited the Company’s ability to, among other things, incur additional indebtedness, pay dividends, redeem stock, make certain restricted payments, and dispose and transfers of assets. The indenture governing the New Notes contains minimum hedging requirements of 50% of the forward 12 calendar month PDP forecasted production as prepared to the Canadian standard using NI 51-101 until principal debt is less than US$100 million and limit capital expenditures to CAD$100 million annually until the principal outstanding is less than US$150 million. The New Notes are not subject to any financial covenants.

Under the indenture governing the New Notes, the Company is required to redeem the New Notes at 105% of the principal amount plus accrued and unpaid interest with 75% of Excess Cash Flow (as defined in the New Notes Indenture) every six-months, with the first payment due by August 15, 2024. If consolidated indebtedness is less than US$150 million, the required redemption is reduced to 25% of Excess Cash Flow to be paid for every six-month period until the principal owing on the New Notes is US$100 million

The Company is exposed to foreign exchange rate fluctuations on the principal value and interest payments in respect of its New Notes. As of December 31, 2023, a 10% change to the value of the Canadian dollar relative to the US dollar would result in a foreign exchange gain (loss) of approximately $39.7 million (December 31, 2022 - $29.3 million, December 31, 2021 - $39.6 million).

The New Notes are subject to fixed interest rates and are not exposed to changes in interest rates.

As at December 31, 2023, the carrying value of the Company’s long-term debt was $376.48 million and the fair value was $394.1 million (December 31, 2022 carrying value – $254.4 million, fair value – $315.7 million).

As at December 31, 2023 the Company was compliant with all covenants.

As at December 31 ( thousands)			2022
US dollar denominated debt:
Redeemed 12.00% senior notes issued at 96.5% of par (US217.9 million at December 31, 2022)(1)	-		$	295,173
Unamortized debt discount and debt issue costs	-			(40,765	)
New 12.00% senior notes issued at 98% of par (300 million at December 31, 2023)(1)	396,780			-
Unamortized debt discount and debt issue costs	(20,430	)		-
Total term debt	376,350		$	254,408
Current portion of long-term debt	44,321			63,250
Long-term debt	332,029		$	191,158

All values are in US Dollars.

(1)	The U.S. dollar denominated<br>debt was translated into Canadian dollars as at period end exchange rates.

Greenfire may redeem some or all of the New Notes after October 1, 2025, at 100% of the principal amount of the notes being redeemed, plus accrued and unpaid interest plus a “make whole” premium, as set out in the table below. In addition, at any time before October 1, 2025, the Company may redeem up to 40% of the aggregate principal amount of the notes using the net proceeds from certain equity issuances as a redemption price equal to 112% of the principal amount plus accrued and unpaid interest.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 27 |

| --- | --- |

![](ex99-1_003.jpg)

The following table discloses the redemption amount including the “make whole” premium on redemption of the New Notes:

	US300 million 12.00% senior notes
On or after October 1, 2025 to October 1, 2026
On or after October 1, 2026 to October 1, 2027
On or after October 1, 2027

All values are in US Dollars.

Senior Credit Facility

On September 20, 2023, Greenfire entered into a reserve-based credit facility (the “Senior Credit Facility”) comprised of an operating facility and a syndicate facility. Total credit available under the Facility is $50 million comprising of $20 million operating facility and $30 million syndicated facility.

The Senior Credit Facility is a committed facility available on a revolving basis until September 20, 2024, at which point in time it may be extended at the lender’s option. If the revolving period is not extended, the undrawn portion of the facility will be cancelled and any amounts outstanding would be repayable at the end of the non-revolving term, being September 30, 2025. The Revolving Facility is subject to a semi-annual borrowing base review, occurring in May and November of each year. The borrowing base is determined based on the lender’s evaluation of the Company’s petroleum and natural gas reserves and their commodity price outlook at the time of each renewal.

The Senior Credit Facility is secured by a first priority security interest on substantially all the assets of the Corporation and is senior in priority to the New Notes. The Senior Credit Facility contains certain covenants that limit the Company’s ability to, among other things, incur additional indebtedness, create or permit liens to exist, make certain restricted payments, and dispose of or transfer assets. The Senior Credit Facility is not subject to any financial covenants.

As at December 31, 2023, amounts borrowed under the Senior Credit Facility bear interest at a floating rate based on the applicable Canadian prime rate, US base rate, secured overnight financing rate or bankers’ acceptance rate, plus a margin of 2.75% to 6.25% based on Debt to EBITDA ratio. A standby fee on the undrawn portion of the Senior Credit Facility ranges from 0.6875% to 1.5625% based on Debt to EBITDA ratio. As at December 31, 2023, the Company had no amounts drawn under the Senior Credit Facility.

Letter of Credit Facility

During the fourth quarter of 2023, Greenfire entered into an unsecured $55 million letter of credit facility with a Canadian bank that is supported by a performance security guarantee from the EDC Facility. The EDC Facility is available on a demand basis and letters of credit issued under this facility incur an issuance and performance guarantee fee of 4.25%. As at December 31, 2023, the Company had $54.3 million in letters of credit outstanding under the Letter of Credit Facility.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 28 |

| --- | --- |

![](ex99-1_003.jpg)

16. REVENUE FROM CONTRACTS WITH CUSTOMERS

The Company’s revenue from contracts with customers consists of diluted and non-diluted bitumen sales.

Greenfire’s oil sales include blended bitumen sales from the Expansion Asset and the Demo Asset as well as non-diluted bitumen sales trucked from the Demo Asset. At the Demo Asset, each barrel can be transported to several locations, including both pipeline and rail sales points, depending on the economics of each option at the time of sale. Greenfire’s oil sales are generally sold under variable price contracts and are based on the commodity market price, adjusted for quality, location or other factors. Greenfire is required to deliver nominated volumes of oil to the contract counterparty. Each barrel equivalent of commodity delivered is considered to be a distinct performance obligation. The amount of revenue recognized is based on the agreed transaction price and is recognized as performance obligations are satisfied, therefore resulting in revenue recognition in the same month as delivery. Revenues are typically collected on the 25th day of the month following production.

****<br><br>($ thousands)	YearendedDecember 31, 2023		Year endedDecember 31,2022		YearendedDecember 31,2021
Diluted bitumen sales	$	652,812	$	890,400	$	212,225
Bitumen sales		23,158		108,449		58,449
Oil sales	$	675,970	$	998,849	$	270,674

17. FINANCING AND INTEREST

****<br><br>($ thousands)	Yearended December 31,2023		YearendedDecember 31,2022		YearendedDecember 31,2021
Accretion on long-term debt	$	106,435	$	74,176	$	22,186
Other and cash interest		2,873		2,155		1,926
Accretion on decommissioning liabilities		906		743		298
Financing and interest expense	$	110,214	$	77,074	$	25,050

The total interest and finance expense of $108.3 million during the year ended December 31, 2023, included $42.1 million of accelerated unamortized debt related costs and $19.2 million of debt redemption premiums on the redemption of the 2025 Notes.

18. COMMITMENTS AND CONTINGENCIES

The following table summarizes the Company’s estimated future unrecognized commitments associated with firm transportation agreements as at December 31, 2023:

($ thousands)	Remaining <br><br>2024		2025		2026		2027		2028		Beyond <br><br>2028		Total
Transportation		31,880		30,561		28,956		29,044		29,170		203,198		352,809
Total	$	31,880	$	30,561	$	28,956	$	29,044	$	29,170	$	203,198	$	352,809

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 29 |

| --- | --- |

![](ex99-1_003.jpg)

19. SHARE CAPITAL AND WARRANTS

Share capital

As at December 31, 2023 the Company’s authorized share capital consists of an unlimited number of common shares without a nominal or par value. The following table along with note 5 summarizes the changes to the Company’s common share capital:

	Number of shares		Amount<br>(000’s)
Shares outstanding
Balance, December 31, 2021 and 2022		1
Issuance of new common shares per De-Spac Transaction		43,690,533
Issuance for exercise of bond warrants		15,769,183
Issuance to MBSC shareholders – Class A and Class B		5,005,707
Issuance of new common shares for PIPE investment		4,177,091
Balance, December 31, 2023		68,642,515

All values are in US Dollars.

Bondholder warrants

As at December 31, 2022, GFI had 312,500 bondholder warrants outstanding which entitled the holders of these warrants, in aggregate, the right to purchase 25% of GFI’s issued and outstanding common shares commencing October 18, 2021 at $0.01 per shares. As at December 31, 2022, the bondholders had the right to acquire 2,983,866 common shares of GRI at $0.01 per share based on an exchange ratio of 9.55.

On September 20, 2023, with the closing of the De-Spac Transaction the 312,500 outstanding bondholder warrants were exchanged into 3,225,810 GRI common shares of which 2,886,565 were exchanged for 15,769,183 common shares of Greenfire and 339,245 were cancelled in exchange for cash consideration of $25.5 million.

As at December 31, 2023 there were no bondholder warrants remaining.

Per share amounts

The Company uses the treasury stock method to determine the dilutive effect of performance and bondholder warrants. Under this method, only “in-the-money” dilutive instruments impact the calculation of diluted income (loss) per share. Net income (loss) per share was calculated using the historical weighted average shares outstanding, scaled by the applicable exchange ratio following the completion of the De-Spac Transaction.

The following table summarizes the Company’s basic and diluted net income (loss) per share:

	YearendedDecember 31, 2023			YearendedDecember 31, 2022		YearendedDecember 31, 2021
Weighted average shares outstanding- basic		54,425,083			48,911,099		42,609,296
Dilutive effect of bond and performance warrants		-			21,019,068		5,488,834
Weighted average shares outstanding- diluted		54,425,083			69,930,167		48,098,130
Basic $ per share	$	(2.49	)	$	2.69	$	15.52
Diluted $ per share	$	(2.49	)	$	1.88	$	13.75

In computing the diluted net loss per share for the year ended December 31, 2023, the Company excluded the effect of 7,526,667 New Greenfire Warrants and 3,617,016 Performance Warrants as their effect in anti-dilutive.(December 31, 2022 and 2021 no warrants were excluded).

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 30 |

| --- | --- |

![](ex99-1_003.jpg)

Performance warrants

In February 2022, the Company implemented a warrant plan (“Performance Warrants”) as part of the Company’s long-term incentive plan for employees and service providers. These Performance Warrants had both performance and time vesting criteria before there is the ability to exercise the option to purchase one common share of the Company for each Performance Warrant. On September 20, 2023 with the closing of the De-Spac Transaction there were 739,912 GRI performance warrants outstanding, 661,971 were converted into 3,617,016 Greenfire performance warrants and 77,941 were cancelled for cash consideration of $4.5 million.

The table below summarizes the outstanding warrants as if the warrant exchange ratio used to exchange GRI common shares into Greenfire common shares had occurred on January 1, 2022 and equates to the total common shares issuable to performance warrant holders:

	Year ended <br>December 31, 2023				Year ended <br>December 31, 2022
	Number of Warrants			Weighted Average Exercise Price US	Number of Warrants			Weighted Average Exercise Price US
Performance Warrants outstanding
Balance, beginning of period		3,895,449				-
Performance warrants issued		186,257				4,159,546
Performance warrants forfeited		(38,820	)			(264,097	)
Performance warrants cancelled		(425,870	)			-
Balance, end of period		3,617,016				3,895,449
Common shares issuable on exchange		3,617,016				3,895,449

All values are in US Dollars.

The fair market value of the performance warrants was $11.0 million on the date of issuance. The exchange of the GRI performance warrants to Greenfire performance warrants did not result in an increase to the fair value of the warrants, therefore no additional expense was recorded. The fair value of each performance warrant was estimated on its grant date using the Black Scholes Merton valuation model with the following assumptions:

	2023 Assumptions			2022 Assumptions
Average risk-free interest rate		4.2	%		1.46	%
Average expected dividend yield		-			-
Average expected volatility^1^		70	%		60	%
Average expected life (years)		2-5			3-5
^1^	Expected volatility hasbeen based on historical share volatility of similar market participants
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The performance warrants expire 10 years after the issuance date. On September 20, 2023, with the closing of the De-Spac Transaction, all outstanding performance warrants vested and became exercisable. As a result, the remaining unrecognized fair market value of the performance warrants was immediately recorded as stock-based compensation, and a total of $9.2 million was expensed. For the year ended December 31, 2023, the Company recorded $9.8 million (2022-$1.2 million, 2021 -$nil) of stock-based compensation related to the performance warrant plan.

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 31 |

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![](ex99-1_003.jpg)

20.	WARRANT LIABILITY

On September 20, 2023, Greenfire issued 5,000,000 warrants to GRI common shareholders, bond warrant holders and performance warrant holders (the “New Greenfire Warrants”). The New Greenfire Warrants expire 5 years after issuance and entitle the holder of each warrant to purchase one common share of Greenfire at a price of US$11.50. Greenfire, can at its option, require the holder of the New Greenfire Warrants to exercise on a cashless basis. The 5,000,000 New Greenfire Warrants issued to the former GRI common shareholders and bondholders are to be treated as a derivative financial liability in accordance with IFRS 9 – Financial Instruments and were measured at fair value in accordance with IFRS 13 – Fair Value Measurement. These New Greenfire Warrants had a fair value of $35.6 million at the date of issuance and were recorded as a liability with a corresponding amount booked to retained earnings. The New Greenfire Warrants will be reassessed at the end of each reporting period with subsequent changes in fair value being recognized through the statement of comprehensive income (loss).

In addition, Greenfire as part of the De-Spac Transaction assumed and exchanged 2,526,667 MBSC Class B Private Warrants for 2,526,667 New Greenfire Warrants. The New Greenfire Warrants issued to the MBSC Class B warrant holders were deemed to be an exchange of two financial liabilities at fair value. The fair value of the MBSC Class B Private Warrants was $18.0 million. Both sets of warrants have an exercise price of US$11.50 with both underlying securities trading at or valued at a similar price. As both sets of warrants are deemed to be economically equivalent, no gain or loss was recorded on the exchange. The exchanged warrants will be reassessed at the end of each reporting period with subsequent changes in fair value being recognized through the statement of comprehensive income (loss).

On December 31, 2023, the 7,526,667 outstanding New Greenfire Warrants were revalued based on the closing share price of US$4.86 per common share of Greenfire During the year ended December 31, 2023, the fair value of the warrant liability decreased by $35.0 million. The following table reconciles the warrant liability.

	Year ended <br> December 31, 2023					Year ended December 31, 2022
($ thousands)	Number of Warrants		Amount			Number of Warrants		Amount
Balance, beginning of year		-	$	-			-	$	-
Warrants issued		5,000,000		35,644			-		-
MBSC warrants converted		2,526,667		17,959
Change in fair value		-		(34,973	)		-		-
Balance, end of period		7,526,667	$	18,630			-	$	-
Common shares issuable on exercise		7,526,667		-			-		-

The fair value of each warrant was estimated on its grant date using the Black Scholes Merton valuation model with the following assumptions:

	2023 Assumptions
Average risk-free interest rate		4.2	%
Average expected dividend yield		-
Average expected volatility ^(1)^		70	%
Average expected life (years)		5
^(1)^	Expected volatility hasbeen based on historical share volatility of similar market participants
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| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 32 |

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![](ex99-1_003.jpg)

21. CAPITAL MANAGEMENT

The Company’s net managed capital consists primarily of cash and cash equivalents, long-term debt and shareholders’ equity. The current priorities for managing liquidity risk include managing working capital to ensure interest and debt repayment, and to fund the Company’s operations and the capital program. In the current commodity price environment and in conjunction with the Company’s commodity price risk management program, management believes its current capital resources and cash flow will allow the Company to meet its current and future obligations over the next 12 months. Capital expenditures and debt repayment are expected to be funded by cash-on-hand and out of cash flow. The Company’s capital structure consists of the following:

As at December 31 <br>($ thousands)	2023			2022
Face value of term debt (Note 15)	$	396,780		$	295,173
Shareholders’ equity		712,940			837,771
Working capital, excluding current portion of term debt, warrant liability and risk management contracts		(96,899	)		(76,860	)
Net managed capital	$	1,012,821		$	1,056,084

Net managed capital is not a standardized measure and may not be comparable with the calculation of similar measures by other companies.

22. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

The components of accounts payable and accrued liabilities were:

As at December 31<br> <br>($ thousands)	2023		2022
Trade payables	$	6,303	$	3,367
Accrued payables		35,994		30,401
Accrued employee annual incentive plans		4,435		4,463
Accrued interest payable		13,118		8,338
Accounts payable and accrued liabilities	$	59,850	$	46,569

23. RELATED PARTY TRANSACTIONS

The Company’s related parties primarily consist of key management personnel. The Company considers directors and officers of Greenfire Resources Ltd. as key management personnel.

****<br><br>($ thousands)	Year ended December 31, 2023		Yearended December 31, 2022		Year ended December 31, 2021
Salaries, benefits, and director fees	$	3,808	$	1,978	$	873

24. SUPPLEMENTAL CASH FLOW INFORMATION

The following table reconciles the net changes in non-cash working capital and other liabilities from the consolidated balance sheet to the consolidated statement of cash flows:

($ thousands)	Yearended December 31, 2023			Yearended December 31, 2022			Year ended<br><br> December 31, <br><br>2021
Change in accounts receivable	$	(372	)	$	9,654		$	(43,962	)
Change in inventories		705			1,349			(15,917	)
Change in prepaid expenses and deposits		(1,763	)		6,537			(10,512	)
Change in accounts payable and accrued liabilities		13,048			(10,859	)		57,367
Working capital acquired (note 6)		-			-			41,856
		11,618			6,681			28,832
Other items impacting change in non-cash working capital: <br>Unrealized foreign exchange loss in accounts payable		(93	)		(652	)		-
		11,525			6,029			28,832
Related to operating activities		25,513			3,570			(6,910	)
Related to investing activities (accrued additions to PP&E)		(13,988	)		2,459			35,742
Net change in non-cash working capital	$	11,525		$	6,029		$	28,832
Cash interest paid (included in operating activities)	$	(39,955	)	$	(51,129	)	$	(1,926	)
Cash interest received (included in operating activities)	$	2,976		$	620		$	21

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 33 |

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Corporate Information

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Directors	Solicitors
Julian McIntyre ^(1)^	Burnet, Duckworth, & Palmer LLP
Jonathan Klesch	2400, 525 – 8^th^ Avenue SW
Derek Aylesworth ^(2)(3)^	Calgary, Alberta, Canada
Venkat Siva ^(3)^	T2P 1G1
Matthew Perkal ^(3)^
Robert Logan	Carter Ledyard & Milburn LLP
	41^st^ Floor
(1)	Chair of the Board of Directors	28 Liberty Street
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(2)	Chair of the Audit and Reserves Committee	New York, New York 10005
(3)	Audit and Reserves Committee
		Bankers
Officers
---	---
	Bank of Montreal
Robert Logan MPBE, P.Eng	595-8 Avenue SW
President, and Chief Executive Officer	Calgary, Alberta, Canada
	T2P 1G1
Tony Kraljic, CA
Chief Financial Officer	Auditor
Kevin Millar C.E.T.	Deloitte LLP
SVP Operations & Steam Chief	850 2nd Street SW
	Calgary, Alberta, Canada
Albert MA P.Eng	T2P 0R8
SVP Engineering
	Reserve Engineers
Crystal Park P.Eng, MBA
SVP Corporate Development	McDaniel & Associates Consultants Ltd.
	2200, 255 – 5^th^ Avenue SW
Charles R. Kraus	Calgary, Alberta, Canada
Corporate Secretary	T2P 3G6

Head Office

Suite 1900, 205 – 5^th^ Avenue SW,
Calgary, Alberta, Canada
T2P 2V7
www.greenfireres.com
NYSE : GFR
TSX : GFR

| Greenfire Resources Ltd. | 2023 Annual Financial Statements | 34 |

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Exhibit 99.2

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MANAGEMENT’SDISCUSSION & ANALYSIS

FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2023

Greenfire Resources Ltd.

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MANAGEMENT’S DISCUSSION AND ANALYSIS

This Management’s Discussion and Analysis (“MD&A”) of the financial condition and results of operations of Greenfire Resources Ltd. (“Greenfire” or the “Company”) is dated March 20, 2024, which is the date this MD&A was approved by the Board of Directors of the Company, and should be read in conjunction with the Company’s consolidated balance sheets of Greenfire Resources Ltd. and subsidiaries as at December 31, 2023 and 2022, and the related consolidated statements of comprehensive income (loss), changes in shareholders’ equity (deficit) and cash flows, for each of the three years in the period ended December 31, 2023. The consolidated financial statements, including the comparative figures, were prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board.

This MD&A contains forward-looking information based on the Company’s current expectations and projections. For information on the material factors and assumptions underlying such forward-looking information, refer to the “Forward Looking Statements” section of this MD&A.

The Company holds a 75% working interest in the Expansion Asset (as defined below) and a 100% working interest in the Demo Asset (as defined below). Production volumes and per unit statistics are presented throughout this MD&A on a company gross working interest basis before deduction of royalties.

Dollar per barrel ($/bbl) figures are based upon sold bitumen barrels unless otherwise noted. The Company monitors and reviews financial information on a per barrel basis for comparability to prior period results and to analyze the Company’s competitiveness relative to its peer group.

All financial information included in this MD&A is presented in Canadian dollars (“CAD”), unless otherwise noted. Certain dollar amounts have been rounded to the nearest million dollars or thousand dollars, as noted, and tables may not add due to rounding.

This MD&A contains non-GAAP measures which are detailed in the section entitled “Non-GAAP Measures”. They include adjusted EBITDA, adjusted EBITDA per barrel ($/bbl), operating netback, operating netback per barrel ($/bbl), adjusted funds flow, adjusted free cash flow, adjusted working capital and net debt.

A discussion of the results of operations for the year ended December 31, 2022, compared to the year ended December 31, 2021 has been reported previously in Greenfire’s final prospectus filed pursuant to Rule 424(b)(3) on February 6, 2024 under the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and is not repeated herein. Such information can be found on EDGAR at:

https://www.sec.gov/Archives/edgar/data/1966287/000121390024010570/ea192929-424b3_greenfire.htm

Corporate Information

Greenfire is based in Canada with the Company’s registered office located in Calgary, Alberta. The Company’s principal business is the sustainable production and development of upstream energy resources from the oil sands in Canada, using in situ thermal oil production extraction techniques such as steam assisted gravity drainage (“SAGD”).

Greenfire Acquisition Corporation (“GAC”) was incorporated on November 2, 2020 for the purpose of acquiring the Hangingstone Demonstration Facility (the “Demo Asset”). On April 5, 2021, GAC acquired the Demo Asset and was subsequently amalgamated with Greenfire Resources Operating Corporation (“GROC”), a wholly owned subsidiary of the Company. The Demo Asset is a SAGD bitumen production facility with an estimated debottlenecked capacity of 7,500 bbls/d.

On September 17, 2021, GROC acquired all of the issued and outstanding shares of Japan Canada Oil Sands Limited (“JACOS”). JACOS’s primary asset was a 75% working interest in the Hangingstone Expansion Facility (the “Expansion Asset” and together with the Demo Asset, the “Hangingstone Facilities”). The Expansion Asset is a SAGD bitumen production facility located approximately five kilometers to the southeast of the Demo Asset, with an estimated gross debottlenecked capacity of 35,000 bbls/d.

On December 14, 2022, GRI, M3-Brigade Acquisition III Corp. (“MBSC”), a New York Stock Exchange (“NYSE”) listed special purpose acquisition company, and certain other parties entered into a definitive agreement for a business combination (the “De-Spac Transaction”), which valued Greenfire at an enterprise value of US$950.0 million. The De-Spac Transaction was consummated on September 20, 2023 and Greenfire’s common shares (“Common Shares”) commenced trading on the NYSE. On February 2, 2024, Greenfire filed a final non-offering prospectus with the Alberta Securities Commission resulting in the Company becoming a reporting issuer in the Province of Alberta. On February 8, 2024 the Common Shares commenced trading on the Toronto Stock Exchange (“TSX”) under the symbol “GFR” and Greenfire became a reporting issuer in the Province of Ontario.

On January 1, 2024, GRI amalgamated with GROC in accordance with the provisions of the Business Corporations Act (Alberta), with the surviving entity carrying on as “Greenfire Resources Operating Corporation” and as a wholly-owned subsidiary of the Company.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 2 |

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GREENFIRE’S ASSETS, POSITIONING &STRATEGY

Greenfire is an intermediate, lower-cost and growth-oriented oil sands producer focused on the sustainable development of its Tier-1 assets in Western Canada using SAGD. Greenfire is pursuing capital-efficient and lower-risk growth through the optimization of existing production, facilities and reserves to maximize free cash flow generation. The Company has a large, long-life and relatively low decline oil sands resource base, with two producing and adjacent SAGD assets at the Hangingstone Facilities, with expandable pipeline infrastructure in place for diluted bitumen and diluent at the Expansion Asset. These two assets are:

●	Expansion<br>Asset (75% Working Interest, Operator).
●	Demo<br>Asset (100% Working Interest, Operator).
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The Company believes that the Expansion Asset and Demo Asset have a Tier-1 SAGD reservoir, meaning there is no top gas, bottom water, or lean zones (“thief zones”). Other SAGD reservoirs may have thief zones, which limit reservoir pressure and require the constant use and routine replacement of downhole pumps for production. Tier-1 SAGD reservoirs allow production to flow to the surface with natural lift, which reduces the Company’s capital and operating expenditure requirements compared to other SAGD producers, which the Company believes represents a structural cost advantage for Greenfire.

Greenfire’s strategy is to implement industry proven SAGD optimization techniques, concentrating on maximizing utilization of plant capacity, minimizing capital expenditure and controlling operating cost structures, to maximize the value of its Tier-1 SAGD assets. The Company believes that the Hangingstone Facilities have ample opportunities for additional value generation. Greenfire also plans to evaluate and consider additional potential prospects for further production growth, including external acquisitions that compete with the expected returns from its existing Tier-1 SAGD assets, if the Company believes they are accretive to Greenfire’s shareholders.

FOURTH QUARTER 2023 & RECENT HIGHLIGHTS

Corporate Highlights:

●	The<br>Company’s consolidated net average bitumen production in fourth quarter of 2023 was 17,335 bbls/d, compared to 19,579 bbls/d in<br>the same period of 2022. The Company’s consolidated net average bitumen production during the first two months of 2024 averaged<br>approximately 19,950 bbls/d, largely the result of higher production at the Expansion Asset, as additional redevelopment infill (“Refill”)<br>wells became operational and the continued increase in reservoir pressure owing to heightened rates of non-condensable gas (“NCG”)<br>co-injection.
●	Oil<br>sales were $161.7 million during the fourth quarter of 2023, relative to $180.7 million in the same period of 2022.
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●	Operating<br>expenses were $35.1 million during the fourth quarter of 2023, compared to $42.4 million in the same period in 2022.
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●	Cash<br>provided by operating activities was $25.5 million during the fourth quarter of 2023, compared to $17.3 million in the same period of<br>2022.
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●	Adjusted<br>funds flow^(1)^was $10.5 million during the fourth quarter of 2023, compared to $16.9 million for the same period in 2022.
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●	Cash<br>provided in investing activities was $18.8 million during the fourth quarter of 2023, compared to cash used in investing activities of<br>$17.3 million in the same period in 2022.
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●	Capital<br>expenditures were $19.4 million during the fourth quarter of 2023, compared to $12.4 million for the same period of 2022.
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●	Adjusted<br>free cash flow^(1)^ was negative $8.9 million during the fourth quarter of 2023, compared to positive $4.5 million for the same<br>period in 2022.
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●	Net<br>loss totaled $4.7 million during the fourth quarter of 2023, compared to net income of $88.0 million in the same period in 2022.
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●	Adjusted<br>EBITDA^(1)^ was $23.4 million during the fourth quarter of 2023, compared to $32.5 million for the same period of 2022.
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●	During<br>the fourth quarter of 2023, the Company entered into an unsecured $55.0 million letter of credit facility with a Canadian bank that is<br>supported by a performance security guarantee from Export Development Canada (“EDC Facility”). The EDC Facility replaced<br>a cash collateralized credit facility, resulting in a release of $43.3 million of the restricted cash.
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●	The<br>Company had available liquidity of approximately $159.5 million at December 31, 2023, consisting primarily of $109.5 million of cash<br>and cash equivalents and $50.0 million of available credit under the Company’s Senior Credit Facility provided by several financial<br>institutions (“Senior Credit Facility”).
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(1)	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 3 |

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![](ex99-2_004.jpg)

●	Subsequent<br>to December 31, 2023, the Company implemented an updated West Texas Intermediate (“WTI”) hedging program for 2024 (“2024<br>Hedging Program”). The 2024 Hedging Program:
o	Replaced previous WTI costless collar contracts with 11,500<br>bbls/d of WTI fixed price swaps for 2024 at approximately US$71/bbl, providing increased price certainty relative to the previous floor<br>price ranging from approximately US$60/bbl to US$62/bbl.
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o	Supports funding the Company’s forecasted capital expenditures<br>range contemplated in the Company’s 2024 Outlook (as defined and described in more detail below) from operations at lower WTI prices<br>in the current volatile commodity environment.
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●	The<br>common shares commenced trading on the TSX under the symbol “GFR” at the opening of trading on Thursday, February 8, 2024.
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Operational Update:

Expansion Asset

●	Successfully<br>installed a NCG co-injection compressor during the fourth quarter of 2023, enabling the Company to deliver NCG at higher and more consistent<br>rates for co-injection. With heightened rates of NCG co-injection sustained, higher reservoir pressure is expected to be restored at<br>the Expansion Asset around mid-2024, which management anticipates will support increased production rates.
●	Eight<br>extended reach Refill wells were drilled at the Expansion Asset during the year-end 2023, with two additional extended reach Refill wells<br>drilled during the first quarter of 2024.
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●	Five<br>extended reach Refill wells have been on production for over two months at the Expansion Asset as at December 31, 2023 and have realized<br>an average monthly production rate of approximately 1,500 bbls/d per well, on a 100% working interest basis, or 1,125 bbls/d net to the<br>Company, in the second month of production.
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●	Average<br>bitumen production during the first two months of 2024 averaged approximately 17,650 bbls/d. The Company has recently encountered third-party<br>downhole temperature sensor failures in five of the recently drilled Refill wells at the Expansion Asset. Greenfire has completed the<br>first sensor replacement in March 2024 and plans to replace the remaining sensors in the second quarter of 2024. The Company estimates<br>that bitumen production has been impacted by approximately 2,000 bbls/d.
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Demo Asset

●	The<br>disposal well at the Demo Asset has been temporarily shut-in since the beginning of October 2023. Remediation work for the disposal well<br>is complete and disposal operations are anticipated to recommence subject to regulatory approval, and are expected to increase bitumen<br>production by approximately 1,000 bbls/d.
●	A<br>seven Refill well drilling program commenced in February 2024, with all seven wells anticipated to be extended reach Refill wells, drilled<br>across two producing pads, with lateral lengths averaging approximately 2,000 meters. As of the date of this MD&A, one extended reach<br>Refill well has been drilled.
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●	To<br>accommodate Refill well drilling activities, adjacent producing wells across multiple pads will operate at reduced productivity. Greenfire<br>expects to complete the seven Refill well program by the second quarter of 2024. Once complete, the Company expects that adjacent wells<br>will return to previous productivity levels.
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●	Bitumen<br>production during the first two months of 2024 averaged approximately 2,300 bbls/d, mainly due to the temporarily shut-in of the disposal<br>well and production impacts from ongoing Refill well drilling operations, compared to average bitumen production of 4,284 bbls/d and<br>4,097 bbls/d during the first and second quarter of 2023, respectively, at the Demo Asset.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 4 |

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![](ex99-2_004.jpg)

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Financial & OperationalHighlights

						YearendedDecember 31,
( thousands, unless otherwise noted)			2022			2023			2022			2021^(1)^
Bitumen production – Expansion asset (bbls/d)	14,079			15,710			13,829			16,802			5,352
Bitumen production – Demo asset (bbls/d)	3,256			3,869			3,810			3,701			2,657
Bitumen production – Consolidated (bbls/d)	17,335			19,579			17,639			20,503			8,009
Oil sales	161,730			180,741			675,970			998,849			270,674
Oil sales (/bbl)	71.04			72.18			73.91			96.82			71.89
Operating netback(2)	27,353			34,567			132,704			229,694			79,127
Operating netback (/bbl) (2)	17.19			19.27			20.56			30.58			27.40
Operating expenses	35,084			42,429			148,965			160,826			59,710
Operating expenses (/bbl)	22.05			23.65			23.08			21.41			20.68
Cash provided (used) by operating activities	25,530			17,322			86,548			164,727			31,985
Adjusted funds flow(2)	10,517			16,902			73,206			163,926			49,213
Cash provided (used) by investing activities	18,782			(17,316	)		(12,103	)		(63,746	)		(336,528	)
Capital expenditures	19,413			12,361			33,428			39,592			4,594
Adjusted free cash flow(2)	(8,896			4,541			39,778			124,334			44,619
Net income (loss) and comprehensive income (loss)	(4,659	)		87,995			(135,671	)		131,698			661,444
Per share – basic(3)	(0.07	)		1.80			(2.49	)		2.69			15.52
Per share – diluted(3)	(0.07	)		1.25			(2.49	)		1.88			13.75
Adjusted EBITDA(2)	23,434			32,528			117,316			218,033			75,492
Total assets(4)	-			-			1,173,483			1,174,258			1,129,080
Total non-current financial liabilities(4)	-			-			332,029			191,158			215,210
Common shares outstanding, end of period	68,642,515			48,911,009			68,642,515			48,911,009			42,609,296
Weighted average shares outstanding- diluted	68,642,515			70,427,594			54,425,083			69,930,167			48,098,130

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
^(2)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
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^(3)^	For the years ended December 31, 2022 and 2021, the Company’s<br>basic and diluted earnings per share is the net income per common share of GRI and the weighted average common shares outstanding has<br>been scaled by the applicable exchange ratio following the completion of the De-Spac Transaction with MBSC.
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^(4)^	As at December 31, 2023.
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Liquidity and Balance Sheet

	December 31,		December 31,
($ thousands)	2023		2022
Cash and cash equivalents		109,525		35,363
Restricted cash		-		35,313
Available credit facilities^(1)^		50,000		7,000
Face value of Long-term debt^(2)^		396,780		295,173
^(1)^	As at December 31, 2023 the Company had $50.0 million of available<br>credit under the Senior Credit Facility, of which nil was drawn as of December 31, 2023. As at December 31, 2022 the Company had $15.0<br>million of available credit under available credit facilities, of which $8.0 million was drawn.
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^(2)^	As at December 31, 2023, the 2028 Notes (as defined below) have<br>a face value of US$300.0 million and were converted into Canadian dollars as at period end exchange rates. As at December 31, 2022 the<br>2025 Notes (as defined below) had a face value of US$217.9 million and were converted into Canadian dollars as at period end exchange<br>rates.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 5 |

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OUTLOOK

Corporate2024 Outlook

	2024 Outlook
Annual Net Average Bitumen Production	22,000 – 25,000 bbls/d
Production Growth vs. Annual 2023	25% – 40%
Capital Expenditures:
Drilling	$50 – $60 million
Facilities and Field Infrastructure	$20 – $30 million
Total Capital Expenditures	$70 - $90 million
- Capital Expenditures at the Expansion Asset <br>- Capital Expenditures at the Demo Asset	60%<br> <br>40%
^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
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Capital expenditures contemplated by the Company’s 2024 Outlook are expected to be allocated to both the Expansion Asset and Demo Asset, including, at the mid-point, $55 million directed to drilling to focus on developing capital efficient and productive inventory of Refill well targets as well as $25 million for facilities and field infrastructure investments. Approximately 60% of Greenfire’s expected capital expenditures in 2024 are forecasted to be deployed at the Expansion Asset. To provide certainty on cost structure and service availability, Greenfire entered into a two-year take-or-pay drilling contract with an established SAGD drilling contractor in Western Canada, which commenced drilling during 2023 and will facilitate the Company’s continuous drilling program at the Hangingstone Facilities and includes a commitment to drill 550 days over a two-year period. The two-year take-or-pay drilling contract has been recorded as a lease liability in the December 31, 2023 consolidated balance sheets.

Subsequent to December 31, 2023, the Company implemented the 2024 Hedging Program, including the replacement of WTI costless collar contracts with 11,500 bbls/d of WTI fixed price swaps for 2024 at approximately US$71/bbl. To achieve the mid-point of the Company’s range for production and capital expenditures under the 2024 Outlook, assuming a US$15/bbl Western Canadian Select (“WCS”) differential, Greenfire forecasts that capital expenditures can be funded from operations down to approximately:

●	US$55/bbl<br>WTI – before the financial impact of the 2024 Hedging Program; or
●	US$35/bbl<br>WTI – inclusive of the existing 2024 Hedging Program.
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The Company expects that its structural cost advantages from its Tier-1 SAGD reservoir, combined with its relatively lower forecasted capital expenditure profile due to its projected multi-year inventory of Refill well targets at the Hangingstone Facilities, is anticipated to result in near-term production growth and potential meaningful free cash flow generation. Greenfire plans to continue focusing on debt reduction with semi-annual debt repayments using 75% of Excess Cash Flow (as defined in the indenture for the Company’s 12% senior secured notes due 2028 (the “2028 Notes”).

DE-SPAC TRANSACTION

On September 20, 2023, Greenfire, GRI, MBSC, DE Greenfire Merger Sub Inc. (“DE Merger Sub”) and 2476276 Alberta ULC (“Canadian Merger Sub”), completed a De-Spac Transaction pursuant to a business combination agreement dated December 14, 2022, as amended (the “Business Combination Agreement”) with MBSC, DE Merger Sub and Canadian Merger Sub were incorporated in December 2022 for the purposes of completing the De-Spac Transaction.

Pursuant to the De-Spac Transaction (i) Canadian Merger Sub amalgamated with and into GRI pursuant to a statutory plan of arrangement (the “Plan of Arrangement”) under the Business Corporations Act (Alberta), with GRI continuing as the surviving corporation and becoming a direct, wholly-owned subsidiary of Greenfire and (ii) DE Merger Sub merged with and into MBSC pursuant to a Delaware statutory merger (the “Merger) with MBSC continuing as the surviving corporation and becoming a direct, wholly-owned subsidiary of Greenfire.

As a result of the De-Spac Transaction, the following occurred:

●

Of<br>the GRI 8,937,518 common shares outstanding, 7,996,165 were converted to 43,690,534 common shares of Greenfire and 941,353 were cancelled<br>in exchange for cash consideration of $70.8 million. Cash consideration was comprised of a dividend paid of $59.4 million and $11.4 million<br>for shares repurchased and cancelled by the Company. The $70.8 million cash consideration was recorded as a reduction to retained earnings.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 6 |

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●	312,500<br>outstanding GRI bondholder warrants were exchanged for 3,225,810 GRI common shares of which 2,886,048 were converted to 15,769,183 common<br>shares of Greenfire and 339,245 were cancelled in exchange for cash consideration of $25.5 million. This $25.5 million was recorded as<br>a reduction to retained earnings. In conjunction with the share conversion and cancellation, $43.5 million was reclassified from contributed<br>surplus to share capital ($38.9 million) and retained earnings ($4.6 million).
●	Of<br>the 739,912 GRI performance warrants outstanding, 661,971 were converted into 3,617,016 Performance Warrants of the Company (“Performance<br>Warrants”) and 77,941 were cancelled for cash consideration of $4.5 million, which was the fair value of the warrants. The $4.5<br>million was recorded as a reduction to retained earnings. In conjunction with the cancellation, $1.2 million was reclassified from contributed<br>surplus to retained earnings.
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●	Greenfire<br>issued an additional 5,000,000 Warrants of the Company (“Warrants”) to former GRI shareholders, GRI bond warrant holders<br>and GRI performance warrant holders that entitle the holder of each warrant to purchase one common share of Greenfire. The Warrants were<br>recorded as a warrant liability on the consolidated balance sheet.
---	---
●	755,707<br>MBSC Class A common shares held by MBSC’s public shareholders were converted into 755,707 Greenfire common shares.
---	---
●	4,250,000<br>Class B MBSC common shares were converted into 4,250,000 Greenfire common shares.
---	---
●	2,526,667<br>MBSC private placements warrants were converted into 2,526,667 Greenfire Warrants, which were recorded as a warrant liability on the<br>consolidated balance sheet.
---	---
●	Concurrent<br>with the execution of the Business Combination Agreement, the Company and MBSC had entered into subscription agreements with certain<br>investors (the “PIPE Investors”) pursuant to which the PIPE Investors agreed to purchase Class A common shares of MBSC at<br>a purchase price of US$10.10 per share. MBSC issued 4,177,091 Class A common shares to the PIPE Investors for proceeds of $56.6 million<br>(US$42.2 million) which were converted into Greenfire common shares at the closing of the De-Spac Transaction.
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Greenfire has been identified as the acquirer for accounting purposes. As MBSC does not meet the definition of a business under IFRS 3 Business Combinations, the transaction is accounted for pursuant to IFRS 2 Share Based Payment. On closing of the De-Spac Transaction, the Company accounted for the excess of the fair value of Greenfire common shares issued to MBSC shareholders as consideration, over the fair value of MBSC’s identifiable net assets at the date of closing, resulting in $106.5 million (US$79.4 million) being recognized as a listing expense. The fair value of MBSC Class B common shares exchanged for Greenfire common shares was measured at the market price of MBSC’s publicly traded Class A common shares on September 20, 2023, which was US$9.37 per share. The fair value of MBSC Class A common shares exchanged for Greenfire common shares was measured at the market price of MBSC’s publicly traded Class A common shares on September 20, 2023, which was US$9.37 per share. As part of the De-Spac Transaction, Greenfire acquired marketable securities held in trust, prepaid expenses, accrued liabilities, taxable payable, other liabilities, warrant liability and deferred underwriting fees. The following table reconciles the elements of the listing expense:

( thousands)
Total fair value of consideration deemed to have been issued by Greenfire:
4,250,000 MBSC Class B common shares at US9.37 per common share (US39.8 million)	53,454
755,707 MBSC Class A common shares at US9.37 per common share (US7.1 million)	9,505
Less the following:
Fair value of identifiable net assets of MBSC
Marketable securities held in Trust Account	10,485
Prepaid expenses and deposits	8
Accounts payable and accrued liabilities	(16,262	)
Warrant liability	(17,960	)
Other liability	(5,369	)
Deferred underwriting fee	(13,422	)
Taxes payable	(1,063	)
Fair value of identifiable net assets of MBSC	(43,583	)
Total listing expense	106,542

All values are in US Dollars.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 7 |

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RESULTS OF OPERATIONS

Production

The Company’s net average bitumen production was 17,335 bbls/d and 17,639 bbls/d for the three and twelve months ended December 31, 2023, respectively, both lower than 19,579 bbls/d and 20,503 bbls/d from the same respective periods in 2022.

●	At<br>the Expansion Asset, net average bitumen production was 14,079 bbls/d during the fourth quarter of 2023, lower than the 15,710 bbls/d<br>during the fourth quarter of 2022, mainly due to a combination of lower reservoir pressure resulting from short-term limitations of NCG<br>availability for co-injection from the Company’s natural gas provider during 2023, as well as planned well reductions and well<br>shut-ins to facilitate the Refill wells drilling program. Full year 2023 net average bitumen production was 13,829 bbls/d, lower than<br>the 16,802 bbls/d in the same period in 2022, reflecting a combination of lower reservoir pressure resulting from short-term limitations<br>of NCG availability for co-injection from the Company’s natural gas provider during 2023, unplanned field downtime due to consecutive<br>external power grid outage, and the unplanned well shut-ins noted in the fourth quarter of 2023.
●	At<br>the Demo Asset, net average bitumen production of 3,256 bbls/d for the fourth quarter of 2023 was lower than 3,869 bbls/d from the same<br>period in 2022 due to the temporary shut-in of the disposal well, while full year net average bitumen production was 3,810 bbls/d and<br>was slightly higher than 3,701 bbls/d from the full year in 2022, mainly due to the continued optimization of water disposal wells that<br>debottlenecked water handling capabilities for the first three quarters of 2023, partially offset by the temporary shut-in of the disposal<br>well in the fourth quarter of 2023. Subject to regulatory approval to recommence disposal operations, management anticipates net average<br>bitumen production at the Demo Asset will increase by approximately 1,000 bbls/d.
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Bitumen Production and OilSales

	Three months ended<br> December 31,				Year ended<br> December 31,
(Average barrels per day, unless otherwise noted)	2023		2022		2023		2022		2021^(1)^
Bitumen Production – Expansion Asset		14,079		15,710		13,829		16,802		5,352
Bitumen Production – Demo Asset		3,256		3,869		3,810		3,701		2,657
Total Bitumen Production		17,335		19,579		17,639		20,503		8,009
Total Diluted Bitumen Sales		23,736		25,026		24,052		24,985		7,677
Total Non-diluted Bitumen Sales		1,010		2,193		1,006		3,277		2,639
Total Sales Volumes		24,746		27,219		25,058		28,264		10,316
^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
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Commodity Prices

The prices received for Greenfire’s crude oil production directly impact earnings, cash flow and financial position.

Benchmark Commodity Pricing

						Year ended<br> December 31,
Benchmark Pricing			2022			2023			2022			2021
Crude oil (US/bbl)
WTI(1)	78.32			82.65			77.62			94.23			67.91
WCS differential to WTI	(21.89	)		(25.89	)		(18.71	)		(18.27	)		(13.04	)
WCS(2)	56.43			56.76			58.91			75.96			54.87
Edmonton Condensate (C5+)	76.78			83.46			76.79			93.86			68.44
Natural gas (/GJ)
AECO 5A	2.18			4.85			2.50			5.04			3.44
Electricity (/MWh)
Alberta power pool	81.73			213.64			133.55			161.88			102.37
Foreign exchange rate(3)
US:CAD	1.3618			1.3577			1.3495			1.3016			1.2536

All values are in US Dollars.

^(1)^	As per NYMEX oil futures contract
^(2)^	Reflects heavy oil prices at Hardisty, Alberta
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^(3)^	Annual or quarterly average exchange rates as per the Bank of<br>Canada.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 8 |

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WCS

Revenue from Greenfire’s bitumen production is closely linked to WCS, the pricing benchmark for Canadian heavy oil at Hardisty, Alberta. WCS trades at a discount to WTI known as the WCS differential, which fluctuates based on heavy oil production, inventory levels, infrastructure egress capacity, and refinery demand in Canada and the United States, among other factors.

Condensate

To facilitate pipeline transportation of Greenfire’s produced bitumen, the Company uses condensate as diluent for blending at the Expansion Asset, which is from Edmonton and delivered via the Inter Pipeline Polaris Pipeline. The price of condensate is historically within approximately 5% of the price of WTI and is typically higher in winter months owing to increased diluent requirements in colder temperatures relative to warmer summer months.

Oil Sales

Greenfire’s oil sales include blended bitumen sales from the Expansion Asset and diluted non-diluted bitumen sales from the Demo Asset. At the Demo Asset volumes can be transported to multiple potential sales locations, including both pipeline and rail sales points, depending on the economics of each option at the time of sale. During mid-October 2022, the Company commissioned a bitumen truck off-loading facility (“Truck Rack”) at the Expansion Asset that can receive up to approximately 5,000 bbls/d of bitumen production (non-diluted bitumen) from the Demo Asset that is blended with the Expansion Asset production and sold via pipeline.

The Company recorded oil sales of $161.7 million in the fourth quarter of 2023, compared to $180.7 million during the same period in 2022 reflecting lower production volumes in 2023. Full year 2023 oil sales totaled $676.0 million, lower than $998.8 million in 2022 as a result of lower realized WCS benchmark oil prices and lower production volumes.

Oil Sales

				Year ended<br> December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
Oil Sales	161,730		180,741		675,970		998,849		270,674
- (/bbl)	71.04		72.18		73.91		96.82		71.89

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

Royalties

Royalties paid by the Company are crown royalties to the Province of Alberta. Alberta oil sands royalty projects are based on government prescribed pre and post payout^(1)^ royalty rates, which are determined on a sliding scale using the Canadian dollar equivalent WTI benchmark price.

Royalties for a pre-payout project are based on a monthly calculation that applies a royalty rate (ranging from one percent to nine percent, based on the Canadian dollar equivalent WTI benchmark price) to the gross revenues from the project. Gross revenues are a function of sales revenues less diluent costs and transportation costs. The Expansion Asset is a pre-payout project.

Royalties for a post-payout project are based on an annualized calculation that uses the greater of: (1) the gross revenues multiplied by the applicable royalty rate (one percent to nine percent, based on the Canadian dollar equivalent WTI benchmark price); or (2) the net revenues of the project multiplied by the applicable royalty rate (25 percent to 40 percent, based on the Canadian dollar equivalent WTI benchmark price). Net revenues are a function of sales revenues less diluent costs, transportation costs, and allowable operating and capital costs. While the Demo Asset is a post-payout project, due to the carry forward of previous years costs, it is currently assessed under scenario (1) discussed above. The Company’s Demo Asset may become assessable under scenario (2) in 2024, depending on actual production performance, oil prices and costs.

Fourth quarter 2023 royalties of $3.79/bbl were lower than $4.17/bbl for the same period in 2022, while full year 2023 royalties were $3.67/bbl compared to $6.67/bbl in 2022, all attributable to lower WTI benchmark oil prices.

^(1)^	The payout status will either be pre-payout (when cumulative<br>costs exceed cumulative revenues) or post-payout (once cumulative revenues first equal or exceed cumulative costs).

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 9 |

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Royalties

				Year ended<br> December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
Royalties	6,024		7,477		23,706		50,064		9,543
- (/bbl)	3.79		4.17		3.67		6.67		3.30

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

Risk Management Contracts

The Company is exposed to commodity price risk on its oil sales and energy operating costs due to fluctuations in market prices. The Company executes a risk management program that is primarily designed to reduce the volatility of revenue and cash flow and ensure sufficient cash flows to service debt obligations and fund the Company’s operations. The Company’s risk management liabilities may consist of hedging instruments such as fixed price swaps and option structures, including costless collars on WTI, WCS differentials, condensate differential, natural gas and electricity swaps. The Company does not use financial derivatives for speculative purposes.

As at December 31, 2023, the Company’s obligations under the indenture governing the 2028 Notes (as outlined in the “Capital Resources and Liquidity – Long Term Debt” section of this MD&A), includes a requirement to maintain twelve consecutive months of commodity hedges on WTI for not less than 50% of the hydrocarbon output under the proved developed producing reserves forecast in the most recent reserves report, as determined by a qualified and independent reserves evaluator. The hedging obligation is in place until the aggregate principal amount of the 2028 Notes outstanding is at or below US$100.0 million, at which point, the Company will no longer be required to enter into subsequent commodity hedges. In the event that WTI is equal or less than US$55/bbl for such month being hedged, the Company is not required to hedge for that month.

The Company’s commodity price risk management program does not involve margin accounts that require posting of margin, including in scenarios of increased volatility in underlying commodity prices. Financial risk management contracts are measured at fair value, with gains and losses on re-measurement included in the consolidated statements of comprehensive income (loss) in the period in which they arise.

Financial contracts

The Company’s financial risk management contracts are subject to master netting agreements that create the legal right to settle the instruments on a net basis. The fair value of the risk management contracts resulted in a net current liability of $0.4 million at December 31, 2023.

The following table summarizes the gross asset and liability positions of the Company’s individual risk management contracts that are offset in the consolidated balance sheets:

Financial Management Contracts

	As at December 31,					As at December 31,
	2023					2022
($ thousands)	Asset		Liability			Asset			Liability
Gross amount		-		(417	)		21,375			(48,379	)
Amount offset		-		-			(21,375	)		21,375
Risk management contracts		-		(417	)		-			(27,004	)

Financial contracts settled in the period result in realized gains or losses based on the market price compared to the contract price and the notional volume outstanding. Changes in the fair value of unsettled financial contracts are reported as unrealized gains or losses in the period as the forward markets for commodities fluctuate and as new contracts are executed.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 10 |

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Outstanding Financial RiskManagement Contracts at December 31, 2023

	WTI – Costless Collar				Natural Gas – Fixed<br> <br>Price Swaps
Term	Volume<br> <br>(bbls)		Put Strike Price (US/bbl)	Call Strike Price (US/bbl)	Volume (GJs)		Swap Price (CAD/GL)
Q1 2024		877,968				455,000
Q2 2024		877,968				-
Q3 2024		887,800				-
Q4 2024		887,800				-

All values are in US Dollars.

Subsequent to December 31, 2023, the Company implemented the 2024 Hedging Program for WTI, including the replacement of previous WTI costless collar contracts with 11,500 bbls/d of WTI fixed price swaps for 2024.

Financial Risk ManagementContracts subsequent to December 31, 2023

	WTI – Fixed Price Swaps			WTI – Costless Collar
Term	Volume(bbls)		Swap Price (US/bbl)	Volume<br> (bbls)		Put Strike Price (US/bbl)	Call Strike Price (US/bbl)
Q1 2024		1,046,500			-
Q2 2024		1,046,500			-
Q3 2024		1,058,000			-
Q4 2024		1,058,000			-
Q1 2025		-			640,700

All values are in US Dollars.

Realized and Unrealized Risk Management Contracts

In the three and twelve months ended December 31, 2023, the Company recorded total risk management contract gains of $14.8 million and $16.4 million, respectively, compared to total risk management contract gains of $2.2 million and losses of $121.5 million for the same respective periods in 2022.

Fourth Quarter 2023

●	$3.2<br>million realized risk management contracts loss ($6.2 million realized gain in the same period of 2022) as market prices for WTI settled<br>at levels above the Company’s risk management contracts during the quarter.
●	$18.0<br>million unrealized gain on risk management contracts ($4.0 million unrealized loss in the same period of 2022) was primarily a result<br>of the market prices for WTI settling at levels below those set at the end of the third quarter of 2023.
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Year Ended December 31, 2023

●	$10.2<br>million of realized risk management contracts loss ($122.4 million realized loss in the same period of 2022), primarily a result of the<br>market prices for WTI settling at levels above the Company’s risk management contracts outstanding during 2023, partially offset<br>by gains due to the widening of WCS differentials.
●	$26.6<br>million of unrealized gain on risk management contracts ($0.9 million unrealized gain in the same period of 2022), primarily a result<br>of the market prices for WTI settling at levels within the Company’s outstanding risk management contracts, in addition to the<br>settlement of the risk management contracts realized during the first twelve months of 2023.
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Realized and UnrealizedGain (Loss) on Commodity Price Risk Management Contracts

	Three months ended<br> December 31,						Year ended<br> December 31,
($ thousands)	2023			2022			2023			2022			2021^(1)^
Realized gain (loss)		(3,225	)		6,243			(10,182	)		(122,408	)		(3,614	)
Unrealized gain (loss)		18,035			(4,019	)		26,587			930			(35,677	)
Risk management contracts gains (losses)		14,810			2,224			16,405			(121,478	)		(39,291	)
^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 11 |

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Diluent Expense

In order to facilitate pipeline transportation of bitumen, the Company uses condensate as diluent for blending at the Expansion Asset and for trucked volumes from the Demo Asset that are delivered to the Truck Rack that is located at the Expansion Asset. Greenfire’s diluent expense includes the cost of diluent plus the pipeline transportation for the diluent from Edmonton to the Expansion Asset via the Inter Pipeline Polaris Pipeline.

The Company’s diluent expense in the fourth quarter of 2023 was $17.65/bbl, lower than $19.34/bbl in the comparative period of 2022 and for the full year 2023 was $16.39/bbl, higher than $12.83/bbl in the full year 2022. The factors driving the lower diluent pricing are discussed in the “Results of Operations – Commodity Prices” section of this MD&A.

Diluent Expense

				Year ended<br> December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
Diluent expense	76,768		85,946		304,740		368,015		94,623
- (/bbl)	17.65		19.34		16.39		12.83		10.92

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

Transportation and Marketing Expense

Transportation expense at the Expansion Asset includes the costs to move production from the facility to the sales point in Edmonton, Alberta, via the Enbridge Lateral Pipeline and Enbridge Waupisoo Pipeline. At the Demo Asset, transportation expenses relate to the trucking of bitumen from the facility to various pipeline and rail sales points, including to the Truck Rack at the Expansion Asset.

Greenfire has entered into exclusive marketing contracts with a large reputable international energy marketing company (the “Sole Petroleum Marketer”). The exclusive marketing services at the Expansion Asset expire in October 2028 and include the purchase of all blended bitumen produced, the supply of all diluent and the facilitation of all pipeline transportation and storage costs. The exclusive marketing services at the Demo Asset expire in April 2026 and include the purchase of all bitumen produced, and the facilitation of all bitumen transportation. In addition to the marketing fees, production at the Demo Asset is further subject to additional costs associated with the marketing contract that include royalty incentive and performance fees.

Transportation and marketing expense was $8.34/bbl and $8.63/bbl in the fourth quarter and year ended December 31, 2023, respectively, lower than $9.23/bbl and $9.03/bbl for the same respective periods in 2022, primarily due to lower oil transportation costs at the Demo Asset from utilizing the Truck Rack.

Transportation and Marketing Expenses

				Year ended<br> December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(2)^
Marketing fees(1)	2,419		2,866		10,934		12,441		2,884
Oil transportation expense	10,858		13,698		44,739		55,401		21,173
Transportation and marketing	13,277		16,566		55,673		67,842		24,057
Marketing fees(1) (/bbl)	1.52		1.60		1.69		1.66		1.00
Oil transportation expense (/bbl)	6.82		7.64		6.93		7.38		7.33
Transportation and marketing (/bbl)	8.34		9.24		8.62		9.04		8.33

All values are in US Dollars.

^(1)^	Marketing fees include marketing fees paid to the Sole Petroleum<br>Marketer and terminal fees.
^(2)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 12 |

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Operating Expenses

Operating expenses include energy operating expenses and non-energy operating expenses.

●	Energy<br>operating expenses reflect the cost of natural gas to generate steam and to support reservoir pressure through NCG co-injection to enhance<br>oil production and recovery as well as electricity to operate the Company’s facilities.
●	Non-energy<br>operating expenses relate to production-related operating activities, including staff, contractors and associated travel and camp costs,<br>chemicals and treating, insurance, equipment rentals, maintenance and site administration, among other costs.
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The Company’s energy operating expenses for the three months and year ended December 31, 2023 were $7.68/bbl and $8.77/bbl, respectively, which was lower than the comparative periods in 2022 of $12.32/bbl and $11.35/bbl, respectively. The lower per barrel energy operating expenses in 2023, were primarily related to lower natural gas and electricity prices partially offset by lower sales volumes.

Non-energy operating expenses for the fourth quarter and full year 2023 were $14.37/bbl and $14.31/bbl, higher than the comparative periods in 2022 of $11.33/bbl and $10.06/bbl. The higher per barrel non-energy operating expenses in 2023 was primarily the result of the recognition of higher greenhouse gas emission fees, the planned minor turnaround being expensed, and inflationary pressures on the costs of goods and services combined with lower sales volumes for the three months ended December 31, 2023.

Operating Expenses

				Year ended<br> December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
Operating expenses – energy	12,223		22,100		56,624		85,232		28,673
Operating expenses –non-energy	22,861		20,329		92,341		75,594		31,037
Operating expenses	35,084		42,429		148,965		160,826		59,710
Operating expenses – energy (/bbl)	7.68		12.32		8.77		11.35		9.93
Operating expenses – non-energy (/bbl)	14.37		11.33		14.31		10.06		10.75
Operating expenses (/bbl)	22.05		23.65		23.08		21.41		20.68

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

Operating Netback^(1)^

Oil sales is a GAAP measure that is the most directly comparable measure to operating netback^(1)^, which is a non-GAAP measure.

During the three months and year ended December 31, 2023, the Company had oil sales of $161.7 million and $676.0 million, respectively, compared to oil sales of $180.7 million and $998.8 million, during the comparative periods in 2022.

Operating netback^(1)^ for the three and twelve months ended December 31, 2023 was $17.19/bbl and $20.56/bbl, respectively, lower than the same respective periods in 2022 which were $19.27/bbl and $30.58/bbl. The lower per barrel operating netback^(2)^ in the fourth quarter of 2023, compared to the same period in 2022 was primarily due to increased realized loss on risk management contracts and higher non-energy operating costs per barrel due to lower oil sales volumes, partially offset by lower natural gas and power prices. The lower per barrel operating netback^(1)^ in year ended 2023 was mainly due to lower realized WCS benchmark oil prices and higher non-energy operating costs per barrel due to lower oil sales volumes, partially offset by lower realized risk management contract losses, lower gas and power prices and lower royalties, relative to the same period in 2022.

^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
^(2)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
---	---

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 13 |

| --- | --- |

![](ex99-2_004.jpg)

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Operating Netback^(1)^

						Year ended<br> <br>December 31,
( thousands, unless otherwise noted)			2022			2023			2022			2021^(2)^
Oil sales	161,730			180,741			675,970			998,849			270,674
Diluent expense	(76,768	)		(85,946	)		(304,740	)		(368,015	)		(94,623	)
Transportation and marketing	(13,277	)		(16,566	)		(55,673	)		(67,842	)		(24,057	)
Royalties	(6,024	)		(7,477	)		(23,706	)		(50,064	)		(9,543	)
Operating expense – energy	(12,223	)		(22,100	)		(56,624	)		(85,232	)		(28,674	)
Operating expense – non-energy	(22,862	)		(20,329	)		(92,342	)		(75,594	)		(31,037	)
Operating netback(1), excluding realized gain (loss) risk management contracts	30,576			28,324			142,885			352,102			82,741
Realized gain (loss) risk management contracts	(3,225	)		6,243			(10,182	)		(122,408	)		(3,614	)
Operating netback(1)	27,351			34,567			132,703			229,694			79,127
Oil sales (/bbl)	71.04			72.18			73.91			96.82			71.89
Diluent expense (/bbl)	(17.65	)		(19.34	)		(16.39	)		(12.83	)		(10.92	)
Transportation and marketing (/bbl)	(8.34	)		(9.23	)		(8.63	)		(9.03	)		(8.33	)
Royalties (/bbl)	(3.79	)		(4.17	)		(3.67	)		(6.67	)		(3.30	)
Operating expense – energy (/bbl)	(7.68	)		(12.32	)		(8.77	)		(11.35	)		(9.93	)
Operating expense – non-energy (/bbl)	(14.37	)		(11.33	)		(14.31	)		(10.06	)		(10.75	)
Operating netback(1), excluding realized gain (loss) risk management contracts (/bbl)	19.21			15.79			22.14			46.88			28.65
Realized gain (loss) risk management contracts (/bbl)	(2.03	)		3.48			(1.58	)		(16.30	)		(1.25	)
Operating netback (/bbl)(1)	17.19			19.27			20.56			30.58			27.40

All values are in US Dollars.

^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
^(2)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
---	---

General & Administrative Expenses

General and administrative (“G&A”) expenses include head office and corporate costs such as salaries and employee benefits, office rent, independent third-party audit and engineering services, and administrative recoveries earned for operating exploration and development activities on behalf of the Company’s working interest partners, among other costs. G&A expenses primarily fluctuates with head office staffing levels and the level of operated exploration and development activity during the period. G&A may also include expenses related to corporate strategic initiatives, if any.

G&A expenses for the three months and year ended December 31, 2023, were $2.14/bbl and $1.79/bbl, respectively, which was higher than the comparative periods in 2022 of $1.60/bbl and $1.31/bbl, respectively. The increase in G&A expenses per barrel was primarily due to the listing of the Common Shares on the NYSE and related public company expenditures, among other items. The increase in G&A expenses per barrel was also due to lower sales volumes for the three months and year ended December 31, 2023 compared to the same period in 2022.

General & Administrative Expenses

				Year ended<br> <br>December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
General and administrative expenses	3,401		2,874		11,536		9,836		3.285
- (/bbl)	2.14		1.60		1.79		1.31		1.14

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 14 |

| --- | --- |

![](ex99-2_004.jpg)

Stock-based Compensation

On September 20, 2023, with the closing of the De-Spac Transaction, all outstanding Performance Warrants vested and became exercisable. As a result, the remaining unrecognized fair market value of the Performance Warrants was immediately recorded as stock-based compensation during the third quarter of 2023. The Performance Warrants expire 10 years following their original issuance date as GRI performance warrants prior to the closing of the De-Spac Transaction.

The Company recorded stock-based compensation of nil and $9.8 million during the three months and year ended December 31, 2023, respectively, compared to $1.2 million for both of the respective periods during 2022.

Stock-based Compensation

				Year ended December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
Stock-based compensation	-		1,183		9,808		1,183		-
- (/bbl)	-		0.66		1.52		0.16		-

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

Interest and Finance Expenses

Interest and finance expenses include coupon interest, amortization of debt issue costs and debt underwriter fees, issuer discount, redemption premiums on long term debt, interest on revolving credit facility, letter of credit facilities and other interest charges. Coupon interest and required redemption premiums related to long term debt are accrued and paid according to the indenture that governs the 2028 Notes.

Interest and finance expenses for the three and twelve months ended December 31, 2023 were $16.4 million and $110.2 million, respectively, higher than the comparative periods in 2022 of $10.8 million and $77.1 million, mainly due to higher interest incurred on the 2028 Notes. The total interest and finance expense in 2023 of $108.3 million was comprised of $42.1 million of unamortized debt related costs and $19.2 million from the early debt redemption premium (the “Debt Redemption Premium”) on the redemption of our previously issued senior secured notes due in 2025 (the “2025 Notes”).

Refer to the “Capital Resources and Liquidity” section in this MD&A for more details of Greenfire’s long-term debt, revolving credit facility and letter of credit facilities.

Interest and Finance Expenses

****	Three months ended December 31,				Year ended December 31,
($ thousands)	2023		2022		2023		2022		2021^(1)^
Accretion on long-term debt	$	14,056	$	10,002	$	106,435	$	74,176	$	22,186
Other interest		2,078		591		2,873		2,155		1,926
Accretion of decommissioning obligations		236		200		906		743		298
Total interest and finance expenses	$	16,370	$	10,794	$	110,214	$	77,074	$	25,050
^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
---	---

Depletion and Depreciation

The Company depletes crude oil properties on a unit-of-production basis over estimated total recoverable proved plus probable (2P) reserves. The depletion base consists of the historical net book value of capitalized costs, plus the estimated future costs required to develop the Company’s estimated recoverable proved plus probable reserves. The depletion base excludes exploration and the cost of assets that are not yet available for use.

The unit-of-production rate accounts for expenditures incurred to date, together with estimated future development expenditures required to develop those proved reserves. This rate, calculated at a facility level, is then applied to sales volume to determine depletion each period. The Company believes that this method of calculating depletion charges each barrel of crude oil equivalent sold with its proportionate share of the cost of capital invested over the total estimated life of the related asset as represented by 2P reserves.

The Company’s depletion and depreciation expense for the three months and year ended December 31, 2023 were $10.23/bbl and $10.54/bbl, respectively, which was higher than the comparative periods in 2022 of $9.87/bbl and $9.06/bbl, respectively. The higher per barrel depletion and depreciation expense in 2023, was primarily due to an increase in estimated future development costs as represented by 2P reserves in the Company’s most recent reserve report, relative to the prior reserve report.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 15 |

| --- | --- |

![](ex99-2_004.jpg)

Depletion and Depreciation Expense

				Year ended December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
Depletion and depreciation expense	16,273		17,702		68,054		68,027		27,071
- (/bbl)	10.23		9.87		10.54		9.06		9.38

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

Exploration Expenses

The Company’s exploration expenses primarily consist of escalating mineral lease rentals on the undeveloped lands.

In the three months and year ended December 31, 2023, exploration expenses were $0.5 million and $3.8 million, compared to $0.3 million and $1.8 million for the same respective periods in 2022. The increase in 2023 was primarily due to a one-time regulatory expense associated with the implementation of the Oil Sands Tenure Regulation^(1)^.

Exploration Expenses

****	Three months ended December 31,				Year ended December 31,
($ thousands, unless otherwise noted)	2023		2022		2023		2022		2021^(1)^
Exploration expenses		517		347		3,852		1,825		350
^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
---	---

Other (Income) and Expense

Other (income) and expense in the fourth quarter of 2023 reflected income of $1.3 million, compared to income of $1.4 million for the comparative period in 2022. Other (income) and expenses during each of the respective periods are mainly comprised of interest earnings from savings accounts and short-term investments.

In the year ended December 31, 2023, other (income) and expense was income of $2.9 million, compared to income of $0.2 million in 2022, with the difference primarily attributable to higher interest earnings from savings accounts during 2023, compared to 2022, partially offset by expenses related to the JACOS acquisition, among other items.

Other (Income) and Expense

	Three months ended<br> December 31,						Year ended <br> December 31,
($ thousands, unless otherwise noted)	2023			2022			2023			2022			2021^(1)^
Other (income) and expenses		(1,313	)		(1,367	)		(2,905	)		(206	)		8,373
^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
---	---

Foreign Exchange Loss (Gain)

The Company’s foreign exchange loss (gain) is driven by fluctuations in the US dollar to Canadian dollar exchange rate, as it relates to its long-term debt that is denominated in US dollars and is primarily related to the note principal and interest components of the Company’s US dollar denominated debt.

In the three months and year ended December 31, 2023, Greenfire recorded a foreign exchange gain of $8.1 million and $8.7 million, respectively, compared to a gain of $2.9 million and a loss of $26.1 million for the comparative periods in 2022. The foreign exchange gain during the fourth quarter of 2023 and full year 2023 were mainly due to the Canadian dollar strengthening relative to the US dollar.

^(1)^	This regulation, made under the Mines and Minerals Act, is<br>the primary regulation that deals with tenure of oil sands agreements in Alberta. The regulation provides for the issuance and continuation<br>of primary oil sands leases, and the payment of escalating rental when a continued lease does not meet a minimum level of production.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 16 |

| --- | --- |

![](ex99-2_004.jpg)

Foreign Exchange Loss (Gain)

	Three months ended<br> December 31,						Year ended <br> December 31,
($ thousands, unless otherwise noted)	2023			2022			2023			2022		2021^(1)^
Realized foreign exchange loss (gain)		-			3,675			19,914			5,188		-
Unrealized foreign exchange loss (gain)		(8,072	)		(6,561	)		(28,638	)		20,911		1,512
Foreign exchange loss (gain)		(8,072	)		(2,886	)		(8,724	)		26,099		1,512
^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
---	---

Transaction Costs

On September 20, 2023, the Company completed the De-Spac Transaction with MBSC.

The Company expensed $3.8 million and $12.2 million in transaction costs during the three months and year ended December 31, 2023 respectively, compared to $2.8 million for each of the respective comparative periods during 2022. Refer to the “De-Spac Transaction” section in this MD&A for more information.

Transaction Costs

				Year ended <br> December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
Transaction costs	3,848		2,769		12,172		2,769		10,318
- (/bbl)	10.55		1.54		1.89		0.37		3.57

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

Gain on Revaluation of Warrants

On September 20, 2023, and in connection with the De-Spac Transaction, the Company issued 5,000,000 Warrants to former GRI common shareholders, GRI bond warrant holders and GRI performance warrant holders and issued 2,526,667 Warrants to former holders of MBSC’s private placement warrants. The 7,526,667 outstanding Warrants expire 5 years after issuance and entitle the holder of each Warrant to purchase one Common Share at a price of US$11.50. If permitted by Greenfire, the Warrants can be exercised on a cashless basis. The Warrants are to be treated as a derivative financial liability in accordance with IFRS 9 – Financial Instruments and were measured at fair value in accordance with IFRS 13 – Fair Value Measurement. The Warrants will be reassessed at the end of each reporting period with subsequent changes in fair value being recognized through the statement of comprehensive income (loss).

During the three months and year ended December 31, 2023, the Company incurred $2.7 million and $35.0 million in gains on revaluation of warrants, respectively, compared to nil for the comparative periods in 2022. The gains relate to a decrease of the warrant liability due to a reduction to the closing share price from the close of the De-Spac Transaction to December 31, 2023.

Gain on Revaluation of Warrants

	Three months ended<br> December 31,					Year ended <br> December 31,
($ thousands, unless otherwise noted)	2023			2022		2023			2022		2021^(1)^
Gain on revaluation of warrants		(2,697	)		-		(34,973	)		-		-
^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
---	---

Taxes

At December 31, 2023, the Company recognized a deferred tax asset of $68.3 million (December 31, 2022 – $87.7 million). As a result of improved commodity prices, the deferred tax asset has been recognized to the extent that it is probable that future taxable income will be available against which the temporary difference can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 17 |

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![](ex99-2_004.jpg)

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Income Tax Expense

($ thousands)	Year ended December 31, 2023		****	Year ended December 31, 2022		****	Year ended December 31, 2021^(1)^		****
Income (loss) before taxes	$	(116,285	)	$	44,017		$	661,444
Expected statutory income tax rate		23.00	%		23.00	%		23.00	%
Expected income tax expense (recovery)		(26,746	)		10,124			152,132
Gain on business combination		-			-			(159,609	)
Permanent differences		24,149			7,327			15,401
Unrecognized deferred income tax (asset) liability		21,983			(105,132	)		(7,924	)
Deferred income tax expense (recovery)	$	19,386		($	87,681	)	$	-
^(1)^	Certain accounts were consolidated into permanent differences<br>for presentation purposes.
---	---

The Company has approximately $1.8 billion in tax pools and loss carry forwards in the year ended December 31, 2023 (December 31, 2022 – $1.8 billion) including approximately $1.4 billion in non-capital losses available for immediate deduction against future income. The Company’s non-capital losses have an expiry profile between 2033 and 2043.

Canadian Tax Pools

****	Year ended December 31		Year ended December 31		Year ended December 31
($ millions)	2023		2022		2021
Undepreciated capital cost		329		321		297
Canadian oil and gas property expenditures		10		13		13
Canadian development expenditures		35		36		29
Canadian exploration expenditures		-		0.3		-
Federal income tax losses carried forward^(1) (2)^		1,377		1,402		1,569
Other^(3)^		90		19		-
Total Canadian federal tax pools		1,840		1,791		1,908
^(1)^	Federal income tax losses<br>carried forward expire in the following years 2033 - $4.3 million; 2034 - $58.7 million; 2035 - $30.0 million; 2037 - $36.2 million;<br>2038 - $8.3 million; 2039 - $1,232.8 million; 2042 - $2.9 million; 2043 - $3.6 million.
---	---
^(2)^	Provincial income tax losses<br>carry forward is $985.0 million which is lower than the federal income tax losses carried forward due to differences in historical claims<br>at the provincial level.
^(3)^	Other includes $27.6 million<br>in capital losses that have been recognized at the full amount as at December 31, 2023.

Net Income (loss) and comprehensiveincome (loss) and Adjusted EBITDA^(1)^

During the three months ended December 31, 2023, the Company recorded net loss of $4.7 million, compared to net income of $88.0 million, during the same period in 2022. The $92.7 million reduction to net income (loss) and comprehensive income (loss) in 2023 was primarily due to the recognition of a deferred tax asset expense of $25.9 million in 2023, compared to a deferred tax asset recovery of $87.7 million during the fourth quarter of 2022, partially offset by a reduction to listing expense of $4.2 million during the fourth quarter of 2023. The decrease in net income was partially offset by $14.8 million in risk management contract gains in the current quarter, compared to $2.2 million in risk management contract losses in the prior year period, amongst other items.

During the year ended December 31, 2023, the Company recorded a net loss of $135.7 million, compared to net income of $131.7 million, respectively, during the comparative period in 2022. The $267.4 million reduction to net income (loss) and comprehensive income (loss) in 2023 was primarily due to one-time costs of $106.5 million of listing expenses related to the De-Spac Transaction, the recognition of a deferred tax asset expense of $19.4 million in 2023, compared to a deferred tax asset recovery of $87.7 million in 2022, as well as a $31.2 million increase in refinancing costs related to the redemption of the 2025 Notes. Additionally, the decrease was also due to $296.5 million in lower oil sales, net of royalties, partially offset by $16.4 million in risk management contract gains in the current year, compared to $121.5 million in risk management contract losses, as well as $63.3 million in higher diluent expense in the prior year, amongst other items.

Net income (loss) and comprehensive income (loss) is a GAAP measure, which is the most directly comparable measure to adjusted EBITDA^(1)^, which is a non-GAAP measure.

^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 18 |

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![](ex99-2_004.jpg)

Adjusted EBITDA^(1)^ was $23.4 million in the fourth quarter of 2023, compared to $32.5 million in the same period in 2022, with the year over year decrease primarily due to lower oil sales volumes which more than offset the lower diluent expenses and the recognition of $6.2 million of realized risk management contract gains in 2022, compared to $3.2 million of risk management contract losses during the same period in 2023.

Greenfire had Adjusted EBITDA^(1)^ of $117.3 million for the year ended December 31, 2023, compared to $218.0 million during 2022, with the decrease primarily due to lower oil sales volumes and lower realized WCS benchmark oil prices which more than offset the lower diluent expenses. Further, the Company recognized $122.4 million of realized risk management contract losses in 2022, compared to $10.2 million in losses during the same period in 2023.

The following table is a reconciliation of net income (loss) net income (loss) and comprehensive income (loss) to adjusted EBITDA^(1)^.

Adjusted EBITDA^(1)^

						Year ended<br> <br>December 31,
( thousands)			2022			2023			2022			2021^(2)^
Net income (loss)	(4,659	)		87,995			(135,671	)		131,698			661,444
Add (deduct):
Income tax expense (recovery)	25,881			(87,681	)		19,386			(87,681	)		-
Unrealized (gain) loss risk management contracts	(18,035	)		4,019			(26,587	)		(930	)		35,677
Stock-based compensation	-			1,183			9,808			1,183			-
Financing and interest	16,370			10,794			110,214			77,074			25,050
Depletion and depreciation	16,273			17,702			68,054			68,027			27,071
Transaction costs	3,848			2,769			12,172			2,769			10,318
Listing expense	(4,162	)		-			106,542			-			-
Gain on revaluation of warrants	(2,697	)		-			(34,973	)		-			-
Gain on acquisitions	-			-			-			-			(693,953	)
Foreign exchange loss (gain)	(8,072	)		(2,886	)		(8,724	)		26,099			1,512
Other (income) and expenses	(1,313	)		(1,367	)		(2,905	)		(206	)		8,373
Adjusted EBITDA(1)	23,434			32,528			117,316			218,033			75,492
Net income (loss) (/bbl)	(2.93	)		49.05			(21.02	)		17.53			229.07
Add (deduct):
Income tax recovery (expense) (/bbl)	16.26			(48.87	)		3.00			(11.67	)		-
Unrealized (gain) loss risk management contracts (/bbl)	(11.33	)		2.24			(4.12	)		(0.12	)		12.36
Stock based compensation (/bbl)	-			0.66			1.52			0.16			-
Financing and interest (/bbl)	10.29			6.02			17.08			10.26			8.68
Depletion and depreciation (/bbl)	10.23			9.87			10.54			9.06			9.38
Transaction costs (/bbl)	2.42			1.54			1.89			0.37			3.57
Listing expense (/bbl)	(2.62	)		-			16.51			-			-
Gain on revaluation of warrants (/bbl)	(1.69	)		-			(5.42	)		-			-
Gain on acquisitions (/bbl)	-			-			-			-			(240.33	)
Foreign exchange loss (gain) (/bbl)	(5.07	)		(1.61	)		(1.35	)		3.47			0.52
Other (income) and expenses (/bbl)	(0.83	)		(0.76	)		(0.45	)		(0.03	)		2.90
Adjusted EBITDA(1) (/bbl)	14.73			18.14			18.18			29.03			26.15

All values are in US Dollars.

^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
^(2)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 19 |

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![](ex99-2_004.jpg)

CAPITAL RESOURCES AND LIQUIDITY

The Company’s capital management objective is to maintain financial flexibility and sufficient liquidity to execute on planned capital programs, while meeting short and long-term commitments, including servicing and repaying long term debt. The Company strives to actively manage its capital structure in response to changes in economic conditions and further deleverage its balance sheet.

At December 31, 2023, the Company’s capital structure primarily comprised of cash and cash equivalents, restricted cash, long-term debt and shareholders’ equity.

Management believes its current capital resources and its ability to manage cash flow and working capital levels will allow the Company to meet its current and future obligations, to make scheduled interest and principal payments, and to fund the other needs of the business.

Long Term Debt

On August 12, 2021, GRI issued US$312.5 million of 2025 Notes. The 2025 Notes were senior secured notes that had an original issue discount of 3.5%, bore interest at the fixed rate of 12.00% per annum, payable semi-annually, and had a maturity date of August 15, 2025.

On September 20, 2023 in conjunction with the closing of the De-Spac Transaction and the issuance of 2028 Notes as described below, GRI redeemed the outstanding balance of $294.6 million (US$217.9 million) on the 2025 Notes at a redemption premium of 106.5%, plus accrued interest of $3.4 million. The total Debt Redemption Premium paid as a result of the early redemption was $19.2 million (US$14.2 million) plus accrued interest of $3.4 million (US$2.5 million). Unamortized debt costs of $42.1 million were also expensed in conjunction with the extinguishment of the debt.

On September 20, 2023, the Company issued US$300.0 million of 2028 Notes. The 2028 Notes are senior secured notes that bear interest at the fixed rate of 12.00% per annum, payable semi-annually on April 1 and October 1 of each year, commencing on April 1, 2024 and mature on October 1, 2028. The 2028 Notes are secured by a lien on substantially all the assets of the Company and its wholly owned subsidiaries, junior in priority to the Senior Credit Facility. Subject to certain exceptions and qualifications, the indenture governing the 2028 Notes contains certain covenants that limit the Company’s ability to, among other things, incur additional indebtedness, pay dividends, redeem stock, make certain restricted payments, and dispose of and transfer assets. The indenture governing the 2028 Notes has a minimum hedging requirement of 50% of the forward 12 calendar month PDP forecasted production as prepared in accordance with the Canadian standards under National Instrument 51-101 – Standardsfor Disclosure for Oil and Gas Activities until principal debt under the 2028 Notes is less than US$100.0 million and limits capital expenditures to US$100.0 million annually until the principal outstanding is less than US$150.0 million.

Under the indenture governing the 2028 Notes, the Company is required to redeem the 2028 Notes at 105% of the principal amount plus accrued and unpaid interest with 75% of Excess Cash Flow (as defined in the indenture governing the 2028 Notes) in six-month periods, with the first period beginning on June 30, 2024. If Consolidated Indebtedness is less than US$150.0 million, the required redemption is reduced to 25% of Excess Cash Flow to be paid in every six-month period until the principal outstanding on the 2028 Notes is less than $100.0 million.

As at December 31, 2023, the carrying value of the Company’s long-term debt was $376.4 million^(1)^ and the fair value was $394.1 million (December 31, 2022 carrying value – $254.4 million, fair value – $315.7 million).

The Company is exposed to foreign exchange rate fluctuations on the principal value and interest payments in respect of the 2028 Notes. As of December 31, 2023, a 10% change to the value of the Canadian dollar relative to the US dollar would result in a foreign exchange gain (loss) of approximately $39.7 million (December 31, 2022 - $29.3 million, December 31, 2021 - $39.6 million).

Senior Credit Facility

On September 20, 2023, Greenfire also entered into the Senior Credit Facility which is a senior reserve-based credit facility comprised of an operating facility and a syndicated facility. Total credit available under the Senior Credit Facility is $50.0 million, comprising of a $20.0 million operating facility and a $30.0 million syndicated facility.

The Senior Credit Facility is a committed facility available on a revolving basis until September 20, 2024, at which point in time it may be extended at the lender’s option. If the revolving period is not extended, the undrawn portion of the facility will be cancelled and any amounts outstanding would be repayable at the end of the non-revolving term, being September 20, 2025. The Senior Credit Facility is subject to a semi-annual borrowing base review, occurring in May and November of each year, with the first review scheduled in May 2024. The borrowing base is determined based on the lender’s evaluation of the Company’s petroleum and natural gas reserves and their commodity price outlook at the time of each renewal.

^(1)^	The U.S. dollar denominated<br>debt was translated into Canadian dollars as at period end exchange rates.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 20 |

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The Senior Credit Facility is secured by a first priority security interest on substantially all the assets of the Company and is senior in priority to the 2028 Notes. The Senior Credit Facility contains certain covenants that limit the Company’s ability to, among other things, incur additional indebtedness, create or permit liens to exist, make certain restricted payments, and dispose of or transfer assets.

Amounts borrowed under the Senior Credit Facility bear interest at a floating rate based on the applicable Canadian prime rate, US base rate, secured overnight financing rate or bankers’ acceptance rate, plus a margin of 2.75% to 6.25% based on Debt to EBITDA ratio. A standby fee on the undrawn portion of the Senior Credit Facility ranges from 0.6875% to 1.5625% based on Debt to EBITDA ratio. As at December 31, 2023, the Company had nil amounts drawn under the Senior Credit Facility and the Company was in compliance with all covenants.

During the three months ended December 31, 2023, Greenfire entered into the EDC Facility which is an unsecured $55.0 million letter of credit facility with a Canadian bank that is supported by a performance security guarantee from Export Development Canada. The EDC Facility is available on a demand basis and letters of credit issued under this facility incur an issuance and performance guarantee fee of 4.25%. As at December 31, 2023, the Company had $54.3 million drawn under the EDC Facility and the Company was in compliance with all covenants.

Restricted Cash and Letter of CreditFacilities

As at December 31, 2023, the Company replaced the $46.8 million credit facility with the Sole Petroleum Marketer that was used to issue letters of credit related to the Company’s long-term pipeline transportation agreements with the new EDC Facility in November 2023, which resulted in the release of the $43.3 million of restricted cash.

Adjusted Working Capital^(1)^

Working capital (deficit) is a GAAP measure that is the most directly comparable measure to adjusted working capital^(1)^, which is a non-GAAP measure.

As at December 31, 2023, working capital increased to $33.5 million from a working capital deficit of $13.4 million as at December 31, 2022, a difference of $46.9 million, primarily due to an increase in cash and cash equivalents from the proceeds from the issuance of the 2028 Notes, as well as a decrease to the current liability portion of risk management contracts.

Adjusted working capital^(1)^ increased to $78.3 million at year-end 2023, from $76.9 million as at December 31, 2022, a difference of $1.4 million, primarily due to an increase in cash and cash equivalents from the proceeds from the issuance of the 2028 Notes, partially offset by the recognition of the fair value of the Warrants issued to former GRI common shareholders, GRI bond warrant holders and GRI performance warrants holders.

Refer to the “Capital Resources and Liquidity – Long Term Debt” section in this MD&A for more details of the Company’s long-term debt.

Adjusted Working Capital^(1)^

	Year ended			Year ended
	December 31,			December 31,
($ thousands)	2023			2022
Current assets		163,814			123,527
Current liabilities		(130,283	)		(136,921	)
Working capital (deficit)		33,531			(13,394	)
Current portion of risk management contracts		417			27,004
Current portion of long-term debt		44,321			63,250
Adjusted working capital^(1)^		78,269			76,860
^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
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^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 21 |

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Share Capital and Warrant Liability

The Company is authorized to issue an unlimited number of Common Shares. As of December 31, 2023, the Company had 68,642,515 Common Shares, 7,526,667 Warrants and 3,617,016 Performance Warrants issued and outstanding.

As of the date of this MD&A, the Company had 68,707,994 Common Shares, 7,526,667 Warrants and 3,480,417 Performance Warrants issued and outstanding. In addition, the Company had 10,213 deferred share units, 829,094 performance share units and 162,116 restricted share units issued and outstanding which were granted pursuant the Company’s amended and restated omnibus share incentive plan (the “Incentive Plan”) as at February 19, 2024. The Incentive Plan provides for the granting of deferred share units, performance share units, restricted share units and options and the aggregate maximum number of Common Shares reserved for issuance thereunder is limited to 10% of the Company’s issued and outstanding Common Shares, less any Common Shares underlying securities granted under any other share compensation arrangements of the Company, if any, including Common Shares issuable on exercise of Performance Warrants.

Cash Flow Summary

Cash Provided (used) by Operating Activities

Cash provided by operating activities in the fourth quarter of 2023 was $25.5 million compared to $17.3 million in the same period in 2022, with the increase primarily due to changes in non-cash working capital and lower diluent expense, partially offset by lower oil sales volumes during the fourth quarter of 2023.

For the year ended December 31, 2023, cash provided by operating activities was $86.5 million compared to $164.7 million in 2022, primarily due to lower realized WCS benchmark oil prices and lower production, partially offset by $10.2 million of realized risk management contract losses in 2023, compared to $122.4 million of realized risk management contract losses in 2022.

Based on current and forecasted production levels, operating expenses, capital expenditures, existing commodity price risk management contracts and current outlook for commodity prices, the Company expects cash from operating activities will be sufficient to cover its operational commitments and financial obligations under the indenture governing the 2028 Notes and the credit agreement governing the Senior Credit Facility in the next 12 months.

Cash Provided (used) by Financing Activities

Cash used by financing activities in the fourth quarter was $51.0 thousand compared to cash used by financing activities of $62.9 million in the same period in 2022, mainly from a debt principal repayment on the 2025 Notes during the fourth quarter of 2022. During the year ended December 31, 2023, cash provided by financing activities was $2.0 thousand as the issuance of the 2028 Notes offset the redemption of the 2025 Notes and the De-Spac Transaction, compared to cash used by financing activities of $123.6 million in the same period in 2022, mainly from debt principal repayments on the 2025 Notes during the year ended 2022.

Cash Provided (used) in Investing Activities

During the three months ended December 31, 2023, cash provided in investing activities was $18.8 million compared to cash used in investing activities of $17.3 million in the same period in 2022, with the difference in 2023 primarily due to the Company transferring $43.3 million in outstanding letters of credit from restricted cash to cash and cash equivalents as part of the EDC Facility. Additionally, the increase to cash provided (used) in investing activities during the fourth quarter of 2023 was partially offset by higher capital expenditures.

Cash used in investing activities during 2023 was $12.1 million compared to cash used in investing activities of $63.7 million in 2022, again attributable to the transfer of $43.3 million in outstanding letters of credit from restricted cash to cash and cash equivalents as part of the EDC Facility, along with lower capital expenditures during the year ended 2023.

Cash Flow Summary

	Three months ended<br> December 31,						Year ended <br> December 31,
($ thousands, unless otherwise noted)	2023			2022			2023			2022			2021^(1)^
Cash provided (used) by:
Operating activities		25,530			17,322			86,548			164,727			31,985
Financing activities		(51	)		(62,926	)		2			(123,638	)		365,606
Investing activities		18,782			(17,316	)		(12,103	)		(63,746	)		(336,528	)
Exchange rate impact on cash and cash equivalents held in foreign currency		(713	)		(1,539	)		(285	)		(2,849	)		(194	)
Change in cash and cash equivalents		43,548			(64,459	)		74,162			(25,506	)		60,869
^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 22 |

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Capital Expenditures

Total capital expenditures for the three and twelve months ended December 31, 2023 was $19.4 million (2022 - $12.4 million) and $33.4 million (2022 - $39.6 million). Greenfire spent $14.9 million and $22.8 million in the fourth quarter, and full year 2023 respectively, on the Refill wells for the drilling program at the Expansion Asset, as well as $4.5 million and $10.6 million spent on various facility projects at the Demo Asset and the Expansion Asset for the same respective periods.

Capital Expenditures

				Year ended <br> December 31,
( thousands, unless otherwise noted)		2022		2023		2022		2021^(1)^
Total capital expenditures	19,413		12,361		33,428		39,592		4,594
- /bbl	12.20		6.89		5.18		5.27		1.59

All values are in US Dollars.

^(1)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.

Adjusted FundsFlow^(1)^and Adjusted Free Cash Flow^(1)^

Cash provided (used) by operating activities is a GAAP measure that is the most directly comparable measure to adjusted funds flow^(1)^ and adjusted free cash flow^(1)^ which are non-GAAP measures.

During the three months and year ended December 31, 2023, the Company had cash provided by operating activities of $25.5 million and $86.5 million, respectively, compared to cash provided by operating activities of $17.3 million and $164.7 million, during the comparative periods in 2022.

Adjusted funds flow^(1)^ was $10.5 million, during the three months ended December 31, 2023, compared to $16.9 million, during the same period in 2022. The decrease in adjusted funds flow^(1)^ during the fourth quarter of 2023 was primarily the result of lower oil sales volumes, partially offset by lower diluent expense.

Adjusted funds flow^(1)^ was $73.2 million, during the year ended December 31, 2023, compared to $163.9 million, during the same period in 2022. The decrease in adjusted funds flow^(1)^ during the year ended December 31, 2023, was primarily the result of lower oil sales and lower realized WCS benchmark oil prices, which was partially offset by the Company recognizing $10.2 million of realized risk management contract losses in 2023, compared to $122.4 million in risk management contract losses during the same period in 2022.

During the three months ended December 31, 2023, Greenfire had negative adjusted free cash flow^(1)^ of $8.9 million compared to positive adjusted free cash flow^(1)^ of $4.5 million during the same period in 2022. The decrease in adjusted free cash flow^(1)^ during the fourth quarter of 2023 was primarily the result of lower sales volumes and higher capital expenditures, partially offset by lower diluent expense. Adjusted free cash flow^(1)^ during the year ended December 31, 2023 was $39.8 million compared to $124.3 million during the same period in 2022, with the decrease primarily due to lower oil sales and lower realized WCS benchmark oil prices, partially offset by the recognition of $10.2 million of realized risk management contract losses in 2023, compared to $122.4 million in risk management contract losses during the same period in 2022.

Adjusted Funds Flow^(1)^ and Adjusted Free Cash Flow^(1)^

	Three months ended<br> December 31,						Year ended <br> December 31,
($ thousands)	2023			2022			2023			2022			2021^(2)^
Cash provided (used) by operating activities		25,530			17,322			86,548			164,727			31,985
Transaction costs		3,848			2,769			12,172			2,769			10,318
Changes in non-cash working capital		(18,861	)		(3,189	)		(25,514	)		(3,570	)		6,910
Adjusted funds flow^(1)^		10,517			16,902			73,206			163,926			49,213
Capital expenditures		(19,413	)		(12,361	)		(33,428	)		(39,592	)		(4,594	)
Adjusted free cash flow^(1)^		(8,896	)		4,541			39,778			124,334			44,619
^(1)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” in this MD&A for further information.
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^(2)^	Results are from operations that began at the Expansion Asset<br>after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when it was acquired on April 5, 2021.
(1)	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” section in this MD&A for further information.
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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 23 |

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NON-GAAP MEASURES

In this MD&A, we refer to certain specified financial measures such as adjusted EBITDA, adjusted EBITDA per barrel ($/bbl), operating netback, operating netback per barrel ($/bbl), adjusted funds flow, adjusted free cash flow which do not have any standardized meaning prescribed by IFRS. While these measures are commonly used in the oil and natural gas industry, the Company’s determination of these measures may not be comparable with calculations of similar measures presented by other reporting issuers. This MD&A also contains the terms “adjusted working capital” and “net debt” which are non-GAAP measures. We believe that the inclusion of these specified financial measures provides useful information to financial statement users when evaluating the financial results of Greenfire however they should not be considered an alternative to, or more meaningful than, cash provided (used) by operating activities, net profits or other measures of financial performance calculated in accordance with IFRS.

Non-GAAP Financial Measures

Adjusted EBITDA

Net income (loss) and comprehensive income (loss) is the most directly comparable GAAP measure for adjusted EBITDA, which is a non-GAAP measure. Adjusted EBITDA is calculated as net income (loss) before interest and financing, income taxes, depletion, depreciation and amortization, the transaction and financing cost impacts of the De-Spac Transaction and bond refinancing and is adjusted for certain non-cash items, or other items that are not considered part of normal business operations. Adjusted EBITDA is used to measure Greenfire’s profitability from its underlying asset base on a continuing basis. This measure is not intended to represent net income (loss) and comprehensive income (loss) in accordance with IFRS. For a reconciliation of net income (loss) and comprehensive income (loss) to adjusted EBITDA, see the “Results of Operations – Net Income (loss) and comprehensive income (loss) and Adjusted EBITDA” section in this MD&A.

Operating Netback

Oil sales is the most directly comparable GAAP measure for operating netback, which is a non-GAAP measure. This measure is not intended to represent oil sales, net earnings or other measures of financial performance calculated in accordance with IFRS. Operating netback is comprised of oil sales, less diluent expense, royalties, operating expense, transportation and marketing expense, adjusted for realized commodity risk management gains or losses, as appropriate. Operating netback is a financial measure widely used in the oil and gas industry as a supplemental measure of a Company’s efficiency and ability to generate cash flow for debt repayments, capital expenditures or other uses. See the “Results of Operations – Operating Netback” section in this MD&A for a reconciliation of oil sales to operating netback.

Adjusted Funds Flow

Cash provided (used) by operating activities is the most directly comparable GAAP measure for adjusted funds flow, which is a non-GAAP measure. This measure is not intended to represent cash provided (used) by operating activities calculated in accordance with IFRS.

The adjusted funds flow measure allows management and others to evaluate the Company’s ability to fund its capital programs and meet its ongoing financial obligations using cash flow internally generated from ongoing operating related activities. We compute adjusted funds flow as cash provided (used) by operating activities, excluding the impact of changes in non-cash working capital, less transaction costs. For a reconciliation of cash provided (used) by operating activities to adjusted funds flow, see the “Capital Resources and Liquidity – Adjusted Funds Flow and Adjusted Free Cash Flow” section in this MD&A.

Adjusted Free Cash Flow

Cash provided (used) by operating activities is the most directly comparable GAAP measure for adjusted free cash flow, which is a non-GAAP measure. Management uses adjusted free cash flow as an indicator of the efficiency and liquidity of its business, measuring its funds after capital investment that is available to manage debt levels and return capital to shareholders. By removing the impact of current period capital expenditures from adjusted free cash flow, management monitors its adjusted free cash flow to inform its capital allocation decisions. We compute adjusted free cash flow as cash provided (used) by operating activities, excluding the impact of changes in non-cash working capital, less transaction costs and capital expenditures. For a reconciliation of cash provided (used) by operating activities to adjusted free cash flow, see the “Capital Resources and Liquidity – Adjusted Funds Flow and Adjusted Free Cash Flow” section in this MD&A.

Non-GAAP Financial Ratios

Adjusted EBITDA ($/bbl)

Net income (loss) and comprehensive income (loss) is the most directly comparable GAAP measure for adjusted EBITDA ($/bbl), which is a non-GAAP measure. Adjusted EBITDA ($/bbl) is used to measure Greenfire’s profitability from its underlying asset base on a continuing basis. This measure is not intended to represent net income (loss) and comprehensive income (loss) in accordance with IFRS. Adjusted EBITDA ($/bbl) is calculated by dividing adjusted EBITDA by the Company’s total sales volume in a specified period.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 24 |

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Operating Netback ($/bbl)

Oil sales ($/bbl) is a ratio calculated using oil sales, which is the most directly comparable GAAP measure for operating netback. Operating netback is the non-GAAP financial measure used to calculate operating netback ($/bbl), which is a non-GAAP financial ratio. This measure is not intended to represent oil sales, net earnings or other measures of financial performance calculated in accordance with IFRS. Operating netback ($/bbl) is calculated by dividing operating netback by the Company’s total oil sales volume, in a specified period. Operating netback ($/bbl) is a non-GAAP financial ratio widely used in the oil and gas industry as a supplemental measure of a Company’s efficiency and ability to generate cash flow for debt repayments, capital expenditures or other uses, isolated for the impact of changes in oil sales volume, in a specified period.

Capital Management and Liquidity Measures

Adjusted Working Capital

Working capital (deficit) is a GAAP measure that is the most directly comparable measure to adjusted working capital. These measures are not intended to represent current assets, net earnings or other measures of financial performance calculated in accordance with IFRS. Adjusted working capital is comprised of current assets less current liabilities on the Company’s balance sheet, and excludes the current portion of risk management contracts and current portion of long-term debt, the latter of which is subject to estimates in future commodity prices, production levels and expenses, among other factors. Adjusted working capital is included within the non-GAAP measures because it is a less volatile measure of current assets and current liabilities, after isolating for current portion of long-term debt and current portion of risk management contracts, a surplus of adjusted working capital will result in a future net cash inflow to the business that can be used by management to evaluate the Company’s short-term liquidity and its capital resources available at a point in time. A deficiency of adjusted working capital will result in a future net cash outflow, which may result in the Company not being able to settle short-term liabilities more than current assets.

Net debt

Long-term debt is a GAAP measure that is the most directly comparable financial statement measure to net debt. These measures are not intended to represent long-term debt calculated in accordance with IFRS. Net debt is comprised of long-term debt, adjusted for current assets and current liabilities on the Company’s balance sheet, and excludes the current portion of risk management contracts and current portion of warranty liability. Management uses net debt to monitor the Company’s current financial position and to evaluate existing sources of liquidity. Net debt is used to estimate future liquidity and whether additional sources of capital are required to fund planned operations.

Reconciliation of Long-TermDebt to Net Debt

	Year ended			Year ended
	December 31,			December 31,
($ thousands)	2023			2022
Long-term debt		(332,029	)		(191,158	)
Current assets		163,814			123,527
Current liabilities		(130,283	)		(136,921	)
Current portion of risk management contracts		417			27,004
Current portion of warrant liability		18,630			-
Net debt		(279,451	)		(177,548	)

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| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 25 |

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Summary of Quarterly Results

											2022
( thousands, unless otherwise noted)			Q3			Q2		Q1			Q4		Q3		Q2		Q1
BUSINESS ENVIRONMENT(1)
WTI (US/bbl)	78.32			82.26			73.78		76.13			82.65		91.55		108.41		94.29
WTI (CAD/bbl)	106.66			110.31			99.09		102.93			112.21		119.54		138.39		119.38
WCS (CAD/bbl)	76.85			93.00			78.75		69.29			77.05		93.48		122.04		100.96
AECO (CAD/GJ)	2.18			2.46			2.32		3.05			4.85		3.95		6.86		4.49
FX (:CAD)(2)	1.362			1.341			1.343		1.352			1.358		1.306		1.277		1.266
Operational – Expansion
Bitumen production (bbls/d)	14,079			11,052			13,939		16,302			15,710		14,926		17,910		18,714
Operational – Demo
Bitumen production (bbls/d)	3,256			3,618			4,097		4,284			3,869		2,922		3,830		4,196
Operational – Consolidated
Bitumen production (bbls/d)	17,335			14,670			18,036		20,586			19,579		17,848		21,740		22,910
OPERATING RESULTS
Oil sales	161,730			160,967			173,605		179,668			180,741		209,550		315,794		292,764
Oil sales (/bbl)	71.04			89.96			75.12		64.92			72.18		97.37		119.24		97.21
Operating expenses	35,084			38,442			35,675		39,764			42,429		36,507		44,435		37,454
Operating expenses (/bbl)	22.05			29.12			21.79		20.87			23.65		22.38		22.89		17.46
Operating netback(3)	27,353			50,254			37,747		17,352			34,567		42,244		72,707		80,182
Operating netback (/bbl)(3)	17.19			38.07			23.05		9.11			19.27		25.90		37.46		37.39
Adjusted EBITDA(3)	23,434			46,434			34,389		13,058			32,528		38,651		70,445		76,409
Net income (loss)	(4,659	)		(138,557	)		24,223		(16,678	)		87,995		111,594		45,473		(102,426	)
Cash provided (used) by operating activities	25,530			41,873			23,640		(4,495	)		17,322		49,164		67,553		30,688
Adjusted funds flow(3)	10,517			36,173			23,460		3,056			16,902		27,447		57,745		61,830
Capital expenditures	19,413			9,587			1,911		2,518			12,361		14,325		7,706		5,200
Adjusted free cash flow(3)	(8,896	)		26,586			21,549		539			4,541		13,122		50,039		56,630
FINANCIAL POSITION
Cash and cash equivalents	109,525			65,976			36,882		22,403			35,363		99,822		73,375		83,774
Restricted cash	-			43,779			47,363		39,363			35,313		27,413		22,017		13,917
Total assets	1,173,483			1,198,889			1,153,021		1,147,984			1,174,258		1,158,367		1,174,634		1,182,168
Total debt	376,350			382,842			246,805		259,555			254,408		320,607		289,604		329,689
Shareholders’ equity	695,000			699,657			846,098		821,418			837,771		748,593		647,937		602,464

All values are in US Dollars.

^(1)^	These benchmark prices are not the Company’s realized<br>sales prices and represent approximate values.
^(2)^	Annual or quarterly average exchange rates as per the Bank<br>of Canada.
^(3)^	Non-GAAP measures do not have any standardized meaning prescribed<br>by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the “Non-GAAP<br>Measures” in this MD&A for further information.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 26 |

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COMMITMENTS AND CONTRACTUAL OBLIGATIONS

Management believes its current capital resources, combined with its ability to manage cash flow and working capital levels, will enable the Company to meet its current and future obligations, make scheduled interest and principal payments, and fund other business needs. In the short term, the Company anticipates meeting its cash requirements through a combination of cash on hand, operating cash flows, and potentially accessing available credit facilities. However, the Company acknowledges the potential impact of any adverse changes in economic conditions or unforeseen expenses on its ability to generate adequate cash in the short term.

The Company enters into commitments and contractual obligations in the normal course of operations. The following table is a summary of management’s estimate of the contractual maturities of obligations as at December 31, 2023:

($ thousands)	1 Year		2-3 Years		4-5 Years		Thereafter		Total
Transportation		31,880		59,517		58,214		203,198		352,809
Office lease commitments^(1)^		299		598		598		1,496		2,992
Drilling services		5,845		8,635		-		-		14,480
Total annual commitments		38,024		68,750		58,812		204,694		370,281
Accounts payable and accrued liabilities		59,850		-		-		-		59,850
Long-term debt - Principal^(2)^		44,321		108,340		244,239		-		396,900
Long-term debt - Interest^(2)^		48,048		74,066		56,349		-		178,463
Risk management contracts		417		-		-		-		417
Lease obligations		157		284		333		1,015		1,789
Decommissioning obligations^(3)^		-		81		6,542		199,911		206,534
Total contractual obligations		152,793		182,771		307,463		200,926		843,953
Total future payments		190,817		251,521		366,275		405,620		1,214,234
^(1)^	Relates to non-lease components and variable operating cost<br>payments.
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^(2)^	This represents the estimated principal repayments of the 2028 Notes and associated interest<br> payments based on foreign exchange rates in effect on December 31, 2023.
^(3)^	These values are undiscounted and will differ from the amounts<br>presented in the 2023 Financial Statements.

CREDIT RISK

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Company’s accounts receivable. The Company is primarily exposed to credit risk from receivables associated with its oil sales. The Company manages its credit risk exposure by transacting with high-quality credit worthy counterparties and monitoring credit worthiness and/or credit ratings on an ongoing basis. Trade receivables from oil sales are generally collected on 25th day of the month following production. Joint interest receivables are typically collected within one to three months of the invoice being issued. For the period ended December 31, 2023, the Company had oil sales to a single counterparty and the Company has not previously experienced any material credit losses on the collection of accounts receivable.

At December 31, 2023 credit risk from the Company’s outstanding accounts receivable and joint interest receivable balances was considered low due to a history of collections and the receivables that were held by credit worthy counterparties. There were no overdue balances at December 31, 2023.

Accounts Receivable

	Year ended		Year ended
	December 31,		December 31,
($ thousands)	2023		2022
Trade receivables		22,452		22,428
Joint interest receivables		12,228		11,880
Accounts receivable		34,680		34,308

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 27 |

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CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES

The Company’s critical accounting policies and estimates are those estimates having a significant impact on the financial position and operations that require management to make judgements, assumptions and estimates in the application of IFRS. Judgements, assumptions and estimates are based on historical experience and other factors that management believes to be reasonable under current conditions. As events occur and additional information becomes available, these judgements, assumptions and estimates may be subject to change. Detailed disclosure of the material accounting policies and the significant accounting estimates, assumptions and judgements can be found in Note 3 “Material Accounting Policies” in the Company’s financial statements for the period ended December 31, 2023.

OFF-BALANCE SHEET ARRANGEMENTS

We do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a material current or future effect on our financial condition, change in financial condition, revenues, expenses, results of operations, liquidity, capital expenditures or capital resources.

FORWARD LOOKING STATEMENTS

This MD&A contains “forward-looking information” within the meaning of the applicable United States federal securities laws and applicable Canadian securities laws (forward-looking information being collectively hereinafter referred to as “forward-looking statements”). Such forward-looking statements are based on expectations, estimates and projections as at the date of this MD&A. Any statements that involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often but not always using phrases such as “expects”, “is expected”, “anticipates”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends”, or variations of such words and phrases (including negative and grammatical variations), or stating that certain actions, events or results “may”, “could”, “would”, “should”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements and are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements and information concerning: the intentions, strategy, plans and future actions of the Company; that Greenfire is pursuing capital-efficient and lower-risk growth through the optimization of existing production, facilities and reserves to maximize free cash flow generation; Greenfire’s plans to evaluate and consider additional potential prospects for further production growth, including external acquisitions; that the additional production from the ten Refill wells completed at the Expansion Asset as of February 2024 will continue to ramp up and meet expectations; that the additional production from the one Refill well completed at the Demo Asset as of February 2024 will continue to ramp up and meet expectations; the expectation that the NCG injection compressor at the Expansion Asset which was completed and fully commissioned by the year ended December, 2023 will result in targeted reservoir pressure and related increased production rates; estimated production impacts from the failure of third party downhole temperature sensors and the Company’s plans to replace those sensors in the second quarter of 2024; regulatory approval for the remediation work completed at the Demo Asset disposal well and expected related production increases; the Company’s 2024 Outlook, including expected production and forecasts for capital expenditures thereunder; future assessment of royalties at the Demo Asset; the Company’s drilling program, including Greenfire’s commitment to drill 550 days over a two-year period; management’s intent to actively manage the Company’s capital structure in response to changes in economic conditions and its intention to further deleverage the Company’s balance sheet; management’s belief that the Company’s current capital resources and its ability to manage cash flow and working capital levels will allow the Company to meet its current and future obligations, to make scheduled interest and principal payments, and to fund the other needs of the business; expectations related to the Company’s risk management program; and statements relating to the business and future activities of the Company after the date of this MD&A.

Forward-looking statements are based on the beliefs of the Company’s management, as well as on assumptions, which management believes to be reasonable based on information available at the time such statements were made. In addition to other assumptions set out herein, the forward-looking statements contained herein are based on the following assumptions: Greenfire’s ability to compete with other companies; the anticipated future financial or operating performance of the Company; the expected results of operations; assumptions as to future drilling results; assumptions as to costs and commodity prices; the timing and amount of funding required to execute the Company’s business plans; assumptions about future capital expenditures; the effect on the Company of any changes to existing or new legislation or policy or government regulation; the length of time required to obtain permits, certifications and approvals; the availability of labor; estimated budgets; assumptions about future interest and currency exchange rates; requirements for additional capital; the timing and possible outcome of regulatory and permitting matters; goals; strategies; future growth; and the adequacy of financial resources. However, by their nature, forward-looking statements are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 28 |

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Forward-looking statements are subject to a variety of risks, uncertainties and other factors which could cause actual results, performance or achievements to differ from those expressed or implied by the forward-looking statements, including, without limitation, a decline in oil prices or widening of differentials between various crude oil prices; lower than expected reservoir performance, including, but not limited to, lower oil production rates; the inability to recognize continued or increased efficiencies from the Company’s production enhancement program and processing plant enhancements, debottlenecking and brownfield expansions; reduced access to or an increase in the cost of diluent; an increase in the cost of natural gas or electricity; the reliability and maintenance of Greenfire’s facilities; supply chain disruption and risks of increases costs relating to inflation; the safety and reliability of pipelines and trucking services that transport Greenfire’s products; the need to replace significant portions of existing wells, referred to as “workovers”, or the need to drill additional wells; the cost to transport bitumen, diluent and bitumen blend, and the cost to dispose of certain by-products; the availability and cost of insurance and the inability to insure against certain types of losses; severe weather or catastrophic events such as fires, droughts, lightning, earthquakes, extreme cold weather, storms or explosions; seasonal weather patterns and the corresponding effects of the spring thaw on equipment on Greenfire’s properties; the availability of pipeline capacity and other transportation and storage facilities for the Company’s bitumen blend; the cost of chemicals used in Greenfire’s operations, including, but not limited to, in connection with water and/or oil treatment facilities; the availability of and access to drilling equipment and key personnel; risks of cybersecurity threats including the possibility of potential breakdown, invasion, virus, cyber-attack, cyber-fraud, security breach, and destruction or interruption of the Company’s information technology systems; Canadian heavy and light oil export capacity constraints and the resulting impact on realized pricing;; the impact of global wars and conflicts on global stability, commodity prices and the world economy, changes in the political landscape and/or legal, tax, royalty and regulatory regimes in Canada, and elsewhere; the cost of compliance with applicable regulatory regimes, including, but not limited to, environmental regulation and Government of Alberta production curtailments, if any; the ability to attract or access capital as a result of changing investor priorities and trends, including as a result of climate change, environmental, social and governance initiatives, the adoption of decarbonization policies and the general stigmatization of the oil and gas industry; hedging risks; variations in foreign exchange and interest rates; risks related to the Company’s indebtedness; failure to accurately estimate abandonment and reclamation costs; the potential for management estimates and assumptions to be inaccurate; and general economic, market and business conditions in Canada, the United States and globally.

The lists of risk factors set out in this MD&A or in the Company’s other public disclosure documents are not exhaustive of the factors that may affect any forward-looking statements of the Company. Forward-looking statements are statements about the future and are inherently uncertain. Actual results could differ materially from those projected in the forward-looking statements as a result of the matters set out in this MD&A generally and certain economic and business factors, some of which may be beyond the control of the Company. In addition, the global financial and credit markets have experienced significant debt and equity market and commodity price volatility which could have a particularly significant, detrimental and unpredictable effect on forward-looking statements. The Company does not intend, and does not assume any obligation, to update any forward-looking statements, other than as required by applicable law. For all of these reasons, the Company’s securityholders should not place undue reliance on forward-looking statements.

For additional information relating to Greenfire’s operational and other risk factors, please refer to the Company’s final prospectus filed pursuant to Rule 424(b)(3) on February 6, 2024 and its other reports filed with the SEC, which, along with other relevant documents, will be available on a website maintained by the SEC at www.sec.gov and the Company’s Canadian final non-offering prospectus dates February 2, 2024 and other reports and relevant documents available on the Company’s SEDAR+ profile at www.sedarplus.ca.

ADDITIONAL INFORMATION

Additional information relating to the Company is available on https://www.greenfireres.com and can also be found on a website maintained by the SEC at www.sec.gov and on Greenfire’s SEDAR+ profile at www.sedarplus.ca

| Greenfire Resources Ltd. | 2023 Q4 Management’s Discussion and Analysis | 29 |

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CORPORATE INFORMATION

Directors	Bankers
Julian McIntyre ^(1)^	Bank of Montreal
Jonathan Klesch	595-8 Avenue SW
Derek Aylesworth ^(2)(3)^	Calgary, Alberta, Canada
Venkat Siva ^(3)^	T2P 1G1
Matthew Perkal ^(3)^
Robert Logan	Auditor
(1) Chair of the Board of Directors	Deloitte LLP
(2) Chair of the Audit and Reserves Committee	850 2nd Street SW
(3) Audit and Reserves Committee	Calgary, Alberta, Canada
	T2P 0R8
Officers
	Reserve Engineers
Robert Logan MPBE, P.Eng
President, and Chief Executive Officer	McDaniel & Associates Consultants Ltd.
	2200, 255 – 5^th^ Avenue SW
Tony Kraljic, CPA	Calgary, Alberta, Canada
Chief Financial Officer	T2P 3G6
Kevin Millar C.E.T.
SVP Operations & Steam Chief
Albert MA P.Eng
SVP Engineering
Crystal Park P.Eng, MBA
SVP Commercial
Charles R. Kraus
Corporate Secretary
Head Office
Suite 1900, 205 – 5^th^ Avenue SW,
Calgary, Alberta, Canada
T2P 2V7
www.greenfireres.com
NYSE: GFR
TSX : GFR.TO
Solicitors
Burnet, Duckworth, & Palmer LLP
2400, 525 – 8^th^ Avenue SW
Calgary, Alberta, Canada
T2P 1G1
Carter Ledyard & Milburn LLP
41^st^ Floor
28 Liberty Street
New York, New York 10005
Greenfire Resources Ltd.	2023 Q4 Management’s Discussion and Analysis	30
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Exhibit 99.3

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FORM51-101F1

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STATEMENTOF RESERVES DATA

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ANDOTHER OIL AND GAS INFORMATION

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AS OFDecember 31, 2023

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DATEDMARCH 20, 2024

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TABLEOF CONTENTS

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	Page
GLOSSARY OF<br> TERMS	1
EXPLANATORY NOTE	3
ABBREVIATIONS AND CONVERSIONS	3
ABBREVIATIONS	3
CONVERSIONS	4
CAUTION REGARDING USE OF<br> BARRELS OF OIL EQUIVALENT (BOES)	4
DISCLOSURE OF RESERVES<br> DATA AND ADVISORIES	4
DISCLOSURE OF RESERVES<br> DATA	4
ADVISORIES	5
STATEMENT OF RESERVES DATA<br> AND OTHER OIL AND GAS INFORMATION	7
APPENDIX A – REPORT<br> OF MANAGEMENT AND DIRECTORS ON OIL AND GAS DISCLOSURE	20
APPENDIX B – REPORT<br> ON RESERVES DATA BY THE INDEPENDENT QUALIFIED RESERVES EVALUATOR OR AUDITOR	21

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i

Glossary of Terms

The following words and phrases have the following meanings, unless the context otherwise requires:

“Demo Asset” means the Hangingstone Demonstration Facility, a SAGD thermal oil sands production facility in the Athabasca region of Alberta;

“developed non-producing reserves” are those reserves that either have not been on production, or have previously been on production, but are shut-in, and the date of resumption of production is unknown;

“developed producing reserves” are those reserves that are expected to be recovered from completion intervals open at the time of the estimate.  These reserves may be currently producing or, if shut-in, they must have previously been on production, and the date of resumption of production must be known with reasonable certainty;

“developed reserves” are those reserves that are expected to be recovered from existing wells and installed facilities or, if facilities have not been installed, that would involve a low expenditure (for example, when compared to the cost of drilling a well) to put the reserves on production.  The developed category may be subdivided into producing and non-producing;

“development costs” means costs incurred to obtain access to reserves and to provide facilities for extracting, treating, gathering and storing the oil and gas from reserves.  More specifically, development costs, including applicable operating costs of support equipment and facilities and other costs of development activities, are costs incurred to:

(a)	gain access to and prepare well locations for drilling, including surveying well locations for the purpose<br>of determining specific development drilling sites, clearing ground, draining, road building, and relocating public roads, gas lines and<br>power lines, to the extent necessary in developing the reserves;
(b)	drill and equip development wells, development type stratigraphic test wells and service wells, including<br>the costs of platforms and of well equipment such as casing, tubing, pumping equipment and wellhead assembly;
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(c)	acquire, construct and install production facilities such as flow lines, separators, treaters, heaters,<br>manifolds, measuring devices and production storage tanks, natural gas cycling and processing plants, and central utility and waste disposal<br>systems; and
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(d)	provide improved recovery systems;
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“exploration costs” means costs incurred in identifying areas that may warrant examination and in examining specific areas that are considered to have prospects that may contain oil and gas reserves, including costs of drilling exploratory wells and exploratory type stratigraphic test wells.  Exploration costs may be incurred both before acquiring the related property (sometimes referred to as “prospecting costs”) and after acquiring the property.  Exploration costs, which include applicable operating costs of support equipment and facilities and other costs of exploration activities, are:

(a)	costs of topographical, geochemical, geological and geophysical studies, rights of access to properties<br>to conduct those studies, and salaries and other expenses of geologists, geophysical crews and others conducting those studies (collectively<br>sometimes referred to as “geological and geophysical costs”);
(b)	costs of carrying and retaining unproved properties, such as delay rentals, taxes (other than income and<br>capital taxes) on properties, legal costs for title defence, and the maintenance of land and lease records;
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(c)	dry hole contributions and bottom hole contributions;
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(d)	costs of drilling and equipping exploratory wells; and
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(e)	costs of drilling exploratory type stratigraphic test wells;
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1

“Expansion Asset” means the Hangingstone Expansion Facility, a SAGD thermal oil sands production facility in the Athabasca region of Alberta;

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“forecast prices and costs” means future prices and costs that are:

(a)	generally accepted as being a reasonable outlook of the future; or
(b)	if, and only to the extent that, there are fixed or presently determinable future prices or costs to which<br>Greenfire is legally bound by a contractual or other obligation to supply a physical product, including those for an extension period<br>of a contract that is likely to be extended, those prices or costs rather than the prices and costs referred to in subparagraph (a);
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“Greenfire” or the **“Company”**means Greenfire Resources Ltd. and/or its consolidated subsidiaries, as the context may require;

“Greenfire Reserves Report” means the report of McDaniel dated March 20, 2024 evaluating the bitumen reserves of Greenfire as at December 31, 2023;

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“gross” means:

(a)	in relation to a reporting issuer’s interest in production or reserves, its “company gross reserves”,<br>which are the reporting issuer’s working interest (operating or non-operating) share before deduction of royalties and without including<br>any royalty interests of the reporting issuer;
(b)	in relation to wells, the total number of wells in which a reporting issuer has an interest; and
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(c)	in relation to properties, the total area of properties in which a reporting issuer has an interest;
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“HangingstoneFacilities” are to, collectively, the Demo Asset and the Expansion Asset;

“JACOS” means Japan Canada Oil Sands Limited;

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“McDaniel” means McDaniel & Associates Consultants Ltd., independent petroleum engineers of Calgary, Alberta;

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“net” means:

(a)	in relation to a reporting issuer’s interest in production or reserves, the reporting issuer’s working<br>interest (operating or non-operating) share after deduction of royalty obligations, plus the reporting issuer’s royalty interests in production<br>or reserves;
(b)	in relation to a reporting issuer’s interest in wells, the number of wells obtained by aggregating the<br>reporting issuer’s working interest in each of its gross wells; and
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(c)	in relation to a reporting issuer’s interest in a property, the total area in which the reporting issuer<br>has an interest multiplied by the working interest owned by the reporting issuer;
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“NI 51-101” means National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities;

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“possible reserves” are those additional reserves that are less certain to be recovered than probable resources.  It is unlikely that the actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves;

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“probable reserves” are those additional reserves that are less certain to be recovered than proved reserves.  It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves;

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2

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“proved reserves” are those reserves that can be estimated with a high degree of certainty to be recoverable.  It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves;

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“reserves” are estimated remaining quantities of oil and natural gas and related substances anticipated to be recoverable from known accumulations, as of a given date, based on: (i) analysis of drilling, geological, geophysical and engineering data; (ii) the use of established technology; and (iii) specified economic conditions, which are generally accepted as being reasonable and shall be disclosed. Reserves are classified according to the degree of certainty associated with the estimates;

“SAGD” means steam-assisted gravity drainage, an in-situ thermal oil production extraction technique;

“Statement” means this statement of reserves data and other oil and gas information of Greenfire as at December 31, 2023; and

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“undeveloped reserves” are those reserves expected to be recovered from known accumulations where a significant expenditure (for example, when compared to the cost of drilling a well) is required to render them capable of production.  They must fully meet the requirements of the reserves category (proved, probable, possible) to which they are assigned.

Certain other terms used herein but not defined herein are defined in NI 51-101 and, unless the context otherwise requires, shall have the same meanings herein as in NI 51-101. All dollar amounts stated herein are expressed in Canadian dollars.

EXPLANATORY NOTE

Greenfire Resources Ltd. (“GRL”) is the parent corporation of Greenfire Resources Operating Corporation, and the corporate structure of Greenfire, as it is currently constituted, is the result of: (i) an amalgamation effective as of January 1, 2024, pursuant to which Greenfire Resources Operating Corporation and Greenfire Resources Inc. (“GRI”) amalgamated in accordance with the provisions of the Business Corporations Act (Alberta), with the surviving corporation continuing as “Greenfire Resources Operating Corporation” and as a wholly subsidiary of GRL; (ii) the completion of the transactions contemplated by the business combination agreement, dated December 14, 2022, as amended from time to time, by and between M3-Brigade Acquisition III Corp, GRI, GRL, DE Greenfire Merger Sub Inc. and 2476276 Alberta ULC, which were completed on September 20, 2023; and (iii) a number of other transactions that included: (A) the acquisition of the Demo Asset out of the insolvency proceedings of an unaffiliated corporation named Greenfire Hangingstone Operating Corporation; (ii) a series of incorporations, amalgamations and other reorganization transactions; and (iii) the acquisition of JACOS (which held the Expansion Asset) (the “JACOSAcquisition”).

For more information, see the documents publicly available on Greenfire’s SEDAR+ profile at www.sedarplus.ca and on Greenfire’s EDGAR (as defined below) profile at www.sec.gov/edgar

Abbreviations and Conversions

Abbreviations

The abbreviations set forth below have the following meanings:

Oil and Natural Gas Liquids		Natural Gas
Bbl(s)	Barrel(s)	Mcf	thousand cubic feet
bbls/d	barrels per day	GJ	gigajoule
Mbbl	thousand barrels
boe	barrels of oil equivalent
MMboe	million barrels of oil equivalent

3

Other
WTI	West Texas Intermediate crude oil, a benchmark oil price determined at Cushing, Oklahoma
M$	thousands of dollars
MM$	millions of dollars

Conversions

The following table sets forth certain Standard Imperial Units and International System of Units conversions:

From	To	Multiply By
Mcf	cubic metres	28.174
Mcf	GJ	1.055
cubic metres	cubic feet	35.494
bbls	cubic metres	0.159
acres	hectares	0.405

Caution Regarding Use of Barrels of Oil Equivalent (BOEs)

BOEs/boes may be misleading, particularly if used in isolation. A boe conversion ratio of six Mcf to one bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. As the value ratio between natural gas and crude oil based on the current prices of natural gas and crude oil is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.

Disclosure of Reserves Data and Advisories

Disclosure of Reserves Data

This Statement is prepared as of March 20, 2024 and is based upon an evaluation by McDaniel dated March 20, 2024 with an effective date of December 31, 2023 contained in the Greenfire Reserves Report. This Statement summarizes the bitumen reserves of Greenfire and the future net revenues and net present values for such reserves using forecast prices and costs as at December 31, 2023. All of Greenfire’s reserves are in Canada and, specifically, in the Province of Alberta.

The crude oil and natural gas reserve estimates presented in the Greenfire Reserves Report are based on the guidelines contained in the Canadian Oil and Gas Evaluation Handbook (the “COGE Handbook”) and the reserve definitions contained in NI 51-101 and the COGE Handbook. A summary of those definitions are set forth under “Glossary of Terms” above. McDaniel was engaged to provide evaluations of proved and proved plus probable reserves.

The board of directors of Greenfire has reviewed and approved the Greenfire Reserves Report. The Report of Management and Directors on Oil and Gas Disclosure and the Report on Reserves Data by Independent Qualified Reserves Evaluator or Auditor are attached as Appendix A and Appendix B hereto, respectively.

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All evaluations of future revenue containedin the Greenfire Reserves Report are after the deduction of royalties, operating costs, development costs and abandonment, decommissionand reclamation costs. It should not be assumed that the estimates of future net revenues presented in the tables below represent thefair market value of the reserves. There are numerous uncertainties inherent in estimating quantities of bitumen reserves and the futurecash flows attributed to such reserves. The reserve and associated cash flow information set forth in this Statement are estimates only.The recovery and reserve estimates of the bitumen reserves provided herein are estimates only and there is no guarantee that the estimatedreserves will be recovered. Actual bitumen reserves may be greater than or less than the estimates provided herein.

4

In general, estimates of economically recoverable oil and gas reserves and the future net cash flows therefrom are based upon a number of variable factors and assumptions, such as historical production from the properties, production rates, ultimate reserve recovery, timing and amount of capital expenditures, marketability of oil and gas, royalty rates, the assumed effects of regulation by governmental agencies and future operating costs, all of which may vary materially from actual results. For those reasons, among others, estimates of the economically recoverable oil and gas reserves attributable to any particular group of properties, classification of such reserves based on risk of recovery and estimates of future net revenues associated with reserves may vary and such variations may be material. The actual production, revenues, taxes and development and operating expenditures with respect to the reserves associated with Greenfire’s properties may vary from the information presented herein and such variations could be material. In addition, there is no assurance that the forecast price and cost assumptions contained in the Greenfire Reserves Report will be attained and variances could be material.

For reserves calculated under United States Securities and Exchange Commission (“SEC”) requirements, please refer to Greenfire’s Form 20-F which will be filed on the SEC’s Electronic Data Gathering Analysis and Retrieval system (“EDGAR”) at www.sec.gov/edgar and filed on Greenfire’s SEDAR+ profile on www.sedarplus.ca. As a public company in the United States, Greenfire has and is expected to continue to disclose reserves information in filings with the SEC prepared in accordance with guidelines specified in Item 1202(a)(8) of Regulation S-K and in conformity with Rule 4-10(a) of Regulation S-X. There are significant differences to the type of volumes disclosed and the basis from which the volumes are economically determined under the SEC requirements and NI 51-101, and the difference between the reported numbers under the two disclosure standards can, therefore, be material. For example, the U.S. standards require United States oil and gas reporting companies, in their filings with the SEC, to disclose only proved reserves after the deduction of royalties and production due to others but permits the optional disclosure of probable and possible reserves in accordance with the SEC’s definitions. Additionally, the COGE Handbook and NI 51-101 require disclosure of reserves and related future net revenue estimates based on forecast prices and costs, whereas the U.S. standards require that reserves and related future net revenue be estimated using average prices for the previous 12 months and that the standardized measure reflect discounted future net income taxes related to Greenfire’s operations. In addition, the COGE Handbook and NI 51-101 permit the presentation of reserves estimates on a “company gross” basis, representing Greenfire’s working interest share before deduction of royalties, whereas the U.S. standards require the presentation of net reserve estimates after the deduction of royalties and similar payments. There are also differences in the technical reserves estimation standards applicable under NI 51-101 and, pursuant thereto, the COGE Handbook, and those applicable under the U.S. Standards. NI 51-101 requires that proved undeveloped reserves be reviewed annually for retention or reclassification if development has not proceeded as previously planned, while the U.S. Standards specify a five-year limit after initial booking for the development of proved undeveloped reserves. Finally, the SEC prohibits disclosure of oil and gas resources in SEC filings, including contingent resources, whereas Canadian securities regulatory authorities allow disclosure of oil and gas resources other than reserves, as well as reserves. The foregoing is not an exhaustive summary of Canadian or U.S. reserves reporting requirements.

Advisories

Certain information regarding Greenfire set forth in this Statement contains forward-looking information or statements as defined in applicable securities laws (collectively, “forward-lookingstatements” or “statements”) that involve substantial known and unknown risks and uncertainties. The use of any of the words “plan”, “expect”, “prospective”, “project”, “intend”, “believe”, “should”, “anticipate”, “estimate” or other similar words, or statements that certain events or conditions “may” or “will” occur are intended to identify forward-looking statements. Such statements represent Greenfire’s internal projections, estimates or beliefs, which are only predictions and actual events or results may differ materially. Although management believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause Greenfire’s actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Greenfire.

More particularly, this Statement may contain, without limitation, statements pertaining to the following: bitumen production levels; projections of commodity prices and costs; future cash flows from reserves; tax horizon (including the expectation that no income taxes will be required to be paid by Greenfire until 2027); expected abandonment and reclamation costs, including the amount thereof and the timing expected to be paid; treatment under governmental regulatory regimes including but not limited to royalties, environmental and taxation; timing of the development of proved undeveloped reserves and probable undeveloped reserves and investment in connection therewith; Greenfire’s development plans over the next several years, including with respect to drilling and other plans to develop Greenfire’s assets; future development costs and that Greenfire expects to use a combination of internally generated cash from operations, working capital and the issuance of new equity or debt where and when it believes appropriate to fund future development costs; and Greenfire’s use of certain financial instruments to hedge exposure to commodity price fluctuations.

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Forward-looking statements are based on the beliefs of the Company’s management, as well as on assumptions, which management believes to be reasonable based on information available at the time such statements were made. In addition to other assumptions set out herein, the forward-looking statements contained herein are based on the following assumptions: Greenfire’s ability to compete with other companies; the anticipated future financial or operating performance of the Company; the expected results of operations; assumptions as to future drilling results; assumptions as to costs and commodity prices; the timing and amount of funding required to execute the Company’s business plans; assumptions about future capital expenditures; the effect on the Company of any changes to existing or new legislation or policy or government regulation; the length of time required to obtain permits, certifications and approvals; the availability of labor; estimated budgets; assumptions about future interest and currency exchange rates; requirements for additional capital; the timing and possible outcome of regulatory and permitting matters; goals; strategies; future growth; and the adequacy of financial resources. However, by their nature, forward-looking statements are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

Forward-looking statements are subject to a variety of risks, uncertainties and other factors which could cause actual results, performance or achievements to differ from those expressed or implied by the forward-looking statements, including, without limitation, a decline in oil prices or widening of differentials between various crude oil prices; lower than expected reservoir performance, including, but not limited to, lower oil production rates; the inability to recognize continued or increased efficiencies from the Company’s production enhancement program and processing plant enhancements, debottlenecking and brownfield expansions; reduced access to or an increase in the cost of diluent; an increase in the cost of natural gas or electricity; the reliability and maintenance of Greenfire’s facilities; supply chain disruption and risks of increases costs relating to inflation; the safety and reliability of pipelines and trucking services that transport Greenfire’s products; the need to replace significant portions of existing wells, referred to as “workovers”, or the need to drill additional wells; the cost to transport bitumen, diluent and bitumen blend, and the cost to dispose of certain by-products; the availability and cost of insurance and the inability to insure against certain types of losses; severe weather or catastrophic events such as fires, droughts, lightning, earthquakes, extreme cold weather, storms or explosions; seasonal weather patterns and the corresponding effects of the spring thaw on equipment on Greenfire’s properties; the availability of pipeline capacity and other transportation and storage facilities for the Company’s bitumen blend; the cost of chemicals used in Greenfire’s operations, including, but not limited to, in connection with water and/or oil treatment facilities; the availability of and access to drilling equipment and key personnel; risks of cybersecurity threats including the possibility of potential breakdown, invasion, virus, cyber-attack, cyber-fraud, security breach, and destruction or interruption of the Company’s information technology systems; Canadian heavy and light oil export capacity constraints and the resulting impact on realized pricing; the impact of global wars and conflicts on global stability, commodity prices and the world economy, changes in the political landscape and/or legal, tax, royalty and regulatory regimes in Canada, and elsewhere; the cost of compliance with applicable regulatory regimes, including, but not limited to, environmental regulation, if any; the ability to attract or access capital as a result of changing investor priorities and trends, including as a result of climate change, environmental, social and governance initiatives, the adoption of decarbonization policies and the general stigmatization of the oil and gas industry; hedging risks; variations in foreign exchange and interest rates; risks related to the Company’s indebtedness; failure to accurately estimate abandonment and reclamation costs; the potential for management estimates and assumptions to be inaccurate; and general economic, market and business conditions in Canada, the United States and globally.

You should carefully consider all of the risks and uncertainties described in the “Risk Factors” section of the Company’s final non-offering prospectus dated February 2, 2024, which is available on SEDAR+ at www.sedarplus.ca and registration statement on Form F-1, initially filed with the United States Securities and Exchange Commission (the “SEC”) on October 10, 2023, as amended on December 1, 2023, and January 22, 2024 and other documents filed by Greenfire from time to time with the SEC. The lists of risk factors set out in this Statement or in the Company’s other public disclosure documents are not exhaustive of the factors that may affect any forward-looking statements of the Company. Forward-looking statements are statements about the future and are inherently uncertain. Actual results could differ materially from those projected in the forward-looking statements as a result of the matters set out in this Statement generally and certain economic and business factors, some of which may be beyond the control of the Company. In addition, the global financial and credit markets have experienced significant debt and equity market and commodity price volatility which could have a particularly significant, detrimental and unpredictable effect on forward-looking statements. The Company does not intend, and does not assume any obligation, to update any forward-looking statements, other than as required by applicable law. For all of these reasons, the Company’s securityholders should not place undue reliance on forward-looking statements.

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Statement of Reserves Data and Other Oil and Gas Information

This Statement of Greenfire’s reserves data and other oil and gas information set forth below is dated December 31, 2023. The effective date of the statement of reserves data and other oil and gas information set forth below is December 31, 2023 and the preparation date is March 20, 2024. All of Greenfire’s reserves are in Canada and, specifically, in the Province of Alberta.

In certain of the tables set forth below, the columns may not add due to rounding. All dollar amounts in the tables below are expressed in Canadian dollars.

Reserves Data (Forecast Prices and Costs)

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SUMMARY OF OIL AND GAS RESERVES

AS OF DECEMBER 31, 2023

FORECAST PRICES AND COSTS

	Bitumen
Reserve Category	Gross^(1)^ (Mbbl)		Net^(2)^ (Mbbl)
PROVED
Developed Producing		30,886		27,809
Undeveloped		152,396		122,465
TOTAL PROVED		183,282		150,273
PROBABLE		54,396		38,441
TOTAL PROVED PLUS PROBABLE		237,679		188,714

Notes:

(1)	Gross reserves are working interest reserves before royalty deductions.
(2)	Net reserves are working interest reserves after royalty deductions plus royalty interest reserves.
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SUMMARY OF NET PRESENT VALUES OF FUTURE NETREVENUE

AS OF DECEMBER 31, 2023

FORECAST PRICES AND COSTS

	Before Income Taxes Discounted at (%/year)					After Income Taxes Discounted at (%/year)					Unit Value Before Income Tax Discounted at 10%/ year(1)
Reserves Category	0 (MM)	5 (MM)	10 (MM)	15 (MM)	20 (MM)	0 (MM)	5 (MM)	10 (MM)	15 (MM)	20 (MM)	(/bbl)
PROVED
Developed Producing
Developed Non-Producing
Undeveloped
TOTAL PROVED
PROBABLE
TOTAL PROVED PLUS PROBABLE

All values are in US Dollars.

Notes:

(1)	The unit values are based on net reserve volumes.
(2)	Net present values prepared by McDaniel in the evaluation<br>of Greenfire’s properties are calculated by considering sales of bitumen reserves and other income. After tax net present values prepared<br>by McDaniel in the evaluation of Greenfire’s properties are calculated by considering the foregoing factors as well as appropriate income<br>tax calculations, current federal tax regulations and including prior tax pools for Greenfire (at the corporate level).
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TOTAL FUTURE NET REVENUE (UNDISCOUNTED)

AS OF DECEMBER 31, 2023

FORECAST PRICES AND COSTS

Reserves Category	Revenue(1) (M)	Royalties(2) (M)	Operating Costs (M)	Development Costs (M)	Abandonment and Reclamation Costs (M)(3)	Future Net Revenue Before Income Taxes (M)	Income Taxes (M)	Future Net Revenue After Income Taxes (M)
Proved Reserves
Proved Plus Probable Reserves

All values are in US Dollars.

Notes:

(1)	Includes all product revenues and other revenues as forecast.
(2)	Royalties include any net profits interests paid.
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(3)	Abandonment and reclamation costs include but are not limited<br>to items such as: producing wells, suspended wells, service wells, gathering systems, facilities, and surface land development.
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FUTURE NET REVENUE BY PRODUCT TYPE

AS OF DECEMBER 31, 2023

FORECAST PRICES AND COSTS

Reserves Category	Product Type	Future Net Revenue Before Income Taxes (Discounted At 10%/Year) (M)	Unit Value^(1)^(Units as noted)
Proved Reserves	Bitumen		$	13.46/bbl
Proved Plus Probable Reserves	Bitumen		$	12.84/bbl

All values are in US Dollars.

Note:

(1)	Unit values are calculated using the 10% discount rate divided<br>by the major product type net reserves for each group.

Pricing Assumptions

The future net revenues and net present values presented in the Greenfire Reserves Report were calculated using the average forecast price and costs of Sproule Associates Limited (“Sproule”), McDaniel and GLJ Ltd. (“GLJ”) as of December 31, 2023 for the future crude oil, natural gas and natural gas product prices.

Sproule, McDaniel, and GLJ have prepared their December 31, 2023, price and market forecasts after a comprehensive review of information. Information sources include numerous government agencies, industry publications, Canadian oil refiners and natural gas marketers. The forecasts presented herein are based on an informed interpretation of currently available data. While these forecasts are considered reasonable at this time, users of these forecasts should understand the inherent high uncertainty in forecasting any commodity or market. These forecasts will be revised periodically as market, economic and political conditions change. These future revisions may be significant.

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SUMMARY OF PRICING AND INFLATION RATE ASSUMPTIONS^(1)^

AS OF DECEMBER 31, 2023

FORECAST PRICES AND COSTS^(1)^

The forecast cost and price assumptions assume increases in wellhead selling prices and take into account inflation with respect to future operating and capital costs. The forecast cost and price assumptions utilized in the Greenfire Reserves Report were as follows:

	Crude Oil
Year	WTI Crude Oil (US/bbl)	Brent Crude Oil (US/bbl)	Edmonton Light Crude Oil (/bbl)	Alberta Bow River Hardisty Crude<br> Oil (/bbl)	Western Canadian Select Crude Oil<br> (/bbl)	Alberta Heavy Crude Oil (/bbl)	Sask Cromer Medium Crude Oil (/bbl)	Inflation^(2)^%		Exchange<br> Rate(3) US/CAN
Forecast^(1)^
2024									0.0
2025									2.0
2026									2.0
2027									2.0
2028									2.0
2029									2.0
2030									2.0
2031									2.0
2032									2.0
2033									2.0
2034									2.0
2035									2.0
2036									2.0
2037									2.0
2038									2.0
Thereafter

All values are in US Dollars.

Notes:

(1)	Calculated using the average forecast price and costs of<br>Sproule, McDaniel and GLJ as of December 31, 2023 for the future crude oil, natural gas and natural gas product prices.
(2)	Inflation rates for costs.
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(3)	The exchange rate used to generate the benchmark reference prices<br>in this table.
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Weighted average historical price realized by Greenfire for the year ended December 31, 2023, was $73.91/bbl for bitumen.

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Reserves Reconciliation

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RECONCILIATION OF GROSS RESERVES BY PRODUCTTYPE

FORECAST PRICES AND COSTS

	Bitumen
FACTORS	Proved (Mbbl)			Probable (Mbbl)			Proved Plus Probable (Mbbl)
December 31, 2022		183,367			56,059			239,426
Extensions & Improved Recovery^(1)^		6,797			2,173			8,970
Technical Revisions^(2)^		(444	)		(3,836	)		(4,279	)
Discoveries		-			-			-
Acquisitions		-			-			-
Dispositions		-			-			-
Economic Factors		-			-			-
Production		(6,438	)		-			(6,438	)
December 31, 2023		183,282			54,396			237,679

Notes:

(1)	Extensions are due to the inclusion of additional undeveloped<br>wells at the Demo property that were not previously included in reserves.
(2)	Technical revisions are associated with the decommissioning<br>of production from existing well-bores that are to be re-drilled as part of the upcoming drilling program, as well as changes to the<br>future development plan.
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Additional Information Relating to Reserves Data

Undeveloped Reserves

Undeveloped reserves are attributed by McDaniel in accordance with standards and procedures contained in the COGE Handbook. Proved undeveloped reserves are those reserves that can be estimated with a high degree of certainty and are expected to be recovered from known accumulations where a significant expenditure is required to render them capable of production. Probable undeveloped reserves are those reserves that are less certain to be recovered than proved reserves and are expected to be recovered from known accumulations where a significant expenditure is required to render them capable of production. Proved and probable undeveloped reserves have been assigned in accordance with engineering and geological practices as defined under NI 51-101.

Proved and Probable Undeveloped Reserves

The following tables set forth the proved undeveloped reserves and the probable undeveloped bitumen reserves that were first attributed to Greenfire’s assets for the years ended December 31, 2021, 2022 and 2023. Greenfire acquired the Demo Asset and Expansion Asset in 2021 and did not have any oil and gas properties in the year ended December 31, 2020. All of Greenfire’s proved undeveloped reserves and the probable undeveloped reserves are located in the Province of Alberta.

There are a number of factors that could result in delayed or cancelled development, including the following: (i) changing economic conditions (due to commodity pricing, operating and capital expenditure fluctuations); (ii) changing technical conditions (including production anomalies, such as facility bottlenecks or accelerated depletion); (iii) a larger development program may need to be spread out over several years to optimize capital allocation and facility utilization; and (iv) surface access issues (including those relating to land owners, weather conditions and regulatory approvals). See “Disclosure of Reserves Data and Advisories – Advisories” in this Statement.

Proved Undeveloped Reserves

	Bitumen<br> (Mbbl)
Year	First Attributed
Prior thereto	-
2021		148,007
2022		-
2023		6,797

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Proved undeveloped reserves have been assigned in areas where the reserves can be estimated with a high degree of certainty. In most instances, proved undeveloped reserves will be assigned on lands immediately offsetting existing producing wells within the same accumulation or pool. The Greenfire Reserves Report has assigned 152.4 MMboe of proved undeveloped reserves.

Development of the proved undeveloped reserves is expected to occur over the next 32 years. Timing of the investment and the desired pace of development will depend to a large extent on economic conditions, including, in particular, world commodity prices.

Probable Undeveloped Reserves

	Bitumen<br> (Mbbl)
Year	First Attributed
Prior thereto		-
2021		48,229
2022		-
2023		2,173

Probable undeveloped reserves have been assigned in areas where the reserves can be estimated with less certainty. It is equally likely that the actual remaining quantities recovered will be greater or less than the proved plus probable reserves. In most instances probable undeveloped reserves have been assigned on lands in the area with existing producing wells but there is some uncertainty as to whether they are directly analogous to the producing accumulation or pool. The Greenfire Reserves Report has assigned 48 MMboe of probable undeveloped reserves.

Development of the probable undeveloped reserves is expected to occur over the next 37 years. Timing of the investment and the desired pace of development will depend to a large extent on performance of new and existing wells and economic conditions, including, in particular, world commodity prices.

See “Statement of Reserves Data and OtherOil and Gas Information – Other Oil and Natural Gas Information – Principal Properties” and “Statement of ReservesData and Other Oil and Gas Information – Additional Information Related to Reserves Data – Future Development Costs” for a description of Greenfire’s exploration and development plans and expenditures.

Significant Factors or Uncertainties

The process of evaluating reserves is inherently complex. It requires significant judgments and decisions based on available geological, geophysical, engineering and economic data. These estimates may change substantially as additional data from ongoing development activities and production performance becomes available and as economic conditions impacting oil and gas prices and costs change. The reserve estimates contained herein are based on current production forecasts, prices and economic conditions and other factors and assumptions that may affect the reserve estimates and the present worth of the future net revenue therefrom. These factors and assumptions include, among others: (i) historical production in the area compared with production rates from analogous producing areas; (ii) initial production rates; (iii) production decline rates; (iv) ultimate recovery of reserves; (v) success of future development activities; (vi) marketability of production; (vii) effects of government regulations; and (viii) other government levies imposed over the life of the reserves. Although every reasonable effort is made to ensure that reserve estimates are accurate, reserve estimation is an inferential science. As a result, subjective decisions, new geological or production information and a changing environment may impact these estimates.

Greenfire has a significant amount of proved undeveloped and probable undeveloped reserves assigned to its properties. As circumstances change and additional data becomes available, reserve estimates also change. Estimates are reviewed and revised, either upward or downward, as warranted by new information. Revisions are often required due to changes in well performance, prices, economic conditions and government restrictions. Revisions to reserve estimates can arise from changes in year-end prices, reservoir performance and geologic conditions or production. These revisions can be either positive or negative. Degradation in future commodity price forecasts relative to the forecast in the Greenfire Reserves Report can also have a negative impact on the economics and timing of development of undeveloped reserves, unless significant reduction in the future costs of development are realized.

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Other than the foregoing, Greenfire does not anticipate any significant economic factors or significant uncertainties that may affect any particular components of this statement of reserves data and other oil and gas information. However, reserves can be affected significantly by fluctuations in product pricing, capital expenditures, operating costs, royalty regimes and well performance that are beyond Greenfire’s control. See “Disclosure of Reserves Data andAdvisories – Advisories” in this Statement.

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Abandonment and Reclamation Costs

The Company follows International Financial Reporting Standards to account for and report the estimated cost of future site abandonment and reclamation. This standard requires liability recognition for retirement obligations associated with long-lived assets, which would include abandonment of wells and related facilities, natural gas wells and related facilities, removal of equipment from leased acreage and returning such land to a condition equivalent to its original condition. Under the standard, the estimated cost of each decommissioning obligation is recorded in the period a well or related asset is drilled, constructed or acquired. The obligation is estimated using the present value of the estimated future cash outflows to abandon the asset at the Company’s credit-adjusted risk-free rate. The obligation is reviewed regularly by management based upon current regulations, costs, technologies and industry standards. The discounted obligation is recognized as a liability and is accreted against income until it is settled or the property is sold and is included as a component of net finance expense. Actual restoration expenditures are charged to the accumulated obligation as incurred.

The Company’s decommissioning obligation is the estimated cost of future abandonment and reclamation of the Company’s existing long-lived assets. As of December 31, 2023, the estimated total undiscounted amount required to settle the decommissioning obligations in respect of all the Company’s facilities and wells, net of estimated salvage recoveries, was $206.5 million. This obligation is estimated to be settled in periods up to 2071. The discounted present value of this amount is $8.4 million as reported in the financial statements of the Company for the year ended December 31, 2023.

The Greenfire Reserves Report estimate of abandonment and reclamation costs is an estimate of the amount required to abandon and reclaim the entire development (including well sites, gathering systems and processing facilities) over the life of the reserves. In the Greenfire Reserves Report, abandonment and reclamation costs for total proved plus probable reserves were estimated to be $251 million, undiscounted, and $14 million, discounted at 10%. These costs include the abandonment, decommissioning and reclamation of the entire Hangingstone Facilities, infrastructure, currently drilled SAGD and observation wells plus the future well pairs, infills and observation wells anticipated to be required to develop the assigned reserves over the life of the Hangingstone Facilities. These estimates do not include abandonment and reclamation costs or other liabilities outside of the Hangingstone Facilities, which the Company has included in determining its total decommissioning provision.

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Future Development Costs

The following table sets out the development costs deducted in the estimation of future net revenue attributable to proved reserves (using forecast prices and costs) and proved plus probable reserves (using forecast prices and costs) based upon the Greenfire Reserves Report.

Year	Total Proved Reserves (Estimated Using Forecast Prices and Costs 000s)	Total Proved Plus Probable Reserves (Estimated Using Forecast Prices and Costs 000s)
2024
2025
2026
2027
2028
Thereafter
Total for all years undiscounted
Total for all years discounted at 10% per year

All values are in US Dollars.

Greenfire expects to use a combination of internally generated cash from operations, working capital and the issuance of new equity or debt where and when it believes appropriate to fund future development costs set out in the Greenfire Reserves Report. There can be no guarantee that funds will be available or that Greenfire will allocate funding to develop all of the reserves attributable in the Greenfire Reserves Report. Failure to develop those reserves could have a negative impact on Greenfire’s future cash flow. Further, Greenfire may choose to delay development depending upon a number of circumstances including the existence of higher priority expenditures and available cash flow.

Greenfire does not anticipate that interest or other funding costs would make further development of any of Greenfire’s properties uneconomic.

Other Oil and Natural Gas Information

Unless otherwise stated, the following information is presented as at December 31, 2023.

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Principal Properties

Hangingstone Expansion Asset

The Company owns a 75% working interest in the Expansion Asset. The Expansion Asset is located in the southern Athabasca region of Northeastern Alberta, approximately 30 miles southwest of Fort McMurray. JACOS commenced Phase I construction of the Expansion Asset in 2013, investing approximately $1.5 billion of capital to create robust infrastructure to support growth. The Expansion Asset’s first steam occurred in April 2017 and first production occurred in July 2017. The Company estimates that the Expansion Asset has a debottlenecked capacity of 35,000 bbls/d of bitumen production. Since the commencement of production in 2017, 32 well pairs have been developed at the Expansion Asset. The Expansion Asset is pipeline connected for diluted bitumen and diluent, and as a result, all production from the Expansion Asset is transported by pipeline following the blending of bitumen with diluent to meet pipeline specifications.

In 2023, the annual average gross production from the Expansion Asset was 18,439 bbls/d (approximately 13,829 bbls/d net to Greenfire’s working interest) of bitumen. Greenfire has an interest in 17,730 gross hectares (13,298 net hectares) of land at the Expansion Asset.

Hangingstone Demo Asset

The Company owns a 100% working interest in the Demo Asset, which is approximately three miles from the Expansion Asset. Management estimates that the Demo Asset has a debottlenecked capacity of 7,500 bbls/d of bitumen production. The Demo Asset was originally commissioned in 1999 by JACOS as a demonstration asset to prove the economic viability of enhanced thermal oil recovery. As of December 31, 2023, approximately 40.3 million barrels of bitumen had been produced at the Demo Asset and the facility has a relatively long history of production.

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Bitumen production from the Demo Asset is unique relative to other thermal oil assets in western Canada as it is produced without the use of added diluent or synthetic oils. This attribute results in relatively lower operating expenses when compared to other oil sands assets of similar scale and provides more options in terms of marketing and selling the product. Access to a diluent-free heavy crude oil barrel is also valued by refiners in the United States, which facilitates additional sales points for the Demo Asset’s production, including transportation by rail to the United States to access WTI indexed pricing, when it is economically viable to do so. Following the JACOS Acquisition, Greenfire constructed a truck offloading facility at the Expansion Asset to accept trucked production volumes from the Demo Asset. Prior to the construction of the truck offloading facility, production from the Demo Asset was required to be trucked over 600 miles round trip to a pipeline salespoint, and following completion of the construction of the truck offloading facility the round trip trucking distance has been reduced to approximately six miles. Aside from enhancing profitability by reducing transportation costs, the reduction of distance trucked reduces emissions associated with the transportation of its production.

In 2023, the gross and net annual average bitumen production from the Demo Asset was 3,810 bbls/d. Greenfire has an interest in 974 hectares of land at the Demo Asset.

Land Acreage

As a result of the JACOS Acquisition, Greenfire holds significant undeveloped leases at three locations, Chard, Corner, and Liege, all of which are in the Athabasca region of Alberta, Canada. The Company believes that the Chard, and Corner properties are potential prospects for future in-situ bitumen production using SAGD processes.

A gross acre is an acre in which a working interest is owned, and a net acre is the result that is obtained when the fractional ownership working interest of a lease is multiplied by gross acres of that lease. The number of net acres is the sum of the fractional working interests owned in gross acres expressed as whole numbers and fractions thereof.

All of Greenfire’s acreage is located in the Province of Alberta and is held indefinitely. There are no near-term acreage expirations. The following table shows Greenfire’s total gross and net mineral rights acreage by asset location as of December 31, 2023:

Properties with Reserves

Area	Property	Interest (%)		Gross Area (Hectares)		Net Area (Hectares)
Hangingstone	Expansion		75		17,730		13,298
Hangingstone	Demo		100		974		974
Total Acreage					18,704		14,272

Unproved Properties

****<br><br>Area	Property	Interest (%)		Gross Area (Hectares)		Net Area (Hectares)
Corner	Corner North		100		6,516		6,516
Corner	Corner South		12		12,004		1,440
Chard	Chard North		100		7,318		7,318
Chard	Chard West		25		7,800		1,950
Chard	Chard East		25		7,250		1,812
Chard	Chard		25		8,031		2,008
Hangingstone	Gas		100		1,024		1,024
Liege	Liege		25		13,824		3,456
Total Acreage					63,767		25,524

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Well Information

Greenfire had 54 gross (46 net horizontal wells) capable of producing bitumen as of each of the years ended December 31, 2023, and 2022. As of December 31, 2023, Greenfire has drilled eight new redevelopment infill (“Refill”) wells. Refill wells are an infill well that has been drilled via the re-entry of an existing primary producer well to produce incremental pre-heated bitumen between two sets of well pairs. Refill wells utilize an existing producer wellhead and casing to reduce costs associated with drilling and facilities, with an acceleration of first production anticipated, relative to producing from traditional infill wells. The Company expects that Refill wells will enhance the total bitumen recovery of previously drilled and steamed well pairs, with marginal incremental capital expenditure and minimal geological risk. The SAGD industry has a long-term track record of consistently and effectively producing incremental pre-heated bitumen volumes from infill and Refill wells. Greenfire has no exploratory wells and did not drill any dry exploratory or development wells in the last three fiscal years.

As evaluated by McDaniel as of December 31, 2023, proved undeveloped reserves are from planned well locations in the Alberta Energy Regulator (“AER”) approved development area and are within three miles from existing bitumen producing wells at the Demo Asset and Expansion Asset. Development plans include new well pairs that consist of horizontal steam injector wells placed approximately 15 feet (5 meters) above horizontal bitumen production wells in a reservoir that has a minimum of 32 feet (10 meters) of average bitumen net pay and up to over 100 feet (30 meters). Spacing between well pairs at both the Demo Asset and Expansion Asset is approximately 325 feet (100 meters). Future development plans include drilling infill horizontal bitumen production wells between existing and new well pairs.

In order to make the most efficient use of Greenfire’s steam generating and oil treating facilities, the drilling and steaming of new wells would take place over 30 years. Development of Greenfire’s proved undeveloped reserves will take place in an orderly manner as additional well pairs and infills are drilled to use available steam when existing well pairs reach the end of their steam injection phase. The forecasted production of Greenfire’s proved reserves extends approximately 32 years.

Oil and Natural Gas Wells

The following table sets forth Greenfire’s producing and non-producing bitumen production wells as of December 31, 2023, all of which are in Alberta, Canada:

	Producing Wells as of<br> December 31, 2023				Non-Producing Wells as of<br> December 31, 2023
Expansion Asset	Gross		Net		Gross		Net
SAGD Well Pairs^(1)^		32		24		-		-
Infill Wells		-		-		-		-
Demo Asset
SAGD Well Pairs		22		22		2		2
Infill Wells		-		-		-		-
Total		54		46		2		2

Note:

(1)

These SAGD wells include the 8 Refill wells drilled at the Expansion<br>Asset in 2023. A Refill well is an infill well that has been drilled via the re-entry of an existing primary producer well to produce<br>incremental pre-heated bitumen between two sets of well pairs. Refill wells utilize an existing producer wellhead and casing to reduce<br>costs associated with drilling and facilities, with an acceleration of first production anticipated, relative to producing from traditional<br>infill wells. They do not add to a well pair count nor can be considered a true infill well.

Properties with No Attributed Reserves

As at December 31, 2023, Greenfire held approximately 63,767 gross acres and 25,524 net acres of rights with no attributed reserves. For additional information about Greenfire’s properties with no attributed reserves see “Other Oil and Natural Gas Information – Principal Properties – Land Acreage”.

16

Forward Contracts

Greenfire may use financial derivatives to manage its exposure to fluctuations in commodity prices, foreign exchange and interest rates. These include contracts for exposure management unrelated to crude oil sales price risk management; and contracts for management of price exposures associated with crude oil, crude oil differentials, condensate, natural gas liquids, refined products, refining margins, natural gas, electricity and renewable power contracts. The indenture governing Greenfire’s senior secured notes has a minimum hedging requirement of 50% of the forward 12 calendar month proved developed producing forecasted production as prepared in accordance with the Canadian standards under NI 51-101 until principal debt under the senior secured notes is less than US$100.0 million.

As of December 31, 2023, Greenfire entered into commodity-based derivative contracts as follows:

	WTI -Costless Collar				Natural Gas-Fixed Price Swaps
Term	Volume (bbls)		Put Strike Price <br>(US/bbl)	Call Strike Price <br>(US/bbl)	Volume (GJs)		Swap Price <br>(CAD/GL)
Q1 2024		877,968				455,000
Q2 2024		877,968				-
Q3 2024		887,800				-
Q4 2024		887,800				-

All values are in US Dollars.

Greenfire has revised its risk management contracts for 2024 replacing the WTI costless collars with WTI-fixed price swaps. As of March 20, 2024, Greenfire has the following commodity-based derivative contracts.

	WTI-Fixed Price Swaps			WTI-Costless Collars				Natural Gas-Fixed Price Swaps
Term	Volume<br><br> (bbls)		Swap Price<br> (US/bbl)	Volume<br><br> (bbls)		Put Strike Price<br>(US/bbl)	Call Strike Price<br> (US/bbl)	Volume<br><br> (GJs)		Swap Price<br> (US/GJ)
Q1 2024		1,046,500			-				455,000
Q2 2024		1,046,500			-				-
Q3 2024		1,058,000			-				-
Q4 2024		1,058,000			-				-
Q1 2025		-			640,700				-

All values are in US Dollars.

Tax Horizon

In 2023, Greenfire was not required to pay any income related taxes. It is expected, based upon current legislation, the projections contained in the Greenfire Reserves Report, proved plus probable analysis and various other assumptions, that no income taxes will be required to be paid by Greenfire until 2027. A higher level of capital expenditures than those contained in the Greenfire Reserves Report, or further additional acquisitions, could further extend the estimated tax horizon.

17

Costs Incurred

The following table summarizes certain costs incurred by Greenfire in Canada for the year ended December 31, 2023:

Expenditure^(1)^	(millions)
Property acquisition costs
Proved properties
Unproved properties
Exploration costs
Development costs
Total

All values are in US Dollars.

Note:

(1)	Greenfire had no property acquisition costs, or disposition proceeds, for the year ended December 31,<br>2023. Development costs during the year were related to mineral lease rentals on undeveloped lands.

Exploration and Development Activities

The following table sets forth the wells in which Greenfire participated during the year ended December 31, 2023.

	2023 Wells<br> (Gross and Net)
	Gross Wells		Net Wells
Exploration Wells		-		-
Stratigraphic Test Wells		-		-
SAGD Wells^(1)^		8		6
Observation Wells		-		-
Infill Wells		-		-
Water Source Wells		-		-
Water Disposal Wells		-		-
Total Completed Wells:		8		6

Note:

(1)

These are the 8 Refill wells drilled at the Expansion Asset in 2023. A Refill well is an infill well that<br>has been drilled via the re-entry of an existing primary producer well to produce incremental pre-heated bitumen between two sets of well<br>pairs. Refill wells utilize an existing producer wellhead and casing to reduce costs associated with drilling and facilities, with an<br>acceleration of first production anticipated, relative to producing from traditional infill wells. They do not add to a well pair count<br>nor can be considered a true infill well.

See “Other Oil and Natural Gas Information– Principal Properties” for a description of Greenfire’s current and proposed exploration and development activities.

18

Production Estimates

The following table sets out the volumes of company share production estimated by McDaniel for 2024, which is reflected in the estimate of future net revenue disclosed in the forecast price tables contained under “Statement of Reserves Data and Other Oil and Gas Information –Disclosure of Reserves Data –Pricing Assumptions”.

	Bitumen<br> (bbls/d)
Total Proved
Alberta
Expansion Asset		18,356
Demo Asset		4,870
Other		-
Total		23,226
Total Proved Plus Probable
Alberta
Expansion Asset		20,134
Demo Asset		5,450
Other		-
Total		25,584

Production History

The following table sets forth certain information in respect of production, product prices received, royalties paid, production costs and resulting netback received by Greenfire for the periods indicated below:

								Year Ended<br> <br>2023
		June 30		Sept. 30		Dec. 31		Dec 31
Average Daily Sales(1)
Bitumen (Bbls/d)	20,586		18,036		11,052		17,335		17,639
Average Price Received (net of quality adjustment)
Bitumen (/Bbl)	65.87		75.78		89.86		71.04		73.91
Royalties Paid
Bitumen (/Bbl)	2.36		3.54		5.60		3.79		3.67
Production Costs
Bitumen (/Bbl)	20.87		20.20		29.12		22.05		23.08
Net Transportation Costs
Bitumen (/Bbl)	6.83		6.46		7.79		6.82		6.93
Resulting Netback Received(2)
Bitumen (/Bbl)	9.11		23.05		38.07		17.19		20.56

All values are in US Dollars.

Notes:

(1)	Before deduction of royalties.
(2)	Netbacks are calculated by subtracting royalties and operating costs from revenues. Excludes realized<br>gains (losses) on risk management contracts.
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The following table indicates Greenfire’s average daily production from the Demo Asset and the Expansion Asset for the year ended December 31, 2023:

	Bitumen<br> (Bbls/d)
Alberta
Demo Asset		3,810
Expansion Asset		13,829
Total		17,639

19

APPENDIX A – REPORT OF MANAGEMENT AND DIRECTORS ON OIL AND GAS DISCLOSURE

Management of Greenfire Resources Ltd. (the “Company”) is responsible for the preparation and disclosure of information with respect to the Company’s oil and natural gas activities in accordance with securities regulatory requirements. This information includes reserves data which are estimates of proved reserves and probable reserves and related future net revenue as at December 31, 2023, estimated using forecast prices and costs.

An independent qualified reserves evaluator has evaluated the Company’s reserves data. The report of the independent qualified reserves evaluator is presented above.

The Audit and Reserves Committee of the Board of Directors of the Company has:

(a)	reviewed the Company’s procedures<br>for providing information to the independent qualified reserves evaluator;
(b)	met with the independent qualified reserves evaluator to determine<br>whether any restrictions affected the ability of the independent qualified reserves evaluator to report without reservation; and
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(c)	reviewed the reserves data with management and the independent<br>qualified reserves evaluator.
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The Audit and Reserves Committee of the Board of Directors has reviewed the Company’s procedures for assembling and reporting other information associated with oil and gas activities and has reviewed that information with management. The Board of Directors has, on the recommendation of the Audit and Reserves Committee, approved:

(a)	the content and filing with securities regulatory authorities<br>of Form 51-101F1 containing reserves data and other oil and gas information;
(b)	the filing of Form 51-101F2 which is the report of the independent<br>qualified reserves evaluator on the reserves data, contingent resources data, or prospective resources data; and
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(c)	the content and filing of this report.
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Because the reserves data are based on judgments regarding future events, actual results will vary and the variations may be material.

(Signed) “Robert Logan”	(Signed) “Tony Kraljic”
Robert Logan	Tony Kraljic
President, Chief Executive Officer and a Director	Chief Financial Officer
(Signed) “Venkat Siva”	(Signed) “William Derek Aylesworth”
---	---
Venkat Siva	William Derek Aylesworth
Director and Member of the Audit and Reserves Committee	Director and Chair of the Audit and Reserves Committee

March 20, 2024

20

APPENDIX B – REPORT ON RESERVES DATA BY THE INDEPENDENT QUALIFIED RESERVES EVALUATOR OR AUDITOR

To the Board of Directors of Greenfire Resources Ltd., (the “Company”):

1.	We have evaluated the Company’s reserves data as at December 31, 2023. The reserves data are estimates<br>of proved reserves and probable reserves and related future net revenue as at December 31, 2023, estimated using forecast prices and costs.
2.	The reserves data are the responsibility of the Company’s management. Our responsibility is to express<br>an opinion on the reserves data based on our evaluation.
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3.	We carried out our evaluation in accordance with standards set out in the Canadian Oil and Gas Evaluation<br>Handbook as amended from time to time (the “COGE Handbook”) maintained by the Society of Petroleum Evaluation Engineers<br>(Calgary Chapter).
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4.	Those standards require that we plan and perform an evaluation to obtain reasonable assurance as to whether<br>the reserves data are free of material misstatement. An evaluation also includes assessing whether the reserves data are in accordance<br>with principles and definitions presented in the COGE Handbook.
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5.	The following table shows the net present value of future net revenue (before deduction of income taxes)<br>attributed to proved plus probable reserves, estimated using forecast prices and costs and calculated using a discount rate of 10%, included<br>in the reserves data of the Company evaluated by us for the year ended December 31, 2023, and identifies the respective portions thereof<br>that we have evaluated and reported on to the Company’s Board of Directors:
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Independent Qualified	Effective Date of Evaluation	Location of Reserves (County or Foreign Geographic	Net Present Value of Future Net Revenue (before income<br> taxes, 10% discount rate - M)
---	---	---	---	---	---	---	---	---	---
Reserves Evaluator	Report	Area)	Audited	Evaluated		Reviewed		Total
McDaniel	December 31, 2023	Canada			2,423,414		-		2,423,414

All values are in US Dollars.

6.	In our opinion, the reserves data respectively evaluated by us have, in all material respects, been determined<br>and are in accordance with the COGE Handbook, consistently applied. We express no opinion on the reserves data that we reviewed but did<br>not audit or evaluate.
7.	We have no responsibility to update our reports referred to in paragraph 5 for events and circumstances<br>occurring after the effective date of our reports.
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8.	Because the reserves data are based on judgements regarding future events, actual results will vary and<br>the variations may be material.
---	---

Executed as to our report referred to above:

McDaniel & Associates Consultants Ltd.

(Signed) “Jared Wynveen”
Jared Wynveen, P.Eng.
Executive Vice President
Calgary, Alberta, Canada, March 20, 2024

21

Exhibit 99.4

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PRESS RELEASE

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GreenfireResources Announces Q4 2023 Results, Year-end 2023 Reservesand Continued Success of the Company’s Multi-year Drilling Program in Q1 2024, Including the Inaugural Extended Reach Refill Well at the Demo Asset

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CALGARY,ALBERTA – March 20, 2024 – Greenfire Resources Ltd. (NYSE and TSX: GFR) (“Greenfire” or the “Company”), a Calgary-based energy company focused on the sustainable production and development of thermal energy resources from the Athabasca region of Alberta, Canada, is pleased to announce its operating and financial results for the quarter and year ended December 31, 2023; a summary of the Company’s 2023 year-end reserves; and an operational update for the first quarter of 2024. The audited consolidated Financial Statements and Notes and Management’s Discussion and Analysis (“MD&A”) will be filed on SEDAR+ at www.sedarplus.ca, on EDGAR at www.sec.gov/edgar.shtml and are available on Greenfire’s website at www.greenfireres.com.

A conference call to discuss the results has been scheduled for Thursday, March 21, 2024 at 6:00 a.m. Mountain Time (8:00 a.m. Eastern Time). Access details for the conference call are provided below. Following the conference call, Greenfire will ring the opening bell at the Toronto Stock Exchange (“TSX”), commemorating its recent listing under the symbol “GFR”. A live webcast of the celebration is expected to be available beginning shortly before 9:30 am ET on BNN Bloomberg and on YouTube at https://www.youtube.com/watch?v=1RLYrYzEtIw.

“Positive production results and impactful initial contributions from the Company’s redevelopment infill (“Refill”) drilling program and facility optimization initiatives in the fourth quarter of 2023 provided another clear indication of the productivity potential of Greenfire’s Tier-1 SAGD assets,” said Robert Logan, President and Chief Executive Officer of Greenfire.

“The Company’s successful drilling momentum continued in the first quarter of 2024 with the initiation of a seven well extended reach Refill drilling program at the Demo Asset, targeting an industry leading horizontal length averaging approximately 2,000 meters per well.”

“Supported by our recent listing on the TSX and amidst a potential re-rating of the Canadian heavy oil barrel with the Trans Mountain Expansion Project (“TMX”) anticipated to commence operations in 2024, Greenfire will drive continued production growth, accelerate debt repayment and pursue additional potential step-change value generation opportunities.” concluded Mr. Logan.

Alldollar amounts reported in this press release are in Canadian dollars unless otherwise noted.

TheCompany holds a 75% working interest in the Hangingstone Expansion Facility (the “Expansion Asset”) and a 100% working interestin the Hangingstone Demonstration Facility (the “Demo Asset” and together with the Expansion Asset, the “Hangingstone Facilities”). Unless otherwise indicated, production and reserves volumes and per unit statistics are presented throughout thispress release on a company gross working interest basis before deduction of royalties.

Q4and Year-end 2023 Highlights

---

●	Delivered<br>consolidated bitumen production of 17,335 barrels per day (“bbls/d”) in Q4 2023 and 17,639 bbls/d for the year-end 2023,<br>reflecting strong production performance from the Refill drilling program, which began in August 2023, as well as surface facility optimizations<br>at the Expansion Asset.
●	Adjusted<br>EBITDA^(1)^ was $23.4 million in Q4 2023 ($32.5 million – Q4 2022) and $117.3 million for year-end 2023 ($218.0 million<br>– 2022), while adjusted funds flow^(1)^was $10.5 million in Q4 2023 ($16.9 million – Q4 2022) and $73.2 million<br>for year-end 2023 ($163.9 million – 2022).
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●	Capital<br>expenditures totaled $33.4 million in 2023, which included $19.4 million deployed in the fourth quarter, consisting of $14.9 million<br>allocated to the Refill drilling program at the Expansion Asset, and $4.5 million directed to various facility projects.
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![](ex99-4_002.jpg)

●	Available<br>liquidity of $159.5 million at December 31, 2023, consisting of:
o	$109.5<br> million of cash and cash equivalents; and
---	---
o	$50.0<br> million of available credit under a reserve-based credit facility (“Senior Credit Facility”).
---	---
●	Greenfire’s<br>independent reserves evaluator, McDaniel & Associates Consultants Ltd. (“McDaniel”), prepared independent reserves evaluations<br>for Greenfire for the year-ended 2023 in accordance with National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities(“NI 51-101”), which reflected the following:
---	---
o	Proved<br> reserves at December 31, 2023 totaled 183.3 MMbbl (183.4 MMbbl – year-end 2022), representing<br> a net present value (discounted at 10%) (“NPV10”) of $2.0 billion based on forecast<br> pricing in accordance with NI 51-101^(2)^ or approximately $24.10 per diluted share,<br> net of outstanding debt plus cash and cash equivalents.
---	---
o	Proved<br> plus probable (“2P”) reserves at December 31, 2023 totaled 237.7 MMbbl (239.4 MMbbl<br> – year-end 2022), representing an NPV10 of $2.4 billion based on forecast pricing in<br> accordance with NI 51-101^(2)^ or approximately $29.70 per diluted share, net of<br> outstanding debt plus cash and cash equivalents.
---	---
o	Greenfire<br> has a large, long-life and relatively low decline oil sands resource base, with a 2P reserves<br> life index of 37 years^(3)^. The Company has approximately $1.8 billion of tax pools<br> as at December 31, 2023 and does not anticipate paying cash (income) taxes until approximately<br> 2030.
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(1)	Non-GAAPmeasures do not have any standardized meaning prescribed by International Financial Reporting Standards (IFRS”) and may not be comparablewith the calculation of similar measures presented by other entities. Refer to the discussion under the heading “Non-GAAP and OtherFinancial Measures” in this press release for further information.
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(2)	NI51-101 pricing refers to an average of McDaniel, Sproule and GLJ forecast pricing as at January 1, 2024.
---	---
(3)	2Preserves life index is calculated by dividing Greenfire’s 2P reserves as at December 31, 2023 by the Company’s 2023 annual production.
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2
![](ex99-4_002.jpg)

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Financial& Operational Highlights

						Year ended<br> <br>December 31,
( thousands, unless otherwise noted)			2022			2023			2022
Bitumen Production - Expansion Asset (bbls/d)	14,079			15,710			13,829			16,802
Bitumen Production - Demo Asset (bbls/d)	3,256			3,869			3,810			3,701
Total Bitumen Production (bbls/d)	17,335			19,579			17,639			20,503
WTI (US/bbl)	78.32			82.65			77.62			94.23
WCS differential to WTI (US/bbl)	(21.89	)		(25.89	)		(18.71	)		(18.27	)
WCS (US/bbl)	56.43			56.76			58.91			75.96
AECO 5A (/GJ)	2.18			4.85			2.50			5.04
Oil sales	161,730			180,741			675,970			998,849
Oil sales (/bbl)	71.04			72.18			73.91			96.82
Operating netback(1)	27,353			34,567			132,704			229,694
Operating netback (/bbl)(1)	17.19			19.27			20.56			30.58
Operating expenses	35,084			42,429			148,965			160,826
Operating expenses (/bbl)	22.05			23.65			23.08			21.41
Cash provided (used) by operating activities	25,530			17,322			86,548			164,727
Adjusted EBITDA(1)	23,434			32,528			117,316			218,033
Adjusted funds flow(1)	10,517			16,902			73,206			163,926
Cash provided (used) by investing activities	18,782			(17,316	)		(12,103	)		(63,746	)
Capital expenditures	19,413			12,361			33,428			39,592
Adjusted free cash flow(1)	(8,896	)		4,541			39,778			124,334
Net income (loss) and comprehensive income (loss)	(4,659	)		87,995			(135,671	)		131,698
Per share – basic(2)	(0.07	)		1.80			(2.49	)		2.69
Per share – diluted(2)	(0.07	)		1.25			(2.49	)		1.88
Total assets, end of period	1,173,483			1,174,258			1,173,483			1,174,258
Total non-current financial liabilities, end of period	332,029			191,158			332,029			191,158
Common shares outstanding, end of period	68,642,515			48,911,009			68,642,515			48,911,009
Weighted average shares outstanding – diluted	68,642,515			70,427,594			54,425,083			69,930,167

All values are in US Dollars.

(1)	Non-GAAPmeasures do not have any standardized meaning prescribed by IFRS and may not be comparable with the calculation of similar measures presentedby other entities. Refer to the discussion under the heading “Non-GAAP and Other Financial Measures” in this press releasefor further information.
(2)	Forthe year ended December 31, 2022, the Company’s basic and diluted earnings per share is the net income per common share of GreenfireResources Inc. (“GRI”) and the weighted average common shares outstanding has been adjusted by the applicable exchange ratiofollowing the completion of the business combination (the “De-SPAC Transaction”) involving, among other entities, Greenfire,GRI and M3-Brigade Acquisition III Corp., which closed on September 20, 2023.
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Liquidityand Balance Sheet

As at ($ thousands)	December 31, <br><br>2023		December 31,<br><br> 2022
Cash and cash equivalents		109,525		35,363
Restricted cash		-		35,313
Available credit facilities^(1)^		50,000		7,000
Face value of Long-term debt^(2)^		396,780		295,173
(1)	Includes$50.0 million of available credit under Greenfire’s Senior Credit Facility, of which nil was drawn as of December 31, 2023.
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(2)	Asat December 31, 2023, the 2028 Notes (as defined below) have a face value of US$300.0 million and were translated in Canadian dollarsas at period end exchange rates.
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3
![](ex99-4_002.jpg)

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Outlookand Q1 2024 Operational Update

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●	Greenfire<br>successfully completed the ten well extended reach Refill drilling program at the Expansion Asset in February of 2024 and subsequently<br>initiated the seven well extended reach Refill drilling program at the Demo Asset.
●	In<br>the first two months of 2024, consolidated bitumen production increased to average approximately 20,000 bbls/d, reflecting initial production<br>contributions from new extended reach Refill wells and continued increases in reservoir pressure following heightened rates of non-condensable<br>gas (“NCG”) co-injection at the Expansion Asset.
---	---
●	Greenfire’s<br>previously announced 2024 Outlook allocates capital expenditures to the Hangingstone Facilities, which at the mid-point, includes $55<br>million directed to drilling for the development of the Company’s capital efficient and productive inventory of Refill well targets,<br>along with $25 million for facilities and field infrastructure investments.
---	---
●	Greenfire<br>remains committed to prioritizing debt repayment and intends to reduce debt in the near-term using 75% of excess cash flow (as defined<br>in the indenture for the Company’s Senior Secured Notes due 2028, the “2028 Notes”) to semi-annually redeem the 2028<br>Notes until total indebtedness is less than US$150 million.
---	---
o	The<br> outstanding principal amount of the 2028 Notes is US$300 million or $397 million assuming<br> the year-end 2023 U.S. to Canadian dollar exchange rate of 1.32.
---	---
●	The<br>Company is positioned to benefit from completion of TMX, given 100% of its production is weighted to crude oil benchmarks that are linked<br>to Western Canadian Select (“WCS”) differentials, which could improve as an incremental 590,000 bbls/d of pipeline egress<br>to tidewater is expected to become operational for Western Canada in 2024.
---	---
o	At<br> the mid-point of Greenfire’s 2024 Outlook production range and assuming a US$15/bbl<br> differential, the Company estimates that each US$1/bbl change in the WCS differential would<br> impact 2024 adjusted EBITDA by approximately $15 million.
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ExpansionAsset (75% Working Interest, Operator)

---

●	InitialTen Refill Well Drilling Program Successfully Completed: Eight extended reach Refill wells were drilled at the Expansion Asset during<br>2023, with an additional two extended reach Refill wells drilled during the first quarter of 2024.
●	HeightenedNCG Co-injection Continues to Support Higher Reservoir Pressure: Greenfire successfully executed multiple NCG debottlenecking initiatives<br>at the Expansion Asset in the second half of 2023, which have enabled the Company to deliver NCG at higher and more consistent rates<br>for reservoir co-injection. With heightened rates sustained, the Company expects that higher reservoir pressure will be restored at the<br>Expansion Asset around mid-2024, which management anticipates will support increased production rates.
---	---
●	Greenfire’sworking interest bitumen production at the Expansion Asset averaged approximately 17,650 bbls/d during the first two months of 2024.<br>The Company has recently encountered third-party downhole temperature sensor failures in five of the recently drilled Refill wells at<br>the Expansion Asset. Greenfire has completed the first sensor replacement in March 2024 and plans to replace the remaining sensors in<br>the second quarter of 2024. The Company estimates that working interest bitumen production has been impacted by approximately 2,000 bbls/d.
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4
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DemoAsset (100% Working Interest, Operator)

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●	RefillDrilling Program Launched: Seven extended reach Refill wells with lateral lengths averaging approximately 2,000 meters are in the<br>process of being drilled.
o	To<br> accommodate the Refill well drilling activities, producing wells across multiple adjacent<br> pads are expected to temporarily operate at reduced productivity. Greenfire expects to complete<br> the seven Refill well program by the second quarter of 2024.
---	---
o	One<br> extended reach Refill well has been successfully drilled to date, representing the first<br> Refill (or infill) well drilled at the site since the Demo Asset was commissioned for SAGD<br> in 1999.
---	---
●	DisposalWell Expected to Recommence Operations: The disposal well at the Demo Asset has been temporarily shut-in since the beginning of October<br>2023. Remediation work for this well is now complete, with disposal operations anticipated to recommence upon regulatory approval, which<br>is projected to increase bitumen production by an incremental approximately 1,000 bbls/d once fully operational.
---	---
●	Greenfire’sworking interest bitumen production at the Demo Asset averaged approximately 2,300 bbls/d during the first two months of 2024, mainly<br>due to production impacts from ongoing Refill well drilling operations as well as the temporarily shut-in of the disposal well.
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Greenfire’sGrowth-oriented Strategy Underpinned by Concentrated Tier-1 SAGD Assets

Greenfire has a large, long-life and relatively low decline Tier-1 oil sands resource base, with two producing and adjacent SAGD assets at the Hangingstone Facilities and expandable pipeline infrastructure in place for diluted bitumen and diluent at the Expansion Asset. The Company’s structural cost advantages from its Tier-1 SAGD reservoir at the Hangingstone Facilities, combined with its relatively lower forecasted capital expenditure profile due to its projected multi-year inventory of Refill well targets, is anticipated to result in continued near-term production growth and potential meaningful free cash flow generation. The Company believes that the Hangingstone Facilities offer ample opportunities for additional value generation.

In addition to Greenfire’s existing commitment to repay debt, the Company intends to formalize and initiate a policy to return capital to its shareholders over time. Greenfire also plans to evaluate and consider additional potential prospects for further production growth, including external acquisitions that compete with the expected returns from its existing Tier-1 SAGD assets, if the Company believes they are accretive to Greenfire’s shareholders.

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Year-end2023 Independent Reserves Reinforce Value Potential at the Hangingstone Facilities

---

Greenfire’s independent reserves evaluator, McDaniel & Associates Consultants Ltd. (“McDaniel”), prepared independent reserves evaluations for Greenfire in accordance with NI 51-101 standards, effective December 31, 2023.

In accordance with NI 51-101 standards using an average of McDaniel, Sproule and GLJ forecast pricing as at January 1, 2024, Greenfire holds approximately 238 million barrels of bitumen 2P reserves with an NPV10 of $2.4 billion or approximately $29.70 per diluted share, net of outstanding debt plus cash and cash equivalents, entirely underpinned by the Tier-1 SAGD reservoir at the Hangingstone Facilities.

December31, 2023 NI 51-101 Reserves at Forecast Pricing:

	Reserves<br> <br>(mbbls)^(1)^		NPV10 Before Tax (<br> Million)(1)(2)
Proved Developed Producing		30,886
Total Proved		183,282
Total Proved and Probable		237,679

All values are in US Dollars.

(1)	Reservesand the associated values have been reported on a “gross” basis under NI 51-101, which reflects Greenfire’s working interestreserves before deduction of royalties.
(2)	AsGreenfire does not expect to be taxable before 2030, the before and after-tax estimates of the NPV10 of Greenfire’s reserves are thesame.
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5
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ConferenceCall Details

Greenfire plans to host a conference call on Thursday, March 21, 2024 at 6:00 a.m. Mountain Time (8:00 a.m. Eastern Time), during which members of the Company’s executive team will discuss its Q4 2023 results as well as host a question-and-answer session with investors.

●	**Date:**Thursday, March 21, 2024
●	**Time:**6:00 a.m. Mountain Time (8:00 a.m. Eastern Time)
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●	DialIn:
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o	North<br> America: 1-800-319-4610
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o	International:<br> 1-604-638-5340
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AboutGreenfire

Greenfire is an intermediate, lower-cost and growth-oriented Athabasca oil sands producer with concentrated Tier-1 assets that use steam assisted gravity drainage extraction methods. The Company is focused on responsible and sustainable energy development in Canada, with its registered office located in Calgary, Alberta. Greenfire is an operationally focused company with an emphasis on an entrepreneurial environment and employee ownership. Greenfire common shares are listed on the New York Stock Exchange and Toronto Stock Exchange under the symbol “GFR”. For more information, visit greenfireres.com or find Greenfire on LinkedIn.

Non-GAAPand Other Financial Measures

Certain financial measures in this news release including Adjusted EBITDA (in total, and per bbl), Operating Netback (in total, and per bbl), Adjusted Funds Flow, Adjusted Free Cash Flow), are non-GAAP financial measures or ratios, supplementary financial measures or ratios and capital management measures. These measures are not defined by IFRS and, therefore, may not be comparable to similar measures provided by other companies. These non-GAAP and other financial measures should not be considered in isolation or as an alternative for measures of performance prepared in accordance with IFRS.

For further details of these non-GAAP financial measures or ratios, please refer to the Corporation’s MD&A for the quarter ended December 31, 2023 which is available on the Corporation’s website at www.greenfireres.com and is also available on the EDGAR and SEDAR+ websites.

Non-GAAPFinancial Measures

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AdjustedEBITDA

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Net income (loss) and comprehensive income (loss) is the most directly comparable GAAP measure for adjusted EBITDA, which is a non-GAAP measure. Adjusted EBITDA is calculated as net income (loss) before interest and financing, income taxes, depletion, depreciation and amortization, the transaction and financing cost impacts of the De-SPAC Transaction and bond refinancing and is adjusted for certain non-cash items, or other items that are not considered part of normal business operations. Adjusted EBITDA is used to measure Greenfire’s profitability from its underlying asset base on a continuing basis. This measure is not intended to represent net income (loss) and comprehensive income (loss) in accordance with IFRS.

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The following table is a reconciliation of net income (loss) net income (loss) and comprehensive income (loss) to adjusted EBITDA^(1)^.

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AdjustedEBITDA^(1)^

						Yearended December 31,
( thousands)			2022			2023			2022			2021^(2)^
Net income (loss)	(4,659	)		87,995			(135,671	)		131,698			661,444
Add (deduct):
Income tax recovery	25,881			(87,681	)		19,386			(87,681	)		-
Unrealized (gain) loss risk management contracts	(18,035	)		4,019			(26,587	)		(930	)		35,677
Stock-based compensation	-			1,183			9,808			1,183			-
Financing and interest	16,370			10,794			110,214			77,074			25,050
Depletion and depreciation	16,273			17,702			68,054			68,027			27,071
Transaction costs	3,848			2,769			12,172			2,769			10,318
Listing expense	(4,162	)		-			106,542			-			-
Gain on revaluation of warrants	(2,697	)		-			(34,973	)		-			-
Gain on acquisitions	-			-			-			-			(693,953	)
Foreign exchange loss (gain)	(8,072	)		(2,886	)		(8,724	)		26,099			1,512
Other (income) and expenses	(1,313	)		(1,367	)		(2,905	)		(206	)		8,373
Adjusted EBITDA(1)	23,434			32,528			117,316			218,033			75,492
Net income (loss) (/bbl)	(2.93	)		49.05			(21.02	)		17.53			229.07
Add (deduct):
Income tax recovery (expense) (/bbl)	16.26			(48.87	)		3.00			(11.67	)		-
Unrealized (gain) loss risk management contracts (/bbl)	(11.33	)		2.24			(4.12	)		(0.12	)		12.36
Stock based compensation (/bbl)	-			0.66			1.52			0.16			-
Financing and interest (/bbl)	10.29			6.02			17.08			10.26			8.68
Depletion and depreciation (/bbl)	10.23			9.87			10.54			9.06			9.38
Transaction costs (/bbl)	2.42			1.54			1.89			0.37			3.57
Listing expense (/bbl)	(2.62	)		-			16.51			-			-
Gain on revaluation of warrants (/bbl)	(1.69	)		-			(5.42	)		-			-
Gain on acquisitions (/bbl)	-			-			-			-			(240.33	)
Foreign exchange loss (gain) (/bbl)	(5.07	)		(1.61	)		(1.35	)		3.47			0.52
Other (income) and expenses (/bbl)	(0.83	)		(0.76	)		(0.45	)		(0.03	)		2.90
Adjusted EBITDA(1) (/bbl)	14.73			18.14			18.18			29.03			26.15

All values are in US Dollars.

^(1)^	Non-GAAP<br>measures do not have any standardized meaning prescribed by IFRS and may not be comparable with the calculation of similar measures presented<br>by other entities. Refer to the “Non-GAAP Measures” section in this MD&A for further information.
^(2)^	Results<br>are from operations that began at the Expansion Asset after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when<br>it was acquired on April 5, 2021.
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OperatingNetback

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Oil sales is the most directly comparable GAAP measure for operating netback, which is a non-GAAP measure. This measure is not intended to represent oil sales, net earnings or other measures of financial performance calculated in accordance with IFRS. Operating netback is comprised of oil sales, less diluent expense, royalties, operating expense, transportation and marketing expense, adjusted for realized commodity risk management gains or losses, as appropriate. Operating netback is a financial measure widely used in the oil and gas industry as a supplemental measure of a Company’s efficiency and ability to generate cash flow for debt repayments, capital expenditures or other uses.

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The following table is a reconciliation of oil sales to operating netback.

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OperatingNetback^(1)^

						Year ended <br> December 31,
( thousands, unless otherwise noted)			2022			2023			2022			2021^(2)^
Oil sales	161,730			180,741			675,970			998,849			270,674
Diluent expense	(76,768	)		(85,946	)		(304,740	)		(368,015	)		(94,623	)
Transportation and marketing	(13,277	)		(16,566	)		(55,673	)		(67,842	)		(24,057	)
Royalties	(6,024	)		(7,477	)		(23,706	)		(50,064	)		(9,543	)
Operating expense – energy	(12,223	)		(22,100	)		(56,624	)		(85,232	)		(28,674	)
Operating expense – non-energy	(22,862	)		(20,329	)		(92,342	)		(75,594	)		(31,037	)
Operating netback(1), excluding realized gain (loss) risk management contracts	30,576			28,324			142,885			352,102			82,741
Realized gain (loss) risk management contracts	(3,225	)		6,243			(10,182	)		(122,408	)		(3,614	)
Operating netback(1)	27,351			34,567			132,703			229,694			79,127
Oil sales (/bbl)	71.04			72.18			73.91			96.82			71.89
Diluent expense (/bbl)	(17.65	)		(19.34	)		(16.39	)		(12.83	)		(10.92	)
Transportation and marketing (/bbl)	(8.34	)		(9.23	)		(8.63	)		(9.03	)		(8.33	)
Royalties (/bbl)	(3.79	)		(4.17	)		(3.67	)		(6.67	)		(3.30	)
Operating expense – energy (/bbl)	(7.68	)		(12.32	)		(8.77	)		(11.35	)		(9.93	)
Operating expense – non-energy (/bbl)	(14.37	)		(11.33	)		(14.31	)		(10.06	)		(10.75	)
Operating netback(1), excluding realized gain (loss) risk management contracts (/bbl)	19.21			15.79			22.14			46.88			28.65
Realized gain (loss) risk management contracts (/bbl)	(2.03	)		3.48			(1.58	)		(16.30	)		(1.25	)
Operating netback (/bbl)(1)	17.19			19.27			20.56			30.58			27.40

All values are in US Dollars.

^(1)^	Non-GAAP<br>measures do not have any standardized meaning prescribed by IFRS and may not be comparable with the calculation of similar measures presented<br>by other entities. Refer to the “Non-GAAP Measures” section in this MD&A for further information.
^(2)^	Results<br>are from operations that began at the Expansion Asset after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when<br>it was acquired on April 5, 2021.
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AdjustedFunds Flow and Adjusted Free Cash Flow

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Cash provided (used) by operating activities is the most directly comparable GAAP measure for adjusted funds flow and adjusted free cash flow, which are non-GAAP measures. These measures are not intended to represent cash provided (used) by operating activities calculated in accordance with IFRS.

The adjusted funds flow measure allows management and others to evaluate the Company’s ability to fund its capital programs and meet its ongoing financial obligations using cash flow internally generated from ongoing operating related activities. We compute adjusted funds flow as cash provided (used) by operating activities, excluding the impact of changes in non-cash working capital, less transaction costs.

Management uses adjusted free cash flow as an indicator of the efficiency and liquidity of its business, measuring its funds after capital investment that is available to manage debt levels and return capital to shareholders. By removing the impact of current period capital expenditures from adjusted free cash flow, management monitors its adjusted free cash flow to inform its capital allocation decisions. We compute adjusted free cash flow as cash provided (used) by operating activities, excluding the impact of changes in non-cash working capital, less transaction costs and capital expenditures.

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The following table is a reconciliation of cash provided (used) by operating activities to adjusted funds flow and adjusted free cashflow.

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AdjustedFunds Flow^(1)^ and Adjusted Free Cash Flow^(1)^

	Three months ended December 31,						Year ended December 31,
($ thousands)	2023			2022			2023			2022			2021^(2)^
Cash provided (used) by operating activities		25,530			17,322			86,548			164,727			31,985
Transaction costs		3,848			2,769			12,172			2,769			10,318
Changes in non-cash working capital		(18,861	)		(3,189	)		(25,514	)		(3,570	)		6,910
Adjusted funds flow^(1)^		10,517			16,902			73,206			163,926			49,213
Capital expenditures		(19,413	)		(12,361	)		(33,428	)		(39,592	)		(4,594	)
Adjusted free cash flow^(1)^		(8,896	)		4,541			39,778			124,334			44,619
^(1)^	Non-GAAP<br>measures do not have any standardized meaning prescribed by IFRS and may not be comparable with the calculation of similar measures presented<br>by other entities. Refer to the “Non-GAAP Measures” in this MD&A for further information.
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^(2)^	Results<br>are from operations that began at the Expansion Asset after the acquisition of JACOS on September 17, 2021 and at the Demo Asset when<br>it was acquired on April 5, 2021.
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Non-GAAPFinancial Ratios

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AdjustedEBITDA ($/bbl)

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Net income (loss) and comprehensive income (loss) is the most directly comparable GAAP measure for adjusted EBITDA ($/bbl), which is a non-GAAP measure. Adjusted EBITDA ($/bbl) is used to measure Greenfire’s profitability from its underlying asset base on a continuing basis. This measure is not intended to represent net income (loss) and comprehensive income (loss) in accordance with IFRS. Adjusted EBITDA ($/bbl) is calculated by dividing adjusted EBITDA by the Company’s total sales volume in a specified period.

OperatingNetback ($/bbl)

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Oil sales ($/bbl) is a ratio calculated using oil sales, which is the most directly comparable GAAP measure for operating netback. Operating netback is the non-GAAP financial measure used to calculate operating netback ($/bbl), which is a non-GAAP financial ratio. This measure is not intended to represent oil sales, net earnings or other measures of financial performance calculated in accordance with IFRS. Operating netback ($/bbl) is calculated by dividing operating netback by the Company’s total oil sales volume, in a specified period. Operating netback ($/bbl) is a non-GAAP financial ratio widely used in the oil and gas industry as a supplemental measure of a Company’s efficiency and ability to generate cash flow for debt repayments, capital expenditures or other uses, isolated for the impact of changes in oil sales volume, in a specified period.

Forward-LookingStatements

This press release may contain “forward-looking information” within the meaning of applicable Canadian securities laws (forward-looking information being collectively hereinafter referred to as “forward-looking statements”). Such forward-looking statements are based on expectations, estimates and projections as at the date of this press release. Any statements that involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often but not always using phrases such as “expects”, “is expected”, “anticipates”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends”, or variations of such words and phrases (including negative and grammatical variations), or stating that certain actions, events or results “may”, “could”, “would”, “should”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements and are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements and information concerning: the intentions, strategy, plans and future actions of the Company; Greenfire’s intention to drive continued production growth, accelerate debt repayment and pursue additional potential step change value generation opportunities; Greenfire’s 2024 Outlook including expected amount and type of capital expenditures at the Hangingstone Facilities; Greenfire’s intent to continue to prioritize debt repayment and to reduce debt in the near-term using 75% of excess cash flow; Greenfire’s expected benefits from completion of the Trans Mountain expansion project, which is expected to become operational for Western Canada in 2024; the expectation that at the mid-point of Greenfire’s 2024 Outlook production range and assuming a US$15/bbl differential, the Company estimates that each US$1/bbl change in the WCS differential would impact 2024 adjusted EBITDA by approximately $15 million; the Company’s expectation that higher reservoir pressure will be restored at the Expansion Asset around mid-2024, which management anticipates will support increased production rates; estimated production impacts from the failure of third party downhole temperature sensors and the Company’s plans to replace those sensors in the second quarter of 2024; Greenfire’s expectation to complete the seven Refill well program at the Demo Asset by the second quarter of 2024; the expected timing for disposal operations at the disposal well at the Demo Asset to recommence and the expected resultant incremental production; the expectation that various factors will result in continued near-term production growth and potential meaningful free cash flow generation; the Company’s belief that the Hangingstone Facilities offer ample opportunities for additional value generation; estimates of reserves and the associated values; and statements relating to the business and future activities of the Company after the date of this press release.

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Forward-looking statements are based on the beliefs of the Company’s management, as well as on assumptions, which management believes to be reasonable based on information available at the time such statements were made. In addition to other assumptions set out herein, the forward-looking statements contained herein are based on the following assumptions: Greenfire’s ability to compete with other companies; the anticipated future financial or operating performance of the Company; the expected results of operations; assumptions as to future drilling results; assumptions as to costs and commodity prices; the timing and amount of funding required to execute the Company’s business plans; assumptions about future capital expenditures; the effect on the Company of any changes to existing or new legislation or policy or government regulation; the length of time required to obtain permits, certifications and approvals; the availability of labor; estimated budgets; assumptions about future interest and currency exchange rates; requirements for additional capital; the timing and possible outcome of regulatory and permitting matters; goals; strategies; future growth; and the adequacy of financial resources. However, by their nature, forward-looking statements are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

Forward-looking statements are subject to a variety of risks, uncertainties and other factors which could cause actual results, performance or achievements to differ from those expressed or implied by the forward-looking statements, including, without limitation, a decline in oil prices or widening of differentials between various crude oil prices; lower than expected reservoir performance, including, but not limited to, lower oil production rates; the inability to recognize continued or increased efficiencies from the Company’s production enhancement program and processing plant enhancements, debottlenecking and brownfield expansions; reduced access to or an increase in the cost of diluent; an increase in the cost of natural gas or electricity; the reliability and maintenance of Greenfire’s facilities; supply chain disruption and risks of increases costs relating to inflation; the safety and reliability of pipelines and trucking services that transport Greenfire’s products; the need to replace significant portions of existing wells, referred to as “workovers”, or the need to drill additional wells; the cost to transport bitumen, diluent and bitumen blend, and the cost to dispose of certain by-products; the availability and cost of insurance and the inability to insure against certain types of losses; severe weather or catastrophic events such as fires, droughts, lightning, earthquakes, extreme cold weather, storms or explosions; seasonal weather patterns and the corresponding effects of the spring thaw on equipment on Greenfire’s properties; the availability of pipeline capacity and other transportation and storage facilities for the Company’s bitumen blend; the cost of chemicals used in Greenfire’s operations, including, but not limited to, in connection with water and/or oil treatment facilities; the availability of and access to drilling equipment and key personnel; risks of cybersecurity threats including the possibility of potential breakdown, invasion, virus, cyber-attack, cyber-fraud, security breach, and destruction or interruption of the Company’s information technology systems; Canadian heavy and light oil export capacity constraints and the resulting impact on realized pricing; the impact of global wars and conflicts on global stability, commodity prices and the world economy, changes in the political landscape and/or legal, tax, royalty and regulatory regimes in Canada, and elsewhere; the cost of compliance with applicable regulatory regimes, including, but not limited to, environmental regulation, if any; the ability to attract or access capital as a result of changing investor priorities and trends, including as a result of climate change, environmental, social and governance initiatives, the adoption of decarbonization policies and the general stigmatization of the oil and gas industry; hedging risks; variations in foreign exchange and interest rates; risks related to the Company’s indebtedness; failure to accurately estimate abandonment and reclamation costs; the potential for management estimates and assumptions to be inaccurate; and general economic, market and business conditions in Canada, the United States and globally.

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You should carefully consider the all of the risks and uncertainties described in the “Risk Factors” section of the Company’s final non-offering prospectus dated February 2, 2024, which is available on SEDAR+ at www.sedarplus.ca and registration statement on Form F-1, initially filed with the United States Securities and Exchange Commission (the “SEC”) on October 10, 2023, as amended on December 1, 2023, and January 22, 2024 and other documents filed by Greenfire from time to time with the SEC. The lists of risk factors set out in this press release or in the Company’s other public disclosure documents are not exhaustive of the factors that may affect any forward-looking statements of the Company. Forward-looking statements are statements about the future and are inherently uncertain. Actual results could differ materially from those projected in the forward-looking statements as a result of the matters set out in this press release generally and certain economic and business factors, some of which may be beyond the control of the Company. In addition, the global financial and credit markets have experienced significant debt and equity market and commodity price volatility which could have a particularly significant, detrimental and unpredictable effect on forward-looking statements. The Company does not intend, and does not assume any obligation, to update any forward-looking statements, other than as required by applicable law. For all of these reasons, the Company’s securityholders should not place undue reliance on forward-looking statements.

FinancialInformation

The financial information and data contained in this press release is unaudited and does not conform to Regulation S-X promulgated under the United States Securities Act of 1933. While Greenfire’s financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”), the financial information and data contained in this press release have not been prepared in accordance with IFRS. Greenfire believes the measures that are not defined under IFRS provide useful information to management and investors regarding certain financial and business trends relating to Greenfire’s financial condition and results of operations. Greenfire believes that the use of these non-IFRS financial measures provides an additional tool for investors to use in evaluating projected operating results and trends relating to Greenfire’s financial condition and results of operations. These non-IFRS measures may not be indicative of Greenfire’s historical operating results, nor are such measures meant to be predictive of future results. These measures may not be comparable to measures under the same or similar names used by other similar companies. Management does not consider these non-IFRS measures in isolation or as an alternative to financial measures determined in accordance with IFRS.

Oil andGas Terms

This press release uses the term Tier-1 SAGD reservoir to describe the bitumen reservoirs that Greenfire has an interest in. The term Tier-1 SAGD reservoir refers to SAGD reservoirs that have no top gas, bottom water, or lean zones, commonly referred to as “thief zones”. Thief zones provide an unwanted outlet for steam and reservoir pressure. Thief zones require costly downhole pumps and recurring pump replacements to achieve targeted production rates, leading to higher capital and operating expenditures. Tier-1 wells flow to surface with natural lift; not requiring downhole pumps or gas lift.

ContactInformation

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GreenfireResources Ltd.

205 5th Avenue SW

Suite 1900

Calgary, AB T2P 2V7

investors@greenfireres.com

greenfireres.com

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