Sky Quarry Enters Strategic Multi-Party MOU to Advance Next-Generation Fuel Technologies

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Collaboration with Southern Energy Renewables and DevvStream Opens New Pathways at PR Spring and the Foreland Refinery

WOODS CROSS, UT / ACCESS Newswire / May 7, 2026 / Sky Quarry Inc. (NASDAQ:SKYQ) ("Sky Quarry" or the "Company"), an integrated energy and resource recovery company, today announced the execution of a Memorandum of Understanding ("MOU") with Southern Energy Renewables Inc. ("Southern"), a U.S.-based developer of carbon-negative fuels and large-scale biomass-to-sustainable aviation fuel ("SAF") platforms, and DevvStream Corp. ("DevvStream"), a technology-driven environmental markets and carbon management company.

The MOU establishes a strategic collaboration focused on fuel innovation, refinery integration, and low-carbon fuel development, including opportunities involving recycled hydrocarbons, specialty fuels, SAF, and related fuel applications.

A Step-Change in Development Capacity for Sky Quarry

The agreement materially expands Sky Quarry's development capabilities by aligning with organizations actively advancing large-scale clean fuel infrastructure and environmental market solutions.

Southern's platform is designed to produce sustainable aviation fuel, methanol, and other low-carbon fuels at industrial scale through modular plant designs and integrated conversion technologies intended to reduce development timelines and capital intensity.

DevvStream brings expertise in carbon management, environmental attribute monetization, and lifecycle analysis, capabilities that are increasingly central to the economics of low-carbon fuel projects.

Through this collaboration, Sky Quarry gains access to:

• Advanced development expertise across FEED, pilot validation, and commercialization

• Scalable project frameworks capable of accelerating timelines at PR Spring

• Integration pathways into emerging low-carbon fuel ecosystems and environmental markets

• Exposure to environmental attribute markets, carbon programs, and project financing frameworks across low-carbon fuel infrastructure

Maximizing the Value of PR Spring

The MOU provides a clear pathway to expand and optimize the PR Spring asset by integrating new fuel development initiatives alongside existing hydrocarbon recovery operations.

Specifically, the partnership enables:

• Pilot-scale validation of advanced fuels, including SAF, specialty fuels, and recycled hydrocarbon blends

• Expansion of product slate beyond traditional heavy oil and asphalt outputs

• Acceleration of commercialization timelines through the partners' combined development roadmap

• Potential integration into broader SAF and synthetic fuel supply chains

Southern's demonstrated experience in gasification, syngas conversion, and methanol-to-fuel pathways provides a complementary framework that can enhance PR Spring's long-term production capabilities and economic profile. DevvStream's carbon intensity optimization and environmental attribute expertise add a further dimension, positioning output streams for low-carbon fuel markets that reward verified emissions reductions.

Advancing Technology at the Foreland Refinery

At the Foreland Refinery in Nevada, the collaboration introduces a pathway to advance refining complexity and product value through new fuel technologies.

The partnership is expected to support:

• Blending of synthetic and conventional feedstocks to produce higher-value fuels

• Development of on-spec aviation and specialty fuels supported by advanced fuel development initiatives under the collaboration

• Technology validation that can inform future refinery upgrades, including hydrotreating and advanced processing systems

• Positioning Foreland as a regional hub for next-generation fuel production

This represents a strategic evolution of Foreland from a traditional refinery into a technology-enabled fuel production platform aligned with emerging domestic energy and low-carbon fuel priorities.

Strategic Alignment with Evolving Energy Markets

The collaboration comes at a time of increasing U.S. policy support for domestic fuel production, refining infrastructure, sustainable fuels, and carbon reduction initiatives, including:

• Incentives for low-carbon and synthetic fuels

• Funding for energy infrastructure and refining capacity

• Growing demand for environmental attribute monetization and carbon intensity optimization across low-carbon fuel supply chains

Leadership Commentary

"This MOU represents a significant expansion of Sky Quarry's development platform," said Marcus Laun, Chief Executive Officer of Sky Quarry. "By collaborating with Southern and DevvStream, we are accelerating the optimization of PR Spring while advancing new technology pathways that can transform Foreland into a next-generation fuel production hub. This partnership positions Sky Quarry at the intersection of traditional energy infrastructure and advanced fuel innovation."

"Sky Quarry's combination of upstream resources and refining infrastructure creates a compelling platform for advanced fuel development," said Nevin Smalls, Chief Strategy Officer of Southern Energy Renewables. "We look forward to exploring opportunities around low-carbon fuels, refining innovation, and scalable commercial applications together."

Next Steps

The parties intend to advance toward definitive agreements focused on:

• Pilot programs for advanced fuel development

• Commercialization frameworks for aviation and specialty fuels

• Integration of technologies across Sky Quarry's asset base

The MOU has an initial term of three years and reflects the parties' intent to collaborate on a long-term basis across multiple projects, fuel markets, and geographies. The MOU is non-binding, except for certain customary provisions.

About Sky Quarry Inc.

Sky Quarry is an oil production and refining company that operates the Foreland Refinery, a regional facility producing diesel, vacuum gas oil (VGO), naphtha, and liquid paving asphalt for Western U.S. markets. The Company is also advancing its PR Spring development in Utah, focused on technologies to recover hydrocarbons from oil-saturated sands, soils, and consumer waste, including asphalt shingles, using its proprietary ECOSolv process. This closed-loop technology aims to enable efficient oil recovery while reducing landfill waste and supporting domestic energy production. For more information, please visit www.skyquarry.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements about the Company's plans and strategy, future financial and/or operating results and projections, future developments in the industry and the potential impact of regulations. All statements other than statements of historical fact may constitute forward-looking statements. The statements may be identified by words such as "expect," "anticipate," "intend," "plan," "believe," "seek," "estimate," "will," "project," "potential," "may," "can," "if," or words of similar meaning. Such statements are based on current expectations and assumptions of management, many of which are beyond the Company's control, and are subject to a number of risks, uncertainties, and factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described explicitly or implicitly in any forward-looking statement. Forward-looking statements speak only as of the date hereof. Except as required by applicable law, the Company undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events and circumstances or otherwise. You are urged to carefully review and consider the cautionary statements and the Company's other disclosures, including the statements made under the heading "Risk Factors" and elsewhere in the Company's most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other filings made with the SEC.

Investor Relations

Jennifer Standley

Director of Investor Relations

[email protected]

SOURCE: Sky Quarry