Mr. Jeff Tonken reports

BIRCHCLIFF ENERGY LTD. ANNOUNCES Q3 2023 RESULTS, DECLARATION OF Q4 2023 DIVIDEND OF $0.20 PER COMMON SHARE AND PRELIMINARY 2024 GUIDANCE

Birchcliff Energy Ltd. has released its third quarter 2023 financial and operational results and its preliminary guidance for 2024. Also, Birchcliff's board of directors has declared a quarterly cash dividend of 20 cents per common share for the quarter ended Dec. 31, 2023.

"In Q3 2023, we generated adjusted funds flow of $72.2-million and free funds flow of $5.5-million, with average production of 74,143 [barrels of oil equivalent per day]. In addition, we returned an aggregate of $53.3-million to shareholders in Q3 2023 through our base common share dividend. Since Sept. 30, 2022, Birchcliff has returned an aggregate of $218.5-million to shareholders (or 82 cents per basic common share) through common share dividends," commented Jeff Tonken, chief executive officer of Birchcliff. "Earlier in the year, we made the strategic decision to defer the drilling of nine wells from [second quarter] 2023 to Q3 2023, which resulted in no new wells being brought on production in Q3 2023. These nine wells were recently brought on production, allowing us to capture the anticipated strength in natural gas pricing that is typically seen in winter months, as well as setting us up for stronger average production in [fourth quarter] 2023 and [first quarter] 2024.

"We anticipate that our adjusted funds flow will be sufficient to fully fund our [finding and development] capital expenditures and common share dividend payments in 2024 based on our preliminary budgeting process and current commodity price outlook. We are targeting F&D capital expenditures of $260-million to $280-million in respect of 2024 and annual average production of 77,000 to 79,000 boe/d. We expect to generate adjusted funds flow of approximately $500-million and free funds flow of approximately $240-million to $260-million in 2024. As part of Birchcliff's $260-million to $280-million capital program for 2024, we expect to spend approximately $20-million in Q4 2023 to commence the drilling of five wells in Pouce Coupe, which will allow us to maximize production during the winter months, and $240-million to $260-million in 2024. We are continuing to evolve our plans for 2024, and expect to announce the details of our formal 2024 capital budget and updated five-year outlook for 2024 to 2028 on Jan. 17, 2024."

Q3 2023 financial and operational highlights:

• Achieved quarterly average production of 74,143 boe/d;
• Generated quarterly adjusted funds flow of $72.2-million, or 27 cents per basic common share, and quarterly free funds flow of $5.5-million, or two cents per basic common share;
• Generated cash flow from operating activities of $67.8-million;
• Reported quarterly net income to common shareholders of $15.1-million, or six cents per basic common share;
• Realized an operating expense of $3.93 per boe;
• F&D capital expenditures totalled $66.7-million;
• Total debt at Sept. 30, 2023, was $327.7-million;
• Returned $53.3-million to shareholders through the corporation's base common share dividend.

Birchcliff's unaudited interim condensed financial statements for the three and nine months ended Sept. 30, 2023, and related management's discussion and analysis will be available on its website and on SEDAR+.

Declaration of Q4 2023 quarterly dividend

The board has declared a quarterly cash dividend of 20 cents per common share for the quarter ending Dec. 31, 2023. The dividend will be payable on Dec. 29, 2023, to shareholders of record at the close of business on Dec. 15, 2023. The ex dividend date is Dec. 14, 2023. The dividend has been designated as an eligible dividend for the purposes of the Income Tax Act (Canada). This is the fifth consecutive quarter in which Birchcliff's board has declared a cash dividend of 20 cents per common share.

Outlook and guidance

Updated 2023 guidance

The corporation is reaffirming its annual average production guidance at approximately 77,000 boe/d for 2023. As previously disclosed, Birchcliff expected to be on the low end of its 2023 production guidance range of 77,000 to 80,000 boe/d, largely as a result of an unplanned system outage on Pembina Pipeline's Northern pipeline system that negatively affected the corporation's production in the first half of the year, as well as the deferral of the drilling of nine wells from Q2 2023 to Q3 2023.

Birchcliff is updating its 2023 F&D capital expenditures guidance from $270-million to $280-million to $300-million to reflect the acceleration of approximately $20-million of capital expenditures from 2024 into Q4 2023. Birchcliff will commence the drilling of five (5.0 net) wells in Pouce Coupe in Q4 2023, which wells are planned to be brought on production in late January, 2024, as well as drill several surface holes and procure various long-lead items required for the execution of the corporation's 2024 capital program.

By accelerating these capital projects, the corporation will be able to maximize production during the winter months to capture the anticipated strength in natural gas pricing that is typically seen in the winter months. In addition, accelerating this capital into Q4 2023 will allow Birchcliff to continue its two-drilling-rig program throughout the rest of 2023, help to ensure the efficient execution of the corporation's 2024 capital program and allow Birchcliff to significantly decrease the risks related to the price and availability of drilling and other oil field services during a period of tight supply.

The corporation is also updating certain other items of its 2023 guidance to reflect the acceleration of capital and an updated commodity price forecast for 2023.

The company sets forth Birchcliff's updated and previous guidance and commodity price assumptions for 2023, as well as its free funds flow sensitivity.

Preliminary 2024 guidance

For 2024, Birchcliff remains focused on maintaining capital discipline, generating free funds flow and delivering significant returns to shareholders, while maintaining a strong balance sheet. Based on its preliminary budgeting process and current commodity price outlook for 2024, Birchcliff is targeting F&D capital expenditures of $240-million to $260-million in 2024. When combined with the accelerated capital of $20-million in Q4 2023 as discussed above, this would equate to approximately $260-million to $280-million of F&D capital expenditures in respect of 2024. This level of capital spending will allow the corporation to bring approximately 28 to 30 wells on production in 2024 and increase its annual average production year over year. With the addition of the five wells that will be drilled in Q4 2023 and brought on production in late January, 2024, the corporation currently expects to deliver annual average production of 77,000 to 79,000 boe/d in 2024.

Birchcliff is currently forecasting that it will generate approximately $500-million of adjusted funds flow and $240-million to $260-million of free funds flow in 2024 based on its targeted levels of F&D capital expenditures and annual average production. Based on the corporation's preliminary budgeting process and current commodity price outlook for 2024, Birchcliff anticipates that its adjusted funds flow will be sufficient to fully finance its F&D capital expenditures and common share dividend payments in 2024.

Excess free funds flow generated in 2024, above current dividend levels, is currently anticipated to be used to invest in the corporation's business, including filling its existing infrastructure to increase adjusted funds flow and lower per-unit costs. Depending on commodity prices and available cash flow, the corporation may also use a portion of excess free funds flow to reduce indebtedness and/or increase its base dividend.

Birchcliff continues to evolve its plans for 2024 and expects to announce the details of its formal 2024 capital budget and updated five-year outlook for 2024 to 2028 on Jan. 17, 2024.

The company sets forth Birchcliff's preliminary guidance and commodity price assumptions for 2024, as well as its free funds flow sensitivity.

About Birchcliff Energy Ltd.

Birchcliff is a dividend-paying, intermediate oil and natural gas company based in Calgary, Alta., with operations focused on the Montney/Doig resource play in Alberta. Birchcliff's common shares are listed for trading on the Toronto Stock Exchange under the symbol BIR.

We seek Safe Harbor.