Mr. Craig Bryksa reports

CRESCENT POINT COMPLETES STRATEGIC ALBERTA MONTNEY CONSOLIDATION AND PROVIDES IMPROVED 2024 AND FIVE-YEAR OUTLOOK

Crescent Point Energy Corp. has successfully completed its previously announced strategic acquisition of Hammerhead Energy Inc., an oil- and liquids-rich Alberta Montney producer. The company is also pleased to provide its formal 2024 guidance and five-year plan, which are significantly enhanced as a result of the transaction.

"Our recent Alberta Montney consolidation marks the completion of our portfolio transformation," said Craig Bryksa, president and chief executive officer of Crescent Point. "Through this strategic transaction, we have enhanced the long-term sustainability of our business, including increasing the excess cash flow per share expected within our five-year plan by approximately 20 per cent. This accretion also enhances our return of capital profile for shareholders. As we approach 2024, we are excited to build on the momentum and strong results we have achieved to date within our resource plays, including through potential synergies from our recent Montney transaction. Our strategic priorities will now focus on continued operational execution, balance sheet strength and increasing our return of capital to shareholders."

Key highlights:

• Completed previously announced Alberta Montney consolidation, increasing corporate premium drilling inventory to over 20 years.
• Entered into agreements to dispose of 5,000 boe/d (barrels of oil equivalent per day) of non-core assets for $140-million, with net proceeds directed to the balance sheet.
• Annual average production of 198,000 boe/d to 206,000 boe/d expected in 2024, with development capital expenditures of $1.4-billion to $1.5-billion.
• Excess cash flow of $750-million to $950-million expected in 2024 at $70 (U.S.) to $75 (U.S.) WTI (West Texas Intermediate), with 60 per cent returned to shareholders.
• Plan to increase base dividend by 15 per cent to 46 cents per share on an annual basis, which is expected to be declared in early 2024.
• Enhanced the cumulative excess cash flow expected in five-year plan to $4.7-billion at $70 (U.S.) WTI, an increase of 20 per cent per share.
• Achieved strong peak 30-day rates of 1,250 boe/d and 1,350 boe/d from recent pads in the Kaybob Duvernay and Alberta Montney.

Two thousand twenty-three operational update

Crescent Point remains on target with its 2023 guidance, which is expected to generate approximately $950-million of excess cash flow for the full year, based on average WTI price of approximately $77.50 (U.S)/bbl (barrel) for 2023.

In the Kaybob Duvernay and Alberta Montney plays, the company continues to achieve strong operational results that are in line or ahead of booked type well expectations. In the Kaybob Duvernay, Crescent Point's most recent multiwell pad within the volatile oil fairway came on stream during fourth quarter with an average peak 30-day rate of 1,250 boe/d per well (81 per cent condensate, 5 per cent NGLs (natural gas liquids)). In the Alberta Montney, Crescent Point brought on stream two multiwell pads during fourth quarter in its Gold Creek area. The first pad achieved peak 30-day rates averaging 1,350 boe/d per well (72 per cent light oil, 5 per cent NGLs). The second pad has been on stream for less than 30 days with similar initial production rates.

Non-core asset dispositions

During Q4 2023, Crescent Point entered into agreements to dispose of its Swan Hills and Turner Valley assets in Alberta for total proceeds of approximately $140-million. The company expects production for these assets to average approximately 5,000 boe/d (75 per cent oil and liquids) in 2024. Crescent Point did not plan to allocate any capital expenditures to these assets in 2024. These dispositions are expected to close by early Q1 2024, subject to the receipt of regulatory approvals and the satisfaction of customary closing conditions, with net proceeds directed toward the company's balance sheet.

Two thousand twenty-four guidance

Crescent Point now expects to generate annual average production of 198,000 boe/d to 206,000 boe/d (65 per cent oil and liquids) in 2024 based on development capital expenditures of $1.4-billion to $1.5-billion, demonstrating an improvement in production and capital expenditures compared with the company's preliminary guidance. Crescent Point's production guidance has changed by 2,000 boe/d compared with its preliminary guidance, despite the recently announced non-core asset dispositions of approximately 5,000 boe/d, with $50-million of less development capital expenditures expected in 2024. These improvements reflect the company's continued operational outperformance.

Crescent Point expects this program to generate $750-million to $950-million of excess cash flow in 2024, at $70 (U.S.)/bbl to $75 (U.S.)/bbl WTI and $2.75/Mcf (million cubic feet) AECO (Alberta Energy Company), and to be fully financed at approximately $55 (U.S.)/bbl WTI, including the planned increase to its base dividend.

The company plans to allocate 45 per cent of its 2024 budget to the Alberta Montney, which is expected to generate annual average production of 97,000 boe/d (50 per cent oil and liquids). Crescent Point plans to maintain three active drilling rigs in the Alberta Montney in 2024, drilling 60 net wells across its land base in the volatile oil fairway. The company's operational initiatives include further enhancing its drilling and completion design, and efficiently developing the recently acquired Montney assets by optimizing the number of wells drilled per section.

Crescent Point plans to allocate 35 per cent of its 2024 budget to the Kaybob Duvernay, which is expected to generate annual average production of 50,000 boe/d (60 per cent oil and liquids). The company plans to maintain two active drilling rigs in the Kaybob Duvernay in 2024, drilling 45 net wells across its land base within the volatile oil- and liquids-rich fairways, supporting production growth during the second half of the year and into 2025. This budget includes drilling longer lateral wells to improve efficiencies and further delineation of its land position, including the eastern and western portion of its land base.

Crescent Point plans to allocate the remaining 20 per cent of its 2024 budget to its long-cycle, low-decline assets in Saskatchewan, which are expected to generate annual average production of 55,000 boe/d (95 per cent oil and liquids). The budget includes the continued advancement of decline mitigation programs, including water floods and polymer floods, in addition to further development of open-hole multilateral (OHML) wells. Crescent Point's low-decline, high-netback Saskatchewan assets are expected to account for approximately 50 per cent of the company's excess cash flow in 2024.

Crescent Point's 2024 budget remains disciplined and flexible, with a continued focus on allocating capital to its highest return assets with attractive payback periods. Similar to prior years, the company will continue to allocate a portion of its capital to longer-term projects and environmental initiatives, which are expected to represent 10 per cent of total expenditures, including reclamation activities.

All financial figures are approximate.

Five-year plan

Crescent Point's annual production is forecast to grow to approximately 260,000 boe/d in 2028 under its five-year plan, driven by the company's Alberta Montney and Kaybob Duvernay assets, with cumulative after-tax excess cash flow of approximately $4.7-billion at $70 (U.S.)/bbl WTI and $3.35/Mcf AECO. Under this five-year plan, the company expects to generate excess-cash-flow-per-share growth of 7 per cent on a compounded annual basis, or 15 per cent including the benefit from expected share repurchases.

This enhanced profile highlights the strong contribution of the newly acquired Alberta Montney assets, which are expected to provide the company with a combination of growing production and lower capital expenditure requirements to sustain production in later years. On a per-share basis, Crescent Point's cumulative excess cash flow under its five-year plan has increased by approximately 20 per cent as a result of the transaction.

In 2024, the recently acquired Montney assets are expected to produce 56,000 boe/d, growing to 80,000 boe/d by 2026, then remaining flat thereafter. During this same period, development capital expenditures are expected to gradually decline from $400-million in 2024 to $300-million toward the end of the five-year plan, resulting in significant excess cash flow generation.

Crescent Point's combined Alberta Montney and Kaybob Duvernay assets are expected to represent 80 per cent of the company's total production in 2028. Crescent Point's disciplined capital allocation, in combination with its low-decline, long-cycle assets, is expected to allow the company to also moderate its base decline rate from 30 per cent in 2024 to 27 per cent toward the end of its five-year plan. During this period, Crescent Point expects to reduce its reinvestment ratio, or capital expenditures as a percentage of funds flow, by nearly 10 per cent.

Strategic priorities and outlook

Crescent Point's strategic priorities will focus on operational execution, strengthening its balance sheet and increasing return of capital. The company's execution to date across its asset base, including its Kaybob Duvernay and Alberta Montney plays, has resulted in improved asset-level returns through a combination of realized efficiencies and enhanced productivity. Crescent Point plans to build on this success by targeting additional efficiencies as it executes its organic growth plan.

As previously announced, given the expected accretion from the transaction, the company plans to increase its quarterly base dividend by 15 per cent to 11.5 cents per share, or to 46 cents per share on an annual basis, up from 40 cents per share currently. This base dividend increase is subject to approval from Crescent Point's board of directors and is expected to be effective in connection with the Q1 2024 dividend, which is anticipated to be declared in early 2024.

The company's leverage ratio, or net debt to adjusted funds flow, is expected to be approximately 1.2 times to 1.3 times by year-end 2024, at $70 (U.S.)/bbl to $75 (U.S.)/bbl WTI and $2.75/Mcf AECO. To protect against commodity price volatility, the company has hedged approximately 35 per cent of its oil and liquids production, net of royalty interest, in 2024 and 30 per cent of its natural gas production, at attractive commodity prices.

The company plans to continue allocating 60 per cent of its excess cash flow to dividends and share repurchases in the interim, and plans to increase this allocation over time as it further strengthens its balance sheet. Crescent Point's strategy is centred around creating sustainable long-term returns for shareholders through a combination of per-share growth, return of capital and balance sheet strength.

We seek Safe Harbor.