An anonymous director reports

MEG ENERGY ANNOUNCES 2024 CAPITAL INVESTMENT PLAN AND OPERATIONAL GUIDANCE

MEG Energy Corp. has released its 2024 capital investment plan and operational guidance. All financial figures are in Canadian dollars, and all references to barrels are per barrel of bitumen sales unless otherwise noted Highlights include:

• Continued emphasis on operations excellence and safety leadership
• Annual production guidance of 102,000 to 108,000 bbls/d at a steam oil ratio ("SOR") of approximately 2.3;
• Capital expenditures of $550 million, consisting of $450 million of sustaining capital and $100 million supporting 4% production growth in 2024;
• Non-energy operating costs and general & administrative ("G&A") expense guidance of $5.10 to $5.40/bbl and $1.75 to $1.95/bbl, respectively; and
• 100% of free cash flow allocated to shareholders once the US$600 million net debt target is reached

2024 Guidance

MEG is focused on safe and reliable operations at our Christina Lake asset. We will continue to invest in our safety leadership program, for both employees and contractors, to advance operational excellence. This focus on operational excellence is underpinned by a comprehensive Operations Excellence Management System that is expected to drive increased production, a top tier SOR performance, and a reduced greenhouse gas ("GHG") emissions intensity.

The 105,000 bbls/d mid-point of MEG's 2024 guidance is approximately a 4% increase from the current 2023 production estimate. MEG anticipates exiting 2023 near its 110,000 bbls/d facility capacity, as its latest well pad ramps up and field and plant operations demonstrate high reliability.

The 2024 annual production estimate incorporates reduced turnaround activities spread more evenly throughout the year. The plan also includes the startup of two well pads, with the first pad on-stream mid-year and the second in the fourth quarter. New pad activity supports the higher 2024 production estimate and builds annualized capacity for future growth.

Under a US$75/bbl WTI oil price, MEG anticipates it will achieve its US$600 million long-term net debt target around the third quarter of 2024 and conclude its multi-year financial risk reduction strategy. The improved balance sheet and strong operating performance provides confidence to:

• Initiate 100% free cash flow returns to shareholders; and
• Commence investment in modest capacity growth

Capacity growth from MEG's long-life reserve base generates shareholder value. During 2024, we will commence investment in a new project to add 15,000 bbls/d of new productive capacity to our existing facility, with an estimated total cost of $300 million over the next three years.

Sustaining capital in 2024 reflects reduced turnaround activity, increased pad drilling, and investment in field infrastructure to advance production from high-quality undeveloped areas of our assets. These activities, combined with our operating strategy, will continue to enhance MEG's top tier SOR.

MEG's balance sheet and operating performance provide a solid foundation to fund the 2024 capital program, and no WTI or WTI:WCS differential hedges have been entered for 2024. MEG retains the flexibility to adjust capital expenditures in response to changing market conditions, such as declining oil prices, differentials and inflationary cost pressures.

MEG's total 2024 capital program is $550 million, with $100 million allocated towards multi-year capacity growth and $450 million to sustaining activities. The growth investment commences a project with an estimated total cost of $300 million which is forecast to deliver incremental production towards the end of 2026.

Sustaining activities are mainly directed to increased well pad and redevelopment drilling and investment in pad gathering infrastructure to access high-quality resource. Remaining capital largely comprises field and facility infrastructure targeting sub-surface production optimization, gas and water processing, and reliability improvements. Budgeted sustaining capital also reflects a 5% year-over-year impact from inflationary and supply chain pressures.

Non-Energy Operating Costs and G&A Expense Per Barrel

Non-energy operating costs per barrel in 2024 are estimated to rise approximately 5% over 2023, to $5.25/bbl at the mid-point of our 2024 guidance range, reflecting an increased scope of operations and inflationary pressures.

The mid-point of the 2024 G&A per barrel guidance is consistent with our current outlook for 2023, driven by increased staff costs and support for near-term production growth.

Adjusted Funds Flow ("AFF") Sensitivity

MEG's production is entirely comprised of crude oil and AFF is highly correlated with crude oil benchmark prices. The following table provides an annual sensitivity estimate to the most significant market variables.

MEG has capacity to ship 100,000 bbls/d of AWB blend sales, on a pre-apportionment basis, to the U.S. Gulf Coast market via its committed capacity on the Flanagan South and Seaway Pipeline systems ("FSP"). In addition, 20,000 bbls/d of capacity is contracted on the TMX pipeline system to the Canadian West Coast. With TMX scheduled to start near the end of the first quarter of 2024, over 80% of MEG's blend sales will have tidewater access, positioning the company with broader market reach, improved realized prices, and reduced WCS differential volatility.

MEG had approximately $5.0 billion of available Canadian tax pools, including $3.4 billion of non-capital losses which are immediately deductible, at September 30, 2023. Those tax pools will shelter cash taxes until approximately mid-2027 under a US $75/bbl WTI oil price assumption.

Capital Allocation Strategy

MEG anticipates reaching its US $600 million net debt target around the third quarter of 2024 at a US$75/bbl WTI oil price, completing its multi-year financial risk reduction strategy. Capital returns to shareholders will rise to 100% of free cash flow at that point, reinforcing our long-term commitment to shareholder capital returns.

From April 1, 2022 through November 24, 2023 the corporation has repurchased and cancelled 35.0 million shares, reducing the outstanding share count by approximately 11% from year end 2021 and returning $715 million to shareholders at a weighted average price of $20.47 per share. Debt repurchases have totaled US $870 million (approximately $1.2 billion) over that same period.

Pathways Alliance

MEG, along with its Pathways Alliance ("Alliance") peers, will continue to progress pre-work on the proposed foundational carbon capture and storage ("CCS") project, which will transport CO2 via pipeline from multiple oil sands facilities to be stored safely and permanently underground in the Cold Lake region of Alberta. In 2024 technical teams will advance detailed evaluations of the proposed carbon storage hub and work with the Government on a carbon sequestration agreement to support regulatory submissions. In addition, the Alliance will progress engineering work, environmental field programs to minimize the project's environmental disturbance, and consultations with Indigenous and local communities along the proposed CO2 transportation and storage network corridor. The Alliance continues to work collaboratively with both the federal and Alberta governments on the necessary policy and co-financing frameworks required to move the project forward. It will be important for governments to work together with industry to ensure required support to enable CCS project development.

MEG's 2024 capital budget includes pre-FEED expenditures for carbon capture and storage facilities at Christina Lake that would capture post-combustion CO2 emissions for transportation to the proposed Pathways Alliance CO2 pipeline. The process to capture CO2 emissions from flue gas at MEG's Christina Lake facilities has been selected, after extensive review, as a key element in the carbon capture facilities design.

For further details on the Corporation's approach to ESG matters, please refer to the "Sustainability" section of the Corporation's website and the most recently filed AIF on SEDAR+.

About MEG

MEG is an energy company focused on sustainable in situ thermal oil production in the southern Athabasca region of Alberta, Canada. MEG is actively developing innovative enhanced oil recovery projects that utilize steam-assisted gravity drainage extraction methods to improve the responsible economic recovery of oil as well as lower carbon emissions. MEG transports and sells thermal oil (AWB) to customers throughout North America and internationally. MEG is a member of the Pathways Alliance, a group of Canada's largest oil sands producers working together to address climate change and achieve the goal of net zero emissions1 by 2050. MEG's common shares are listed on the Toronto Stock Exchange under the symbol "MEG" (TSX: MEG).

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