Mr. Jean-Paul Lachance reports

PEYTO ANNOUNCES CLOSING OF EQUITY FINANCING

Peyto Exploration & Development Corp. has completed its previously announced bought deal equity financing, issuing 16,916,500 subscription receipts at a price of $11.90 per subscription receipt for gross proceeds of approximately $201-million, which included the full exercise of the overallotment option granted to the underwriters. The bought deal offering was completed through a syndicate of underwriters led by BMO Capital Markets, CIBC Capital Markets and National Bank Financial. The gross proceeds from the equity offering, less the portion of the underwriters' fee that is payable on the closing of the equity offering, will be held in escrow and are intended to be used by Peyto to finance a portion of the purchase price for the acquisition of Repsol Canada Energy Partnership, which holds the Canadian upstream oil and gas business of Repsol Exploracion SAU, including all related midstream facilities and infrastructure located predominantly in the Deep basin area of Alberta, for cash consideration of $468-million (U.S.) ($636-million), prior to closing adjustments. The acquisition is expected to close in mid-October, subject to customary closing conditions, including receipt of necessary regulatory approvals.

Each subscription receipt will entitle the holder to receive, without payment of additional consideration and without further action, one common share of Peyto upon the closing of the acquisition.

Holders of the subscription receipts will be entitled to receive payments per subscription receipt equal to the cash dividends paid on Peyto's common shares, if any, actually paid or payable to holders of such common shares in respect of all record dates for such dividends occurring from the closing date of the equity offering to, but excluding, the last day on which the subscription receipts remain outstanding, to be paid to holders of subscription receipts concurrently with the payment date of each such dividend.

Peyto has previously announced that a monthly dividend of 11 cents per common share is to be paid on Oct. 13, 2023, for shareholders of record on Sept. 30, 2023. Accordingly, holders of subscription receipts on Sept. 30, 2023, will be entitled to a dividend equivalent payment equal to 11 cents per subscription receipt, which is to be paid on Oct. 13, 2023, concurrently with the common share dividend.

If the acquisition is not completed on or before March 31, 2024, or in certain other events, then the subscription price for the subscription receipts will be returned to holders of subscription receipts, together with any unpaid dividend equivalent payments and any pro-rata interest on such funds, if any.

Peyto anticipates that the subscription receipts will be listed and posted for trading on the Toronto Stock Exchange under the symbol PEY.R at the open of markets today. A copy of the subscription receipt agreement governing the terms of the subscription receipts will be filed on Peyto's profile on SEDAR+.

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