Mr. John Jeffrey reports

SATURN OIL & GAS INC. REPORTS Q3 2023 FINANCIAL AND OPERATIONAL RESULTS HIGHLIGHTED BY RECORD QUARTERLY PRODUCTION AND ADJUSTED EBITDA

Saturn Oil & Gas Inc. has released its financial and operating results for the three and nine months ended Sept. 30, 2023.

"Saturn reached a new milestone in its goal of creating sustainable free cash flow by achieving record quarterly adjusted EBITDA of over $100-million in the third quarter," commented John Jeffrey, chief executive officer of Saturn. "This achievement stemmed from record corporate production in the third quarter of 2023, but was also facilitated by our commitment to driving operational efficiencies, which resulted in the company achieving its lowest operating and transportation costs per boe in the past two years."

Third quarter 2023 highlights:

• Record average production of 26,265 boe/d (barrels of oil equivalent per day), a 140-per-cent increase compared with 10,965 boe/d in Q3 2022;
• Record petroleum and natural gas sales of $201.1-million, up from $105.7-million in Q3 2022;
• Operating netback, net of derivatives of $43.74 per boe while the benchmark WTI (West Texas Intermediate) oil price averaged $82.18 (U.S.)/bbl during the period, compared with $50.60 per boe in Q3 2022 when the price of WTI oil averaged $91.58 (U.S.)/bbl;
• Record quarterly adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $100.3-million, compared with $50.3-million in Q3 2022;
• Record quarterly adjusted funds flow of $76.5-million, compared with $40.0-million in Q3 2022;
• Invested $35.3-million of development capital expenditures, drilling 18 gross (15.3 net) wells; including 12 in southeast Saskatchewan, two in West Central Saskatchewan, three in central Alberta and one in North Alberta, all with a 100-per-cent success rate;
• Free funds flow of $41.2-million compared with $3.0-million in Q3 2022;
• Net debt of $473.8-million realizing a net debt to annualized quarterly adjusted funds flow ratio of 1.5 times.

Message to shareholders

With the increase in oil prices in the quarter, Saturn ramped up its development activities. The company invested over $26-million in drilling and completions in Q3 2023 which surpassed the $23-million of drilling and completions expenditures made in the first half of this year. The third quarter also marked Saturn's inaugural drilling program in the province of Alberta, targeting Cardium light oil in central Alberta and Montney light oil in North Alberta. Saturn was active developing all four core operational areas in Alberta and Saskatchewan during the quarter with the drilling of a total of 18 (15.3 net) new wells. The company continued to reduce its debt with principal repayments of $50.7-million made in the quarter.

Southeast Saskatchewan update

The company's assets located in southeast Saskatchewan produced 11,628 boe/d for the three months ended Sept. 30, 2023, a 65-per-cent increase from Q3 2022. The company drilled and completed 12 (11.4 net) horizontal wells in Q3 2023 with a 100-per-cent success rate. The final four (4.0 net) gross wells of the six well Spearfish development program were drilled early in the third quarter in the Manor area. The Spearfish wells continue to exhibit excellent production performance above the budgeted type curve. Saturn also drilled three wells targeting Frobisher oil formations which were put on production in late August with good initial performance, including the 101/14-18-006-04W2/00 location which had initial 30-day average production of over 150 bbl/d. The company rig released five (4.5 net) horizontal wells targeting Bakken light oil in the third quarter, which subsequent to quarter-end were brought on to production with very strong initial production rates. The Frobisher and Bakken well production results will be released after 30 days of production data is available, expected in late November.

West-central Saskatchewan update

The company's assets located in west-central Saskatchewan produced 3,943 boe/d in Q3 2023, compared with 3,945 boe/d in Q3 2022. The company participated in two (0.9 net) non-operated wells targeting the Viking formation that were brought on stream in August and in line with type curve expectations.

Central Alberta update

Saturn's assets located in central Alberta produced 8,229 boe/d in Q3 2023. During the period Saturn drilled three (2.0 net) operated wells targeting Cardium light oil in the Lochend area. One Lochend well was brought on stream in August and two were put into production in late October.

North Alberta update

The company's assets in the Kaybob and Deer Mountain areas produced 2,465 boe/d in Q3 2023. Saturn rig released one (1.0 net) well of a four-well pad during the period, targeting Montney light oil in the Kaybob area, and expects the four wells to be completed and put on production by mid-November. The Montney wells were drilled with horizontal legs in the range of 1.5 and two miles.

Outlook

Saturn is continuing to accelerate development activities in both Alberta and Saskatchewan with expectations that the fourth quarter of 2023 will be the most active development period yet for the company. The company has recently contracted an additional drilling rig in Saskatchewan and is now running three concurrent drilling programs for the first time in Saturn's history.

The Alberta drilling rig has been moved to West Pembina in the company's central Alberta asset for the drilling of two 100-per-cent working interest wells targeting light oil and liquids-rich Cardium formations with production expected to be on stream in early Q1 2024. The Alberta rig is expected to finish the year drilling Cardium light oil targets in the Brazeau area for expected production additions in early Q1 2024.

In west-central Saskatchewan the newly contracted rig is currently drilling a budgeted four-well Viking program, including follow-up drilling to the successful eastern expansion of the company's Plato Viking field.

Saturn's focus in Q4 2023 in southeast Saskatchewan is the exclusive development of the deep portfolio of development opportunities acquired with the purchase of Ridgeback Resources Inc. Saturn intends to drill five additional wells targeting Bakken light oil in the Viewfield area before year-end with two of the wells planned to be drilled as open hole multilateral (OHML) wells. Based on recent industry success, OHML wells are showing the potential to increase estimated ultimate recoveries of light oil and enhancing development economics. Saturn has also recently successfully drilled two Frobisher wells in the Crealman area.

Based on the increased development activities across Saturn's four core operational areas, and the company's continued drilling success Saturn maintains its production target of 27,000 boe/d for December, 2023, and believes that the back-end weighted capital spending plan in 2023 will position the company well for the start of 2024.

Investor webcast

Saturn will host a webcast at 10 a.m. MT (12 p.m. ET) on Nov. 8, 2023, to discuss the third quarter financial report and provide investors an update. Participants can access the live webcast on-line or through the company's website. A recorded archive of the webcast will be available afterward on the company's website.

About Saturn Oil & Gas Inc.

Saturn Oil & Gas is one of Canada's fastest-growing energy companies, focused on generating positive shareholder returns through the continued responsible development of high-quality, light oil weighted assets, supported by an acquisition strategy that targets highly accretive, complementary opportunities. Saturn has assembled an attractive portfolio of free-cash flowing, low-decline operated assets in southeastern Saskatchewan, west-central Saskatchewan and central/Northern Alberta that provide a deep inventory of long-term economic drilling opportunities across multiple zones. With an unwavering commitment to building an ESG-(environmental, social and governance)-focused culture, Saturn's goal is to increase reserves, production and cash flows at an attractive return on invested capital. Saturn's shares are listed for trading on the Toronto Stock Exchange under ticker SOIL, on the Frankfurt Stock Exchange under symbol SMKA and on the OTCQX under the ticker OILSF.

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