Mr. Brian Schmidt reports

TAMARACK VALLEY ENERGY ANNOUNCES FIRST QUARTER 2023 FINANCIAL RESULTS AND PROVIDES OPERATIONAL UPDATE

Tamarack Valley Energy Ltd. has released its financial and operating results for the three months ended March 31, 2023. Selected financial and operating information is outlined herein and should be read with Tamarack's consolidated financial statements and related management's discussion and analysis for the three months ended March 31, 2023, which are available on SEDAR and on Tamarack's website.

Message to shareholders

The first quarter of 2023 marked Tamarack's most active quarter in the company's history, peaking at nine active drilling rigs. Tamarack drilled 40 (39.8 net) horizontal wells in Q1 2023, including 32 (32.0 net) wells in the Clearwater and eight (7.8 net) wells in the Charlie Lake. The Clearwater program was highlighted by the exploration success at Seal, West Marten Hills and West Nipisi. The company's first three wells at Seal delivered positive results with production from three stacked Clearwater sands. All three wells came on production from a single pad in March and achieved a combined IP30 rate of 380 barrels of oil per day. Individual well performance IP30 rates include the C sand (six legs) at 206 bopd, B sand (six legs) at 130 bopd and the D sand (three legs) at 43 bopd.

Total capital spending for the quarter of $148.2-million included approximately $30-million related to the construction of Tamarack's Wembley gas plant and investment in the Clearwater Nipisi pipeline and terminal project. These two major infrastructure projects remain on time and on budget, with the Wembley plant expected to be commissioned in June, 2023. This sweet gas plant is a key component of Tamarack's strategy to increase its egress capacity and concurrently reduce its operating cost structure related to continuing development of the highly economic Charlie Lake oil play. The Clearwater Nipisi pipeline and terminal project is expected to be on-line at the end of third quarter and will drive operating cost savings along with netback enhancement from blending. When combining both projects, the company expects to see both operating and transport costs driven lower throughout the year. These two initiatives have the potential to reduce the company's free funds flow break-even by 95 U.S. cents to $1.10 (U.S.) per barrel WTI (West Texas Intermediate) and are key to enhancing free funds flow generation within the context of Tamarack's five-year plan and return of capital framework.

Corporately, production for Q1 2023 averaged 67,938 barrels of oil equivalent per day, representing a 64-per-cent year-over-year increase and a 6-per-cent increase over the fourth quarter of 2022. Production through January and February averaged over 68,800 boe/d. The success of its drilling and exploration program, however, was somewhat muted by an unplanned TC Energy pipeline outage in March, which reduced total quarterly production by approximately 1,000 boe/d. Adjusting for this unplanned third party event, production for Q1 was on track to exceed budget expectations.

The synergies from the combined Tamarack and Deltastream Energy Corp. assets are delivering benefits through the scaled-up Clearwater development program. The combined multirig program across Nipisi and Marten Hills has enabled co0ordinated, shared services and the scale to enhance priority access to materials and equipment with its major service providers. The Deltastream assets continue to perform at or above the acquisition forecast, with additional upside and capital efficiency improvement opportunities under way.

Adjusted funds flow of $157.3-million and free funds flow of $9.1-million in the first quarter reflect the production impact of the unplanned third party outages and a wider year-over-year WCS (Western Canadian Select) differential. Subsequent to the end of Q1 2023, the WCS differential has narrowed materially, and current forward pricing indicates narrower WCS differentials through the balance of 2023. Looking ahead, management expects second quarter realized pricing to improve relative to the first quarter. As part of its continuing risk management program, Tamarack has been pro-active in responding to these differential improvements by locking in a portion of its heavy oil production with WCS differential swaps through to second quarter 2024, which will reduce its exposure to potential heavy oil price volatility.

Subsequent to the end of the quarter, Tamarack extended and increased the existing three-year covenant-based sustainability-linked lending (SLL) facility. The amended SLL has an increased capacity of $875-million (up from $700-million) and a new maturity date of May 10, 2026.

2023 outlook and guidance update

The company's 2023 capital guidance range remains unchanged at $425-million to $475-million. Management continues to monitor commodity prices and will remain flexible with its second half capital program. Tamarack continues to target spending at the lower half of the range with a focus on maximizing free funds flow for debt repayment and enhancing shareholder returns as debt thresholds are met. Its 2023 capital guidance maximizes free funds flow generation over both the short and long term, with a significant amount capital in 2023 directed toward water flood and infrastructure initiatives to set up lower sustaining capital and operating cost requirements throughout its five-year plan.

Subsequent to the first quarter, Tamarack disposed of certain non-core natural gas assets and decommissioning obligations for approximately $2.3-million in gross proceeds consisting of approximately 400 boe/d of production. Its 2023 annual production guidance range has been updated to 67,000 to 71,000 boe/d accounting for the disposition and the unplanned production downtime during the first quarter. Tamarack will provide further updates regarding the impact of the wildfires as additional information becomes available. Its operating cost, transportation expense, royalty, general and administrative expense, and interest guidance range remains unchanged.

Investor call tomorrow 9:30 a.m. MDT (11:30 a.m. EDT)

Tamarack will host a webcast at 9:30 a.m. MDT (11:30 a.m. EDT) on Thursday, May 11, 2023, to discuss the first quarter financial results and an operational update. Participants can listen to the live webcast through this link or through links provided on the company's website. A recorded archive of the webcast will be available on the company's website following the live webcast.

About Tamarack Valley Energy Ltd.

Tamarack is an oil and gas exploration and production company committed to creating long-term value for its shareholders through sustainable free funds flow generation, financial stability and the return of capital. The company has an extensive inventory of low-risk, oil development drilling locations focused primarily on the Charlie Lake, Clearwater and EOR plays in Alberta. Operating as a responsible corporate citizen is a key focus to ensure it delivers on its environmental, social and governance (ESG) commitments and goals.

We seek Safe Harbor.