Ms. Darlene Gates reports

MEG ENERGY ANNOUNCES COMPLETION OF DEBT REDUCTION STRATEGY AND INITIATION OF RETURN OF 100% OF FREE CASH FLOW TO MEG SHAREHOLDERS

MEG Energy Corp. has achieved its $600-million (U.S.) debt target and will now be transitioning to a 100-per-cent return of free cash flow to shareholders.

"This achievement marks a significant milestone in our multiyear capital allocation strategy, positioning us to substantially increase returns to our shareholders," said Darlene Gates, president and chief executive officer of MEG Energy. "With the recent repayment of our 2027 7.125 per cent senior unsecured notes, we have achieved our long-stated $600-million (U.S.) debt target. I am excited to share that starting October, 2024, we will increase capital returns to shareholders to 100 per cent of free cash flow through expanded share buybacks and the introduction of a quarterly base dividend."

Ms. Darlene added: "This milestone was enabled by our team's ongoing focus on safe, reliable and predictable performance, ensuring we deliver on our commitments to shareholders. Our long reserve life, low decline and low-cost business is now backed by a strong balance sheet, which will allow for sustainable shareholder returns through the commodity cycle."

Key financial highlights and achievements:

• On Sept. 24, 2024, the corporation fully repurchased the remaining balance of its $1.2-billion (U.S.) 2027 7.125 per cent senior unsecured notes, concluding a multiyear deleveraging strategy.
• Beginning in October, 2024, capital returns to shareholders will increase to 100 per cent of free cash flow, allocated between share buybacks and a base dividend.
• As previously announced, the corporation's first quarterly dividend of 10 cents per share will be paid on Oct. 15, 2024, to shareholders of record as of the close of business on Sept. 17, 2024.

The corporation's balance sheet strength and liquidity profile support enhanced distributions to shareholders with a continued emphasis on share repurchases.

We seek Safe Harbor.