Strathcona Resources Ltd. Announces Sale of Montney Business for $2.84 Billion and Acquisition of Hardisty Rail Terminal

CALGARY, AB, Might 14, 2025/ PRNewswire/ – Strathcona Resources Ltd. (” Strathcona” or the “Business”) SCR is happy to reveal that it has actually participated in conclusive contracts to offer significantly all of its Montney possessions for roughly $ 2.84 billion, pursuant to 3 different deals:

1. The sale of its Kakwa property (the “Kakwa Sale”) to ARC Resources Ltd. for roughly $ 1,695 million in overall worth ($ 1,650 million in money and roughly $ 45 million in presumed lease responsibilities)
2. The sale of its Grande Grassy Field property (the “Grande Grassy Field Sale”) for roughly $ 850 million in overall worth ($ 750 million in money and roughly $ 100 million in presumed lease responsibilities)
3. The sale of its Groundbirch property (the “Groundbirch Sale”) to Tourmaline Oil Corp. (” Tourmaline”) for $ 291.5 million in typical shares of Tourmaline

Taken together, the disposed possessions produced $ 149 million of running revenues in 2024 (12% of overall Strathcona YE 2024 operating revenues, omitting interest and other business products) and had a YE 2024 showed PV-10 before-tax of roughly $ 2.3 billion (15% of overall Strathcona YE 2024 showed PV-10), while the combined price represents roughly 33% of Strathcona’s present business worth. The table listed below programs Strathcona’s combined outcomes for the year ended December 31, 2024, less the Montney personalities.

The Kakwa Sale is anticipated to take place early in the 3rd quarter of 2025, based on invoice of regulative approvals and the fulfillment of other traditional closing conditions.

The Grande Grassy field Sale is anticipated to take place early in the 3rd quarter of 2025, based on invoice of regulative approvals and the fulfillment of other traditional closing conditions.

The Groundbirch sale is anticipated to take place in the 2nd quarter of 2025, based on invoice of regulative approvals and the fulfillment of other traditional closing conditions. The share factor to consider is exempt to any lock-up durations beyond a four-month statutory hold duration. Strathcona is pleased to be an investor of Tourmaline and has no strategies to get rid of the shares at this time.

Strathcona has $ 5.5 billion of tax swimming pools at March 31, 2025 and does not anticipate any money taxes to arise from the Montney personalities.

Strathcona wishes to thank its whole Montney group, led by President Al Grabas, for their vital contributions in growing the Montney service from simply 5 Mboe/ d in January 2017 to 72 Mboe/ d in 2024. Strathcona would likewise like to praise each of the buyers, each of whom are well placed to make the most of worth for the possessions moving forward offered the hand-in-glove fit with each of their existing operations and their long performance history of superior operations in the surrounding locations.

Upgraded Assistance and Long-Range Strategy

Upon conclusion of the Montney personalities, Strathcona will be a pure-play heavy oil business producing roughly 120 Mbbls/ d (100% oil, 95 Mbbls/ d thermal, 25 Mbbls/ d standard) with a 50-year 2P reserve life index and favorable net money (consisting of valuable securities).

Upgraded 2025 Assistance

Strathcona anticipates Q2 2025 production of 180 Mboe/ d, that includes a roughly 7 Mbbls/ d effect from a significant turn-around (5-year cycle) at Tucker. Complete year 2025 production is anticipated to typical 150– 160 Mboe/ d, with 120 to 125 Mbbls/ d anticipated in the 3rd and 4th quarters publish the Montney personalities.

The complete year variety consists of a roughly 5 Mbbls/ d boost compared to initial 2025 assistance, stabilized for the Montney personalities, driven by outperformance at Cold Lake

Complete year capital investment are approximated at $ 1.2 billion (from $ 1.35 billion formerly), which shows the elimination of Montney capital from the 2nd half of 2025.

Upgraded Long-Range Strategy

Pro forma for the Montney personalities, Strathcona’s present long-range strategies sees development to 195 Mbbls/ d by 2031, showing an 8% 7-year CAGR versus 2024. Upon reaching this plateau level, Strathcona’s 2P Reserve Life Index is anticipated to still be roughly 25 years based upon present 2P reserves (presuming no reserve additions in between year-end 2024 and 2031).

Considerably all production development is anticipated to come from Strathcona’s thermal homes, with thermal production in Cold Lake and Lloydminster reaching roughly 170 Mbbls/ d in 2031. Strathcona’s present long-range strategy just shows the advancement of existing jobs and brownfield growths, and does not consist of greenfield jobs.

Capital investment are anticipated to typical $ 0.9 – $ 1.0 billion in 2026 and $ 1.1 – $ 1.2 billion in 2027– 2029, before going back to sustaining anticipated capital of $ 0.8 and $ 0.85 billion in 2030 and 2031. Due to low present oil costs, Strathcona’s upgraded long-range strategy shows a deferment of the sanction of the Lindbergh Stage 2 growth job from 2026 to 2027 to focus on near-term totally free capital generation.

Strathcona will stay active in designating capital and will upgrade its strategies gradually based upon its view of risk-adjusted returns, remembering product costs and capital market characteristics. A complete reconciliation of Strathcona’s present long-range strategy to the strategy provided by the Business at its 2024 Financier Day is revealed listed below.

Production (Full-Year Annualized) (Mboe/ d)

Capital Investment (Full-Year Annualized) (C$ mm)

Hardisty Rail Terminal Acquisition

Likewise in the very first quarter of 2025, Strathcona signed a conclusive contract to get the Hardisty Rail Terminal (” HRT”) for money factor to consider of roughly $ 45 million and closed on the acquisition early in the 2nd quarter. HRT, situated in Hardisty, Alberta, is the biggest crude-by-rail terminal in Western Canada with capability of 262 Mbbls/ d and year-to-date throughput of roughly 50 Mbbls/ d. HRT is straight linked to the Hardisty Diluent Healing System, an ingenious center which separates diluent from raw bitumen prior to rail transport, permitting a competitive netback for upstream manufacturers versus pipeline options.

HRT has an approximated replacement expense of roughly $ 200 million and totally free capital over the previous twelve months of roughly $ 12 million, 80% of which is underpinned by long-lasting take-or-pay agreements with a financial investment grade counterparty. Together with Strathcona’s Hamlin Terminal, Strathcona now owns and runs rail terminals servicing roughly 80% of the overall present crude-by-rail volumes in western Canada, permitting significant economies of scale.

The HRT acquisition is an extension of Strathcona’s countercyclical acquisition technique concentrated on core location combination. While HRT is just 19% used today, it has actually depended on 82% used traditionally throughout durations of tight pipeline egress, offering Strathcona with a natural hedge versus future egress traffic jams.

Very First Quarter Revenues Release and Teleconference

Strathcona will launch its very first quarter revenues after market on Might 15, 2025, with a teleconference to follow the early morning of Might 16, 2025

Advisors

BMO Capital Markets served as lead monetary consultant, and CIBC Capital Markets and Jefferies served as monetary consultants to Strathcona on the Kakwa Sale.

BMO Capital Markets served as unique monetary consultant and RBC Capital Markets served as tactical consultant to Strathcona on the Grande Grassy Field Sale.

Scotiabank served as lead monetary consultant and RBC Capital Markets and ATB Capital Markets served as monetary consultants on the Groundbirch Sale.

National Bank Financial served as monetary consultant to Strathcona on the Hardisty Rail Terminal acquisition.

Blake, Cassels & & Graydon LLP served as legal consultant to Strathcona in regard of each of the deals.

About Strathcona

Strathcona is among The United States and Canada’s fastest growing oil and gas manufacturers with operations concentrated on thermal oil and improved oil healing. Strathcona is developed on an ingenious method to development accomplished through the combination and advancement of long-life oil and gas possessions. Strathcona’s typical shares (sign SCR) are noted on the Toronto Stock Market (TSX).

To find out more about Strathcona, go to www.strathconaresources.com

2024 Section Info

The following table provides monetary efficiency by reportable sector for the year ended December 31, 2024 Particular details associated to basic and administrative and financing expenses has actually been represented to assign by sector to adhere with discussion as at March 31, 2025 Running revenues is the metric utilized by the Business’s Chief Operating Choice Makers to assess sector earnings or loss.

SPECIFIED FINANICAL PROCEDURES

Non-GAAP Financial Steps and Ratios

This news release refers to particular monetary steps and ratios, consisting of field operating earnings and oil and gas sales, internet of mixing, which are not standardized monetary steps under IFRS ® Accounting Standards (the “Accounting Standards”) and may not be equivalent to comparable monetary steps revealed by other companies. Non-GAAP monetary steps and ratios are utilized internally by management to examine the efficiency of the Business. They likewise supply financiers with significant metrics to examine the Business’s efficiency compared to other business in the exact same market. Financiers are warned that these steps must not be interpreted as an option to monetary steps figured out in accordance with normally accepted accounting concepts (” GAAP”) and these steps must not be thought about to be more significant than GAAP steps in examining the Business’s efficiency.

The term “ Oil and gas sales, internet of mixing” is determined by subtracting acquired item and mixing expenses from oil and gas sales and sales of acquired item. Management utilizes this metric to separate the income connected with the Business’s production after representing the inescapable expense of mixing. A quantitative reconciliation of Oil and gas sales, internet of mixing to the most straight equivalent GAAP monetary procedure, Oil and gas sales, is included under the heading “2024 Section Info” of this news release.

“ Field Operating Earnings” is a typical metric utilized in the oil and gas market to examine the success and effectiveness of the Business’s field operations.

The following table fixes up “Field Operating Earnings” to the nearby GAAP procedure.

Supplementary Financial Steps

” TEV” is an aggregation of the Business’s market capitalization, financial obligation and lease and other responsibilities. Market capitalization is figured out by increasing impressive typical shares by the typical share cost. Financial obligation and other responsibilities are as obtained under IFRS Accounting Standards.

Discussion of Oil and Gas Info

In regard of 2024 year-end reserves details included in this news release, Strathcona’s reserves have actually been assessed in accordance with Canadian reserve assessment requirements under National Instrument 51-101– Standards of Disclosure for Oil and Gas Activities (” NI 51-101″). McDaniel & & Associates Professionals Ltd., an independent petroleum consulting company based in Calgary, Alberta, has actually assessed the petroleum and gas reserves connected with Strathcona’s interests in Alberta, British Columbia and Saskatchewan Such quotes make up positive details, which are based upon worths that Strathcona’s management thinks to be sensible and go through the exact same restrictions talked about under “Forward-Looking Info” listed below. A total filing of our oil and gas reserves and other oil and gas details provided in accordance with NI 51-101 are consisted of in Strathcona’s Yearly Info Kind for the year ended December 31, 2024, which can be discovered at www.sedarplus.ca and www.strathconaresources.com.

This press release consists of numerous referrals to the abbreviation ” boe” which suggests barrels of oil equivalent. All boe conversions in this press release are obtained by transforming gas to oil at the ratio of 6 thousand cubic feet (” mcf”) of natural gas to one barrel (” bbl”) of petroleum. Boe might be deceptive, especially if utilized in seclusion. A boe conversion rate of 1 bbl: 6 mcf is based upon an energy equivalency conversion technique mostly relevant at the burner suggestion and does not represent a worth equivalency at the wellhead. Provided that the worth ratio of oil compared to natural gas based on presently dominating costs is substantially various than the energy equivalency ratio of 1 bbl: 6 mcf, using a conversion ratio of 1 bbl: 6 mcf might be deceptive as an indicator of worth.

Referrals in this news release to preliminary production rates and other short-term production rates and test outcomes work in validating the existence of hydrocarbons, nevertheless, such rates are not determinative of the rates at which such wells will start production and decrease afterwards and are not a sign of long-lasting efficiency or of supreme healing. While motivating, readers are warned not to position dependence on such rates in determining aggregate production for the Business or the possessions for which such rates are supplied. A pressure short-term analysis or well-test analysis has actually not been performed in regard of all wells. Appropriately, the test results must be thought about to be initial.

Forward-Looking Info

Particular declarations included in this news release make up positive details within the significance of relevant securities laws. The positive details in this news release is based upon Strathcona’s present internal expectations, quotes, forecasts, presumptions and beliefs. Such positive details is not an assurance of future efficiency and includes recognized and unidentified dangers, unpredictabilities and other elements that might trigger real outcomes or occasions to vary materially from those expected in such positive details. Strathcona thinks the product elements, expectations and presumptions shown in the positive details are sensible since the time of such details, however no guarantee can be considered that these elements, expectations and presumptions will show to be proper, and such positive details consisted of in this news release must not be unduly trusted.

Using any of the words “anticipate”, “target”, “expect”, “mean”, “price quote”, “unbiased”, “continuous”, “might”, “will”, “job”, “think”, “depends”, “might” and comparable expressions are meant to recognize positive details. In specific, however without restricting the generality of the foregoing, this news release consists of positive details relating to the following: Strathcona’s service technique and future strategies; anticipated running technique; the anticipated sale of significantly all of Strathcona’s Montney possessions, consisting of the anticipated timing and pro forma impacts; Strathcona’s prepare for its shareholdings in Tourmaline; the anticipated tax treatment of Strathcona’s personality of the Montney possessions, consisting of the usage and accessibility of tax swimming pools; in regard of HRT, the approximated replacement expense and anticipated totally free capital over the next twelve months; the anticipated advantages of the HRT acquisition, consisting of HRT” s capability to supply Strathcona with a natural hedge versus future egress traffic jams; Strathcona’s 2025 production, reserves, liquidity and capital costs assistance; the effect of the significant turn-around at Tucker; Strathcona’s long-range strategy, consisting of production development to 195 Mbbls/ d by 2031, capital investment balancing $ 0.9 – $ 1.0 billion in 2026 and $ 1.1 to 1.2 billion in 2027-2029, before going back to sustaining anticipated capital of $ 0.8 and $ 0.85 billion in 2030 and 2031; the deferment of the sanction of the Lindbergh Stage 2 growth job to 2027; and the complete reconciliation of Strathcona’s long-range strategy revealing expectations in regard of production and capital investment.

All positive details shows Strathcona’s beliefs and presumptions based upon details readily available at the time the relevant positive details is revealed and due to Strathcona’s present expectations with regard to such things as: the success of Strathcona’s operations and development and growth jobs; expectations relating to production development, future well production rates and reserve volumes; expectations relating to Strathcona’s capital program; the conclusion of deals to get rid of Strathcona’s Montney possessions; the accessibility of Strathcona’s tax swimming pools; expectations relating to the advantages of the HRT acquisition; Strathcona’s capability to create adequate capital to money financial obligation payment and state and pay dividends; expectations relating to the effect of tariffs on Strathcona’s operations and its capability to successfully reduce the effect thereof; the outlook for basic financial patterns, market patterns, dominating and future product costs, foreign exchange rates and rates of interest; the accessibility of 3rd party services; dominating and future royalty routines and tax laws; future well production rates and reserve volumes; changes in energy costs based upon around the world need and geopolitical occasions; the effect of inflation; the stability and dependability of Strathcona’s possessions; decommissioning responsibilities; Strathcona’s capability to adhere to its monetary covenants; and the governmental, regulative and legal environment, consisting of expectations relating to the present and future carbon tax program and policies. In addition, particular positive details with regard to Strathcona’s 2025 assistance presumes product costs and currency exchange rate of: US$ 70/ bbl WTI, US$ 13/ bbl WCS-WTI differential, 1.38 USD– CAD and C$ 3/ GJ AECO. Management thinks that its presumptions and expectations shown in the positive details included herein are sensible based upon the details readily available on the date such details is supplied and the procedure utilized to prepare the details. Nevertheless, it can not guarantee readers that these expectations will show to be proper.

The positive details consisted of in this news release is not an assurance of future efficiency and includes recognized and unidentified dangers, unpredictabilities and other elements that might trigger real outcomes or occasions to vary materially from those expected in such positive details, consisting of, without constraint: modifications in product costs; modifications in the need for or supply of Strathcona’s items; the ongoing effect, or even more degeneration, in worldwide financial and market conditions, consisting of from inflation and/or particular geopolitical disputes, such as the continuous Russia/ Ukraine dispute, the dispute in the Middle East, and other increased geopolitical dangers, consisting of the imposition of tariffs or other trade barriers, and the capability of Strathcona to continue operations as considered due to the foregoing; decisions by the Company of the Petroleum Exporting Countries and other nations regarding production levels; unexpected operating outcomes or production decreases; modifications in tax or ecological laws, environment modification, royalty rates or other regulative matters; modifications in Strathcona’s advancement strategies or by 3rd party operators of Strathcona’s homes; failure to attain awaited outcomes of its operations; competitors from other manufacturers; failure to keep drilling rigs and other services; failure to finish or recognize the awaited advantages of Strathcona’s acquisitions, personalities or business reorganizations, consisting of personality of significantly all of Strathcona’s Montney possessions and the acquisition of HRT; inaccurate evaluation of the worth of acquisitions; hold-ups arising from or failure to get necessary regulative approvals; increased financial obligation levels or financial obligation service requirements; inflation; modifications in foreign exchange rates; incorrect estimate of Strathcona’s oil and gas reserve and contingent resource volumes; restricted, undesirable or an absence of access to capital markets or other sources of capital; increased expenses; an absence of appropriate insurance protection; the effect of rivals; and the other elements talked about under the “Danger Elements” area in Strathcona’s Management’s Conversation and Analysis and Yearly Info Kind for the year ended December 31, 2024 and from time to time in Strathcona’s public disclosure files, which are readily available under Strathcona’s profile on SEDAR+ at www.sedarplus.ca.

Management authorized the capital investment and production assistance and long-range strategy included herein since the date of this news release. The function of the capital investment and production assistance and long-range strategy is to help readers in understanding Strathcona’s anticipated and targeted monetary position and efficiency, and this details might not be proper for other functions.

This release consists of details that might make up future-oriented monetary details or monetary outlook details (jointly, “FOFI”) about Strathcona’s potential monetary efficiency, monetary position or capital, all of which undergoes the exact same presumptions, threat elements, restrictions and certifications as stated above. Readers are warned that the presumptions utilized in the preparation of such details, although thought about sensible at the time of preparation, might show to be inaccurate or incorrect and, as such, excessive dependence needs to not be put on FOFI. Strathcona’s real outcomes, efficiency and accomplishments might vary materially from those revealed in, or suggested by, FOFI. Strathcona has actually consisted of FOFI in order to supply readers with a more total viewpoint on Strathcona’s future operations and management’s present expectations associating with Strathcona’s future efficiency. Readers are warned that such details might not be proper for other functions.

The foregoing dangers must not be interpreted as extensive. The positive details included in this news release speaks just since the date of this news release and Strathcona does not presume any commitment to openly upgrade or modify such positive details to show brand-new occasions or scenarios, other than as might be needed pursuant to relevant laws. Any positive details included herein is specifically certified by this cautionary declaration.

SOURCE Strathcona Resources Ltd.