Tourmaline Delivers Record Production in Q1 2025, Announces Two Acquisitions and Declares a Special Dividend

MAY 7, 2025

Calgary, Alberta – Tourmaline Oil Corp. (TSX:TOU) (“Tourmaline” or the “Company”) is pleased to release financial and operating results for the first quarter of 2025, announce two acquisitions in the NEBC Montney and declare a special dividend.

HIGHLIGHTS

⦁ First quarter 2025 average production was 637,867 boepd, an 8% increase over first quarter 2024 and ahead of the 630,000 – 635,000 boepd first quarter 2025 expected range announced on March 5, 2025.

⦁ First quarter 2025 cash flow(1) (“CF”) was $963.0 million ($2.56 per diluted share(2)) on total capital expenditures(3) of $825.0 million (EP spending(4) of $797.7 million) generating free cash flow(5) (“FCF”) of $149.1 million for the quarter ($0.40 per diluted share(6)).

⦁ In 2025, at strip pricing(7), the Company now expects to generate CF of $3.9 billion ($10.44 per diluted share) and FCF of $960.0 million ($2.55 per diluted share) on EP spending of $2.725 billion (midpoint of 2025 guidance range).

(1) This news release contains certain specified financial measures consisting of non-GAAP financial measures, non-GAAP financial ratios, capital management measures and supplementary financial measures. See “Non-GAAP and Other Financial Measures” in this news release for information regarding the following specified financial measures: “cash flow”, “capital expenditures”, “EP spending”, “free cash flow”, “operating netback”, “operating netback per boe”, “cash flow per diluted share”, “free cash flow per diluted share”, “adjusted working capital” and “net debt”. Since these specified financial measures do not have standardized meanings under International Financial Reporting Standards (“GAAP”), securities regulations require that, among other things, they be identified, defined, qualified and, where required, reconciled with their nearest GAAP measure and compared to the prior period. See “Non-GAAP and Other Financial Measures” in this news release and in the Company’s most recently filed Management’s Discussion and Analysis (the “Q1 MD&A”), which information is incorporated by reference into this news release, for further information on the composition of and, where required, reconciliation of these measures.

(1) “Cash flow per diluted share” is a non-GAAP financial ratio. Cash flow, a non-GAAP financial measure, is used as a component of the non-GAAP financial ratio. See “Non-GAAP and Other Financial Measures” in this news release and in the Q1 MD&A.

(3) “Capital expenditures” is a non-GAAP financial measure defined as cash flow used in investing activities adjusted for the change in non-cash working capital (deficit). See “Non-GAAP and Other Financial Measures” in this news release and in the Q1 MD&A.

(4) “EP spending” (or “Exploration and production expenditures”) is a non-GAAP financial measure defined as capital expenditures, excluding property acquisitions and dispositions and other expenditures. See “Non-GAAP and Other Financial Measures” in this news release.

(4) “Free cash flow” is a non-GAAP financial measure defined as cash flow less capital expenditures, excluding acquisitions and dispositions. Free cash flow is prior to dividend payments. See “Non-GAAP and Other Financial Measures” in this news release.

(4) “Free cash flow per diluted share” is a non-GAAP financial ratio. Free cash flow, a non-GAAP financial measure, is used as a component of the non-GAAP financial ratio. See “Non-GAAP and Other Financial Measures” in this news release and in the Q1 MD&A.

(4) Based on oil and gas commodity strip pricing at April 15, 2025.

⦁ Tourmaline continues to consolidate the NEBC Montney, one of the most profitable gas plays in North America, in concert with the Company’s NEBC infrastructure buildout. In the North Montney, the Company has entered into an agreement to acquire the balance of the jointly-owned Laprise-Conroy assets through the acquisition of Saguaro Resources Ltd. In addition, Tourmaline has entered into an agreement to acquire assets located in the Greater Septimus area of the South Montney. The Company expects these acquisitions to close in Q2 2025.

⦁ Tourmaline’s Board of Directors has declared a special dividend of $0.35 per share payable on May 26, 2025 to shareholders of record on May 15, 2025.

⦁ The Company intends to declare a quarterly dividend of $0.50 per share, payable on June 30, 2025, to shareholders of record on June 16, 2025.

PRODUCTION UPDATE

⦁ First quarter 2025 average production was 637,867 boepd, slightly ahead of the guidance range announced on March 5, 2025 and up 8% from the first quarter of 2024. March 2025 average production was 645,036 boepd.

⦁ First quarter 2025 average liquids production (oil, condensate, NGLs) was 147,438 bpd, up 2% over the first quarter 2024 average liquids production of 145,016 bpd.

⦁ The 2025 forecast production range of 635,000 – 665,000 boepd remains unchanged. Production averaged 660,000 boepd for the first half of April.

⦁ The Company expects second quarter 2025 average production in the 615,000 – 625,000 boepd range, reflecting increased maintenance now scheduled given the anticipated weaker gas prices during that time period, particularly at Station 2 where pricing and volume in April was impacted by maintenance at the third party-operated Aitken storage facility.

FINANCIAL RESULTS

⦁ First quarter 2025 cash flow was $963.0 million ($2.56 per fully diluted share) and FCF was $149.1 million ($0.40 per fully diluted share).

⦁ First quarter 2025 earnings were $212.7 million ($0.56 per fully diluted share).

⦁ First quarter EP capital spending was $797.7 million. The Company expects EP capital spending to be approximately $560.0 million in Q2 2025 during spring break-up, yielding an estimated 1H 2025 FCF of $430.0 million ($1.14 per diluted share) based on strip pricing. The Company expects commodity prices to improve in the 2H 2025 with the start-up of the LNG Canada facility on the West Coast, resulting in higher FCF in 2H 2025 relative to 1H 2025.

2025 CAPITAL PROGRAM

⦁ The full year 2025 EP capital program remains unchanged at $2.60 to $2.85 billion.

⦁ Given weak Station 2 gas prices, the Company intends to defer some planned Q2 frac activity into the third quarter of 2025. The Company continues to expect stronger prices at both the Station 2 and AECO hubs during the second half of 2025 as gas volumes commence flowing west to the LNG Canada liquification facility. The Company will continue to match planned production growth to the anticipated increasing natural gas price curve.

⦁ The Company expects to release an updated multi-year EP plan, including the full NEBC Montney gas and liquids infrastructure buildout, and incorporation of all recent acquisitions in the second half of 2025. Inclusive of projects not yet incorporated in the EP plan and recent acquisitions, the Company forecasts to enter the next decade producing at approximately 850,000 boepd(8).

ACQUISITION UPDATE

⦁ Tourmaline continues to consolidate the NEBC Montney, one of the most profitable gas plays in North America, in concert with the Company’s NEBC infrastructure buildout.

⦁ In the North Montney, the Company has entered into an agreement to acquire the balance of the jointly-owned Laprise-Conroy assets through the acquisition of Saguaro Resources Ltd., and in the South Montney, Tourmaline has entered into an agreement to acquire assets in the Greater Septimus area from a third party. Both transactions are expected to close in Q2 2025, and Tourmaline’s forward guidance and EP plan will reflect these acquisitions in the Company’s next update.

⦁ In aggregate, these two transactions add approximately 20,000 boepd of current production, an estimated 369.4 mmboe of current 2P reserves(9), and approximately 410 primarily Tier 1 future net drilling locations. Production and reserves from these assets are expected to experience significant future growth as each asset is systematically developed as part of the Company’s NEBC Montney buildout.

⦁ The Laprise-Conroy asset is the key component of the North Montney Phase 2 project, and the Greater Septimus asset is complementary and adjacent to Tourmaline’s planned Groundbirch 400 mmcfpd / 20,000 bpd two-phase gas plant development project.

⦁ As part of these transactions, Tourmaline will also acquire 9 net sections and an estimated 54 net drilling locations in the Resthaven area of the Alberta Deep Basin.

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