BAYTEX ANNOUNCES THIRD QUARTER 2022 RESULTS

CALGARY, ALBERTA (November 3, 2022) – Baytex Energy Corp. (“Baytex”)(TSX: BTE) reports its operating and financial results for the three and nine months ended September 30, 2022

Q3/2022 Results

During the third quarter, we delivered strong operating and financial results which has set the stage for continued momentum as we approach 2023. In addition, we advanced our exciting Clearwater play at Peavine with initial results from our H2/2022 drilling program delivering among the best wells drilled to date in the play.

Production during the third quarter averaged 83,194 boe/d (84% oil and NGL) as compared to 83,090 boe/d (83% oil and NGL) in Q2/2022. Production in October increased to over 87,000 boe/d, in line with our targeted exit production rate of 87,000 to 88,000 boe/d. Exploration and development expenditures totaled $167 million in Q3/2022 and we participated in the drilling of 86 (72.0 net) wells.

During the quarter, we delivered adjusted funds flow(1) of $284 million ($0.51 per basic share) and net income of $265 million ($0.48 per basic share). We generated free cash flow(2) of $112 million ($0.20 per basic share) which brings our year-to-date free cash flow to $478 million ($0.85 per basic share).

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Baytex Wells Drilled in 2022

Operating Results
Eagle Ford and Viking Light Oil
Production in the Eagle Ford averaged 27,391 boe/d (82% oil and NGL) during Q3/2022 and generated an operating netback(2) of $140 million. We invested $50 million on exploration and development in the Eagle Ford during the quarter and brought 19 (4.1 net) wells onstream. We expect to bring approximately 18 net wells onstream in 2022.

Production in the Viking averaged 16,019 boe/d (88% oil and NGL) during Q3/2022 and generated an operating netback of $116 million. We invested $62 million on exploration and development in the Viking during the quarter and brought 42 (40.5 net) wells onstream. We expect to bring approximately 130 net wells onstream in 2022.

Heavy Oil
Our heavy oil assets at Peace River and Lloydminster (excluding Clearwater development) produced a combined 23,377 boe/d (90% oil and NGL) during Q3/2022 and generated an operating netback of $80 million. We invested $31 million on exploration and development during the quarter and brought onstream 2 net Bluesky wells at Peace River and 2.6 net wells at Lloydminster.

In 2022, we will drill approximately 9 net Bluesky wells at Peace River and 31 net wells at Lloydminster.

Peace River Clearwater
Production in the Clearwater averaged 8,191 boe/d (100% oil) during Q3/2022 and generated an operating netback of $37 million. Production during the month of October averaged approximately 10,000 bbl/d from 24 producing wells.

Our second half drilling program kicked off in July and will include the drilling of 13 Clearwater wells, including 12 wells at Peavine and one well at Seal that follows up a successful exploration well from 2021. The first four wells from the H2/2022 drilling program generated average 30-day initial production rates of 1,100 bbl/d per well. Initial well performance continues to outperform type curve assumptions and we now hold 13 of the top 15 initial rate wells drilled across the play.

We continue to optimize planned development for our Peavine lands, which now includes a combination of traditional ultilateral wells (eight one-mile long laterals) and extended reach horizontal (“ERH”) multi-lateral wells (four two-mile long laterals). The RH multi-lateral wells are utilized to provide appropriate set-backs to residents and environmentally sensitive areas and were among the first of their type to be drilled in western Canada.

Following further detailed reservoir and economic analysis of the Peavine Clearwater, our most recent wells were drilled at 40 metre inter-lateral spacing (5 wells per section) whereas our initial wells were drilled at 50 metre inter-lateral spacing (4 wells persection). At this tighter spacing, we could potentially see a 20% increase in our prospective drilling inventory yielding meaningfully improved resource recovery and value.

The Clearwater generates among the strongest economics within our portfolio with payouts of less than five months at US$80 WTI and has the ability to grow organically while enhancing our free cash flow profile. To-date, we have de-risked 50 sections (ofour 80-section Peavine land base) and believe the lands hold the potential for greater than 250 locations with production increasing to approximately 15,000 bbl/d. When combined with our legacy acreage position in northwest Alberta, we estimate
that over 125 sections of our lands are highly prospective for Clearwater development.

Pembina Area Duvernay Light Oil
Production in the Pembina Duvernay averaged 3,405 boe/d (84% oil and NGL) during Q3/2022.

The Pembina Duvernay shale is an early stage, high operating netback light oil resource play. During the first quarter, we drilled a three-well pad on the northern edge of our land base that was brought on production in June/July. Performance of the three wells has tracked to type well forecast for that region, generating an average 90-day initial production rate of approximately 700 boe/d per well (86% crude oil and NGL). The three wells, each drilled to a vertical depth of 2,400 metres with a horizontal lateral of 1.85 miles, were drilled and completed for $8.3 million per well.

As we progress our understanding of the reservoir and gain confidence in capital execution and well performance, we believe the Pembina Duvernay shale has the potential to generate competitive returns within our portfolio, with payouts of 13 to 15 months at US$80 WTI. For 2023, we are in the planning stages of a four-well program to further progress our development. Across our Pembina acreage, we hold 200 sections of contiguous 100% working interest lands.

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