Tourmaline Oil Q3 2021 Results

Calgary, Alberta – Tourmaline Oil Corp. (TSX:TOU) (“Tourmaline” or the “Company”) is pleased to release
financial and operating results for the third quarter of 2021.

Tourmaline 2021 Oil & Gas Permits


• Record quarterly cash flow(1) of $761.3 million and free cash flow(2) of $369.5 million in the third quarter.
• Current production is ranging between 485,000 – 490,000 boepd; the Company expects to achieve 500,000
boepd by early December, a month earlier than previously anticipated.
• The Company now expects exit 2021 net debt(3) of approximately $815 million (at current strip pricing(
giving effect to the special dividend of $0.75/share ($247.2 million) paid on October 7, 2021. Long term, the
Company intends to keep net debt in the $1.0 – $1.2 billion range.
• The Gundy and Aitken facility expansions will be completed and on production in December 2021,
approximately one month earlier than expected.
• The Company’s original methane emission reduction target of 25% below 2018 levels by 2023 has already
been achieved three years ahead of schedule.


• Current production is ranging between 485,000 – 490,000 boepd; the Company expects to achieve the exit
production target of 500,000 boepd by early December – ahead of schedule.
• Q3 2021 average production was 456,489 boepd. Force majeure events impacting Pembina’s Redwater
fractionation facilities and Pembina’s Northern NGL pipeline system reduced Q3 average volumes by a total
of 2,825 boepd. Pembina’s Redwater fractionation facilities and Northern NGL pipeline system have both
resumed operations. Because the Pembina Northern NGL pipeline system continued to be offline for the first 11 days of October, expected Q4 average volumes were reduced by 625 boepd; however, Q4 guidance remains in the 485,000 to 495,000 boepd range.
• The Company expects 2022 average production of 500,000-510,000 boepd (2.31 bcf/day of natural gas,
115,000 bpd of oil, condensate, NGLs).


• Third quarter 2021 cash flow was $761.3 million ($2.32 per fully diluted share) compared to $279.9 million in
Q3 2020 ($1.03 per fully diluted share).
• Nine-month 2021 cash flow is $1.96 billion; full-year 2021 cash flow of $3.1 billion is now expected.
• The Company delivered free cash flow of $369.5 million in Q3 2021 on EP capital spending of $379.7 million.
• Third quarter 2021 earnings were $361.1 million ($1.10 per fully diluted share), compared to $4.8 million
($0.02 per fully diluted share) in Q3 2020.
• The average Q3 2021 operating netback of $18.35/boe featured continued strong cash cost (operating,
transportation, general and administrative, and interest) control ($8.72/boe), coupled with higher prices
across the entire product price complex.


• Third quarter 2021 EP capital spending was $379.7 million, compared to guidance of $420.0 million.
• Full-year 2021 EP capital spending of $1.375 billion and 2022 EP capital spending of $1.125 billion remain
unchanged from the previously disclosed forecast.
• The Company expects exit 2021 net debt of approximately $815.0 million on current strip pricing. Long term,
the Company intends to keep net debt in the $1.0 – $1.2 billion range.
• As previously disclosed, Tourmaline paid a special dividend of $0.75/share on October 7, 2021, and also
increased the annual base dividend to $0.72/share. The Company plans further special dividends over the
next several quarters, contingent upon commodity prices and free cash flow allocation decisions. Given
current strong pricing and the rate of FCF accumulation, Tourmaline expects to pay the next special dividend
during Q1 2022.
• Tourmaline is expecting full-year 2022 cash flow of $4.0 billion yielding free cash flow of $2.8 billion on
unchanged EP capital spending of $1.125 billion.


• Average realized natural gas price in Q3 2021 was $3.88/mcf as the Company benefited from rising
commodity prices, select hedging, and the Company’s broad natural gas market diversification portfolio
throughout North America.

Tourmaline has 591 mmcfpd of fixed price hedges for 2022 at a weighted average price of CAD $3.17/mcf
(approximately 25% of 2022 gas volumes), an average of 149 mmcfpd in basis hedges to AECO of USD
$(0.07)/mcf, and an average 621 mmcfpd exposed to export markets including Dawn, Iroquois, US Gulf
Coast, Empress/McNeill, Chicago, Ventura, Sumas, Malin, and PG&E.
• The 2022 hedged volumes include approximately 145 mmcfpd of lower-priced hedges acquired in the
Modern and Black Swan transactions; 58% of which expire during 2022.
• Tourmaline has recently acquired additional transportation service for Winter 21/22 and now has a total of
130 mmcfpd exposed to the US Midwest market.
• In November 2022, Tourmaline will have 150 mmcfpd exposed to the Gulf Coast market, which will become
JKM index exposure in January 2023. Furthermore, the Company will add an incremental 100 mmcf/d of
exposure to the GTN Malin/PG&E markets in November 2022 and 50 mmcfpd in November 2023.
• NGL price realizations in Q3 2021 were up 115% over Q3 2020. Tourmaline is Canada’s largest NGL
producer with anticipated average production levels of approximately 72,000 bpd in 2022.


• Tourmaline is pleased to report that the accelerated deep cut facility projects at both Gundy and Aiken are
expected to be completed ahead of the revised, accelerated schedule and on budget. New gas and liquids
production is anticipated from both facilities during the first half of December.
• Tourmaline is currently operating 13 drilling rigs as planned, 87 net wells were drilled in the third quarter, 77
net wells were stimulated and brought on production. The Company expects to stimulate and bring on
production approximately 79 new net wells during the fourth quarter.


• Tourmaline is pleased to report that it has already achieved the methane emission reduction target of 25%
from 2018 levels by 2023 as reflected in the Company’s current five-year Environmental Performance
Improvement Plan. 2020 actuals of 405,487 tonnes (CO2 equivalent) are 26% lower than 2018 actuals of
547,396 tonnes (CO2 equivalent), despite production growth of 17% during that period.
• The Company will continue further reducing methane, CO2 and other atmospheric emissions throughout the
EP portfolio and will revise the five-year Environmental Performance Improvement Plan as appropriate as
these targets are achieved.
• The Company’s Emission Testing Centre (“ETC”) at the Tourmaline/Perpetual Wolf Creek gas plant, the first
of its kind in the World, is now fully operational. The ETC, a collaboration with NGIF (Natural Gas Innovation
Fund) and Industry, is critical in evolving new technology and methodologies to continue materially reducing
methane and other emissions in the entire EP business. Producing the lowest emission natural gas will allow
Canada to grow both domestic production and international exports.


Tourmaline is an investment grade Canadian senior crude oil and natural gas exploration and production
company focused on providing strong and predictable long-term growth and a steady return to shareholders
through an aggressive exploration, development, production and acquisition program in the Western Canadian
Sedimentary Basin by building its extensive asset base in its three core exploration and production areas and
exploiting and developing these areas to increase reserves, production and cash flows at an attractive return on
invested capital

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