Whitecap Resources Announces Acquisition of World Class Enhanced Oil Recovery Project

Whitecap Resources Inc. has entered into an agreement to purchase high quality light oil assets in southeast Saskatchewan for cash consideration of $940 million before closing adjustments. The Acquisition includes a 62.1% operated working interest in the Weyburn Unit (14,600 boe/d) and 200 boe/d of production from minor assets in southeast Saskatchewan. The Weyburn Unit (the “Unit”) is a world class carbon dioxide (“CO2”) enhanced oil recovery (“EOR”) development with a low base decline rate of less than 5%, high operating netback of $31.86/boe, and significant short and long term development and expansion opportunities. The Assets also include extensive infrastructure in place to facilitate future development plans.

The Acquisition will be funded with a $92.5 million non-brokered private placement and a concurrent $332.5 million bought deal equity financing and by the Company's credit facilities. Whitecap’s credit facilities are anticipated to increase to $1.7 billion upon closing of the Acquisition.

STRATEGIC RATIONALE

The Acquisition is a continuation of Whitecap’s strategy to enhance our existing portfolio with assets that exhibit lower production declines, high operating netbacks and significant growth opportunities with strong capital efficiencies to further enhance our future free funds flow. The Unit is a self-sustaining operation that generates strong free funds flow even in a low commodity price environment and requires minimal capital investment to maintain production volumes and associated funds flow. In 2018, our base case assumptions are to invest 35% of the net operating income from these Assets to maintain production at 14,800 boe/d which we anticipate will result in significant additional free funds flow of approximately $112 million. We estimate that over the next five years, the base Assets have the potential to grow to approximately 17,700 boe/d and generate cumulative free funds flow of $459 million using a flat operating netback of $31.86/boe. Refer to the Increased 2018 Guidance section of this press release for the commodity price assumptions. The significant free funds flow from the Assets in combination with those generated by our other core asset areas allows Whitecap to also announce an additional increase to our monthly dividend of 5% to $0.0257 per share ($0.3084 per share annualized) from $0.0245 per share ($0.2940 per share annualized) effective for the January 2018 dividend. This represents a cumulative 10% dividend increase including the previously announced increase on November 1, 2017.

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