WHITECAP RESOURCES INC. REPORTS STRONG SECOND QUARTER RESULTS AND RECORD FUNDS FLOW PER SHARE

WHITECAP RESOURCES INC. REPORTS STRONG SECOND QUARTER RESULTS AND RECORD FUNDS FLOW PER SHARE

CALGARY, ALBERTA - Whitecap Resources Inc. ("Whitecap" or the "Company") (TSX: WCP) is pleased to report its operating and unaudited consolidated financial results for the three and six months ended June 30, 2022.

Selected financial and operating information is outlined below and should be read with Whitecap's unaudited interim consolidated financial statements and related Management's Discussion and Analysis for the three and six months ended June 30, 2022 which are available at www.sedar.com and on our website at www.wcap.ca.

FINANCIAL AND OPERATING HIGHLIGHTS

MESSAGE TO SHAREHOLDERS

Whitecap's financial and operating results for the second quarter were once again ahead of expectations as the Company maintained operational momentum from the first quarter drilling program resulting in production of 132,293 boe/d and record funds flow of $677 million or $1.08 per share. After capital expenditures of only $88 million, the Company generated $589 million of free funds flow⁶ in the second quarter, of which over $175 million was returned to shareholders through our base dividend ($56 million) and our normal course issuer bid ("NCIB") ($121 million). Net debt of $674 million at the end of the second quarter was approximately $125 million lower than our targeted $800 million of quarter end net debt.

Whitecap drilled 8 (5.4 net) wells during the second quarter which included 5 (3.4 net) Montney wells at Kakwa and 3 (2.0 net) Frobisher wells in Southeast Saskatchewan. We will be increasing our activity levels in the third quarter and will reach our peak utilization of eleven rigs by the end of August. We expect activity levels to modestly decrease through the fourth quarter and then ramp back up to approximately eleven rigs in the first quarter of 2023 until breakup, which will be adequate for efficient execution of our capital program including the expanded capital on the XTO Energy Canada ("XTO") lands.

Since our initial Montney joint venture in 2019 and the subsequent consolidation of additional Montney lands in 2021, we have continued to advance our drilling and completion design and have modified our well spacing assumptions to achieve strong results to date in the Montney.

Our most recent four well (2.6 net) 12-33 Montney pad at Kakwa that is jointly held with XTO was brought on production late in the second quarter and has produced at an average rate of 2,150 boe/d per well (45% liquids) in the first 30 days of production. The wells are continuing to clean up with the pad producing at an average rate of over 10,000 boe/d (40% liquids) over the last seven days prior to being tied into permanent facilities. Further, our three well (2.4 net) 14-13 pad has now been producing for 180 days at an average rate of 1,832 boe/d per well (33% liquids) which is similar to the average rate over its first 90 days on production.

These results further validate our assessment of the quality of the XTO Montney acreage we are acquiring, and we look forward to deploying our refined drilling and completion design on these assets.

We highlight the following second quarter 2022 financial and operating results:

· Production Outperformance. Second quarter production of 132,293 boe/d was higher than our internal forecast of 128,000 - 130,000 boe/d and increased 13% per share compared to Q2/21. Continued production optimization along with organic drilling success contributed to results being above our internal forecast.

· Record Funds Flow. Second quarter funds flow of $677 million or $1.08 per share was up 35% as compared to the prior quarter and 151% as compared to Q2/21. Strong operating netbacks of $57.59 per boe were driven by favourable commodity prices and strong operational execution.

· Continued Return of Capital. Dividends paid during the second quarter were $56 million or $0.09 per share, which were 20% and 94% higher on a per share basis than Q1/22 and Q2/21, respectively. Including $121 million of share repurchases under our NCIB, total capital returned to shareholders of over $175 million during the quarter matches our previous quarterly high from Q4/21. We recently increased our annual dividend by 22% to $0.44 per share.

· Balance Sheet Strength. Quarter end net debt of $674 million was lower than our targeted net debt of $800 million. Quarter end debt to EBITDA ratio⁷ was 0.5x and EBITDA to interest expense ratio⁷ was 43.7x, well within our covenant limits of not greater than 4.0x and not less than 3.5x, respectively.

OUTLOOK

Our current asset mix has provided us with long-term operational success, and we are excited to be adding the XTO assets to our portfolio. We expect to continue to provide exceptional returns on capital deployed in each of our core business units.

The XTO acquisition is on track to close before the end of the third quarter and we continue to forecast average production and capital expenditures for 2022 of 138,000 - 140,000 boe/d and $610 - $630 million, respectively. Our preliminary 2023 forecast is for production to average 168,000 - 174,000 boe/d and capital expenditures of $900 million to $1.1 billion.

Our ability to acquire a world class asset with no dilution to shareholders is a testament to our balance sheet strength and our ability to generate significant free funds flow. We remain committed to increasing return of capital to our shareholders by linking future dividend increases to our net debt milestones and stress testing our sustainability down to US$50/bbl WTI and C$4.00/GJ AECO.

On behalf of our employees, management team and Board of Directors, we would like to thank our shareholders for their support and look forward to updating you on our progress through the remainder of the year.

CONFERENCE CALL AND WEBCAST

Whitecap has scheduled a conference call and webcast to begin promptly at 9:00 am MT (11:00 am ET) on Thursday, July 28, 2022.

The conference call dial-in number is: 1-888-390-0605 or (587) 880-2175 or (416) 764-8609

A live audio webcast of the conference call will be accessible on Whitecap's website at www.wcap.ca by selecting "Investors", then "Presentations & Events". Shortly after the live webcast, an archived version will be available.

For further information:

Grant Fagerheim, President & CEO
or
Thanh Kang, Senior Vice President & CFO

Whitecap Resources Inc.
3800, 525 - 8th Avenue SW
Calgary, AB T2P 1G1
(403) 266-0767
www.wcap.ca
[email protected]

NOTES
¹ Funds flow, funds flow basic ($/share), funds flow diluted ($/share) and net debt are capital management measures. Total payout ratio is a supplementary financial measure. Operating Netback is a non-GAAP financial measure and operating netbacks ($/boe) is a non-GAAP ratio. Refer to the Specified Financial Measures section in this press release for additional disclosure and assumptions.
² Also referred to herein as "capital expenditures".
³ Disclosure of production on a per boe basis in this press release consists of the constituent product types and their respective quantities disclosed herein. Refer to Barrel of Oil Equivalency and Production, Initial Production Rates and Product Type Information in this press release for additional disclosure.
⁴ Prior to the impact of risk management activities and tariffs.
⁵ Supplementary financial measure. Refer to the "Supplementary Financial Measures" section of the Company's MD&A for the three and six months ended June 30, 2022, which is incorporated herein by reference, and available on SEDAR at www.sedar.com.
⁶ Free funds flow is a non-GAAP financial measure. Refer to the Specified Financial Measures section in this press release for additional disclosure and assumptions.
⁷ Debt to EBITDA ratio and EBITDA to interest expense ratio are specified financial measures that are calculated in accordance with the financial covenants in our credit agreement.

Refer to full press release for forward-looking statements and advisories.

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