Ovintiv Reports First Quarter 2024 Financial and Operating Results

Strong Shareholder Returns Underpinned by Continued Operational Excellence

• Generated net earnings of $338 million, cash from operating activities of $659 million, Non-GAAP Cash Flow of $1,035 million and Non-GAAP Free Cash Flow of $444 million after capital expenditures of $591 million
• First quarter production was at the high-end or above the guidance range on every product with average total production volumes of 574 thousand barrels of oil equivalent per day ("MBOE/d"), including 211 thousand barrels per day ("Mbbls/d") of oil and condensate, 88 Mbbls/d of other NGLs (C2 to C4) and 1,648 million cubic feet per day ("MMcf/d") of natural gas
• Returned $328 million to shareholders through the combination of base dividend payments and share buybacks
• Raised full year production guidance to 560 MBOE/d to 575 MBOE/d while leaving capital guidance unchanged at $2.2 billion to $2.4 billion
• Released 2023 Sustainability Report on Company website

DENVER, May 7, 2024 /PRNewswire/ - Ovintiv Inc. (NYSE: OVV) (TSX: OVV) ("Ovintiv" or the "Company") today announced its first quarter 2024 financial and operating results. The Company plans to hold a conference call and webcast at 9:00 a.m. MT (11:00 a.m. ET) on May 8, 2024. Please see dial-in details within this release, as well as additional details on the Company's website at www.ovintiv.com under Presentations and Events – Ovintiv.

"Our solid execution continued across the portfolio during the first quarter," said Ovintiv President and CEO, Brendan McCracken. "Our combination of strong productivity, leading capital efficiency and a stronger oil price environment have raised our expectations for 2024 Non-GAAP Free Cash Flow from $1.6 billion to $1.9 billion – roughly $750 million more than last year."

• The Company recorded net earnings of $338 million, or $1.24 per diluted share of common stock. Included in net earnings were net losses on risk management of $54 million, before tax.
• Cash from operating activities was $659 million, Non-GAAP Cash Flow was $1,035 million and capital investment totaled approximately $591 million, resulting in $444 million of Non-GAAP Free Cash Flow.
• First quarter average total production volumes were approximately 574 MBOE/d, including 211 Mbbls/d of oil and condensate, 88 Mbbls/d of other NGLs and 1,648 MMcf/d of natural gas.
• Upstream operating expense was $4.52 per barrel of oil equivalent ("BOE"). Upstream transportation and processing costs were $7.25 per BOE. Production, mineral and other taxes were $1.60 per BOE, or 4.3% of upstream revenue. These costs were at the low-end of guidance on a combined basis.
• Excluding the impact of hedges, first quarter average realized prices were $74.62 per barrel for oil and condensate (97% of WTI), $21.03 per barrel for other NGLs (C2-C4) and $2.21 per thousand cubic feet ("Mcf") for natural gas (99% of NYMEX) resulting in a total average realized price of $36.97 per BOE.
• Including the impact of hedges, the average realized prices for oil and condensate was $74.20 per barrel (96% of WTI), $21.16 per barrel for other NGLs, and $2.56 per Mcf for natural gas (114% of NYMEX) resulting in a total average realized price of $37.84 per BOE.

The Company issued its second quarter 2024 guidance and raised its full year production guidance while leaving full year capital guidance unchanged. Full year production volumes are expected to average 560 to 575 MBOE/d, with full year capital investment of $2.2 billion to $2.4 billion.

Ovintiv remains committed to its capital allocation framework, which returns at least 50% of post base dividend Non-GAAP Free Cash Flow to shareholders through buybacks and/or variable dividends.

In the first quarter of 2024, the Company returned $328 million to shareholders through share buybacks totaling $248 million and its base dividend of approximately $80 million. Share buybacks in the second quarter are expected to total approximately $182 million.

Ovintiv had approximately $3.0 billion in total liquidity as of March 31, 2024, which included available credit facilities of $3,250 million, available uncommitted demand lines of $237 million, and cash and cash equivalents of $5 million, net of outstanding commercial paper of $495 million.

Ovintiv reported Non-GAAP Debt to EBITDA of 1.3 times and Non-GAAP Debt to Adjusted EBITDA of 1.3 times.

The Company remains committed to maintaining a strong balance sheet and is currently rated investment grade by four credit rating agencies. Ovintiv maintains a long-term leverage target of 1.0 times Non-GAAP Debt to Adjusted EBITDA at mid-cycle prices, with an associated long-term total debt target of $4.0 billion.

On May 7, 2024, Ovintiv's Board declared a quarterly dividend of $0.30 per share of common stock payable on June 28, 2024, to shareholders of record as of June 14, 2024.

Permian production averaged 206 MBOE/d (82% liquids) in the first quarter. The Company had 21 net wells turned in line ("TIL"). Ovintiv plans to invest approximately $1.35 to $1.45 billion in the play in 2024 to bring on 120 to 130 net wells.

Montney production averaged 226 MBOE/d (19% liquids) in the first quarter. The Company had 11 net wells TIL. Ovintiv plans to invest approximately $425 to $475 million in the play in 2024 to bring on 60 to 70 net wells.

Uinta production averaged 28 MBOE/d (79% liquids) in the first quarter. The Company had nine net wells TIL. Ovintiv plans to invest approximately $300 to $350 million in the play in 2024 to bring on 25 to 30 net wells.

Anadarko production averaged 108 MBOE/d (59% liquids) in the first quarter. The Company had no TILs during the quarter. Ovintiv plans to invest approximately $100 to $125 million in the play in 2024 to bring on seven to ten net wells.

Today, the Company released its 2023 Sustainability Report, highlighting its progress and performance on several key initiatives related to the environment, social responsibility and corporate governance.

"We are proud of another year of strong performance in 2023," said McCracken. "Our results demonstrate our commitment to developing our resource efficiently and responsibly, while also generating durable returns for our shareholders. We believe that fostering a culture of innovation, engaging with our external stakeholders and workforce, adhering to the highest standards of conduct, and setting measurable near-term targets strengthens our business and drives better corporate outcomes."

• Achieved a 41% reduction in Scope 1 & 2 greenhouse gas (GHG) emissions intensity since 2019, continuing progress toward the Company's goal of a 50% reduction by 2030  

• Committed $10 million to local children's hospitals
• Developed new and updated existing safety programs and processes under the guidance of the Company's Safety Advisory Task Force to drive and sustain improved safety performance 
• Received an award for LINK, Ovintiv's inclusive employee resource group, for its efforts toward driving a just, equitable, diverse, and inclusive culture in the workplace 

• Added a Board of Directors Overboarding and Change in Circumstance Policy, setting high standards for strong corporate governance 
• Welcomed a new independent director in January 2024, adding deep technical accounting and energy industry expertise as well as further diversity to the Board 

Ovintiv's sustainability report can be found on the Company's website at Home – Ovintiv.

For additional information on the Company's quarterly results, please refer to the First Quarter 2024 Results Presentation available on Ovintiv's website, www.ovintiv.com under Presentations and Events – Ovintiv. Supplemental Information, and Non-GAAP Definitions and Reconciliations, are available on Ovintiv's website under Financial Documents Library.

A conference call and webcast to discuss the Company's first quarter results will be held at 9:00 a.m. MT (11:00 a.m. ET) on May 8, 2024.

To join the conference call without operator assistance, you may register and enter your phone number at https://emportal.ink/3tPPnb2 to receive an instant automated call back. You can also dial direct to be entered to the call by an Operator. Please dial 888-664-6383 (toll-free in North America) or 416-764-8650 (international) approximately 15 minutes prior to the call.                                                    

The live audio webcast of the conference call, including slides and financial statements, will be available on Ovintiv's website, www.ovintiv.com under Investors/Presentations and Events. The webcast will be archived for approximately 90 days.

Refer to Note 1 Non-GAAP measures and the tables in this release for reconciliation to comparable GAAP financial measures.

Natural Gas Hedges ($/Mcf)	2Q 2024	3Q 2024	4Q 2024	1Q 2025	2Q 2025	3Q 2025	4Q 2025
NYMEX Swaps	200 MMcf/d $3.62	200 MMcf/d $3.62	200 MMcf/d $3.62	0 -	0 -	0 -	0 -
NYMEX Collars Call Strike Put Strike	400 MMcf/d $3.40 $3.00	400 MMcf/d $3.40 $3.00	400 MMcf/d $5.57 $3.00	0 - -	0 - -	0 - -	0 - -
NYMEX 3-Way Options Call Strike Put Strike Sold Put Strike	200 MMcf/d $4.44 $3.00 $2.25	200 MMcf/d $4.44 $3.00 $2.25	200 MMcf/d $4.58 $3.00 $2.25	500 MMcf/d $4.74 $3.00 $2.25	380 MMcf/d $4.38 $3.00 $2.25	380 MMcf/d $4.38 $3.00 $2.25	380 MMcf/d $4.38 $3.00 $2.25
Waha % of NYMEX Swaps	50 MMcf/d 71%	50 MMcf/d 71%	50 MMcf/d 71%	0 -	0 -	0 -	0 -
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