CALGARY, AB, May 6, 2026 /PRNewswire/ - Strathcona Resources Ltd. ("Strathcona" or the "Company") (TSX: SCR) today reported its first quarter 2026 financial and operating results. The Board of Directors also declared a quarterly dividend of $0.30 per common share.

Q1 2026 Highlights

• Production of 116,542 boe/d (99.7% liquids)
• Operating Earnings of $194 million ($0.91 / share)⁽¹⁾
• Free Cash Flow of $47 million ($0.22 / share)⁽¹⁾

Quarter Review and Near-Term Priorities

Production for the first quarter of 2026 of 117 Mboe / d (99.7% liquids) was in-line versus the fourth quarter of 2025. Operating earnings of $194 million ($0.91 / share) reflected a 33% increase versus the prior quarter, largely driven by higher oil prices. Free cash flow of $47 million ($0.22 / share) was roughly flat versus the prior quarter, with higher operating earnings being offset by increased capital expenditures under Strathcona's annual capital program, which is weighted to the first half of 2026.

In Cold Lake, production decreased approximately 2% quarter-over-quarter with strong initial performance from new C-East lower-drainage wells ("LDWs") at Tucker being offset by downtime at the Company's Lindbergh property. Downtime at Lindbergh was driven by the mechanical failure of Lindbergh's main fuel gas supply pipeline, which caused the curtailment of steam generation and non-condensable gas ("NCG") volumes during the quarter. The pipeline is in the process of being repaired and is expected to return to full capacity in the third quarter of 2026.

In Lloydminster Thermal, capital activity remains focused on the Company's $360 million Meota Central brownfield development project, which is now approximately 91% complete, on-time and on-budget. The Company expects to achieve first steam from Meota Central in the third quarter of 2026 and first oil early in the fourth quarter of 2026, ramping to an expected peak rate of approximately 13 Mbbls / d by mid-2027. Activity is also focused at Edam-Vawn, where the Company has begun steaming the 10-well VAF pad targeting the Waseca formation for the first time. The Company expects to complete the first 5 of 10 wells on the VAF pad in 2026, targeting a per well peak rate of approximately 750 bbls / d.

In Lloydminster Conventional, the Company completed its annual winter drilling program at Cactus Lake, Druid and Winter, drilling a total of 46 wells (including 4 multi-lateral horizontal wells). Early results from the program are in-line with expectations on both costs and volumes, with an additional 46 wells planned for later in 2026. Following underperformance at the Company's polymer floods in Cactus Lake and Bodo-Cosine in 2025, current production from each asset has since improved approximately 5% versus the end of 2025, as a result of successful flood conformance projects.

Outlook

Strathcona's 2026 production guidance of 120 to 130 Mbbls / d and capital budget of $1.0 billion is unchanged, as is its 2026 first half production guidance of 115 to 120 Mbbls / d and year end 2026 exit rate of approximately 135 Mbbls / d (reflecting an approximately 15% exit-to-exit growth rate).

At current strip prices¹, Strathcona expects to generate approximately $1.0 billion of free cash flow in 2026. Free cash flow will initially be allocated to debt repayment, with share buybacks and M&A to be evaluated opportunistically throughout the year and additional dividends to be evaluated closer to year end.

Quarterly Dividend

Strathcona's Board of Directors has declared a quarterly dividend of $0.30 per share to be paid on June 17, 2026 to shareholders of record on June 8, 2026. Payments to shareholders who are not residents of Canada will be net of any Canadian withholding taxes that may be applicable. Dividends paid by Strathcona are considered "eligible dividends" for Canadian tax purposes.

About Strathcona

Strathcona is one of North America's fastest growing pure play heavy oil producers with operations focused on thermal oil and enhanced oil recovery. Strathcona is built on an innovative approach to growth achieved through the consolidation and development of long-life assets. Strathcona's common shares (symbol SCR) are listed on the Toronto Stock Exchange (TSX).

For more information about Strathcona, visit www.strathconaresources.com.

Non-GAAP Measures and Ratios

The financial results for the three months ended March 31, 2026 and 2025, are presented below to reconcile continuing and discontinued operations to total results. Total results in a non-GAAP measure used by Management to assess the historical financial performance of the total business and is not intended to be indicative of future results.

"Oil and natural gas sales, net of blending and other income" is calculated by deducting purchased product and blending costs from oil and natural gas sales, sales of purchased product, midstream revenue and other income. Management uses this metric to isolate all revenue after accounting for the unavoidable cost of blending. Oil and natural gas sales, net of blending and other income, is also reflected on a per boe basis calculated using sales volumes. This ratio is useful to management when analyzing realized pricing against benchmark commodity prices.

"Effective royalty rate" is calculated by dividing royalties by oil and natural gas sales and sale of purchased product, net of blending and purchased product. This metric allows management to analyze the movement of royalty expenses in relation to realized and benchmark commodity prices.

"Oil and natural gas sales, net of blending" is calculated by deducting purchased product and blending costs from oil and natural gas sales, sales of purchased product, and midstream revenue. Management uses this metric to isolate the revenue associated with the Company's production after accounting for the unavoidable cost of blending. Oil and natural gas sales, net of blending, is also reflected on a per boe basis calculated using sales volumes. This ratio is useful to management when analyzing realized pricing against benchmark commodity prices. A quantitative reconciliation of oil and natural gas sales, net of blending to the most directly comparable GAAP financial measure, Oil and natural gas sales, is presented below.

"Operating Earnings – Discontinued" is considered a key financial metric for evaluating the profitability of Strathcona's discontinued operations. "Operating Earnings - Continuing" is a GAAP financial measure as it is used by the Chief Operating Decision Makers to evaluate profit or loss and is presented in the condensed consolidated interim financial statements for the three months ended March 31, 2026 and 2025. A quantitative reconciliation of Operating Earnings – Discontinued to the most directly comparable GAAP financial measure, Oil and natural gas sales, is presented below.

"Funds from Operations" is used by management to analyze operating performance and provides an indication of the funds generated by Strathcona's principal business to either fund operating activities, re-invest to either maintain or grow the business or make debt repayments. Funds from Operations is derived from Operating Earnings and adjusted for depletion, depreciation and amortization ("DD&A"), finance costs, gains and losses on risk management contracts – realized and gains and losses on foreign exchange - realized, operating.

"Free Cash Flow" indicates funds available for deleveraging, funding future growth, or shareholder returns. Free Cash Flow is derived from Operating Earnings and adjusted for DD&A, finance costs, gains and losses on risk management contracts – realized and gains and losses on foreign exchange - realized, operating, capital expenditures and decommissioning costs.

Quantitative reconciliations of Funds from Operations and Free Cash Flow for both continuing and discontinued operations to the most directly comparable GAAP financial measure, Operating Earnings, are set forth below.

The following table reconciles Operating Earnings, Funds from Operations and Free Cash Flow for both continuing and discontinued operations:

Supplementary Financial Measures

"Interest and finance costs" is an aggregation of interest and finance costs. Management uses this metric to obtain a fulsome understanding of all interest and accretion costs the Company is subject to.

"Other items" is an aggregation of risk management contracts, foreign exchange, transaction related costs, gain on marketable securities, loss on sale of assets, deferred tax expense (recovery), change in decommissioning liabilities, loss on contingent consideration and impairment from both continuing and discontinued operations. They are presented in such a manner to yield prominence to key financial metrics such as income and comprehensive income, Funds from Operations and Free Cash Flow.

"Non-cash items" is an aggregation of depletion, depreciation and amortization, and finance costs.

"Debt, net of cash, marketable securities and cross-currency swap asset / liability" is comprised of debt less cash, marketable securities and cross-currency swap asset / liability, as derived under the Accounting Standards.

Presentation of Oil and Gas Information

This press release contains various references to the abbreviation "boe" which means barrels of oil equivalent. All boe conversions in this press release are derived by converting gas to oil at the ratio of six thousand cubic feet ("mcf") of natural gas to one barrel ("bbl") of crude oil. Boe may be misleading, particularly if used in isolation. A boe conversion rate of 1 bbl : 6 mcf is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio of oil compared to natural gas based on currently prevailing prices is significantly different than the energy equivalency ratio of 1 bbl : 6 mcf, utilizing a conversion ratio of 1 bbl : 6 mcf may be misleading as an indication of value.

References in this press release to initial production rates and other short-term production rates, test results and peak rates are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such wells will commence production and decline thereafter and are not indicative of long-term performance or of ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating aggregate production for the Company or the assets for which such rates are provided. A pressure transient analysis or well-test interpretation has not been carried out in respect of all wells. Accordingly, the test results should be considered to be preliminary.

Product Type Production Information

National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities includes condensate within the natural gas liquids product type. The Company has disclosed condensate as combined with light oil and separately from other natural gas liquids in this press release since the price of condensate as compared to other natural gas liquids is currently significantly higher and the Company believes that this presentation provides a more accurate description of its operations and results therefrom. References to "natural gas" in this press release refer to conventional natural gas. References to "liquids" in this press release refer to, collectively, bitumen, heavy oil, condensate and light oil (comprised of condensate and light oil) and other natural gas liquids (comprised of ethane, propane and butane only).

The Company's quarterly average daily production volumes for three months ended 2026 and 2025, and the references to "natural gas", "crude oil" and "condensate", reported in this press release consist of the following product types, as defined in NI 51-101 and using a conversion ratio of 6 mcf : 1 bbl where applicable:

Forward-Looking Information

Certain statements contained in this press release constitute forward-looking information within the meaning of applicable securities laws. The forward-looking information in this press release is based on Strathcona's current internal expectations, estimates, projections, assumptions and beliefs. Such forward-looking information is not a guarantee of future performance and involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. The Company believes the material factors, expectations and assumptions reflected in the forward-looking information are reasonable as of the time of such information, but no assurance can be given that these factors, expectations and assumptions will prove to be correct, and such forward-looking information included in this press release should not be unduly relied upon.

The use of any of the words "expect", "target", "anticipate", "intend", "estimate", "objective", "ongoing", "may", "will", "project", "believe", "depends", "could" and similar expressions are intended to identify forward-looking information. In particular, but without limiting the generality of the foregoing, this press release contains forward-looking information pertaining to the following: the Company's business strategy and future plans; expected operating strategy; the expectation that the Company's capital expenditures will be weighted to the first half of 2026; the expected repair timeline for the fuel gas supply pipeline at Lindbergh; timeline and budget expectations for the Company's Meota Central brownfield development project, including an expected total installed cost of approximately $360 million, first steam in the third quarter of 2026 and first oil early in the fourth quarter of 2026, ramping to an expected peak rate of approximately 13 Mbbls / d by mid-2027; the Company's expectation of completing the first 5 of 10 wells at Edam-Vawn in 2026, targeting a per well peak rate of approximately 750 bbls / d; the drilling of an additional 46 wells at Cactus Lake, Druid and Winter later in 2026; the Company's 2026 production guidance of 120 to 130 Mbbls / d and capital budget of $1.0 billion, first half 2026 production guidance of 115 to 120 Mbbls / d and year end 2026 exit rate guidance of approximately 135 Mbbls / d; the Company's expectation of generating approximately $1.0 billion of free cash flow in 2026 and the expected uses thereof.

All forward-looking information reflects Strathcona's beliefs and assumptions based on information available at the time the applicable forward-looking information is disclosed and in light of the Company's current expectations with respect to such things as: the success of Strathcona's operations and growth and expansion projects; expectations regarding production growth, future well production rates and reserve volumes; expectations regarding Strathcona's capital program; Strathcona's ability to declare and pay dividends; expectations regarding the impact of tariffs on Strathcona's operations and its ability to effectively mitigate the impact thereof; the outlook for general economic trends, industry trends, prevailing and future commodity prices, foreign exchange rates and interest rates; prevailing and future royalty regimes and tax laws; future well production rates and reserve volumes; fluctuations in energy prices based on worldwide demand and geopolitical events; the impact of inflation; the integrity and reliability of Strathcona's assets; decommissioning obligations; Strathcona's ability to comply with its financial covenants; and the governmental, regulatory and legal environment, including expectations regarding the current and future carbon tax regime and regulations. In addition, certain forward-looking information with respect to the Company's 2026 guidance assumes commodity prices and exchange rates of: US$85 / bbl WTI, US$15 / bbl WCS-WTI differential, 1.36 USD-CAD and C$2.00 / mcf AECO. Management believes that its assumptions and expectations reflected in the forward-looking information contained herein are reasonable based on the information available on the date such information is provided and the process used to prepare the information. However, it cannot assure readers that these expectations will prove to be correct.

The forward-looking information included in this press release is not a guarantee of future performance and involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information, including, without limitation: changes in commodity prices; changes in the demand for or supply of Strathcona's products; the continued impact, or further deterioration, in global economic and market conditions, including from inflation and/or certain geopolitical conflicts, such as the conflict in the Middle East, including the closure of the Strait of Hormuz, the ongoing Russia/Ukraine conflict, and other heightened geopolitical risks, including the imposition of tariffs or other trade barriers, and the ability of the Company to carry on operations as contemplated in light of the foregoing; determinations by the Organization of the Petroleum Exporting Countries and other countries as to production levels; unanticipated operating results or production declines; changes in tax or environmental laws, climate change, royalty rates or other regulatory matters; changes in Strathcona's development plans or by third party operators of Strathcona's properties; failure to achieve anticipated results of its operations; competition from other producers; inability to retain drilling rigs and other services; failure to realize the anticipated benefits of the Company's acquisitions, dispositions or corporate reorganizations; failure to execute the Company's growth strategy and objectives; incorrect assessment of the value of acquisitions; delays resulting from or inability to obtain required regulatory approvals; increased debt levels or debt service requirements; inflation; changes in foreign exchange rates; inaccurate estimation of Strathcona's oil and gas reserve and contingent resource volumes; limited, unfavourable or a lack of access to capital markets or other sources of capital; increased costs; a lack of adequate insurance coverage; the impact of competitors; and the other factors discussed under the "Risk Factors" section in Strathcona's Management's Discussion & Analysis and Annual Information Form, each for the year ended December 31, 2025, and from time to time in Strathcona's public disclosure documents, which are available at www.sedarplus.ca.

Declaration of dividends, including the Company's quarterly or any special or additional dividends, is at the sole discretion of the board of directors of Strathcona and will continue to be evaluated on an ongoing basis. There are risks that may result in Strathcona changing, suspending or discontinuing its quarterly dividends, including changes to its free cash flow, operating results, capital requirements, financial position, debt levels, market conditions or corporate strategy and the need to comply with requirements under its credit agreement and applicable laws respecting the declaration and payment of dividends. There are no assurances as to the continuing declaration and payment of future dividends or the amount or timing of any such dividends.

Management approved the capital budget and production guidance contained herein as of the date of this press release. The purpose of the capital budget and production guidance is to assist readers in understanding Strathcona's expected and targeted financial position and performance, and this information may not be appropriate for other purposes.

This earnings release contains information that may constitute future-oriented financial information or financial outlook information (collectively, "FOFI") about Strathcona's prospective financial performance, financial position or cash flows, all of which is subject to the same assumptions, risk factors, limitations and qualifications as set forth above. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise or inaccurate and, as such, undue reliance should not be placed on FOFI. Strathcona's actual results, performance and achievements could differ materially from those expressed in, or implied by, FOFI. Strathcona has included FOFI in order to provide readers with a more complete perspective on Strathcona's future operations and management's current expectations relating to Strathcona's future performance. Readers are cautioned that such information may not be appropriate for other purposes.

The foregoing risks should not be construed as exhaustive. The forward-looking information contained in this press release speaks only as of the date of this press release and Strathcona does not assume any obligation to publicly update or revise such forward-looking information to reflect new events or circumstances, except as may be required pursuant to applicable laws. Any forward-looking information contained herein is expressly qualified by this cautionary statement.

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SOURCE Strathcona Resources Ltd.