Canada markets closed

Cardinal Energy Ltd. (CJ.TO)

Toronto - Toronto Real Time Price. Currency in CAD
Add to watchlist
2.4100-0.0300 (-1.23%)
At close: 4:00PM EDT
Full screen
Previous Close2.4400
Open2.4300
Bid2.4100 x 0
Ask2.4200 x 0
Day's Range2.3500 - 2.4300
52 Week Range0.3800 - 2.7800
Volume410,106
Avg. Volume1,268,487
Market Cap346.707M
Beta (5Y Monthly)3.65
PE Ratio (TTM)N/A
EPS (TTM)-3.2020
Earnings DateMay 13, 2021
Forward Dividend & YieldN/A (N/A)
Ex-Dividend DateFeb. 27, 2020
1y Target Est2.06
  • Cardinal Energy Ltd. Announces Fourth Quarter 2020 and Year-End Financial Results
    GlobeNewswire

    Cardinal Energy Ltd. Announces Fourth Quarter 2020 and Year-End Financial Results

    CALGARY, Alberta, March 16, 2021 (GLOBE NEWSWIRE) -- Cardinal Energy Ltd. ("Cardinal" or the "Company") (TSX: CJ) is pleased to announce its operating and financial results for the fourth quarter and year ended December 31, 2020. 2020 FINANCIAL HIGHLIGHTS Fourth quarter adjusted funds flow(1) of $13.6 million funded a conservative capital program of $3.6 million and supported a $12.5 million reduction in net debt(1) compared to the third quarter of 2020;Average fourth quarter production increased 5% over the prior quarter to average 18,625 boe per day as the Company reactivated production shut-in earlier in the year;Fourth quarter net operating expenses(1) per boe decreased 17% over the same period in 2019 averaging $16.84 per boe while annual net operating expenses(1) decreased by $37.9 million or 24% over 2019 to average $17.39 per boe;Fourth quarter 2020 general and administrative ("G&A") expenses per boe decreased 27% over the fourth quarter of 2019 to average $1.64 per boe;Net debt(1) at December 31, 2020 of $246.8 million decreased $27 million or 10% from the high point of the year at the end of the first quarter of 2020. With the recently completed redemption of convertible debentures, our pro-forma net debt(1) at December 31, 2020 is reduced to $218.8 million, a $55 million or 20% reduction from the first quarter of 2020;During the fourth quarter, we completed the extension of our syndicated credit facility with a maturity in May 2022 and exchanged $16.2 million of 2020 maturing convertible debentures with new secured notes which mature in 2022; In the fourth quarter of 2020 a reversal of prior non-cash impairment charges of $122.7 million demonstrated a recovery in forward oil prices and an improved financial position. (1) See non-GAAP measures Financial and Operating Highlights ($000's except shares, per share and operating amounts)Three months ended December 31, Year ended December 31, 20202019% Chg 20202019% ChgFinancial Petroleum and natural gas revenue66,06593,272(29) 223,231388,971(43)Cash flow from operating activities12,81031,714(60) 43,525119,979(64)Adjusted funds flow (1)13,60828,864(53) 43,827121,810(64)per share basic and diluted (1)0.120.25(52) 0.391.06(63)Earnings (loss)119,988(15,094)n/m (363,160)(34,340)n/mper share basic1.06(0.13)n/m (3.20)(0.30)n/mper share diluted1.04(0.13)n/m (3.20)(0.30)n/mDevelopment capital expenditures (1)3,32519,621(83) 30,39363,603(52)Other capital expenditures (1)242397(39) 1,1131,665(33)Acquisitions, net-112(100) -396(100)Total capital expenditures3,56720,130(82) 31,50665,664(52) Common shares, net of treasury shares (000s) 121,349113,6577Dividends declared 3,51117,923(80)per share 0.030.15(80) Bank debt 192,115173,30811Adjusted working capital deficiency(1) 10,28429,291(65)Net bank debt (1) 202,399202,599-Secured notes 16,217-n/mConvertible debentures 28,20745,000(37)Net debt (1) 246,823247,599- Operating Average daily production (2) Light oil (bbl/d)6,9298,100(14) 7,1738,069(11)Medium/heavy oil (bbl/d)8,2208,657(5) 8,0938,722(7)NGL (bbl/d)1,20089334 911932(2)Natural gas (mcf/d)13,65315,459(12) 13,58515,576(13)Total (boe/d)18,62520,227(8) 18,44220,319(9)Netback ($/boe) (1) Petroleum and natural gas revenue38.5650.12(23) 33.0752.45(37)Royalties5.909.36(37) 4.938.87(44)Net operating expenses16.8420.31(17) 17.3920.94(17)Transportation expenses0.250.27(7) 0.290.33(12)Netback15.5720.18(23) 10.4622.31(53)Realized loss on commodity contracts3.580.79n/m 0.071.98(96)Netback after risk management (1)11.9919.39(39) 10.3920.33(49)Interest and other2.401.6248 1.941.7710G&A1.642.26(27) 1.972.14(8)Adjusted funds flow netback (1)7.9515.51(49) 6.4816.42(61) (1) See non-GAAP measures (2) See Supplemental Information Regarding Product Types FOURTH QUARTER AND 2020 HIGHLIGHTS Cardinal began 2020 with a plan to modestly increase production while continuing to reduce debt. Our successful first quarter 2020 drilling program was quickly halted in early March when the coronavirus pandemic ("COVID-19") spread throughout the world. With the uncertainty of demand and the effect on commodity prices, we reacted quickly cutting our capital program by over 50% and reducing our well reactivation program to only essential expenditures. We focused on what we could control by reducing costs including capital costs, operating costs and compensation costs throughout the organization. Despite the difficult environment, Cardinal was able to lower our net debt from the high experienced at the end of the first quarter of $273.8 million to $246.8 million at the end of 2020, a 10% reduction. Despite a conservative $3.6 million capital program, fourth quarter production increased by 5% over the prior quarter to average 18,625 boe per day. After capital expenditures, the majority of the fourth quarter adjusted funds flow of $13.6 million was earmarked for debt repayment as the Company reduced its net debt by $12.5 million in the fourth quarter. In 2020, net operating expenses and net operating expenses per boe decreased 24% and 17%, respectively, over 2019 due to reduced labor costs combined with decreased well servicing and reactivations. After COVID-19 struck, the Company deferred non-essential well reactivations which reduced our operating costs by approximately $1.50 per boe during 2020. In addition, power generation initiatives completed in 2019 and early 2020 have assisted in reducing Cardinal's Alberta power grid usage by 13% during 2020 compared to 2019 contributing to a 15% or $0.76 per boe decrease in 2020 power costs. In response to COVID-19, Cardinal was quick to respond in reducing our G&A costs. Through a combination of reduced staffing, salaries and bonuses combined with certain government grants, our fourth quarter and annual G&A costs per boe decreased by 27% and 8%, respectively. Our total annual Board, executive and office staff compensation costs decreased by approximately 16% over 2019 demonstrating Cardinal's commitment to cost reduction. Through a challenging period in 2020, Cardinal successfully managed our financial position with a series of transactions. In August, we closed an exchange of $28.2 million of our 5.5% convertible debentures that were maturing in December 2020 for new 8% convertible debentures maturing in 2022. In December, Cardinal completed the extension of our syndicated credit facility with a maturity date in May 2022 and also entered into subscription agreements for a non-brokered private placement of secured notes for net proceeds of $16.2 million for which the proceeds were utilized to repay the remaining maturing 5.5% convertible debentures. Subsequent to year-end, the Company issued a redemption notice for all of the outstanding 8% convertible debentures. Prior to the redemption date, 99.3% of the outstanding debentures were converted into 22.4 million common shares which reduced the Company's net debt by $28 million. In the fourth quarter of 2020, Cardinal had earnings of $120 million compared to a loss of $15.1 million in the same period in 2019. During the quarter, increased forecasted commodity prices combined with improved economic stability and certainty, positively affected the Company's outlook and future value of proved and probable oil and gas reserves and a non-cash impairment reversal of $122.7 million was recorded. ENVIRONMENTAL, SOCIAL AND GOVERNANCE ("ESG") In 2020, we participated in various government programs focused on well and pipeline abandonments and facility decommissioning which enabled us to make significant progress on our long-term abandonment and reclamation efforts. In 2021, we expect to continue with our meaningful abandonment and reclamation program and will strengthen our ESG performance as we build on our negative carbon footprint. Our annual 2020 ESG report is posted on our corporate website. OUTLOOK After a difficult and challenging 2020, 2021 is shaping up to be a significant improvement for Cardinal. Global optimism around COVID-19 vaccines and an economic recovery have created positive market sentiment and along with material increases in oil prices are leading to a vastly improved outlook for the Company. With the recently completed $28.2 million settlement of the 8% debentures and our continued debt repayment strategy, our financial position continues to strengthen. Our 2021 budget based on WTI US$52/bbl, is focused on debt repayment and has a modest capital program emphasizing well reactivations and reducing our asset retirement obligations. If oil prices continue to remain above US$60/bbl, we will revisit our budget for the second half of the year and may modestly add to our capital program to ensure reserve replacement and production growth for 2021. Our focus will continue to be on our balance sheet and the reduction of our overall liabilities. As we recover from the effects of COVID-19, our focus remains on the health and safety of our employees and contractors while continuing to execute our business plan with our top tier low decline asset base. We would like to thank our staff for their hard work, our Board for their guidance and our stakeholders for their support through a difficult 2020. ANNUAL FILINGS Cardinal also announces the filing of its Audited Financial Statements for the year ended December 31, 2020 and related Management's Discussion and Analysis with the Canadian securities regulatory authorities on the System for Electronic Analysis and Retrieval ("SEDAR"). In addition, Cardinal will file its Annual Information Form for the year ended December 31, 2020 on SEDAR on or prior to March 30, 2021. Electronic copies may be obtained on Cardinal's website at www.cardinalenergy.ca and on Cardinal's SEDAR profile at www.sedar.com. Note Regarding Forward-Looking Statements This press release contains forward-looking statements and forward-looking information (collectively "forward-looking information") within the meaning of applicable securities laws relating to Cardinal's plans and other aspects of Cardinal's anticipated future operations, management focus, objectives, strategies, financial, operating and production results. Forward-looking information typically uses words such as "anticipate", "believe", "project", "expect", "goal", "plan", "intend", "may", "would", "could" or "will" or similar words suggesting future outcomes, events or performance. The forward-looking statements contained in this press release speak only as of the date thereof and are expressly qualified by this cautionary statement. Specifically, this press release contains forward-looking statements relating to: our business strategies, plans and objectives, our 2020 capital programs and spending plans, our drilling plans, our potential revised 2021 capital program and allocation thereof, adjusted funds flow and net debt, our continuing COVID-19 response plans, the quality of our asset base and decline rates, our abandonment and reclamation program, our future ESG performance, our future financial position, plans for reserve replacement and production growth in 2021, plans to continue to strengthen our balance sheet and to reduce liabilities and plans to operate our assets in a responsible and environmentally sensitive manner. Forward-looking statements regarding Cardinal are based on certain key expectations and assumptions of Cardinal concerning anticipated financial performance, business prospects, strategies, regulatory developments, production curtailments, current and future commodity prices and exchange rates, applicable royalty rates, tax laws, industry conditions, availability of government subsidies and abandonment and reclamation programs, future well production rates and reserve volumes, future operating costs, the performance of existing and future wells, the success of its exploration and development activities, the sufficiency and timing of budgeted capital expenditures in carrying out planned activities, the timing and success of our cost cutting initiatives and power projects, the availability and cost of labor and services, the impact of competition, conditions in general economic and financial markets, availability of drilling and related equipment, effects of regulation by governmental agencies including curtailment, the ability to obtain financing on acceptable terms which are subject to change based on commodity prices, market conditions and drilling success and potential timing delays. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Cardinal's control. Such risks and uncertainties include, without limitation: the impact of general economic conditions; volatility in market prices for crude oil and natural gas; industry conditions; currency fluctuations; imprecision of reserve estimates; liabilities inherent in crude oil and natural gas operations; environmental risks; incorrect assessments of the value of acquisitions and exploration and development programs; competition from other producers; the lack of availability of qualified personnel, drilling rigs or other services; changes in income tax laws or changes in royalty rates and incentive programs relating to the oil and gas industry including government subsidies and abandonment and reclamation programs; hazards such as fire, explosion, blowouts, and spills, each of which could result in substantial damage to wells, production facilities, other property and the environment or in personal injury; and ability to access sufficient capital from internal and external sources. Management has included the forward-looking statements above and a summary of assumptions and risks related to forward-looking statements provided in this press release in order to provide readers with a more complete perspective on Cardinal's future operations and such information may not be appropriate for other purposes. Cardinal's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Cardinal will derive there from. Readers are cautioned that the foregoing lists of factors are not exhaustive. These forward-looking statements are made as of the date of this press release and Cardinal disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws. Supplemental Information Regarding Product Types This press release includes references to 2020 and 2021 production. The Company discloses crude oil production based on the pricing index that the oil is priced off of. The following table is intended to provide the product type composition as defined by NI 51-101. Light/Medium Crude OilHeavy OilNGLConventional Natural GasTotal (boe/d)Q4/2055%26%7%12%18,625Q4/1956%27%4%13%20,227202057%26%5%12%18,442201955%28%4%13%20,319 Advisory Regarding Oil and Gas Information Where applicable, oil equivalent amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Utilizing a conversion ratio at 6 Mcf: 1 Bbl may be misleading as an indication of value. Non-GAAP measures This press release contains the terms "development capital expenditures", "other capital expenditures", "adjusted funds flow", "adjusted funds flow per basic share", "adjusted funds flow per diluted share", "net debt", "net bank debt", "adjusted working capital", "net operating expenses", "netback", "netback after risk management contracts" and "adjusted funds flow netback" which do not have a standardized meaning prescribed by International Financial Reporting Standards ("IFRS" or, alternatively, "GAAP") and therefore may not be comparable with the calculation of similar measures by other companies. Cardinal uses adjusted funds flow, adjusted funds flow per basic and diluted share to analyze operating performance and assess leverage. Cardinal feels these benchmarks are a key measure of profitability and overall sustainability for the Company. Adjusted funds flow is not intended to represent operating profits nor should it be viewed as an alternative to cash flow provided by operating activities, net earnings or other measures of performance calculated in accordance with GAAP. As shown below, adjusted funds flow is calculated as cash flows from operating activities adjusted for changes in non-cash working capital and decommissioning expenditures. Development capital expenditures represents expenditures on property, plant and equipment (excluding capitalized G&A, other assets and acquisitions). Other capital expenditures includes capitalized G&A and other assets. Adjusted working capital includes current assets less current liabilities adjusted for fair value of financial instruments, the current liability component of convertible debentures, current lease liabilities, the warrant liability and current decommissioning obligations. The term "net debt" is not recognized under GAAP and as shown below, is calculated as bank debt plus the principal amount of convertible unsecured subordinated debentures and adjusted working capital. Net debt is used by management to analyze the financial position, liquidity and leverage of Cardinal. "Net bank debt" is calculated as net debt less the principal amount of convertible debentures and secured notes. Net bank debt is used by management to analyze the financial position, liquidity, leverage and borrowing capacity on Cardinal’s bank line. Net operating expenses is calculated as operating expense less processing and other revenue primarily generated by processing third party volumes at processing facilities where the Company has an ownership interest, and can be expressed on a per boe basis. As the Company’s principal business is not that of a midstream entity, management believes this is a useful supplemental measure to reflect the true cash outlay at its processing facilities by utilizing spare capacity through processing third party volumes. Netback is calculated on a boe basis and is determined by deducting royalties, transportation costs and net operating expenses from petroleum and natural gas revenue. Netback after risk management contracts includes realized gains or losses on commodity contracts in the period on a boe basis. Adjusted funds flow netback is calculated as netback after risk management and also includes interest and other costs and G&A costs on a boe basis. Netback, netback after risk management contracts and adjusted funds flow netback are utilized by Cardinal to better analyze the operating performance of our petroleum and natural gas assets taking into account our risk management program, interest and G&A costs against prior periods. The following table reconciles adjusted funds flow: Three months endedYear ended December 31, 2020December 31, 2019December 31, 2020December 31, 2019Cash flow from operating activities12,81031,71443,525119,979Change in non-cash working capital202(5,784)(2,547)(4,740)Funds flow13,01225,93040,978115,239Decommissioning expenditures5962,9342,8496,571Adjusted funds flow13,60828,86443,827121,810 The following table reconciles adjusted working capital: Year ended December 31, 2020December 31, 2019Working capital deficiency(25,690)(84,895)Fair value of financial instruments6,9093,146Liability component of convertible debentures-44,158Lease liabilities1,6871,850Decommissioning obligation3,2806,450Warrant liability3,530-Adjusted working capital deficiency(10,284)(29,291) The following table reconciles net debt and net bank debt: Year ended December 31, 2020December 31, 2019Bank debt192,115173,308Adjusted working capital deficiency10,28429,291Net bank debt202,399202,599Secured notes16,217-Principal amount of convertible debentures28,20745,000Net debt246,823247,599 Oil and Gas Metrics The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value. About Cardinal Energy Ltd. One of Cardinal's goals is to continually improve our Environmental, Social and Governance profile and operate our assets in a responsible and environmentally sensitive manner. As part of this mandate, Cardinal injects and conserves more carbon than it directly emits making us one of the few Canadian energy companies to have a negative carbon footprint. Cardinal is a Canadian oil focused company with operations focused on low decline light, medium and heavy quality oil in Western Canada. For further information: M. Scott Ratushny, CEO or Shawn Van Spankeren, CFO or Laurence Broos, VP Finance Email: info@cardinalenergy.caPhone: (403) 234-8681 Website: www.cardinalenergy.ca

  • Cardinal Energy Ltd. Completes Redemption of 8.00% Convertible Debentures
    GlobeNewswire

    Cardinal Energy Ltd. Completes Redemption of 8.00% Convertible Debentures

    CALGARY, Alberta, March 11, 2021 (GLOBE NEWSWIRE) -- Cardinal Energy Ltd. ("Cardinal" or the "Company") (TSX: CJ; CJ.DB.A) announced today that it has completed the previously announced redemption of its 8.00% Convertible Unsecured Subordinated Debentures due December 31, 2022 (the "Debentures"). Prior to the redemption date, Cardinal issued 22,410,000 common shares upon the voluntary conversion of $28,013,000 principal amount of the Debentures representing approximately 99.3% of the outstanding Debentures. The redemption of the remaining $194,000 principal amount of the Debentures was funded through the Company's credit facility. As the majority of the Debentures were converted into common shares, the redemption financing of unsecured subordinated non-convertible debt announced in our February 4, 2021 press release was not completed. The Debentures were delisted today from the Toronto Stock Exchange. About Cardinal Energy Ltd. One of Cardinal's goals is to continually improve our Environmental, Social and Governance profile and operate our assets in a responsible and environmentally sensitive manner. As part of this mandate, Cardinal injects and conserves more carbon dioxide equivalent than it directly emits making us one of the few Canadian energy companies to have a negative carbon footprint. Cardinal is a Canadian oil focused company with operations focused on low decline light, medium and heavy quality oil in Western Canada. For further information: M. Scott Ratushny, CEO or Shawn Van Spankeren, CFO or Laurence Broos, VP Finance Email: info@cardinalenergy.caPhone: (403) 234-8681 Website: www.cardinalenergy.ca

  • Cardinal Energy Ltd. Announces 2020 Year-End Reserves
    GlobeNewswire

    Cardinal Energy Ltd. Announces 2020 Year-End Reserves

    CALGARY, Alberta, March 03, 2021 (GLOBE NEWSWIRE) -- Cardinal Energy Ltd. ("Cardinal" or the "Company") (TSX:CJ) is pleased to present the results of its independent reserve report effective December 31, 2020. One hundred percent of Cardinal's year-end 2020 reserves were evaluated by independent reserves evaluator GLJ Ltd. ("GLJ") as at December 31, 2020 (the "2020 Reserve Report"). The 2020 financial information in this press release is unaudited and accordingly, such financial information is subject to change based on the results of the Company's year-end audit. SUSTAINABILITY AND OPERATIONS The resilience, quality and sustainability of our low decline asset base was demonstrated through an extremely challenging operational and financial period in 2020. The impacts on our business due to COVID-19 and the associated volatility in oil prices were profound and forced rapid decisions to reduce long term negative consequences. Cardinal’s focus was to preserve financial liquidity, capture cost savings while keeping our operations safe and maintaining the long term value of our assets. The year started off in a bullish fashion with WTI oil prices over US$60 per bbl and Cardinal kicking off a multi-well drilling program. This successful program consisted of six horizontal Glauconitic wells and one multi-leg Ellerslie horizontal well in our Bantry and Duchess fields in southern Alberta. Then the world changed due to the COVID-19 pandemic. We spent the balance of 2020 in a survival mode cutting our capital budget by over 50% and significantly reducing our well reactivation program. The low decline nature of our assets performed exceptionally well as workover and reactivation costs were cut, salaries and wages were significantly reduced and capital spending halted, yet our production base was held relatively flat. We did shut down higher operating cost properties, some of which are still shut in, and we will continue to review these properties to come up with long term solutions to fix their cost structure. Production volumes averaged 17,169 boe/d in the second quarter of 2020 and as prices recovered, reached an average of 18,625 boe/d in the fourth quarter of 2020 without the benefit of drilling new wells as existing production was optimized and selective shut-in barrels were brought back on stream. Throughout the second half of the year, commodity prices stabilized however there were ongoing restrictions and uncertainty when a second wave of the COVID-19 pandemic hit most countries. WTI oil prices averaged US$42.66 per bbl in the fourth quarter and closed at approximately $48.50 per bbl, an increase of 74% over the average price experienced in the second quarter of 2020. Oil prices through Q1 2021 have continued to strengthen to pre COVID-19 levels with recent spot WTI prices around US$60 per bbl further improving the long term outlook for Cardinal and the industry. RESERVE REPORT HIGHLIGHTS All reserves information contained in this press release is based on the 2020 Reserve Report. The Net Present Value ("NPV"), discounted at 10% ("NPV10") is $600 million, $712 million for our Proved Developed Producing ("PDP") and Proved Plus Probable Producing ("P+PDP") reserves respectively.Cardinal continues to maintain a long producing reserve life index(1) ("RLI") of 9.5 years PDP and 12 years P+PDP based on fourth quarter 2020 production which reflects the low decline, low risk predictable nature of our asset base.Cardinal's light and medium crude oil reserves, natural gas and associated liquids saw positive technical revisions of 6.3 Mmboe and 6.7 Mmboe in the Total Proved ("TP") and Total Proved plus Probable ("TPP") reserves category, respectively. The Midale CO2 enhanced recovery project continues to exhibit improved performance.Cardinal maintained a high percentage of reserves as producing with the P+PDP reserves accounting for 82% of the Company's total reserves.Based on the 2020 Reserve Report, the debt adjusted, NPV10 (2) of the Company's PDP reserves was $2.91 per basic share.90% of Cardinal's TPP reserves are associated with oil and natural gas liquids.Future Development Capital ("FDC") was reduced by $51 million (19%) in the TPP reserves category as the Company has limited drilling plans in 2021. Notes: (1) RLI is calculated by dividing the reserves by the annualized fourth quarter production of 18,625 boe per day, consisting of 10,172 bbl/d of light and medium crude oil, 4,977 bbl/d of heavy crude oil, 1,200 bbl/d of natural gas liquids and 13.7 MMcf/d of conventional natural gas.(2) PDP net asset value is based on the before tax NPV10 of the PDP reserves less net debt of $247 million (unaudited) divided by the Company's basic shares at December 31, 2020 of 121.3 million. OIL AND GAS RESERVES The 2020 Reserve Report encompasses 100% of Cardinal's oil and gas properties and was prepared in accordance with definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook("COGEH") and National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). Reserves Detail Our 2020 Reserve Report reflects the impact of a materially lower commodity price forecast of the three consultant's average (GLJ, McDaniel & Associates Consultants Ltd. and Sproule Associates Ltd.) used by GLJ. The forecast crude oil reference prices are 25% lower in the first five years from the 2019 Reserve Report forecast. There were 2.9 million barrels of TP and 2.3 million barrels of TPP heavy oil reserves removed due to low oil pricing at year end. These revisions were offset by the maintained low decline and improved performance in the Midale and other light and medium crude oil properties with associated natural gas and natural gas liquids. The FDC was reduced by $47 million on a TP basis and $51 million on a TPP basis year over year due to the removal of some undeveloped locations primarily due to the change in forecasted commodity prices and the Company's decision to have minimal drilling activity in 2021. FDC was also reduced from revisions to the CO2 purchase requirements and price. The FDC includes costs to develop the undeveloped reserves as well as maintenance capital and CO2 purchases. In the 2020 Reserve Report, Cardinal has included all abandonment, decommissioning and reclamation ("ADR") costs for active and inactive wells, pipelines and facilities. The ADR costs for the active assets are considered in the PDP reserves category. Full inclusion of all ADR costs is recommended by COGEH. Cardinal's full inclusion of costs exceeds the NI 51-101 minimum requirement of ADR for active assets only. At year-end 2020, the 2020 Reserve Report included TPP ADR costs discounted at 10% of $79.8 million. Consistent with prior years and in accordance with COGEH recommendations, Cardinal has included all operating costs, for active and inactive assets. The Company also includes the consideration of future maintenance costs which is included as part of the operating costs or as FDC. Summary of Oil and Gas Reserves (1) The following tables summarize certain information contained in the 2020 Reserve Report. Reserves included below are the Company's estimated gross reserves as at December 31, 2020, as evaluated in the 2020 Reserve Report. Reserves CategoryLight andMedium Oil(Mbbl)Heavy Oil(Mbbl)Natural GasLiquids(Mbbl)ConventionalNatural Gas(2)(MMcf)TotalBOE(Mboe)Proved Developed Producing36,18618,9342,98437,53164,359Proved Developed Non-Producing1,3711,0111796,9013,711Proved Undeveloped4,5121,8452262,5317,005Total Proved42,06921,7903,38946,96375,074Probable14,1806,3511,07615,45724,184Total Proved Plus Probable56,24928,1414,46562,42099,258 Notes: (1) Total values may not add due to rounding.(2) Includes non-associated gas, associated gas and solution gas. (3) In addition to the gross reserves indicated in the above table, the Company has 162 Mboe TPP royalty interest reserves comprised of 122 Mbbl light and medium crude oil and 238 MMcf of conventional natural gas.Summary of Net Present Values of Future Net Revenue (Before Tax)(Based on forecast price and costs) As at December 31, 2020 (1)(2)(3) Discounted at:Reserves Category0.0%(M$)5.0%(M$)10.0%(M$)15.0%(M$)20.0%(M$)Proved Developed Producing950,174770,949600,164488,401412,823Proved Developed Non-Producing(4)(129,617)(44,145)(21,819)(13,519)(9,735)Proved Undeveloped142,04278,91349,69332,44021,164Total Proved962,599805,717628,037507,322424,252Probable692,446312,338183,298123,50290,055Total Proved Plus Probable1,655,0451,118,055811,335630,824514,306 Notes:(1) Total values may not add due to rounding.(2) Based on three consultant's average, as defined below, December 31, 2020 forecast prices and costs. See below for "Price Forecast".(3) Future net revenue has been reduced for future abandonment costs and estimated capital for future development associated with the reserves. (4) The Proved Developed Non-Producing NPV includes the consideration of the inactive ADR costs of the Company. Excluding these costs the NPV10 of these reserves would be $32.9 million. Reconciliations of Changes in Reserves The following table sets out a reconciliation of the changes in the Corporation's reserves as at December 31, 2020 against such reserves at December 31, 2019 based on forecast prices and cost assumptions in effect at the applicable reserve evaluation date: Total Proved Light andMediumCrude Oil(Mbbl)HeavyCrude Oil(Mbbl)Conventional Natural Gas(MMcf)NaturalGasLiquids(Mbbl)MBOE(Mboe)December 31, 201943,96226,86446,7043,27681,886Technical Revisions (1)4,792(772)5,6296165,575Improved Recovery(7)-1(1)(8)Extensions and Infill Drilling6283463,098251,515Dispositions (2)(113)-(7)(2)(116)Economic Factors (1)(3)(3,387)(2,882)(3,452)(211)(7,055)Production(3,805)(1,766)(5,009)(315)(6,722)December 31, 202042,06921,79046,9633,38975,074 Total Proved Plus Probable Light andMediumCrude Oil(Mbbl)Heavy Crude Oil(Mbbl)Conventional Natural Gas(MMcf)NaturalGasLiquids(Mbbl)MBOE(Mboe)December 31, 201958,27934,88763,0164,355108,024Technical Revisions (1)5,199(2,693)5,1746734,040Improved Recovery(15)-(10)(1)(17)Extensions and Infill Drilling722-3,555281,342Dispositions (2)(143)-(9)(2)(147)Economic Factors (1)(3)(3,987)(2,286)(4,297)(273)(7,262)Production(3,805)(1,766)(5,009)(315)(6,722)December 31, 202056,24928,14162,4204,46599,258 Notes: (1) Heavy oil reserves were revised downward due to truncation or uneconomic with this oil price forecast. Other positive or negative revisions are due to variations in performance versus previous forecasts.(2) There were no reserve acquisitions in 2020.(3) Economic factors have been calculated as the difference in reserves using the 2020 Reserve Report price forecast with the 2019 Reserve Report reserve forecasts. There is no consideration of changes in operating costs or price offset changes that occurred in 2020. Price Forecast The following table summarizes Consultant's average (an arithmetic average of the price forecasts of GLJ, McDaniel & Associates Consultants Ltd. and Sproule Associates Ltd.) commodity price forecast and foreign exchange rate assumptions as at December 31, 2020, as applied in the 2020 Reserve Report, for the next five years. Consultants Average Price Forecast(1) ExchangeRateWTI @CushingCanadianLight Sweet40° APIWesternCanada Select20.5° APIMediumat Cromer29° APINatural gasAECO – CspotYear($US/$C)($US/bbl)($C/bbl)$C/bbl)($C/bbl)($C/MMbtu)20210.76847.1755.7644.6353.892.7820220.76550.1759.8948.1857.582.7020230.76353.1763.4852.1061.052.6120240.76354.9765.7654.1063.252.6520250.76356.0767.1355.1964.572.70 Note:(1) Inflation is accounted for at 0% for 2021, 1.3% for 2022, and 2% thereafter.Future Development Costs FDC reflects the best estimate of the capital cost required to produce the reserves. The FDC associated with the TPP reserves at yearend 2020 is $219 million undiscounted ($152 million discounted at 10%). millions $PDPTotal ProvedTotal Provedplus Probable Total FDC, Undiscounted61.4172.6219.3 Total FDC, Discounted at 10%34.2119.9151.8 FDC included at year-end 2020 for CO2 purchases, maintenance and facility capital in PDP, TP and TPP were $61 million, $69 million and $80 million, respectively. This represents 37% of Cardinal's TPP FDC of $219 million. There are 76 net future locations included in the 2020 Reserve Report (including future CO2 injectors). Note Regarding Forward Looking Statements This press release contains forward-looking statements and forward-looking information (collectively "forward-looking information") within the meaning of applicable securities laws relating to the Cardinal's plans and other aspects of Cardinal's anticipated future operations, management focus, objectives, strategies, financial, operating and production results. Forward-looking information typically uses words such as "anticipate", "believe", "project", "expect", "goal", "plan", "intend", " may", "would", "could" or "will" or similar words suggesting future outcomes, events or performance. The forward-looking statements contained in this press release speak only as of the date thereof and are expressly qualified by this cautionary statement.Specifically, this press release contains forward-looking statements relating to: our business strategies, plans and objectives, future drilling plans and locations, plans to improve the cost structure of some of our properties; plans to maintain our production and improve our future Environment, Social and Governance ("ESG") plans, Cardinal's asset base and its future potential and opportunities. In addition, information and statements relating to reserves are deemed to be forward-looking statements, as they involve implied assessment, based on certain estimates and assumptions, that the reserves described exist in quantities predicted or estimated, and that the reserves can be profitably produced in the future. Forward-looking statements regarding Cardinal are based on certain key expectations and assumptions of Cardinal concerning anticipated financial performance, business prospects, strategies, regulatory developments, current and future commodity prices and exchange rates, applicable royalty rates, tax laws, future well production rates and reserve volumes, future operating costs, the performance of existing and future wells, the success of its exploration and development activities, the sufficiency and timing of budgeted capital expenditures in carrying out planned activities, the availability and cost of labor and services, the impact of competition, conditions in general economic and financial markets, access to markets, availability of drilling and related equipment, effects of regulation by governmental agencies, including curtailments, the ability to obtain financing on acceptable terms which are subject to change based on commodity prices, market conditions and potential timing delays. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Cardinal's control. Such risks and uncertainties include, without limitation: the impact of general economic conditions; volatility in market prices for crude oil and natural gas; industry conditions; currency fluctuations; imprecision of reserve estimates; liabilities inherent in crude oil and natural gas operations; environmental risks; incorrect assessments of the value of acquisitions and exploration and development programs; competition from other producers; the lack of availability of qualified personnel, drilling rigs or other services; changes in income tax laws or changes in royalty rates and incentive programs relating to the oil and gas industry; hazards such as fire, explosion, blowouts, and spills, each of which could result in substantial damage to wells, production facilities, other property and the environment or in personal injury; and ability to access sufficient capital from internal and external sources. Management has included the forward-looking statements above and a summary of assumptions and risks related to forward-looking statements provided in this press release in order to provide readers with a more complete perspective on Cardinal's future operations and such information may not be appropriate for other purposes. Cardinal's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Cardinal will derive there from. Readers are cautioned that the foregoing lists of factors are not exhaustive. These forward-looking statements are made as of the date of this press release and Cardinal disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws. Oil and Gas Metrics The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value. This press release contains a number of additional oil and gas metrics, net asset value and reserve life index, which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies. Such metrics have been calculated by management and included herein to provide readers with additional measures to evaluate Cardinal's performance; however, such measures are not reliable indicators of the future performance of Cardinal and future performance may not compare to the performance in previous periods. Development costs include costs of land and seismic, but exclude capitalized general and administration costs. The aggregate of the development costs incurred in the most recent financial year and the change during that year in estimated future development costs generally will not reflect total finding and development costs related to reserves additions for that year. Operating netback is equal to production revenues, less royalties, operating and transportation expenses. Operating netback per boe is calculated by dividing operating netback by total production volumes sold in the period. Reserve life index is calculated based on the amount for the relevant reserve category divided by fourth quarter average daily company interest production. Net asset value is based on the NPV at varying discount rates before tax for the respective reserve category less net debt. Certain financial and operating information included in this press release for the year ended December 31, 2020 are based on estimated unaudited financial results for the year then ended, and are subject to the same limitations as discussed under Forward Looking Statements set out above. These estimated amounts may change upon the completion of audited financial statements for the year ended December 31, 2020 and changes could be material. Supplemental Information Regarding Product Types This press release includes references 2020 production. The following table is intended to provide the product type composition as defined by NI 51-101. LIGHT/MEDIUMCRUDE OILHEAVY OILNGLCONVENTIONALNATURAL GASTOTAL (BOE/D) Q4/2055%27%6%12%18,625Q2/2057%27%4%12%17,169 Reserves Advisories Unless otherwise indicated, all reserves reported in this press release are Company share gross reserves which represent Cardinal's total working interest reserves prior to the deduction of royalties payable. Future net revenue is a forecast of revenue, estimated using forecast prices and costs arising from the anticipated development and production of resources, net of associated royalties, operating costs, development costs and all corporate abandonment and reclamation costs for all active and inactive wells, pipelines and facilities. It should not be assumed that the future net revenues undiscounted and discounted at 10% included in this press release represent the fair market value of the reserves. Reserve Definitions: "Proved" reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves. "Probable" reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves. "Developed" reserves are those reserves that are expected to be recovered from existing wells and installed facilities or, if facilities have not been installed, that would involve a low expenditure (e.g. when compared to the cost of drilling a well) to put the reserves on production. "Developed Producing" reserves are those reserves that are expected to be recovered from completion intervals open at the time of the estimate. These reserves may be currently producing or, if shut-in, they must have previously been on production, and the date of resumption of production must be known with reasonable certainty. "Developed Non-Producing" reserves are those reserves that either have not been on production, or have previously been on production, but are shut in, and the date of resumption of production is unknown. "Undeveloped" reserves are those reserves expected to be recovered from known accumulations where a significant expenditure (for example, when compared to the cost of drilling a well) is required to render them capable of production. They must fully meet the requirements of the reserves classification (proved, probable, possible) to which they are assigned. Drilling Locations This news release discloses Cardinal's 76 net booked drilling (54 proved and 22 probable locations) locations which are included in the 2020 Reserve Report. There is no certainty that we will drill all drilling locations and if drilled there is no certainty that such locations will result in additional oil and gas production. The drilling locations on which we actually drill wells will ultimately depend upon the availability of capital, regulatory approvals, seasonal restrictions, oil and natural gas prices, costs, actual drilling results, additional reservoir information that is obtained and other factors. Non-GAAP measures This press release contains the term "net debt" which does not have a standardized meaning prescribed by International Financial Reporting Standards ("IFRS" or, alternatively, "GAAP") and therefore may not be comparable with the calculation of similar measures by other companies. The term "net debt" is not recognized under GAAP and is calculated as bank debt plus the principal amount of convertible unsecured subordinated debentures ("convertible debentures"), secured notes and current liabilities less current assets (adjusted for the fair value of financial instruments, the current portion of lease liabilities and the current portion of the decommissioning obligation). Net debt is used by management to analyze the financial position, liquidity and leverage of Cardinal. About Cardinal Energy Ltd. One of Cardinal's goals is to continually improve our Environmental, Safety and Governance mandate and operate our assets in a responsible and environmentally sensitive manner. As part of this mandate, Cardinal injects and conserves more carbon than it emits making us one of the few Canadian energy companies to have a negative carbon footprint. Cardinal is a Canadian oil focused company built to provide investors with a stable platform for dividend income. Cardinal's operations are focused in low decline light and medium quality oil in Western Canada. For further information: M. Scott Ratushny, CEO or Shawn Van Spankeren, CFO or Laurence Broos, VP Finance Email: info@cardinalenergy.caPhone: (403) 234-8681 Website: www.cardinalenergy.ca