Mr. Shawn Van Spankeren reports

CARDINAL PROVIDES AN UPDATE ON THE OPERATION OF ITS THERMAL BUSINESS UNIT AND THE DE-RISKING OF SEVERAL THERMAL PROJECTS

Cardinal Energy Ltd. has provided an update on its thermal evaluation and development program and the advancement of two future steam-assisted gravity drainage (SAGD) oil development projects -- Reford 2 and Kelfield. These projects build on the success and technical foundation of the company's Reford 1 SAGD development aligning with Cardinal's strategy to responsibly grow its thermal portfolio in high-quality, long-life reservoirs.

Cardinal's thermal strategy

Since acquiring our initial thermal assets in 2023, Cardinal has been conducting both seismic and stratigraphic delineation and evaluation of these assets and augmenting the company's land position for these assets and additional projects.

Reford 1 project -- performance and context

Cardinal's inaugural thermal project at Reford 1 was delivered substantially on budget and ahead of schedule, with construction and commissioning completed in line with internal objectives. The project has progressed into full production and is currently producing above its 6,000 barrels per day (100-per-cent heavy oil) nameplate design capacity with the company targeting Reford 1 volumes of 6,500 bbl/d in the first quarter of 2026, underscoring the strength of the technical execution and reservoir quality.

Reford 2 project

In the second half of 2025, Cardinal acquired additional lands through a series of transactions and consolidated a 100-per-cent working interest in the Reford 2 project which is located approximately 10 kilometres north of Reford 1. The Reford 2 reservoir targets the same Waseca channel as exists at Reford 1, with analogous geological and reservoir attributes. Highlights of the proposed Reford 2 project are as follows:

• Design capacity: 4,250 bbl/d, expandable to 6,500-plus bbl/d;
• Projected operating life: approximately 20 years;
• Estimated capital cost: approximately $140-million for the base project, expandable to 6,500 bbl/d for an additional cost of approximately $40-million;
• Expected construction timeline from commencement to first steam in 18 months;
• Once the base project reaches nameplate production capacity of approximately 4,250 bbl/d, the company's estimate of the payout of estimated capital cost is approximately two years based on current strip oil prices;
• Regulatory status: application and review processes are under way;
• Delineation: mapped with 3-D seismic and stratigraphic wells;
• Expected operational/cost/infrastructure synergies with Reford 1, due to proximity to Reford 1;
• Facility and SAGD well design: adopts the proven pre-existing Reford 1 design.

This continuity in reservoir understanding and facility design supports Cardinal's disciplined capital execution and reinforces confidence in delivery and long-term performance.

Kelfield project

Cardinal also holds a 100-per-cent working interest in the Kelfield project, situated approximately 40 kilometres south of Reford 1. Kelfield targets the same Waseca channel with reservoir characteristics analogous to Cardinal's existing SAGD assets. Highlights of the Kelfield project are as follows:

• Design capacity: minimum 4,000 bbl/d, expandable to 6,000-plus bbl/d;
• Projected operating life: approximately 20 years;
• Regulatory status: application and review processes are under way;
• Delineation: mapped with 3-D seismic and stratigraphic wells;
• Facility and SAGD well design: adopts the proven pre-existing Reford 1 design;
• Construction timelines and costs similar to the Reford 2 project.

Additional thermal projects

Cardinal is actively developing additional thermal development opportunities as part of its long-term growth strategy. Leveraging the execution learnings, production performance and subsurface insights gained from Reford 1, the company has initiated a comprehensive technical program on two further prospects within its land base. This derisking work includes reprocessing and reinterpreting of existing, and acquiring new, 3-D seismic data to improve channel resolution and reservoir continuity mapping, re-evaluating historical stratigraphic wells and core using updated petrophysical workflows. The company also has drilled new stratigraphic wells, integrating production learnings from Reford 1, to refine initial development planning and have developed updated reservoir models to continue working up resource size and expected SAGD deliverability.

Operational and strategic outlook

Cardinal's thermal growth plans continue to benefit from a strong working relationship with the government of Saskatchewan. The company has been in active discussion with several provincial ministries regarding the long-term development potential across its land base. These discussions reflect the province's support for responsible thermal heavy oil development, consistent with Saskatchewan's publicly stated objective of achieving 600,000 barrels per day of provincial oil production.

The Reford 2 and Kelfield projects are structured to leverage the technical, regulatory and operational learnings from Reford 1, enhancing capital efficiency and execution certainty. Both projects target high-quality reservoirs with favourable continuity. They are expected to deliver long-life production supportive of Cardinal's long-term thermal strategy and corporate sustainability.

Cardinal remains committed to responsible development, continuing community engagement, environmental stewardship and rigorous safety standards across all operations.

About Cardinal Energy Ltd.

Cardinal is a Canadian oil and natural gas production company with operations focused on low-decline sustainable oil production in Western Canada. The company's portfolio of conventional and SAGD project inventory offers a complimentary low-decline, long-life resource base that is ideally suited to sustain the company's commitment to meaningful dividend returns to shareholders.

We seek Safe Harbor.