Mr. Steve Glanville reports

STEP ENERGY SERVICES ANNOUNCES FULL 2024 CAPITAL BUDGET AND PROVIDES FOURTH QUARTER OPERATIONAL UPDATE AND FIRST QUARTER OUTLOOK

Step Energy Services Ltd. is noting continued improvement in its balance sheet, and is providing an update on its 2024 capital budget and an operational update.

Balance Sheet and 2024 Capital Budget

We are pleased to announce that Net debt1 at the close of Q4 2023 is expected to meet STEP's year-end corporate target of less than $100 million, continuing the deleveraging trend that has seen debt come down from $310 million in 2018. Deleveraging has been a strategic priority for STEP and a means to return value to shareholders - the first phase of STEP's shareholder return strategy. STEP intends to continue to reduce leverage into 2024.

STEP is also announcing its full-year 2024 capital budget of $119.8 million, an increase from the preliminary capital budget of $60 million announced on November 1, 2023. The full-year budget includes $69.8 million of optimization capital and $50 million of sustaining capital. The $59.8 million of additional optimization capital will facilitate a number of growth initiatives for STEP including expansion of its Tier 4 dual fuel strategy that will add a second fleet in Canada and the first fleet in U.S. by the second quarter of 2024, investing in additional Canadian sand and logistics infrastructure and providing capital to reactivate additional deep coiled tubing units in Canada and the U.S. to meet expected 2024 demand.

Operational Update and Outlook

Fracturing activity across major North American oil and gas regions slowed in Q4 2023 as operators prioritize capital discipline over adding capital to their 2023 budgets.

STEP's Canadian fracturing operations experienced lower utilization in Q4 relative to Q3 as clients across the basin exhausted their 2023 budgets and did not bring capital forward from 2024. STEP's Q4 U.S. fracturing results will be negatively affected by the cancellation of remaining work scope for one fracturing crew following the acquisition of STEP's long-time client as well as the deferral of work from December into the first quarter for another crew. Coiled tubing activity in both Canada and the U.S. will also experience lower utilization in the fourth quarter relative to the third quarter due to seasonal slowdown.

STEP will use the down time in the fourth quarter to prepare for a highly utilized first quarter in Canada and the U.S. Fracturing and coiled tubing crews are expected to begin mobilizing in late December in anticipation of operations beginning in the early days of January.

ABOUT STEP

STEP is an energy services company that provides coiled tubing, fluid and nitrogen pumping and hydraulic fracturing solutions. Our combination of modern equipment along with our commitment to safety and quality execution has differentiated STEP in plays where wells are deeper, have longer laterals and higher pressures. STEP has a high-performance, safety-focused culture and its experienced technical office and field professionals are committed to providing innovative, reliable and cost-effective solutions to its clients.

Founded in 2011 as a specialized deep capacity coiled tubing company, STEP has grown into a North American service provider delivering completion and stimulation services to exploration and production ("E&P") companies in Canada and the U.S. Our Canadian services are focused in the Western Canadian Sedimentary Basin ("WCSB"), while in the U.S., our fracturing and coiled tubing services are focused in the Permian and Eagle Ford in Texas, the Uinta-Piceance and Niobrara-DJ basins in Colorado and the Bakken in North Dakota.

Our four core values; Safety, Trust, Execution and Possibilities inspire our team of professionals to provide differentiated levels of service, with a goal of flawless execution and an unwavering focus on safety.

1 Net debt is a non-IFRS financial measure, which is not defined and does not have a standardized meaning under IFRS. See "Non-IFRS Measures" below.

We seek Safe Harbor.