Obsidian Energy : First Quarter 2022 – Financial Statements

Obsidian Energy Ltd. Consolidated Balance Sheets

(CAD millions, unaudited)

Assets

Current

Cash

Accounts receivable Risk management

Prepaid expenses and otherNon-current

Property, plant and equipmentTotal assets

Liabilities and Shareholders' Equity Current

Bank overdraft

Accounts payable and accrued liabilities Current portion of long-term debt Current portion of lease liabilities Current portion of provisions Risk management

Non-current

Lease liabilities Provisions

Other non-current liabilitiesShareholders' equity

Shareholders' capital

Other reserves Deficit

Total liabilities and shareholders' equitySubsequent event (Note 7)

Commitments and contingencies (Note 11)Note

March 31, 2022

$

5.6

96.6 68.9

- 1.8

10.0 9.1

112.2

3

1,406.1 1,406.1

$

1,518.3

$

3.3

189.3 107.8

4 5 6 7

368.4 391.0

4.0 4.1

18.1 23.4

13.1 4.2

596.2 530.5

5 6

3.8 4.6

119.8 123.8

8.8 6.8

728.6

9

2,221.2

98.2 (1,529.7)

789.7

$

1,518.3

See accompanying notes to the unaudited interim consolidated financial statements.

As atDecember 31, 2021

$ 7.3

87.1

1,342.1 1,342.1

$

1,429.2

$

-665.7

2,213.8

103.2 (1,553.5)

763.5

$

1,429.2

Obsidian Energy Ltd. Consolidated Statements of Income

(CAD millions, except per share amounts, unaudited)

Three months ended

March 31

Note

2022

2021

Production revenues Processing fees Royalties

Sales of commodities purchased from third partiesOther income

Government decommissioning assistance Risk management loss

Expenses

Operating Transportation

Commodities purchased from third parties General and administrative

Restructuring

Share-based compensation

Depletion, depreciation and impairment Foreign exchange gain

Financing

Transaction costs Other

Income before taxes

8

$

203.7 $ 92.2

1.9 1.6

(30.0) (5.7)

3.1 2.0

178.7 90.1

1.5 1.0

12 7

13.4 4.8

(28.1) (4.5)

165.5

91.4

40.3 30.9

7.3 3.7

2.8 1.8

4.1 3.5

2.5 (2.0)

10 3 4 4

24.1 2.7

51.4 25.5

(0.7) (0.7)

9.8 11.9

0.1 0.1

- (9.2)

141.7

68.2

23.8

23.2

Deferred tax expense

-

-

Net and comprehensive incomeNet income per share

Basic

Diluted

Weighted average shares outstanding (millions)

Basic

Diluted

$

$ $

9 9

See accompanying notes to the unaudited interim consolidated financial statements.

23.8

$

23.2

0.29 $ 0.32

0.28 $ 0.31

81.2 73.5

83.6 76.0

Obsidian Energy Ltd.

Consolidated Statements of Cash Flows

(CAD millions, unaudited)

Operating activities

Net income

Government decommissioning assistance Depletion, depreciation and impairment Financing

Share-based compensation

Unrealized risk management loss (gain) Foreign exchange gain Decommissioning expenditures Onerous office lease settlements Deferred financing costs Financing fees paid

Change in non-cash working capital

Investing activities

Capital expenditures

Change in non-cash working capital

Financing activities

Decrease in long-term debt

Repayment of senior notes/PROP limited recourse loan Lease liabilities settlements

Exercised compensation plans

Three months ended

March 31

Note

2022

2021

$

23.8 $ 23.2

(13.4) (4.8)

3

51.4 25.5

4

2.8 4.5

10

1.4 0.3

7

10.7 (0.6)

4

(0.7) (0.7)

6

(8.5) (3.3)

6

(2.3) (2.3)

0.7 1.0

- (4.1)

18.0 (10.3)

83.9

28.4

3

(103.4)

(29.5)

36.8 (66.6)

6.8 (22.7)

4 4 5

(9.7) (9.0)

(12.6) (1.4)

(1.0) (1.2)

1.0 (22.3)

- (11.6)

Change in cash and cash equivalents

Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period

Cash and cash equivalents includes cash and bank overdraft.

See accompanying notes to the unaudited interim consolidated financial statements.

(5.0) 7.3

$

2.3

(5.9) 8.1

$

2.2

Obsidian Energy Ltd.

Statements of Changes in Shareholders' Equity

(CAD millions, unaudited)

Shareholders'

Note

CapitalOther ReservesDeficitTotalBalance at January 1, 2022 Net and comprehensive income Share-based compensation Issued on exercise of equity compensation plans Balance at March 31, 2022

$

2,213.8

10 10

$

103.2

$ (1,553.5) $ 763.5

- - 7.4

-

23.8 23.8

1.4 - 1.4

(6.4) - 1.0

$

2,221.2

$

98.2 $ (1,529.7) $ 789.7

Shareholders'

(CAD millions, unaudited)

OtherNote

CapitalReservesDeficitTotalBalance at January 1, 2021 Net and comprehensive income Share-based compensation Balance at March 31, 2021

$

2,187.0

10

- -$

2,187.0

See accompanying notes to the unaudited interim consolidated financial statements.

$

103.6

- 0.3

$

103.9

$ (1,967.5) $ 323.1

23.2 23.2

- 0.3

$ (1,944.3) $

346.6

Notes to the Unaudited Interim Consolidated Financial Statements

(All tabular amounts are in CAD millions except numbers of common shares, per share amounts, percentages and various figures in Note 7)

1. Structure of Obsidian Energy

Obsidian Energy Ltd. ("Obsidian Energy", the "Company", "we", "us" or "our") is an exploration and production company and is governed by the laws of the Province of Alberta, Canada. The Company operates in one segment, to explore for, develop and hold interests in oil and natural gas properties and related production infrastructure in the Western Canada Sedimentary Basin directly and through investments in securities of subsidiaries holding such interests. Obsidian Energy's portfolio of assets is managed at an enterprise level, rather than by separate operating segments or business units. The Company assesses our financial performance at the enterprise level and resource allocation decisions are made on a project basis across our portfolio of assets, without regard to the geographic location of projects. Obsidian Energy owns the petroleum and natural gas assets or 100 percent of the equity, directly or indirectly, of the entities that carry on the remainder of the oil and natural gas business of Obsidian Energy which includes 100 percent of the Peace River Oil Partnership ("PROP") effective November 24, 2021.

2. Basis of presentation and statement of compliance

a) Basis of Presentation

The unaudited condensed interim consolidated financial statements ("interim consolidated financial statements") include the accounts of Obsidian Energy and our wholly owned subsidiaries

Certain comparative figures have been reclassified to correspond with current period presentation.

b) Statement of Compliance

These interim consolidated financial statements are prepared in compliance with IAS 34 "Interim Financial Reporting" and accordingly do not contain all of the disclosures included in Obsidian Energy's annual audited consolidated financial statements. These financial statements should be read in conjunction with Obsidian Energy's audited annual consolidated financial statements as at and for the year ended December 31, 2021.

These interim consolidated financial statements were prepared using the same accounting policies as in the annual consolidated financial statements as at and for the year ended December 31, 2021.

All tabular amounts are in millions of Canadian dollars, except numbers of common shares, per share amounts, percentages and other figures as noted.

These interim consolidated financial statements were approved for issuance by the Board of Directors on May 3, 2022.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS 5