Tourmaline Oil : 2022 Sustainability Report

2022 Sustainability Report | D R I V I N G T H E E N E R G Y T R A N S F O R M AT I O N

	Introduction	Strategy	Environment	Social	Governance	Performance Data	Disclosures

In this report:

Introduction	3	Strategy	8		Environment	13	Social	39
CEO Message	3	Approach	9		The World Wants More	14		Health & Safety	40
Company Overview	5	Assurances	9		Canadian Natural Gas			Indigenous Engagement	43
Our Unique Value Proposition	6	Materiality Assessment	10		Air	17		Employees & Diversity	47
ESG Highlights	7	Guiding Principles	11		Water	33		Community Engagement	48
		Stakeholder Engagement	11		Land	36		Supply Chain Management	50
		ESG Strategy	12		Decommissioning &	38
			Reclamation

Governance	51	Performance Data	57	Disclosures	61
Corporate Governance	52					TCFD	62
Risk Management	54					SASB	68
Policies	55					Independent Practitioner's	70
Advocacy	56					Assurance Report
							Forward-Looking	72
							Statements
							Directors & Officers	72

Tourmaline Sustainability Report 2022

ESG STRATEGY IN ACTION CASE STUDIES:

TAKING ACTION TO REDUCE	23
OUR EMISSIONS
DRIVING EMISSION REDUCTION IN	29
THE TRANSPORTATION INDUSTRY
DEEPENING OUR RELATIONSHIPS	45
WITH FIRST NATIONS

		Introduction	Strategy	Environment	Social	Governance	Performance Data	Disclosures
IN THIS SECTION:	CEO Message	Company Overview	Our Unique Value Proposition	ESG Highlights

CEO Message

"With the many emerging opportunities that natural gas enables and the growing

Driving Opportunities for Natural Gas

Global energy demand continues to grow every year - and more than ever, people want energy they can be proud to use.

worldwide demand for natural gas, we believe Canadian gas will play a much larger role in the years ahead."

MICHAEL ROSE

PRESIDENT, CHIEF EXECUTIVE

OFFICER & CHAIRMAN

Tourmaline Sustainability Report 2022

Canadians and international citizens are looking for reliable, affordable, low-emission energy sources they can be proud to use. Our natural gas is the solution. Canada produces amongst the lowest-emission natural gas in the world, and our industry is reducing those emissions at a rapid pace. We should be supplying as much of the growing global demand as possible.

At Tourmaline, we're doing everything we can to drive the many opportunities for natural gas, both at home and abroad. In January 2023, for example, Tourmaline became the first Canadian producer to supply natural gas internationally through a unique 15-year,cross-border agreement with Cheniere Energy, a leading producer and exporter of liquefied natural gas (LNG) in the United States. We see a tremendous opportunity for Canadian natural gas heading west and south for LNG feedstock. Canadian basins are still early in their producing reserve life and the expanding U.S. Gulf Coast LNG complex will increasingly call on Canadian producers for supply.

And in April 2023, we announced a joint development agreement to build and develop a network of compressed natural gas (CNG) stations along key highway corridors across Western Canada. This initiative will help heavy-haul trucks and other commercial transportation fleets transition to using CNG, a lower-emitting alternative to gasoline and diesel. We know from experience the effects will be profound. Across our operations, we have made significant efforts to displace diesel with natural gas, saving costs and dramatically reducing a broad spectrum of emissions, not just CO2.

1Source: World Research Institute.

2Source: Conference Board of Canada. To learn more click here.

With the many emerging opportunities natural gas enables and worldwide natural gas demand growing, we believe Canadian gas will play a much larger role in the years ahead.

Rooting for Canada's Hat Trick

The LNG business offers Canada an incredible opportunity to reduce global emissions, significantly grow our economy, and improve First Nations' prosperity. It's a true hat trick for Canada, but first we must choose to get in the game.

The potential environmental benefits alone are massive. A large and growing Canadian LNG industry provides a material ability to reduce the 98.5% of global emissions that don't originate from Canada1, as each bcf/day of LNG has the potential to reduce carbon emissions by approximately 15 MT/year if used to replace coal in landed jurisdictions.

A growing LNG industry will also undoubtedly help Canada's economy thrive for decades to come in the form of jobs, revenues, and taxes for the entire country. An LNG export industry equivalent to 30 MTPA in British Columbia would inject about $7.4 billion into the Canadian economy over 30 years, and support over 65,000 jobs2.

Finally, should Canada become a major, global LNG player, the opportunities to advance First Nations' economic wellbeing are myriad. Whether by obtaining equity ownership in pipeline projects, securing more contracts for Indigenous businesses, or gaining high-quality employment with energy producers, First Nations across Western Canada will benefit from a growing LNG sector. Simply put, Canada cannot afford to miss the LNG hat trick.

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	Introduction	Strategy	Environment	Social	Governance	Performance Data	Disclosures

IN THIS SECTION:

CEO Message

Company Overview

Our Unique Value Proposition

CEO Message

"We have accomplished a lot, but our goal is to continuously improve our results, setting new, challenging targets every five years to guide the way."

ESG Highlights

Sharing Our Recent Highlights

At Tourmaline, we strive to produce the cleanest and lowest-emission natural gas possible. I am pleased to report our progress on this front and others, as evidenced by these notable achievements:

55%REDUCTION

in methane emissions intensity between 2018 and 2022 while growing production by 89%

Responsibly Developing Canada's

World-Class Assets

We believe Canada is the ideal partner for a secure energy future - and, given our commitment to responsibly developing Canada's world-class assets, Tourmaline is the ideal producer for the growing natural gas and LNG market.

We have reduced scope 1 emissions intensity by 42% since 2013 while increasing production by 570%. We have also reduced our methane emissions intensity by 29% since 2020, and are on track to reach our target of a 55% reduction by 2027, using 2020 as a benchmark. Tourmaline also recovers and reuses more than 95% of water used in completions, with plans to eliminate freshwater use throughout our core gas operations. Conserving and protecting land is also a priority. Among other initiatives, we minimize surface impact by drilling multi-well pads rather than single-well pads, expanding existing facilities rather than building new sites, and using existing pipeline rights-of-way whenever possible.

We have accomplished a lot, but our goal is to continuously improve our results, setting new, challenging targets every five years to guide the way. We're now in the first year

of our second five-year plan for overall environmental performance improvement, and our people are prioritizing

technology, innovation, and efficiency to further reduce our greenhouse gas emissions, eliminate freshwater use, and minimize our land footprint.

Looking Forward

These highlights are just a few accomplishments we are pleased to share with you in this report. In the coming pages, you will find much more about Tourmaline's ongoing dedication to improving our environmental, social and governance performance. As a company and individuals, we are committed to doing things better on all fronts - and I am proud of our team for working hard to make it possible.

On that note, I want to thank our dedicated employees, contractors, consultants, the Indigenous peoples we work with, and the members of every community where we operate. We value our relationships with you and appreciate your support. Together, we are ensuring our stakeholders benefit from the many opportunities natural gas represents. Here's to Canada seizing them all.

Michael Rose

PRESIDENT, CHIEF EXECUTIVE OFFICER & CHAIRMAN

140,000MMBTU/D

delivered to supply LNG internationally - the equivalent of 1 LNG cargo per month

110MILLION litres of diesel displaced in our operations to date

13%REDUCTION	OVER
HALFWAY
in scope 1 emissions	TO OUR
TARGET
intensity since 2018
	OVER
	$7.1BILLION
of value distributed to our
stakeholders in 2022

Tourmaline Sustainability Report 2022

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	Introduction	Strategy	Environment	Social	Governance	Performance Data	Disclosures

IN THIS SECTION:

CEO Message

Company Overview

Company Overview

Our Unique Value Proposition

ESG Highlights

Who We Are

Tourmaline is Canada's largest natural gas producer. From our operations in British Columbia and Alberta, we are proud to send our natural gas across Canada, into the United States, and to international markets, improving the lives of many. Tourmaline sells its natural gas in Canada to British Columbia, Alberta and Ontario; within the United States to California and the Midwest; and at the start of 2023, we became the first Canadian producer to supply natural gas to Asian and European markets.

Our Goal

Our goal is to have the largest supply of low-emission and low-development-cost natural gas in North America. To get there, we have set clear and aggressive targets to further reduce our emissions, recycle water and minimize our land impact. Tourmaline strives to continually improve and reduce our cost structure to remain competitive in the ever-changing landscape.

Our Focus

We focus on providing value for our shareholders in many ways. We are committed to responsibly developing natural gas, fostering a strong and passionate work force, continuously improving our environmental performance, and creating strong relationships in the communities we call home.

Tourmaline Sustainability Report 2022

Largest

natural gas producer in Canada

78%

of our production is natural gas, a cleaner- burning hydrocarbon

2.5BCF/D

of natural gas production

LARGEST

Tier 1

natural gas inventory holder in North America

LO CAT I O N & T SX

Tourmaline is headquartered in Calgary, Alberta and our shares are listed on the Toronto Stock Exchange (TSX) under the symbol TOU.

Where We Operate

Tourmaline has significant resource ownership amongst Canada's world-class energy assets within Alberta and British Columbia.

N E B C

M O N T N E Y

D E E P

BA S I N

P E AC E R I V E R

T R I A S S I C O I L

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