Obsidian Energy's drilling program accelerated in the fourth quarter of 2023 with four rigs in operation across Peace River, Willesden Green/Pembina (Cardium) and Viking areas. During 2023 rig released 59 operated (58.5 net) wells including four (4.0 net) oilsands exploration ("OSE") wells, of which 48 (47.5 net) wells were on production by the end of the year (including 15 (15.0 net) wells which were brought on in late December). The remaining seven (7.0 net) wells are expected to be on production in the first quarter of 2024.

In addition, Obsidian Energy participated in 18 non-operated (6.7 net) wells during 2023, three (1.3 net) of which were water injector wells. The company drilled and placed on production three (3.0 net) appraisal wells in the Dawson area in the fourth quarter of 2023. The company is very excited about the initial results which delineates a significant portion of Dawson asset and, combined with the 12-33 Pad well drilled earlier in the year, firmly establishes the Dawson asset as first Clearwater development area.

The Dawson 7-13 Pad (1.0 net) well came online in November and showed a peak rate of 434 boe/d (100% oil) and an average initial production ("IP") 30-day rate of 312 boe/d (100% oil). The two (2.0 net) wells at the Dawson 13-23 Pad were brought onstream on December 19 with a pad peak rate of 558 boe/d (100% oil) and an average IP 13-day rate of 375 boe/d (100 percent oil) post clean-up. On an individual basis, IP 13-day rates were 228 boe/d (100 percent oil) and 147 boe/d (100 percent oil).

As a result of this success, the company has more than 20 follow-up Clearwater inventory locations (currently unbooked) identified in the Dawson area. The team is currently optimising an accelerated and expanded drilling program in the area for the second half of 2024. In December 2023, Obsidian Energy was the successful bidder at the Alberta provincial land sale on 20 contiguous sections of highly prospective Clearwater rights in the Peace River area, augmenting existing holdings.

Identified as part of broader ongoing technical analysis across the region, the company intend to test this new land in the next winter drilling season. In total, Obsidian Energy now holds 525 sections of land in Peace River. In early January 2024, the company commenced first quarter 2024 Clearwater exploration/appraisal plan that includes the drilling, coring and testing of two (2.0 net) wells in Nampa area.

The company will also drill and core a further four (4.0 net) Clearwater OSE wells in other areas of acreage to continue detailed technical analysis of holdings.