Cenovus Energy increases offer price for MEG Energy

Mr. Jon McKenzie reports CENOVUS ANNOUNCES AMENDED AGREEMENT WITH INCREASED PRICE TO ACQUIRE MEG ENERGY AND PROVIDES UPDATE ON THIRD-QUARTER OPERATING RESULTS Cenovus Energy Inc. has entered into an amending agreement in respect of the arrangement agreement dated Aug. 21, 2025 (as amended) to acquire MEG Energy Corp. Under the terms of the amended agreement, each MEG shareholder will have the option to elect to receive, for each MEG common share, (i) $29.50 in cash; or (ii) 1.240 Cenovus common shares, subject to rounding and proration based on a maximum amount of $3.8-billion in cash and a maximum of 157.7 million Cenovus common shares. The prorated consideration represents a mix of 50 per cent cash and 50 per cent Cenovus common shares. On a fully prorated basis, the consideration per MEG common share represents approximately $14.75 in cash and 0.620 of a Cenovus common share. The fully prorated consideration for MEG represents a value of approximately $29.80 per MEG share at Cenovus's closing share price on Oct. 7, 2025, an increase of approximately $1.32 per share based on current market pricing relative to the terms of the original arrangement agreement. The consideration under the amended agreement represents Cenovus's best and final offer for MEG. "We received support from the majority of MEG's shareholders for our transaction. However, many MEG shareholders indicated that they would prefer to receive greater Cenovus share consideration so that they can more fully participate in the upside of the combined company," said Jon McKenzie, president and chief executive officer of Cenovus. "We listened to these comments and have changed the consideration under our offer to a maximum of 50 per cent cash and 50 per cent Cenovus shares while increasing the aggregate purchase price. We believe this amended agreement delivers compelling and superior value to MEG shareholders and we encourage every MEG shareholder to vote their shares in favour." In consideration of Cenovus amending and increasing the consideration for MEG, MEG and Cenovus have also amended the terms of the existing standstill agreement between the parties to allow Cenovus to complete purchases of up to 9.9 per cent of MEG's outstanding common shares. To the extent Cenovus is able, the company intends to vote any acquired shares in favour of the transaction. As a result of the lower maximum cash consideration to be issued under the amended agreement, if the transaction is approved by MEG shareholders, Cenovus intends to increase planned share repurchases over the coming quarters. To allow MEG shareholders time to consider and vote on the amended agreement, the special meeting of MEG shareholders scheduled for Oct. 9, 2025, has been postponed to Oct. 22, 2025, at 9 a.m. MT (11 a.m. ET). MEG shareholders are encouraged to refer to MEG's release issued today for further information on voting, submitting consideration elections and deadlines with respect to the new meeting date. Cenovus confirms that key regulatory approvals have been received from the Canadian Competition Bureau and the U.S. Federal Trade Commission in respect of the transaction. Third quarter 2025 results update In the third quarter, Cenovus achieved record quarterly production in its upstream business and record crude throughput in its downstream business. Total upstream production was approximately 832,000 barrels of oil equivalent per day in the third quarter, including record production of approximately 640,000 barrels per day from the oil sands segment. Total downstream crude throughput was approximately 712,000 bbl/d in the third quarter, including approximately 606,000 bbl/d in U.S. refining, representing total downstream utilization of 98.8 per cent. Cenovus's major growth projects continue to progress well and on schedule, with volumes ramping up at Narrows Lake, first oil from the Foster Creek Optimization project expected in early 2026 and first oil from West White Rose expected in Q2 2026. Cenovus closed the previously announced sale of its 50-per-cent interest in WRB Refining LP to Phillips 66, with cash proceeds of approximately $1.8-billion (including closing adjustments) received on Oct. 1, 2025. Net debt at the end of the quarter was approximately $5.3-billion prior to receipt of the cash proceeds from the sale of WRB, or approximately $3.5-billion after receipt of proceeds on Oct. 1. In the month of September, Cenovus purchased approximately 21.5 million of its common shares for $512-million at an average price of approximately $23.81 per share. This brings total purchases in the third quarter to approximately 40.4 million shares for $900-million at an average price of approximately $22.31 per share. With net debt below the company's long-term target of $4-billion, Cenovus anticipates continued accelerated share repurchases in the coming months. About Cenovus Energy Inc. Cenovus Energy is an integrated energy company with oil and natural gas production operations in Canada and the Asia-Pacific region and upgrading, refining and marketing operations in Canada and the United States. The company is committed to maximizing value by developing its assets in a safe, responsible and cost-efficient manner, integrating environmental, social and governance considerations into its business plans. Cenovus common shares and warrants are listed on the Toronto and New York stock exchanges, and the company's preferred shares are listed on the Toronto Stock Exchange. We seek Safe Harbor.