<SEC-DOCUMENT>0001193125-20-240865.txt : 20200908
<SEC-HEADER>0001193125-20-240865.hdr.sgml : 20200908
<ACCEPTANCE-DATETIME>20200908134352
ACCESSION NUMBER:		0001193125-20-240865
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20200908
FILED AS OF DATE:		20200908
DATE AS OF CHANGE:		20200908

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			OBSIDIAN ENERGY LTD.
		CENTRAL INDEX KEY:			0001334388
		STANDARD INDUSTRIAL CLASSIFICATION:	CRUDE PETROLEUM & NATURAL GAS [1311]
		IRS NUMBER:				000000000
		STATE OF INCORPORATION:			A0
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-32895
		FILM NUMBER:		201163772

	BUSINESS ADDRESS:	
		STREET 1:		207 - 9TH AVENUE S.W.
		STREET 2:		SUITE 200
		CITY:			CALGARY
		STATE:			A0
		ZIP:			T2P 1K3
		BUSINESS PHONE:		(403) 777-2500

	MAIL ADDRESS:	
		STREET 1:		207 - 9TH AVENUE S.W.
		STREET 2:		SUITE 200
		CITY:			CALGARY
		STATE:			A0
		ZIP:			T2P 1K3

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PENN WEST PETROLEUM LTD.
		DATE OF NAME CHANGE:	20110125

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PENN WEST ENERGY TRUST
		DATE OF NAME CHANGE:	20050727
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>d12390d6k.htm
<DESCRIPTION>6-K
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<HTML><HEAD>
<TITLE>6-K</TITLE>
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<Center><DIV STYLE="width:8.5in" align="left">
 <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="margin-top:4pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>UNITED STATES </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>SECURITIES AND EXCHANGE COMMISSION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Washington, D.C. 20549 </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>Form <FONT
STYLE="white-space:nowrap">6-K</FONT> </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>REPORT OF
FOREIGN PRIVATE ISSUER </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>PURSUANT TO RULE <FONT STYLE="white-space:nowrap">13a-16</FONT> OR
<FONT STYLE="white-space:nowrap">15d-16</FONT> </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>OF THE SECURITIES EXCHANGE ACT OF 1934 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>For the month of September 2020 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Commission File Number <FONT STYLE="white-space:nowrap">1-32895</FONT> </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:24pt; font-family:Times New Roman" ALIGN="center"><B>Obsidian Energy Ltd. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><I>(Translation of registrant&#146;s name into English) </I></B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Suite 200, 207 &#150; 9<SUP STYLE="font-size:85%; vertical-align:top">th</SUP> Avenue SW </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Calgary, Alberta T2P 1K3 </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Canada </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B><I>(Address of
principal executive offices) </I></B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Indicate by check mark whether the registrant files or will file annual reports under cover of Form <FONT STYLE="white-space:nowrap">20-F</FONT> or Form <FONT
STYLE="white-space:nowrap">40-F.)</FONT> </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">Form
<FONT STYLE="white-space:nowrap">20-F&nbsp;&nbsp;&#9744;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Form</FONT> <FONT STYLE="white-space:nowrap">40-F&nbsp;&nbsp;&#9746;</FONT> </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Indicate by check mark if the registrant is submitting the Form <FONT STYLE="white-space:nowrap">6-K</FONT> in paper as permitted by Regulation <FONT
STYLE="white-space:nowrap">S-T</FONT> Rule 101(b)(1)&nbsp;&nbsp;&#9744; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Indicate by check mark if the registrant is submitting the Form <FONT
STYLE="white-space:nowrap">6-K</FONT> in paper as permitted by Regulation <FONT STYLE="white-space:nowrap">S-T</FONT> Rule 101(b)(7)&nbsp;&nbsp;&#9744; </P> <P STYLE="font-size:10pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>DOCUMENTS INCLUDED AS PART OF THIS FORM <FONT STYLE="white-space:nowrap">6-K</FONT>
</B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">See the Exhibit Index hereto. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>SIGNATURES </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on September&nbsp;8, 2020. </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
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<TD VALIGN="top" COLSPAN="3"><B>OBSIDIAN ENERGY LTD.</B></TD></TR>
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<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
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<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Stephen E. Loukas<U> </U></P></TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Stephen E. Loukas</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Interim President&nbsp;&amp; CEO</TD></TR>
</TABLE></DIV>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2 </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>EXHIBIT INDEX </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; display:table-cell; font-size:8pt; font-family:Times New Roman; " ALIGN="center"><B>Exhibit</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" NOWRAP> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; display:table-cell; font-size:8pt; font-family:Times New Roman; "><B>Description</B></P></TD></TR>


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<TD VALIGN="top" NOWRAP>99.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">News release, dated September&nbsp;8, 2020</TD></TR>
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<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>d12390dex991.htm
<DESCRIPTION>EX-99.1
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<Center><DIV STYLE="width:8.5in" align="left">
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 99.1 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Obsidian Energy Announces Intention to Launch Exchange Offer for Bonterra Energy </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>Creates a Cardium Champion with enhanced scale and relevance </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>Accretive across all equity metrics resulting in significant per share value appreciation to the benefit of both </I></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>Obsidian Energy and Bonterra shareholders </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>Stabilize balance sheets, reduce debt and improve access to capital </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>Up to C$100&nbsp;million expected in identified financial, operational and other synergies over the first three years </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>A far superior outcome compared to what either Obsidian Energy or Bonterra could achieve on a stand-alone basis, </I></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>specifically including Bonterra&#146;s proposed BDC term facility </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">CALGARY, September&nbsp;8, 2020 - OBSIDIAN ENERGY LTD. (TSX &#150; OBE, OTCQX &#150; OBELF) (&#147;Obsidian Energy&#148;, &#147;we&#148;, or &#147;our&#148;)
today announced that, further to our August&nbsp;31, 2020 press release, we intend to make an offer (the &#147;Offer&#148;) to purchase all of the issued and outstanding common shares (the &#147;Bonterra Shares&#148;) in the capital of Bonterra
Energy Corp. (TSX &#150; BNE) (&#147;Bonterra&#148;) for consideration consisting of two common shares of Obsidian Energy (the &#147;Obsidian Shares&#148;) for each Bonterra Share. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;We believe our Offer is in the best interests of Obsidian Energy and Bonterra shareholders&#148; said Interim President and Chief Executive Officer
Stephen Loukas. &#147;The combination of our companies creates a &#145;Cardium Champion&#146; with an improved cost structure, increased capital markets relevance and positions us favourably for further consolidation within the basin. The
combination would result in significant cost savings and additional synergies, making the transaction accretive to both Obsidian Energy&#146;s and Bonterra&#146;s free cash flow, funds flow from operations and production on a <FONT
STYLE="white-space:nowrap">per-share</FONT> basis while driving a faster pace of debt repayment.&#148; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Mr.&nbsp;Loukas continued by noting that
&#147;while we recognize on first inspection the Offer of two Obsidian Shares for each Bonterra Share is currently below a trading price-based exchange ratio, our detailed contribution analysis supports that this is a highly compelling exchange
ratio. Bonterra currently trades at a premium to Obsidian Energy and other relevant public oil producing companies, despite recent performance that has been weaker than Obsidian Energy as measured by funds flow from operations, operating costs, and
well results. We recognize the attractive, <FONT STYLE="white-space:nowrap">low-decline</FONT> attributes of Bonterra&#146;s portfolio, but we do not believe that Bonterra&#146;s valuation premium will be sustained as a stand-alone entity given that
its over-levered balance sheet and lack of meaningful scale is unlikely to attract equity market support. More importantly, we believe that the combined entity will have dramatically superior financial performance due to the significant synergies
available. We further believe that it is very unlikely that any other company would be able to achieve the scale of synergies and corresponding equity value appreciation that would result from a merger between Obsidian Energy and Bonterra. As a
result, by making an offer directly to Bonterra&#146;s shareholders, we are seeking to deliver a path to enhanced underlying free cash flow, asset value and meaningfully increased equity value for both Obsidian Energy and Bonterra shareholders
alike.&#148; </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>BACKGROUND TO THE OFFER </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">As described
in greater detail in its public letter to Bonterra and its Board of Directors dated August&nbsp;31, 2020 (the &#147;August 31 Letter&#148;), Obsidian Energy and Bonterra have been engaged in periodic discussions pertaining to a potential friendly
business combination transaction since at least January of 2019. Despite positive initial discussions and Obsidian Energy&#146;s consistent efforts to further the engagement between the two companies, Bonterra has failed to allow any meaningful
progress. Accordingly, in the August&nbsp;31 Letter, Obsidian Energy presented Bonterra&#146;s Board of Directors with a formal <FONT STYLE="white-space:nowrap">non-binding</FONT> business combination proposal on the terms of the Offer. Obsidian
Energy indicated in the August&nbsp;31 Letter that it was prepared to immediately engage in prompt discussions with Bonterra to share its cost synergy and business plan assumptions and invited the Bonterra Board of Directors to participate in good
faith negotiations to explore a mutually acceptable transaction to combine the companies. Obsidian Energy requested that Bonterra respond to its formal <FONT STYLE="white-space:nowrap">non-binding</FONT> proposal on or before Friday,
September&nbsp;4, 2020. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">At the time of this press release, the Bonterra Board of Directors has failed to engage with Obsidian Energy
in any meaningful way. Obsidian Energy was encouraged that the following quote by Bonterra&#146;s Chairman and Chief Executive Officer in the September&nbsp;4, 2020 edition of the Calgary Herald suggested a potential willingness to engage in
discussions on the merits of the proposed combination transaction: </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; margin-left:9%; font-size:10pt; font-family:Times New Roman"><I>&#147;I [George Fink, Chairman and CEO of Bonterra] am not saying
we [Bonterra] don&#146;t want to do a deal, but we don&#146;t want to do a deal that they proposed at this point. It&#146;s too much in favour of their side. There are a lot of positives putting the two entities together, but not the proposal
that&#146;s in front of us right now.&#148;</I> </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Unfortunately, and to the disappointment of Obsidian Energy, this quote was then followed by
correspondence from Bonterra&#146;s Chairman and Chief Executive Officer to Obsidian Energy&#146;s Interim President and Chief Executive Officer on the evening of September&nbsp;4, 2020 that indicated Bonterra is focused on pursuing a subordinated
debt financing with Business Development Bank of Canada (&#147;BDC&#148;) and was not interested in pursuing a transaction with Obsidian Energy, but would advise us if their position changed in the future. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">While Obsidian Energy remains prepared to engage in good faith negotiations with Bonterra to complete the transaction expeditiously for the benefit of
Bonterra&#146;s and Obsidian Energy&#146;s respective shareholders, Bonterra&#146;s continued recalcitrance, and the unwillingness of its Board of Directors to engage in any discussions, has left Obsidian Energy with no option but to bring this
compelling Offer directly to Bonterra shareholders so they can determine the future of their investment. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">A copy of the August&nbsp;31 Letter is available
under Obsidian Energy&#146;s SEDAR profile at www.sedar.com, in the United States on EDGAR at www.sec.gov and on the Obsidian Energy website at www.obsidianenergy.com. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>WHY DOES THIS TRANSACTION MAKE SENSE FOR BOTH BONTERRA AND OBSIDIAN ENERGY? </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Assuming a US$50/bbl WTI and C$1.95/MMBtu AECO 2021 forward commodity price outlook and based on the extensive analysis that we have conducted, a combination
transaction between Obsidian Energy and Bonterra is expected to result in the benefits outlined below. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Cardium Champion: Enhanced Scale and
Relevance </I></B></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Creation of a Top 20 Western Canadian Sedimentary Basin oil producer with approximately 35,000 boe/d of <FONT
STYLE="white-space:nowrap">oil-weighted</FONT> production </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Significant enhancement of our ability to deploy combined capital spending towards Obsidian Energy&#146;s
highest-return inventory at Willesden Green </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">A combined company significantly larger than any other Cardium-focused competitor </P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">A significantly lower 2021 break-even WTI price of ~ US$37/bbl to maintain exit to exit production levels while
achieving free-cash flow neutrality, with further break-even price improvement in 2022 and beyond due, in part, to lower interest expense from debt repayment </P></TD></TR></TABLE>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Maintain Strengths: Low Decline + High Netback Light Oil </I></B></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Pro forma base production decline rate of approximately 18% </P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">High netbacks of C$23/boe in 2022 based on US$50/bbl WTI and C$1.95/MMBtu AECO </P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Continued success in lowering operating expenses and improving capital efficiencies </P></TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 2 - </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Stable Balance Sheet, Lower Debt, Improved Access to Capital </I></B></P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Deleveraging for Bonterra shareholders through significant improvements in credit metrics due to improved free
cash flow and lower debt, resulting in a lower risk profile and forecasted 2022 <FONT STYLE="white-space:nowrap">year-end</FONT> Debt / EBITDA of 2.0x </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Enhanced position to extend debt maturities with support of lenders </P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Obsidian Energy and Bonterra shareholders realizing the benefits of synergies </P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="5%">&nbsp;</TD>
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<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Increased size and scale that we believe would allow the combined entity to access alternative debt financing to
refinance existing first lien debt resulting in a more stable and diversified capital structure that would not be as reliant on and exposed to semi-annual bank redeterminations </P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Improved financial position after sufficient debt pay down would allow the combined entity to eventually
reinstate a dividend to shareholders </P></TD></TR></TABLE> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Meaningful Synergies and Capital Development Plan Drive Equity Appreciation </I></B></P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Synergies from lower general and administrative expenses, operating expense reductions, improved capital
efficiency, aligned decommissioning liability strategy, and reduced interest costs over time </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Significantly greater free cash flow of approximately C$50&nbsp;million in year one and up to C$100&nbsp;million
over the first three years versus the stand-alone entities </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Multi-year capital development plan to invest in Obsidian Energy&#146;s highly economic and substantial drilling
inventory allows for production growth and the generation of additional free cash flow </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Improved free cash flow available to accelerate debt repayment resulting in improved financial performance and
creating a clear path to significant equity appreciation </P></TD></TR></TABLE> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>SIGNIFICANT ACCRETION TO BONTERRA AND OBSIDIAN ENERGY SHAREHOLDERS </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">At the proposed 2.0x exchange ratio, representing total ownership by Bonterra shareholders in the pro forma entity of approximately 48%, we, in conjunction
with our financial advisors, see the potential for robust accretion across all equity metrics resulting in significant per share value appreciation to the benefit of both Obsidian Energy and Bonterra shareholders. </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Assuming a US$50/bbl WTI and C$1.95/MMBtu AECO 2021 forward commodity price outlook and that the pro forma entity
trades at 4.5x Enterprise Value / 2021 EBITDA, <B><I>a trading multiple consistent with peers, Bonterra Shares would appreciate by greater than 300% to approximately C$6.40 per share, representing approximately C$3.20 per Obsidian Share</I></B>.
</P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="5%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt">Extrapolating a 4.5x multiple to projected 2022 EBITDA and using the same commodity price outlook would result in
the <B><I>Bonterra Shares appreciating by almost 600% to approximately C$10.50 per share and approximately C$5.25 per Obsidian Share</I></B> due to modest production growth resulting in higher EBITDA, along with equity value improvement due to
significant debt pay down from free cash flow generation. </P></TD></TR></TABLE> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>ADDITIONAL LEVERAGING OF BONTERRA IS NOT IN THE BEST INTERESTS OF BONTERRA
SHAREHOLDERS </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Given the significant equity appreciation that would result from a combination between Obsidian Energy and Bonterra, we feel strongly
that engaging with Obsidian Energy is a far better outcome for Bonterra shareholders than Bonterra&#146;s current pursuit of incremental second-lien debt financing from BDC. It is clear, in our review and analysis, that adding more debt to an
already over-levered balance sheet is a vastly inferior outcome for Bonterra shareholders compared to the synergies and development opportunities with Obsidian Energy and the resulting corresponding share price appreciation that a combination
transaction would enable. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>&#147;CREATING A CARDIUM CHAMPION&#148; PRESENTATION </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Obsidian Energy&#146;s detailed &#147;Creating a Cardium Champion&#148; presentation is available at www.obsidianenergy.com. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 3 - </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>APPROVALS </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The proposed Offer has been unanimously approved by Obsidian Energy&#146;s Board of Directors. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>DETAILS ON INTENTION TO MAKE AN OFFER </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Other than in
certain circumstances described below, Obsidian Energy intends to commence the Offer as soon as practicable. Once the Offer is formally launched, it will be open for acceptance by Bonterra shareholders for 105 days, unless the Offer is extended,
accelerated or withdrawn, in each case, in accordance with applicable law. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Offer will be subject to certain conditions, including: (i)&nbsp;that the
Bonterra Shares validly deposited to the Offer, and not withdrawn, represent at least 66 2/3% of the then outstanding Bonterra Shares (on a fully-diluted basis); (ii) receipt of all governmental, regulatory and stock exchange approvals, including
pursuant to the <I>Competition Act</I> (Canada) and the approval of the Toronto Stock Exchange (&#147;TSX&#148;), that Obsidian Energy considers necessary or desirable in connection with the Offer; (iii)&nbsp;there being no legal prohibition against
Obsidian Energy making the Offer or taking up and paying for the Bonterra Shares; (iv)&nbsp;Bonterra not having adopted or implemented a shareholder rights plan, disposed of any material assets, incurred any material debts (including pursuant to its
announced prospective term facility with the BDC under its Business Credit Availability Program), implemented any changes in its capital structure or otherwise implemented or attempted to implement a defensive tactic; (v)&nbsp;no material adverse
change having occurred in the business, affairs, prospects or assets of Bonterra, including the commencement of proceedings under the <I>Companies</I><I>&#146;</I><I> Creditors Arrangement Act</I> (Canada) or the <I>Bankruptcy and Insolvency Act
</I>(Canada); (vi) no litigation or regulatory order that may hamper the carrying out of the Offer or any second step transaction in connection with the Offer; (vii)&nbsp;Obsidian Energy shareholders approving, as required by the rules of the TSX,
the issuance of the Obsidian Shares to be distributed by Obsidian Energy in connection with the Offer; (viii)&nbsp;Obsidian Energy being provided with access to all <FONT STYLE="white-space:nowrap">non-public</FONT> information regarding Bonterra
that has been made available to any potential acquiror or, in any case, which a potential acquiror would reasonably require to be given, provided or have made available to it, in each case since June&nbsp;30, 2020 for the purpose of considering or
seeking information to consider an acquisition of, or business combination with, Bonterra in each case on substantially the same terms and conditions as have been or would reasonably be imposed on a potential acquiror, other than any term or
condition that would be inconsistent with or would render Obsidian Energy unable to make the Offer, to <FONT STYLE="white-space:nowrap">take-up</FONT> and pay under the Offer or complete any second step transaction; (ix)&nbsp;Obsidian Energy not
becoming aware of Bonterra having made any untrue statement of a material fact or omitting to state a material fact that is required to be made to any securities regulatory authority; (x)&nbsp;having received all third party consents or approvals
that Obsidian Energy considers necessary or desirable in connection with the Offer, including without limitation all necessary consents to the Offer, or waivers required as a result of the consummation of the Offer, from the lenders under
Bonterra&#146;s revolving credit facility and, as applicable, lenders under Bonterra&#146;s subordinated notes to private related party investors or any other similar agreement or instrument; and (xi)&nbsp;the statutory minimum tender and other
conditions set out in National Instrument <FONT STYLE="white-space:nowrap">62-104</FONT> <I>Take-Over Bids and Issuer Bids</I> (which cannot be waived); and (xii)&nbsp;other customary conditions. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Full details of the Offer will be set out in a bid circular and accompanying offer documents (collectively, the &#147;Offer Documents&#148;), which Obsidian
Energy expects to mail in accordance with applicable Canadian securities laws and to file with the Canadian securities regulatory authorities. In connection with the Offer, Obsidian Energy expects to file with the U.S. Securities and Exchange
Commission (the &#147;SEC&#148;) a registration statement (a &#147;Registration Statement&#148;), which will contain a prospectus relating to the Offer (a &#147;Prospectus&#148;). This news release is not a substitute for the Offer Documents, the
Prospectus or the Registration Statement. Such documents are not currently available, but once available BONTERRA SECURITY HOLDERS AND OTHER INTERESTED PARTIES ARE URGED TO READ THESE DOCUMENTS, ALL DOCUMENTS INCORPORATED BY REFERENCE, ALL OTHER
APPLICABLE DOCUMENTS AND ANY AMENDMENTS OR SUPPLEMENTS TO ANY SUCH DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE EACH WILL CONTAIN IMPORTANT INFORMATION ABOUT OBSIDIAN ENERGY, BONTERRA AND THE OFFER. Materials filed with the Canadian securities
regulatory authorities will be available electronically without charge at&nbsp;www.sedar.com. Materials filed with the SEC will be available electronically without charge at the SEC&#146;s website at&nbsp;www.sec.gov and the materials will be posted
on the Obsidian Energy website at www.obsidianenergy.com. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 4 - </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Securities may not be offered or sold in the United States absent registration or an exemption from
registration under the U.S. <I>Securities Act of 1933</I>, as amended. Securities will not be offered, nor will deposits of securities be accepted from a person, in any State of the United States in which the offering of securities, or acceptance
thereof, would not be in compliance with the laws of such jurisdiction. Neither the SEC nor any securities commission of any State of the United States has (a)&nbsp;approved or disapproved of the Offer, (b)&nbsp;passed upon the merits or fairness of
the Offer, or (c)&nbsp;passed upon the adequacy or accuracy of the disclosure in this document. Any representation to the contrary is a criminal offense in the United States. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Offer will only be made pursuant to a formal Offer and the Offering Documents. The Offer will not be made in, nor will deposits of securities be accepted
from a person in, any jurisdiction in which the making or acceptance thereof would not be in compliance with the laws of such jurisdiction. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Readers
are cautioned that Obsidian Energy may determine not to make the Offer if: (i)&nbsp;Bonterra implements or attempts to implement defensive tactics in relation to the Offer, (ii)&nbsp;Obsidian Energy uncovers or otherwise identifies information
suggesting that the business, affairs, prospects or assets of Bonterra have been impaired or uncovers or otherwise identifies other undisclosed material adverse information concerning Bonterra; (iii)&nbsp;Bonterra determines to engage with Obsidian
Energy to negotiate the terms of a combination transaction and Bonterra and Obsidian Energy determine to undertake that transaction utilizing a structure other than a bid such as a plan of arrangement; or (iv)&nbsp;a material adverse change has
occurred in the business, affairs, prospects or assets of Bonterra prior to commencement of the Offer. Accordingly, there can be no assurance that the Offer will be made or that the final terms of the Offer will be as set out in this news release.
</B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Questions? Bonterra shareholders should contact Kingsdale Advisors, the information agent and depositary for the Offer, at <FONT
STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">1-888-564-7333</FONT></FONT></FONT> (North American Toll-Free Number) or <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT
STYLE="white-space:nowrap">+1-416-867-2272</FONT></FONT></FONT> (Outside North America) or via email at contactus@kingsdaleadvisors.com. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>ADVISORS
</B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Obsidian Energy has engaged Tudor, Pickering, Holt&nbsp;&amp; Co. Securities &#150; Canada, ULC as its financial advisor, Stikeman Elliott LLP,
Bennett Jones LLP and Paul, Weiss, Rifkind, Wharton&nbsp;&amp; Garrison LLP as its legal counsel, Kingsdale Advisors as the information agent and depositary in respect of the Offer and Longview Communications&nbsp;&amp; Public Affairs as its
strategic communications advisors. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>ADDITIONAL READER ADVISORIES </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>NO OFFER OR SOLICITATION </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">This news release does not
constitute an offer to buy or sell, or a solicitation of an offer to sell or buy, any securities of Obsidian Energy or Bonterra. The securities registered pursuant to a Registration Statement are not offered for sale in any jurisdiction in which
such offer or sale is not permitted </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>OIL AND GAS INFORMATION ADVISORY </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Boe may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of crude oil is based
on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is
significantly different from the energy equivalency conversion ratio of 6:1, utilizing a conversion on a 6:1 basis is misleading as an indication of value. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 5 - </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><FONT STYLE="white-space:nowrap">NON-GAAP</FONT> MEASURES </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">This news release contains references to the terms EBITDA, Enterprise Value, Debt, funds flow from operations, free cash flow and netbacks, which do not have a
standardized meaning prescribed by International Financial Reporting Standards and therefore are considered <FONT STYLE="white-space:nowrap">non-GAAP</FONT> measures; accordingly, they may not be comparable to similar measures provided by other
issuers. EBITDA is net earnings (loss) plus finance expenses (income), provisions for (recovery of) income taxes, and depletion, depreciation and amortization. Debt is bank debt, notes and, solely in respect of Bonterra, subordinated debt.
Enterprise Value is a measure of total value of the applicable company calculated by aggregating the market value of its common shares at a specific date, adding its total Debt and subtracting its cash and cash and cash equivalents. Funds flow from
operations is cash flow from operating activities before changes in <FONT STYLE="white-space:nowrap">non-cash</FONT> working capital, decommissioning expenditures, onerous office lease settlements, the effects of financing related transactions from
foreign exchange contracts and debt repayments, restructuring charges and certain other expenses and is representative of cash related to continuing operations. Funds flow from operations is used to assess the combined entity&#146;s ability to fund
planned capital programs. Free cash flow is funds flow from operations less capital and decommissioning expenditures. Netback is the per unit of production amount of revenue less royalties, operating expenses, transportation expenses and realized
risk management gains and losses, and is used in capital allocation decisions and to economically rank projects. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>ABBREVIATIONS </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top">AECO</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Alberta Energy Company</TD></TR>
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<TD VALIGN="top">bbl/d</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">barrels per day</TD></TR>
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<TD VALIGN="top">boe</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">barrel of oil equivalent</TD></TR>
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<TD VALIGN="top">boe/d</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">barrels of oil equivalent per day</TD></TR>
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<TD VALIGN="top">MMBtu</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">million British Thermal Units</TD></TR>
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<TD VALIGN="top">WTI</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">West Texas Intermediate</TD></TR>
</TABLE> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>FORWARD-LOOKING STATEMENTS </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Certain statements contained in this document constitute forward-looking statements or information (collectively &#147;forward-looking statements&#148;).
Forward-looking statements are typically identified by words such as &#147;anticipate&#148;, &#147;continue&#148;, &#147;estimate&#148;, &#147;expect&#148;, &#147;forecast&#148;, &#147;budget&#148;, &#147;may&#148;, &#147;will&#148;,
&#147;project&#148;, &#147;could&#148;, &#147;plan&#148;, &#147;intend&#148;, &#147;should&#148;, &#147;believe&#148;, &#147;outlook&#148;, &#147;objective&#148;, &#147;aim&#148;, &#147;potential&#148;, &#147;target&#148; and similar words
suggesting future events or future performance. In particular, this document contains forward-looking statements pertaining to, without limitation, the following: the intention to make the Offer, the terms and exchange ratio of the Offer and the
timing for the commencement of the Offer, the anticipated strategic, operational and financial benefits and synergies that may result from the proposed combination between Obsidian Energy and Bonterra, including as to expected cost synergies,
accretion and equity appreciation, production levels and WTI break-even price expectations for each of the entities on a stand-alone basis; the terms and exchange ratio of the proposed combination between Obsidian Energy and Bonterra; that the Offer
is the better option compared to adding more debt to an already over-levered balance sheet for Bonterra shareholders; the ascribed share price market trading multiple to the combined entity and the resulting benefit to Obsidian Energy and Bonterra
shareholders; and the conditions that the Offer will be subject to and possible reasons that the Offer would not be made. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">With respect to forward-looking
statements contained in this document, Obsidian Energy has made assumptions regarding, among other things: that both Obsidian Energy and Bonterra, each of which are subject to short term extensions on their respective senior revolving credit
facilities continue to obtain extensions in respect of their thereof and otherwise continue to satisfy the applicable covenants under such facilities, including following the completion of the Offer and any subsequent second step transaction, the
ability to complete the Offer and the proposed combination, integrate Obsidian Energy&#146;s and Bonterra&#146;s respective businesses and operations and realize financial, operational and other synergies from the proposed combination; that each of
Obsidian Energy, Bonterra and, following the completion of the Offer, the combined entity will have the ability to continue as a going concern going forward and realize its assets and discharge its liabilities in the normal course of business; the
impact of regional and/or global health related events, including the ongoing <FONT STYLE="white-space:nowrap">COVID-19</FONT> pandemic, on energy demand; that the combined entity&#146;s operations and production will not be disrupted by
circumstances attributable to the <FONT STYLE="white-space:nowrap">COVID-19</FONT> pandemic and the responses of governments and the public to the pandemic; global energy policies going forward, including the continued agreement of members of OPEC,
Russia and other nations to adhere to existing production quotas or further reduce production quotas; Obsidian Energy&#146;s ability to execute on its plans as described </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 6 - </P>

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herein and in its other disclosure documents and the impact that the successful execution of such plans will have on Obsidian Energy and, following the combination, the combined entity and the
combined entities&#146; respective stakeholders; that the combined entity&#146;s shares will trade at a multiple comparable to peers; that the current commodity price and foreign exchange environment will continue or improve; future capital
expenditure levels; future crude oil, natural gas liquids and natural gas prices and differentials between light, medium and heavy oil prices and Canadian, WTI and world oil and natural gas prices; future crude oil, natural gas liquids and natural
gas production levels, including that we will not be required to <FONT STYLE="white-space:nowrap">shut-in</FONT> additional production due to the continuation of low commodity prices or the further deterioration of commodity prices and our
expectations regarding when commodity prices will improve such that <FONT STYLE="white-space:nowrap">shut-in</FONT> properties can be returned to production; future exchange rates and interest rates; future debt levels; the ability to execute our
capital programs as planned without significant adverse impacts from various factors beyond our control, including weather, wild fires, infrastructure access and delays in obtaining regulatory approvals and third party consents; the combined
entity&#146;s ability to obtain equipment in a timely manner to carry out development activities and the costs thereof; the combined entity&#146;s ability to market our oil and natural gas successfully to current and new customers; the combined
entity&#146;s ability to obtain financing on acceptable terms; and the combined entity&#146;s ability to add production and reserves through our development and exploitation activities. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Although Obsidian Energy believes that the expectations reflected in the forward-looking statements contained in this document, and the assumptions on which
such forward-looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking statements included in this document, as there
can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that
contribute to the possibility that the forward-looking statements contained herein will not be correct, which may cause actual performance and financial results to differ materially from any estimates or projections of future performance or results
expressed or implied by such forward-looking statements. Such assumptions, risks and uncertainties are described in Obsidian Energy&#146;s Annual Information Form and other public filings, available in Canada on SEDAR at www.sedar.com and in the
United States on EDGAR at www.sec.gov. Readers are cautioned that such assumptions, risks and uncertainties should not be construed as exhaustive. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The
forward-looking statements contained in this document speak only as of the date of this document. Except as expressly required by applicable securities laws, we do not undertake any obligation to publicly update any forward-looking statements. The
forward-looking statements contained in this document are expressly qualified by this cautionary statement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">All references to $ or C$ in this news
release are to Canadian dollars and all references in this news release to US$ are to U.S. dollars. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>MEDIA CONTACT </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Lisa Ottmann </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Partner </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Longview Communications&nbsp;&amp; Public Affairs </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Direct: <FONT
STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">587-355-1947</FONT></FONT> </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Cell: <FONT STYLE="white-space:nowrap">403-606</FONT> 0866 </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Email: lottmann@longviewcomms.ca </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>OBSIDIAN ENERGY</B>: Suite
200, 207 - 9th Avenue SW, Calgary, Alberta T2P 1K3, Phone: <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">403-777-2500,</FONT></FONT> Fax:
<FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">403-777-2699,</FONT></FONT> Toll Free: <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">1-866-693-2707,</FONT></FONT></FONT> Website:
www.obsidianenergy.com; Investor Relations: Toll Free: <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">1-888-770-2633,</FONT></FONT></FONT> <FONT STYLE="white-space:nowrap">E-mail:</FONT>
investor_relations@obsidianenergy.com </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 7 - </P>

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