Transaction delivers immediate value, strengthens financial position, supports material shareholder returns and accelerates disciplined growth in Western Canada

November 12, 2025 8:46 AM EST | Source: Baytex Energy Corp.

Calgary, Alberta--(Newsfile Corp. - November 12, 2025) - Baytex Energy Corp. (TSX: BTE) (NYSE: BTE) ("Baytex" or the "Company") today announced it has entered into a definitive purchase and sale agreement to sell its U.S. Eagle Ford assets to an undisclosed buyer (the "Buyer") for US$2.305 billion (approximately $3.25 billion) in cash (the "Transaction").

"This Transaction positions Baytex as a focused, high-return Canadian energy producer," said Eric T. Greager, President and Chief Executive Officer. "Consistent with our disciplined approach to portfolio management, we continually review our asset base to maximize long-term value. Monetizing our U.S. Eagle Ford assets strengthens our balance sheet, supports capital allocation to our highest-return opportunities and positions us to deliver meaningful shareholder returns."

Transaction Highlights

Portfolio Optimization: Refocuses Baytex on the highest-return assets in its portfolio to drive long-term value creation - capital efficient heavy oil development and its scalable position in the Pembina Duvernay.


Balance Sheet Recapitalization: Results in an industry leading financial position. Initially, Baytex will have a net cash position and intends to repay its outstanding credit facilities and 2030 Senior Notes.


Accelerated Shareholder Returns: With strengthened financial positioning, Baytex intends to resume purchases under its normal course issuer bid and is committed to returning a significant portion of the proceeds to shareholders following closing which may include a substantial issuer bid. Baytex expects to maintain its current dividend of $0.09 per share (annualized) (1).


Disciplined Growth: Extensive Canadian inventory of over 2,200 drilling locations supports a targeted annual production growth rate of 3-5% at US$60-65/bbl WTI with flexibility to further accelerate growth in a more constructive pricing environment.

"This Transaction provides Baytex with the financial strength and flexibility to pursue our strategic priorities," said Mark Bly, Chair of the Board of Directors. "By sharpening our focus on core Canadian assets, we have a solid foundation to drive disciplined growth, capitalize on new opportunities, and deliver long-term value for our shareholders."

(1) Refer to the Distribution Advisory section in the press release for further information.

The purchase price will be subject to adjustments based on an effective date of September 1, 2025. The Transaction is expected to close in late 2025 or early 2026, subject to customary closing conditions and regulatory approvals, including approval under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act. The purchase and sale agreement provides for a US$200 million deposit by the Buyer, which deposit may be forfeited by the Buyer to Baytex in certain circumstances set out in the purchase and sale agreement.

A copy of the purchase and sale agreement will be filed on Baytex's SEDAR+ profile and will be available for viewing at www.sedarplus.ca.

Post Transaction Strategy: A Focused Canadian Energy Producer

Baytex will be a focused Canadian energy producer with high-quality heavy oil operations at Peavine, Peace River, and Lloydminster, as well as an attractive, scalable position in the Pembina Duvernay and high netback light oil in the Viking. With a net cash balance sheet and a US$8/bbl improvement in the corporate sustaining break-even(1) to US$52/bbl, Baytex will have the financial strength and resiliency to pursue value-enhancing opportunities for shareholders.

The Canadian portfolio delivered production of 65,000 boe/d(2) (89% crude oil and NGLs) in the first nine months of 2025, which reflects a 5% growth rate compared to 2024 (excluding non-core divestitures).

The Company's heavy oil assets comprise 750,000 net acres of land and 1,100 drilling locations, which supports approximately 10 years of drilling at our current pace of development.

In the Pembina Duvernay, Baytex has assembled 91,500 net acres of land and identified approximately 212 drilling locations. Over the next two years, the Company expects to transition to a one-rig drilling program with 18 to 20 wells per year, targeting production of 20,000-25,000 boe/d by 2029-2030.

At a WTI price of US$60-65/bbI, Baytex intends to target annual production growth of 3-5%. In a more constructive pricing environment, the Company has significant optionality across its portfolio to accelerate growth beyond these levels. Preliminary capital spending plans for the Canadian business in 2026 are estimated at $550-$625 million.

Upon closing, Baytex will provide detailed 2026 guidance, a three-year outlook highlighting the Company's streamlined Canadian asset base, and an updated capital allocation framework reflecting our improved financial position.

Details of the Eagle Ford Assets

The Eagle Ford assets being divested represent all of Baytex's U.S. business.

As of December 31, 2024, these assets had proved plus probable reserves of 401 million boe (277 million boe proved; 124 million boe probable). In Q3/2025 production averaged 82,765 boe/d (52,330 bbl/d of light oil and condensate, 15,582 bbl/d of NGLs, and 89,115 Mcf/d of natural gas).

(1) Corporate sustaining break-even is determined by calculating the minimum WTI price (US$/bbl) required to generate free cash equal to zero while sustaining current production levels.
(2) Comprised of 42,825 bbl/d heavy oil, 11,852 bbl/d light oil and condensate, 3,199 bbl/d NGLs and 42,335 Mcf/d natural gas.

Advisors and Fairness Opinion

RBC Capital Markets is acting as financial advisor to Baytex in connection with the Transaction.

The Transaction has been unanimously approved by the Baytex board of directors. Scotiabank has provided an opinion to Baytex's board of directors to the effect that, as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications set forth therein, the consideration to be received by Baytex under the Transaction is fair, from a financial point of view, to Baytex.

Goldman Sachs Canada Inc. is acting as strategic advisor to Baytex.

Vinson & Elkins LLP and Burnet, Duckworth & Palmer LLP are serving as Baytex's legal counsel.