Connacher Oil and Gas Limited announced that while 2020 was an extremely challenging and unprecedented year for the energy sector, Connacher advanced several key initiatives in the second half of the year to position the Company for the future. Earlier in the year, following the precipitous drop in crude oil prices caused by the COVID-19 pandemic, Connacher significantly reduced production from its Great Divide operations in order to preserve cash. As prices began to recover, production was safely ramped back up to pre-COVID levels towards the end of the second quarter. While there are many challenges remaining in the sector, including pipeline egress out of the basin and the regulatory environment, the Company exited 2020 in a relatively strong position to take advantage of an improving economy post-COVID and enhanced market access as major pipeline projects come into service. Improved Cost Structure: In 2020, Connacher began two new initiatives and continued a third to improve profitability, enhance the Company's competitiveness and position it for the future: Operational Efficiency Improvements through "One Connacher": In Second Quarter 2020, Connacher approached the Alberta Energy Regulator ("AER") and Alberta Boilers Safety Association to secure approvals to streamline its operations at its Pod One and Algar thermal projects. Their facilities are physically separated by only 7 kilometers but have always been operated as separate entities. Under the One Connacher project, wherever safely possible, duplication has been eliminated. The most recent step in this initiative was achieved in November 2020 through the combination of the Pod One and Algar control rooms. The efficiencies gained from the One Connacher project are expected to reduce operating costs, as well as increase consistency across the Company's operations. Drilling of New Infill Wells: In Third Quarter 2020, Connacher took advantage of favorable market conditions and drilled four infill wells at Algar. Each infill well has been drilled several meters below the current producing wells, accessing previously bypassed pay. The additional production from these infill wells will reduce Connacher's steam oil ratios, reduce operating costs per barrel, increase proven reserves, and lower Connacher's GHG emissions intensity. Enhanced Transportation and Marketing: Connacher engaged with pipeline companies to explore alternatives to improve the transportation and marketing of its product. The evaluation of the various alternatives included a collaborative review with Indigenous stakeholders in the region. Following a thorough assessment of the alternatives and commercial negotiation of transportation arrangements with third party carriers, the Company filed an application with the AER for a 26.5 kilometer, 10 inch diameter pipeline that will have an initial capacity of 18,000 barrels per day (bpd). On December 21, 2020, Connacher received AER approval to build this sales oil pipeline lateral from its Great Divide project. The pipeline is expected to be completed by the second half of 2022 and will provide Connacher with efficient access to a liquid market hub for the sale of its product. While the in-service date is dependent on the Company's financing efforts, this new pipeline will reduce Connacher's transportation costs and increase market access. In addition to enhanced access for blended bitumen, Connacher is also pursuing alternatives to improve access and reduce costs of diluent.