Stampede Drilling Announces Closing of Previously Announced Rig Acquisition, Closing of $26.6 Million Equity Financing, and Provides a Market Update

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CALGARY, AB, Aug. 23, 2022 /CNW/ - STAMPEDE DRILLING INC. (TSXV: SDI) ("Stampede", or the "Corporation") is pleased to announce it has closed its acquisition of six drilling rigs and related assets (the "Acquisition") and its public offering of common shares (the "Offered Shares") for aggregate gross proceeds of approximately $26.6 million (the "Offering").

Pursuant to the Offering, Stampede issued 83,202,000 Offered Shares, including 5,077,000 Offered Shares issued pursuant to the exercise of the over-allotment option granted to the Agents (defined below). The Offering was conducted by a syndicate of agents led by Peters & Co. Limited (the "Lead Agent"), and included Acumen Capital Finance Partners Limited, Lightyear Capital Inc. and Stifel FirstEnergy (collectively with the Lead Agent, the "Agents").

The Corporation has directed approximately $21.5 million of the proceeds of the Offering towards the purchase price of the Acquisition with the residual amount of proceeds expected to be used to partially fund capital upgrades on the purchased assets and other capital expenditures as determined by the Corporation.

Additionally, on August 9, Stampede entered into an amending agreement with HSBC Bank of Canada, which increased the total aggregate credit capacity available under its credit facility (the "Credit Facility") and term loan facility (the "Term Loan Facility") to a maximum of $32.5 million effective upon closing of the Offering and the Acquisition. Additional draws under Stampede's lending facilities will be used to fund capital upgrades on the assets purchased pursuant to the Acquisition.

Subject to the Corporation's expected investment of approximately $5 million (an anticipated investment of approximately $1 million per double rig) for required upgrades and recertification, Stampede anticipates that the two double rigs and three heavy double rigs purchased pursuant to the Acquisition will be working under short-term or long-term contracts by the end of 2022. The Corporation anticipates that the super spec triple rig will be ready for work in mid-2023 subsequent to an additional anticipated investment by the Corporation of approximately $5 million to upgrade, refurbish and recertify the super spec triple.

"We are excited to announce the completion of the Acquisition, which furthers our goal of being Canada's safest and most efficient drilling services provider," stated Lyle Whitmarsh, President and CEO of Stampede. "Furthermore, the completion of the Offering for the maximum gross proceeds and the amendment to our Credit Facility and Term Loan Facility provide additional financial flexibility that will allow us to respond to customer requests and capitalize on potential acquisition opportunities."

No securities regulatory authority has either approved or disapproved of the contents of this news release.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this News Release constitute forward-looking statements or forward-looking information (collectively, "forward-looking information"). Forward-looking information relates to future events or the Corporation's future performance. All information other than statements of historical fact is forward-looking information. The use of any of the words "anticipate", "plan", "contemplate", "continue", "estimate", "expect", "intend", "propose", "might", "may", "will", "could", "should", "believe", "predict", and "forecast" are intended to identify forward-looking information.

This News Release contains forward-looking information pertaining to, among other things: the Acquisition, including the anticipated benefits to the Corporation; the Offering, including the use of proceeds and the anticipated benefits thereof; the expected in-service date of the rigs acquired pursuant to the Acquisition; estimated capital expenditures required to upgrade, recertify and refurbish the rigs acquired pursuant to the Acquisition; and the anticipated use of funds drawn from the Corporation's lending facilities, among others.

Forward-looking information is based on certain assumptions that the Corporation has made in respect thereof as at the date of this News Release regarding, among other things: oil and gas industry exploration and development activity levels and the geographic region of such activity; prevailing commodity prices, interest rates, carbon prices, tax rates and exchange rates; future operating costs; that favourable circumstances continue to exist in respect of the operation of the assets acquired pursuant to the Acquisition; management's ability to successfully integrate the assets acquired pursuant to the Acquisition into the operations of the Corporation; the Corporation's ability to successfully contract out the rigs acquired pursuant to the Acquisition; that the Corporation can complete the necessary upgrades, recertification, and refurbishment of the rigs acquired pursuant to the Acquisition for the amounts estimated; and that there are no unforeseen events preventing the performance of contracts or the completion of the relevant projects.

Forward-looking information is presented in this News Release for the purpose of assisting investors and others in understanding certain key elements of the Corporation's financial results and business plan, as well as the objectives, strategic priorities and business outlook of the Corporation, and in obtaining a better understanding of the Corporation's anticipated operating environment. Readers are cautioned that such forward-looking information may not be appropriate for other purposes.

While Stampede believes the expectations and material factors and assumptions reflected in the forward-looking information is reasonable as of the date hereof, there can be no assurance that these expectations, factors and assumptions will prove to be correct. Forward-looking information is not a guarantee of future performance and actual results or events could differ materially from the expectations of the Corporation expressed in or implied by such forward-looking information. Accordingly, readers should not place undue reliance on forward-looking information. All forward-looking information is subject to a number of known and unknown risks and uncertainties including, but not limited to: the condition of the global economy, including trade, inflation, the ongoing conflict in Ukraine and other geopolitical risks; the condition of the crude oil and natural gas industry and related commodity prices; other commodity prices and the potential impact on the Corporation and the industry in which the Corporation operates, including levels of exploration and development activities; the failure to realize the anticipated benefits and/or synergies of the Acquisition following closing due to integration issues or otherwise; the impact of increasing competition; fluctuations in operating results; the ongoing significant volatility in world markets and the resulting impact on drilling and completions programs; foreign currency exchange rates; interest rates; labour and material shortages; cyber security risks; natural catastrophes; and certain other risks and uncertainties detailed in the Corporation's management's discussion and analysis and annual information form each dated March 24, 2022, for the year ended December 31, 2021, the Corporation's management's discussion and analysis dated July 28, 2022, and from time to time in Stampede's public disclosure documents available on SEDAR at www.sedar.com.

This list of risk factors should not be construed as exhaustive. Readers are cautioned that events or circumstances could cause actual results to differ materially from those predicted, forecasted, or projected. Statements, including forward-looking information, are made as of the date of this News Release and the Corporation does not undertake any obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws. The forward-looking information contained in this News Release is expressly qualified by this cautionary statement.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Stampede Drilling Inc.

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