OBSIDIAN ENERGY LTD.

Forward Contracts

We are exposed to market risks resulting from fluctuations in commodity prices, foreign exchange rates and interest rates in the normal course of operations. In accordance with policies approved by our Board of Directors, the Company may, from time to time, manage these risks through the use of swaps or other financial instruments up to a maximum of 50% of forecast sales volumes, net of royalties, for the balance of any current year plus one additional year forward and up to a maximum of 25%, net of royalties, for one additional year thereafter. Risk management limits included in Obsidian Energy’s policies may be exceeded with specific approval from the Board of Directors, these additional approvals are outlined below:

Oil

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Hedge up to 50% of oil volumes net of royalties on a rolling 15-month period, with up to 80% in the prompt three months.

Natural Gas

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allow for hedges of up to 80% of natural gas volumes, net of royalties for the "2023 winter gas months", being the months of January to and including March 2024 and for the “2024 winter gas months”, being the months of November 2024 to and including March 2025.

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allow for hedges of up to 90% of natural gas volumes, net of royalties for the "2024 summer gas months", being the months of April to and including October 2024.

We are also exposed to losses in the event of default by the counterparties to these derivative instruments. We manage this risk by diversifying our hedging portfolio among a number of counterparties, primarily parties within our banking syndicate, whom we consider to be financially sound.

A3-19

As at December 31, 2023, we were not bound by any agreement (including a transportation agreement), directly or through an aggregator, under which we may be precluded from fully realizing, or may be protected from the full effect of, future market prices for oil or natural gas, except for agreements disclosed by us in Note 8 to our audited consolidated financial statements as at and for the year ended December 31, 2023 which have been filed on SEDAR+ atwww.sedarplus.ca.

Our transportation obligations and commitments for future physical deliveries of oil and conventional natural gas do not exceed our expected related future production from our proved reserves, estimated using forecast prices and costs, as disclosed herein.

APPENDIX B