Ovintiv (OVV) Risk Analysis

All of our operations are subject to extensive federal, state, provincial, local and other laws, rules, regulations and executive orders, including with respect to drilling operations; completion operations, including the use of hydraulic fracturing; the production of oil, NGLs and natural gas; the disposal of produced water and other hazardous waste; the gathering and transportation of oil, NGLs and natural gas; the imposition of taxes; royalty payments; environmental matters, including air and water emissions or discharges; free trade agreements and global trade policies; worker health and safety; and conservation policies, including policies related to environmentally sensitive areas and protected species. These laws, rules and regulations may impose substantial liabilities for our failure to comply, including the assessment of administrative, civil and criminal penalties and the issuance of injunctions restricting or prohibiting some or all of our activities in a particular area. In the normal course of our business, we may be required to make large expenditures to comply with applicable governmental laws, rules, regulations, permits or orders. While we cannot predict the actions that future laws, rules and regulations may require or prohibit, our business could be subject to increased operating and other compliance costs and our operations may be delayed if existing laws, rules and regulations are revised or reinterpreted, or if new laws, rules and regulations become applicable to our operations. Any such increases or delays could have a material and adverse effect on our business, financial condition and results of operations.

We currently are, and from time to time in the future may be, subject to claims, litigation, administrative proceedings and regulatory actions. The outcome of these matters may be difficult to assess or quantify, and there cannot be any assurance that such matters will be resolved in our favor. If we are unable to resolve such matters favorably, we or our directors, officers or employees may become involved in legal proceedings that could result in an onerous or unfavorable decision, including fines, sanctions, monetary damages or the inability to engage in certain operations or transactions. The defense of such matters may also be costly, time consuming and could divert the attention of management and key personnel away from our operations. We may also be subject to adverse publicity associated with such matters, regardless of whether such allegations are valid or whether we are ultimately found liable. As a result, such matters could have a material adverse effect on our business, reputation, financial condition, results of operations or liquidity. See Item 3 of this Annual Report on Form 10-K.

From time to time, legislation has been proposed that, if enacted into law, would make significant changes to U.S. and Canadian tax laws and regulations, including those specifically applicable to the oil and natural gas industry (such as the intangible drilling and development costs deduction under U.S. federal income tax law). While we are unable to predict the timing, scope and effect of any proposed or enacted tax law changes, elimination of certain tax deductions, as well as any other changes to, or the imposition of new, federal, state or local U.S. or Canadian taxes (including the imposition of, or increases in, production, severance or similar taxes), could materially and adversely affect our business, financial condition and results of operations. We will continue to monitor and assess any proposed or enacted tax law changes to determine the impact on our business, financial condition and results of operations and take appropriate actions, where necessary. Additionally, U.S. and Canadian tax authorities could detrimentally change their administrative practices or may disagree with the way we calculate our tax liabilities or structure our arrangements and there are certain tax matters under governmental review for which the timing of resolution is uncertain. While we believe that our current provision for income taxes is adequate, certain tax authorities may reassess our taxes and such reassessments may be material.

Our operations and properties are subject to numerous existing laws, rules and regulations governing our interactions with the environment that are enacted by U.S. and Canadian federal, state, provincial, territorial, tribal, and municipal governments (collectively, "Environmental Regulations"). Environmental Regulations impose, among other things, restrictions, liabilities and obligations in connection with (a) discharges and emissions of various substances into the environment; (b) the hydraulic fracturing of wells; (c) the handling, use, storage, transportation, treatment and disposal of chemicals, hazardous substances and waste associated with finding, producing, transmitting and storing oil, NGLs and natural gas; (d) the availability and management of fresh, potable or brackish water sources that are being used, or whose use is contemplated, in oil and natural gas operations; and (e) requirements that well sites and other properties associated with our operations be constructed, operated, maintained, abandoned and reclaimed to the satisfaction of applicable regulatory authorities. In addition, certain types of operations, including new exploration and development projects and certain changes to existing exploration and development projects, may require the submission and approval of environmental impact assessments or permit applications. Expenditures required to institute and maintain compliance with new or existing Environmental Regulations can be significant. Failure to comply with Environmental Regulations may result in substantial clean-up and remediation costs arising from damaged or contaminated properties, the imposition of significant fines and penalties by regulators and costly litigation or administrative proceedings. Examples of recently proposed and final Environmental Regulations or other regulatory initiatives include the following: Emissions - Greenhouse gases (which include, among other things, methane, carbon dioxide, nitrous oxide and various fluorinated gases; "GHGs") are typically emitted throughout all phases of the oil and natural gas supply chain, including production, transportation, processing, refining and storage operations. Additionally, although beyond our control, end user consumption of oil and natural gas in activities such as power generation and motorized transportation also results in GHG emissions. In the United States, the Trump Administration has taken a number of steps to roll back Biden-era (or earlier) environmental regulations. For example: a rule regarding methane pollution set to go into effect in March was delayed until January of 2027; a pending rule would eliminate mandatory reporting for GHG emissions from power plants, refineries, and oil and gas suppliers; and a number of prior initiatives regarding reporting and clean air standards have either been rescinded, withdrawn, or are pending review. Finally, via executive order on January 7, 2026, President Trump withdrew the United States from the United Nations Framework Convention on Climate Change (UNFCCC), which the U.S. joined in 1992, and the Intergovernmental Panel on Climate Change, which produces climate reports. There may continue to be further regulatory changes related to climate change during the remainder of the Trump presidency. In November 2025, the Government of Canada and the Government of Alberta signed a Memorandum of Understanding ("MOU") addressing, among other things, that while Canada and Alberta remain committed to achieving net zero greenhouse gas emissions by 2050, the Government of Canada will not implement the Oil and Gas Emissions Cap, which has not yet been put into effect. Further, Canada and Alberta agreed to enter into a methane equivalency agreement by April 1, 2026, with a 2035 target date and a 75 percent reduction target relative to 2014 emissions levels. In December 2025, the Government of Canada announced final methane regulations for the onshore oil and gas sector under the Canadian Environmental Protection Act. The rules strengthen leak detection and repair requirements, prohibit or significantly limit routine venting and flaring, and establish prescribed work practices and inspection schedules and facility-level methane intensity thresholds. Amendments will come into force on January 1, 2028, and target methane reduction by 2040. The Government of British Columbia also has equivalency agreements in place with the Government of Canada, such that the current federal methane regulations generally do not apply in the province; however, regulatory changes may be issued to maintain the equivalency with the newly issued Federal regulations. In June 2024, the Government of Canada passed amendments to the Competition Act which outlined new provisions aimed at preventing greenwashing. These provisions require that companies be able to substantiate environmental claims made to promote a product or business interest. In November 2025, the Government of Canada published a proposal to remove the requirement that environmental benefit claims be substantiated in accordance with an "internationally recognized methodology"; however, claims must still be based on adequate and proper substantiation. The proposal is expected to be finalized in 2026. On January 1, 2023, material amendments to Alberta's Technology, Innovation and Emissions Reduction Regulation ("TIER") came into force. The amendments align TIER with Canada's federal Greenhouse Gas Pollution Pricing Act, provide price certainty and seek to address a potential surplus of provincial carbon credits in the coming years. As a result of the amendments, flaring emissions are now included in the total regulated emissions for the Company's aggregate oil and gas facilities that are subject to TIER. In British Columbia, the government released a series of GHG reduction intention papers that target methane emissions, carbon pricing mechanisms, permitting of new infrastructure and mechanisms to cap future emissions. These proposed mechanisms include: an oil and gas sector emissions cap to achieve a 33-38 percent reduction in emissions below 2007 levels by 2030; the requirement for all new, large industrial facilities to achieve net-zero emissions by 2050 (2030 for LNG projects) showing how they align with interim 2030 and 2040; and, a new Output Based Pricing System for large industrial emitters to ensure equivalency with the federal carbon pricing regime. However, in November 2025, CleanBC issued a report which included a recommendation to abandon the oil and gas emission cap in the province of British Columbia. The Canadian federal government, along with several provincial and state governments, have also announced intentions to adhere to certain international protocols regarding GHG emissions and regulate GHGs and certain air pollutants. In addition to federal action, many state and provincial officials have stated their intent to intensify efforts to regulate GHG emissions, including methane, from the oil and natural gas industry. These governments are currently developing and/or implementing regulatory and policy frameworks to deliver on their announcements. For example, in Canada, the Government of Canada (a) has committed to cutting Canada's net GHG emissions by 40-45 percent below 2005 levels by 2030 in accordance with its pledge under the Paris Agreement; (b) is gradually raising the federal carbon tax to C$170/tonne CO2e, but likely to be revised to a maximum of $130/tonne, by 2030; and (c) has announced its intention to impose a hard cap on GHG emissions from the oil and natural gas industry, seek to reduce methane emissions from the oil and natural gas industry by 75 percent below 2012 levels by 2030 and ensure GHG emission reductions are on a pace and scale sufficient to reach net-zero by 2050. In November 2021, Canada and other countries entered into the Glasgow Climate Pact, which includes a range of measures designed to address climate change, including but not limited to the phase-out of fossil fuel subsidies, reducing methane emissions 30 percent by 2030, and cooperating toward the advancement of the development of clean energy. Similar regulatory and policy framework efforts were committed to at the 2023 UN Climate Change Conference (COP28) in late 2023. We actively participate in certain provincial industrial emission programs offered by both Alberta and British Columbia that allow for the generation of offsets and other rebates to incentivize emission reduction projects and mitigate carbon tax costs. We expect to continue to be able to utilize these provincial programs in the future to migrate our carbon tax costs. Hydraulic Fracturing Operations - Certain governments in jurisdictions where we do not currently operate have considered or implemented moratoriums on hydraulic fracturing until further studies can be completed and some governments have adopted, and others have considered adopting, Environmental Regulations that could impose more stringent permitting, disclosure and well construction requirements on hydraulic fracturing operations or result in an outright ban of hydraulic fracturing in oil and natural gas operations. Seismic Activity - Some areas of North America are experiencing an increased frequency of localized seismic activity which has been associated with oil and natural gas operations. Although the occurrence and risk of seismicity in relation to oil and natural gas operations is generally very low, it has been linked to the underground disposal of produced water and, in some instances, has been correlated with hydraulic fracturing activities. This has prompted legislative and regulatory initiatives intended to address these concerns. These initiatives have the potential to (a) require additional seismic monitoring; (b) restrict the volume of produced water injected in certain disposal wells; (c) restrict the injection of produced water in certain underground formations; and (d) modify or curtail hydraulic fracturing operations in certain areas. The cost and effects of complying with existing and emerging Environmental Regulations (including those with respect to emissions, hydraulic fracturing operations and seismic activity) and proposed carbon taxes are not currently anticipated to be material to our operations, however federal, state, provincial and local regulations and programs are either under development or in the early stages of implementation and we are unable to accurately predict the total future impact of such regulations and programs. Increased Environmental Regulations and/or carbon taxes could (a) materially increase our cost of compliance and other operating costs; and/or (b) impede or prevent development of our oil, NGLs and natural gas assets, reducing (i) the amount of oil, NGLs and natural gas we are ultimately able to produce from our reserves and (ii) our overall quantity of oil, NGLs and natural gas reserves. The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition and results of operations.

- Our ability to operate and complete projects is dependent on numerous factors outside of our control. - Our operations involve many risks, some of which could result in unforeseen interruptions and expose us to substantial losses and liabilities, for which our insurance may not fully protect us. - Oil and natural gas exploration, development and production activities involve substantial costs and risks and may not result in commercially productive reserves. - The proved reserves data provided in this Annual Report on Form 10-K is an estimate only and any inaccuracies in the methodology or assumptions underlying our proved reserves estimates could cause the quantity and net present value of our oil, NGLs, and natural gas reserves to be materially overstated or understated. - If we fail to find, develop or acquire additional oil, NGLs and natural gas reserves, our reserves and production will decline materially from their current levels. - Horizontal multi-well pad drilling involves certain risks which may cause volatility in our operating results. - We are subject to risks and liabilities from acquisitions and any anticipated or desired benefits from such acquisitions may not be realized. - We are dependent on partners to fund certain projects conducted through joint ventures and partnerships. - We do not operate all of our assets, and, in such instances, we may have a limited ability to exercise influence over the operation and development of such assets. - Our customers, counterparties and lenders may be unable to satisfy their contractual or legal obligations. - We retain certain indemnification obligations related to our corporate reorganization in November of 2009. - We may be unable to dispose of certain assets and may be required to retain liabilities for certain matters. - Our operations may be affected by indigenous treaty, title and other rights.

Our financial performance and condition are substantially dependent on the prevailing prices we receive for the oil, NGLs and natural gas which we produce. Prices for oil, NGLs and natural gas are inherently volatile and fluctuate in response to changes in a variety of factors beyond our control, including: - the international and domestic supply and demand for oil, NGLs and natural gas;- volatility and trading patterns in the commodity futures market, including trading by commodity price speculators and others;- global economic conditions;- production levels of members of OPEC+, Russia, the United States or other hydrocarbon producing nations;- geopolitical risks, including political and civil unrest in oil and natural gas producing regions;- adverse weather conditions, natural disasters and other catastrophic events, such as tornadoes, flooding, severe heat or cold, wildfires, earthquakes and hurricanes;- the price and level of North American oil, NGLs and natural gas imports and exports;- the level of global oil, NGLs and natural gas inventories;- the economic and financial impact of epidemics or other public health issues;- differing quality of production, including the gravity and sulphur content of our oil, the Btu and sulphur content of our natural gas, and the quantity of NGLs associated with our natural gas;- the price and availability of, and demand for, alternative sources of energy (including coal, biofuels, nuclear, hydroelectric, solar and wind);- the effect of energy conservation efforts and technological advances in energy consumption and production, including with respect to transportation and power generation;- the availability and proximity of gathering, transportation, processing, refining, storage and other infrastructure facilities;- changes in trade relations and policies, including the imposition of tariffs by the United States or Canada;- conservation and environmental protection efforts, including activities by non-governmental organizations to restrict the exploration, development and production of oil, NGLs and natural gas; and - the nature and extent of governmental regulations, including any changes or other actions with respect to emissions, climate change, tariffs or tax laws. Prices for oil, NGLs and natural gas are particularly sensitive to actual and perceived threats to geopolitical stability and to changes in production from OPEC+ and non-OPEC+ member states. For example, the ongoing conflict between Russia and Ukraine, and the continuation of, or any increase in the severity of, this conflict, the U.S.'s involvement in Venezuela, or conflict in the Gaza region, has led and may continue to lead to an increase in the volatility of global oil and gas prices. Additionally, political developments, including trade disputes and policy changes, U.S. sanctions, tariffs or other trade restrictions continue to elevate global economic uncertainty and could lead to commodity price volatility. We also may receive discounted prices for our oil, NGLs and natural gas production relative to certain benchmark prices (such as Brent and WTI for oil and Henry Hub and AECO for natural gas) due to constraints on our ability to transport and sell such production to certain markets. A failure to resolve such regional pricing differentials may result in our continued realization of discounted or reduced oil, NGLs and natural gas prices relative to such benchmarks. A substantial or extended decline in oil, NGLs and natural gas prices, or a substantial increase in oil, NGLs and natural gas price differentials with respect to certain benchmarks, could result in, among other things, (a) a delay or cancellation of existing or future drilling, development or construction programs; (b) the curtailment or shut-in of production at some or all of our properties; (c) unutilized long-term transportation and drilling commitments; or (d) a decrease in the value of our oil, NGLs and natural gas reserves, each of which could have a material adverse effect on our business, financial condition, results of operations and the trading prices of our securities. Additionally, on at least an annual basis, we assess the carrying value of our oil and natural gas properties in accordance with applicable accounting standards. If oil, NGLs and natural gas prices decline significantly for a sufficient period, the carrying value of our properties could be subject to financial impairment, and our net earnings could be materially and adversely affected.

- We are subject to risks and uncertainties associated with evolving environmental regulations in all jurisdictions in which we operate. - We are subject to risks and uncertainties arising from changing weather conditions as well as government, investor and consumer action in response to concerns over climate change and the transition to a lower-carbon economy that could reduce demand for the oil, NGLs and natural gas we produce; increase our operating costs; and limit the areas in which we may explore for, develop, and produce oil, NGLs and natural gas. - Estimates used in various scenario planning analyses could differ materially from actual results as the policy and regulatory environment evolves. - Increased scrutiny of sustainability matters could have an adverse effect on our operations.

- A substantial or extended decline in oil, NGLs or natural gas prices, or a substantial increase in oil, NGLs and natural gas price differentials, could have a material adverse effect on our business, financial condition, results of operations, and the trading prices of our securities. - The trading price of our securities, including our common stock, is subject to volatility. - Fluctuations in exchange rates could affect expenses or result in realized and unrealized losses.