Pipestone Energy Corp. announced production update for the month and fourth quarter ended December 2019. Based on field estimates, Pipestone Energy production averaged 17,700 boe/d (~37% liquids) during December 2019, successfully exceeding its exit 2019 production guidance of 14,000 to 16,000 boe/d. In December, the Company has successfully completed six wells drilled at its 6-24 pad-site using Pipestone's limited entry or "XLE" design, with an average lateral length of 2,600 metres, and an average proppant loading of 2.9 T/M. These wells were completed at an average total cost of $4.0 million per well. All six wells will be tied-in and on-stream at the end of First Quarter 2020. An optimized equip & tie-in design on the 6-24 pad is estimated to reduce facility costs from $1.2 million to $0.8 million per well. As a result of these savings, Pipestone Energy is reducing its type well capital cost from $7.5 million to $7.1 million going forward (for a 2,500-metre lateral length well). These incremental cost savings further demonstrate the Company's track record of reducing well costs while increasing frac intensity; total well costs have been improved by $2.6 million from the initial type well estimate of $9.7 million (~27% savings) since early 2019. Average fourth quarter 2019 volumes were approximately 15,100 boe/d (~41% total liquids). On-stream performance of the new 3rd party infrastructure in late Third Quarter 2019 through Fourth Quarter 2019 was intermittent while commissioning, leading to significant variability and pad production restrictions. Notwithstanding the infrastructure challenges, aggregate performance from the 20 new wells brought on during 2019 are meeting type curve expectations. On the 3-1 pad (9 wells), over the first 90 days of production ("IP90"), the average well produced ~1,045 boe/d (sales) with a raw gas condensate-gas-ratio ("CGR") of 108 bbl/MMcf with consistent liquids yields in the Montney `B' and `C'. On the 15-14 pad (10 wells), the average well IP90 production rate was ~910 boe/d (sales). The 15-14 pad was the first pad brought on-stream and was disproportionately affected by the 3rd party infrastructure start-up. The average well has produced ~975 boe/d (sales) over the latest 30 producing days. The 15-14 pad has a higher CGR gradation between the Montney benches as compared to the 3-1 pad. The Montney `B' wells (5) on this pad have liquids ratios performing at type curve expectations, with an average IP90 raw gas CGR of 82 bbl/MMcf, while the Montney `C' wells (4) averaged 35 bbl/MMcf over the same period. Thus far, gas productivity from the 15- 14 pad Montney `C' wells are outperforming type curve expectations. The single producing well on the 6- 24 pad, which was completed in early 2017 utilizing a low intensity frac design, averaged ~1,260 boe/d (sales) over its first 45 producing days with a cumulative raw gas condensate-gas-ratio ("CGR") of ~160 bbl/MMcf. The focus of Pipestone Energy's 2020 development program will be in the northwest area and adjacent to existing gathering systems offsetting the Company's liquids yields observed to date.