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Husky Energy Reaffirms Commitment To Offer For MEG Energy

Husky Energy (HSE.TO) reaffirmed its commitment to the full and fair Offer to buy MEG Energy as outlined on October 2, 2018, and comments on MEG's recent statements and third quarter results.

"MEG's results reinforce our view that it has a quality asset base and a dedicated operating team, but it remains constrained by a highly levered balance sheet and lack of integration," said CEO Rob Peabody. "MEG continues to deliver negative free cash flow, and its assertions it can reverse this trend in the future rely on continued high oil prices and narrow heavy oil differentials."

Husky Energy noted that MEG shareholders should be aware MEG's stand-alone plan comes with a high level of risk.

Husky Energy said MEG's share price has increased significantly as a direct result of Husky's Offer, while shares of MEG's peers and heavy oil prices have fallen substantially over the same period. Absent the Offer, MEG shares would trade at a price well below current levels.

According to Husky Energy, the regulatory approval process continues to advance. The Canadian Commissioner of Competition has issued a "no action" letter confirming that at this time he does not intend to challenge the transaction pursuant to the Competition Act.

In addition, the U.S. Federal Trade Commission has granted Husky early termination of the required waiting period under the U.S. Hart-Scott-Rodino Act. All other required regulatory approvals are expected to be received by the end of the year.

The Offer will be open for acceptance until 5 p.m. Eastern Time on Wednesday, January 16, 2019.

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