Confidential

September 2011 Board of Directors Meeting

September 2011

Agenda
1. 2. 3. 4. 5. 6. 7. 8. 9. Approval of board minutes June 2011 Operations Overview Farmout status Business Development Corporate, Legal & Tax Matters Environmental & Political impacts Financial Summary Proposed Board Actions Appendix

A. Project Area Cost Forecasts B. Activity Schedule & Licence Summary

2. Operations Overview

New License Awards / Renewals status

Assignment of PEDL 180 and 181 to CEPL was completed on 19th July following DECC approval on 20th June Romania Grivita Licence ratification received on 21st July Stoeinita Licence ratification received on 21st July

Switzerland (Neuchatel Jura) - Formal Exploration permit award to be granted post well permitting approval (exclusive rights)
France requirement for all permit holders to issue non fracking confirmation report to retain permits - these were sent to the ministry on 9th September

Jura
Jura 30/6/11 Resource Potential: Land Position at 30/6/11 : Production: Wells Planned: Seismic Plans: Ownership: Operator: 300+ mmboe 6,344 net square kms NA 2 wells - 2012 Contingent on drilling Neuchatel & Vaud 100% (subject to farmouts) Celtique

Jura Exploration Activity Update

Submitted non fracking report to Ministry on 9th September (Pontarlier and Les Moussieres permits) Initial evaluation of the seismic data over Pontarlier Licence is complete. The integration from the specialist structural geologist began in early September. The results from this work are expected in 4Q 2011 Attempts to access information on Autunian shales seen in the Noville well drilled below Lake Geneva are ongoing Detailed evaluation of wells in Pontarlier is underway A SARL Board meeting in Paris was held in mid August to approve SARL accounts and forward exploration plan

Forward Plan Complete geological studies to see whether a play extension exists to the north
6

La Chandeliere - Well Planning Status (Lantenay 1D)

Activity
Well Proposal (design basis) Drilling Programme (1st) EIA Archeological Study Specific flora/fauna studies Aquifer Impact Study Drilling Programme (review & final draft) Well Testing Programme Land Acquisition Planning Submission/DOT document

Progress

Comments
Complete Complete Requires update for Lantenay Not required Carried out for Corcelles but Lantenay requirement unknown Requires update for Lantenay Requires peer review Evaluating artificial lift options Awaiting council decision Georex co-ordinating dossier

Post submission work

Rig/services tendering AFE
7

Initial tendering required update First revision prepared

Jura Les Moussieres permit , La Chandeliere Field - Preferred Lantenay surface location

Lantenay mayor and council indicated their support and are voting on the issue at their meeting on 19th September

Selected site under discussion with Lantenay commune. Well cost estimate 6.5 mm (DHC), 6.9mm completed (15% contingency)

Jura Swiss Neuchatel

Neuchatel Canton contracted independent environmental studies (drilling through
aquifer issue), formal feedback on well proposal now expected September 2011 Royalty and permit terms proposal expected after well approval Well cost estimate 5.8 mm (DHC), 6.5mm completed (15% contingency) Gaznat bottom hole contribution/farmin further meetings planned Geothermal well use enquiry (dry hole basis) Forward Plan: Well Approval dates uncertain owing to government approval timescale: Forecast submit formal Well Plan Oct 2011 (could be later) Public Enquiry Consultation end Oct 2011 (could be later) Canton formal Approval to proceed Dec 2011 Finalise Farmout definitive agreements Dec 2011 Forecast prepare wellsite 1Q2012 (could be later) , drill 3Q2012

Neuchatel - Well Planning Status (Le Cygne Blanc 1)

Activity
Well Proposal (design basis) Drilling Programme (1st) EIA Archeological Study Specific flora/fauna studies Aquifer Impact Study Drilling Programme (review & final draft) Well Testing Programme Land Acquisition Planning Submission/DOT document Post submission work Rig/services tendering AFE
10

Progress

Comments
Complete Complete Complete Not required Not required Complete Requires peer review Not started Awaiting canton review Dossier submitted to canton in Draft form for comments Awaiting feedback from Canton Initial tendering requires update First revision prepared

Aquitaine Basin

30/6/11 Resource Potential: Land Position at 30/6/11 : Production: Wells Planned:

50 mmboe (net) (1) 463 net square kms

Garos

Beyrie

NA 1 well Beyrie in 2012, possible rapid Garos follow up if Beyrie successful Probable 2012 3D after Beyrie reef discovery 100%(1) Celtique
Garlin

Seismic Plans: Ownership: Operator:

(1) Farmout to SCDM/Investaq estimated to be completed 1Q 2012 and Celtique equity reduces to 50%

11

Claracq License
The well sites have been renamed Loncon becomes Beyrie, Bouillon becomes Garos A reservoir fracture study is completed in the Garlin 6 well. Total have granted access to review the Garlin 6 core but will not release any other geological data. Total did release operational data from the wells to aid well planning Interpretation of the recently reprocessed seismic data over the Garlin structure has begun with maps expected in late September The surface Beyrie prospect surface location has been approved by SCDM and negotiations with landowners for rental agreements underway. Well design work on Beyrie well is underway The non fracking report to the Ministry was submitted on 9th September

A TCM/OCM will be held in mid November to discuss the well plan and the 2012 Budget. A site meeting to review the wellsite will also occur at the same time

Forward Plan:
12

Submit DOT well programme DREAL (Oct 2011), (2/3 month review before approval but delays in processing all the permit frack reports may delay this schedule) SCDM permit mutation approval before major expenditure - forecast 4Q2011/1Q2012 Prepare wellsite for drilling 1Q2012, Drill Beyrie (ex Loncon) well 3Q2012

Claracq- Well Planning Status (Beyrie 1D & Garos)

Activity
Well Proposal (design basis) Drilling Programme (1st) EIA Archeological Study Specific flora/fauna studies Aquifer Impact Study Drilling Programme (review & final draft) Well Testing Programme Land Acquisition Planning Submission/DOT document Post submission work Rig/services tendering AFE
13

Progress

Comments
Complete Awaiting land to finalise surface location Consultant not appointed Requirement unknown Requirement unknown Requirement unknown

Positive local response ??

Initial tendering requires update First revision prepared

Southern England

30/6/11 Resource Potential: Land Position at 30/6/11 : Production: Seismic Completed: Well Plans: Ownership: Operator:

150+ mmboe (net) 547 net square kms NA 3 Q2011 2 in 2012 Prospects and Leads 50% Celtique

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Southern England PEDLs 231, 234 and 243 Seismic Program

Seismic acquisition by Tesla-IMC began in the east of the area on 20 July. The programme was completed in the west on 3rd September after 194 kms of data was acquired. The actual cost of the programme was 1.17 million (Celtique share 0.585 million) vs the budget estimate of 1.3 million (all excl VAT)

It is clear based on news reports and people contacting the company that the population to the west (characterised by driving big 4 wheel drive vehicles) are not supportive of hydrocarbon exploration activities. The MOD and National Trust did not allow access onto their land
Interpretation of the data will follow processing and will begin in early December
15

Southern England PEDLs 231, 234 and 243

Permitting of 2 surface sites is underway - one for conventional well at Willow and one for unconventional well. Agreements with landowners are being negotiated. Planning unlikely to be received before 2Q 2012 Study of the Jurassic source potential continues. All wells have been resampled and these results show better potential than originally envisaged. The oil shale play in the Kimmeridgian interval has been confirmed the major risk is reservoir development Active marketing of the opportunity is underway A TCM/OCM will be held in late September with Magellan to review work that has been carried out and to present our future plans

Forward Plan:
16

Process and interpret recently acquired seismic data Finalise geological studies for conventional and unconventional plays Market farmouts aggressively post new seismic interpretation Well permitting ongoing (final locations subject to new seismic interpretation)

Southern England PEDL232

A surface well location for testing the Singleton South prospect has been identified. The landowner is in agreement subject to financial terms. This site lies close to an archaeological site which could pose problems. A detailed survey has been started. Discussions with neighbouring licencees (Providence/Northern Petroleum) continue A farmout package has been prepared and discussions have begun

Forward Plan: Permit surface location

17

Weald Basin (Willow) - Well Planning Status

Activity
Well Proposal (design basis) Drilling Programme (1st) EIA Archeological Study Specific flora/fauna studies Aquifer studies Drilling Programme (review & final draft) Well Testing Programme

Progress

Comments
Initial draft. Work ongoing Not started Full EIA not required Not required Underway Requirement Unknown Not started Not started

Land Acquisition
Planning Submission/DOT document Post submission work Rig/services tendering AFE
18

Sites identified, negotiations started

Barton Wilmore co-ordinating

Not started Initial cost estimate made

Weald Basin (Singleton South) - Well Planning Status

Activity
Well Proposal (design basis) Drilling Programme (1st) EIA Archeological Study Specific flora/fauna studies Aquifer studies Drilling Programme (review & final draft) Well Testing Programme

Progress

Comments
Geological Well Proposal in preparation Not started Required, not started Requirement. RFQ sent out. Underway Requirement unknown Not started Not started

Land Acquisition
Planning Submission/DOT document Post submission work Rig/services tendering AFE
19

Sites identified, negotiations started

Barton Wilmore co-ordinating

Not started Initial cost estimate made

Weald Basin (Tennyson unconventional) - Well Planning Status

Activity
Well Proposal (design basis) Drilling Programme (1st) EIA Archeological Study Specific flora/fauna studies Aquifer Studies Drilling Programme (review & final draft) Well Testing Programme Land Acquisition Planning Submission/DOT document Post submission work Rig/services tendering Not started

Progress

Comments
Geological well proposal in preparation Not started Required, not started Not required Underway Requirement unknown Not started Not started Sites identified, negotiations started Barton Wilmore co-ordinating

AFE
20

Initial cost estimate made

Cheshire Basin PEDL 197

30/6/11 Resource Potential: Land Position at 30/6/11 : Production: Wells Planned: Seismic Plan: 42 mmboe 200 net square kms NA 1 well in 2013 Researching north area

Ownership:
Operator:

100%
Celtique

Permitting of a surface well location has begun and three potential surface sites have been identified that will fulfil the tight subsurface bottom hole constraints the landowner is about to be approached. It may prove cheaper to buy the land outright A large but high risk prospect has been identified. The prospect is shallow (at 2,600 ft) with mean reserve potential of 42 mmbbls. Discussions ongoing with potential farminees

21

Cheshire Basin - Well Planning Status (Hoyle 1)

Activity
Well Proposal (design basis) Drilling Programme (1st) EIA Archeological Study Specific flora/fauna studies Aquifer Studies Drilling Programme (review & final draft) Well Test Programme Land Acquisition Planning Submission/DOT document

Progress

Comments
Started (Turnkey Well) Not started Not started Requirement unknown Requirement unknown Requirement unknown Not started Not started Sites identified, negotiations started Hendersons co-ordinating

Post submission work

Rig/services tendering AFE
22

Favoured Turnkey with Geometric Cofor Turnkey Price

East Midlands

30/6/11 Resource Potential: TBD mmboe Land Position at 30/6/11 : Production: 890 gross, 293 net (square kms) NA 3 contingent wells in 2012 2 wells likely to become firm Q2-Q4 2011

Wells Planned:

Seismic Plans:

Ownership:
Operator: operate all (Europa) 180 (33%), 181 (25%), 182 (33%), 201 (50%), 241 Egdon (50%) except 181

23

East Midlands PEDL 182 and 241

Celtique equity in PEDL 182 has dropped from 50% to 33.3% as part of the equity area alignment with PEDL 180 Egdon have signed a seismic contract with Tesla-IMC for the shooting of a 3D programme (of 49 sq.kms) over the Broughton and Wressel leads in PEDLs 180 and 182. The programme would be split between PEDL 180 (43%), 182 (37%) and 241 (20%). The programme would tie into the existing 3D in PEDL 241. The estimated cost of the 3D is 800,000 (100%). Celtique cost share covering the 3 licences is estimated at 294,000 (equiv 36.6%). It is expected shooting will commence late in 4Q 2011. Assuming the prospects are confirmed Egdon plan to drill in 2012 The second attempt to reprocess the seismic data over the East Kelsey prospect in PEDL 241 is complete and interpretation has begun. If the prospect is confirmed Egdon plan to drill a well to 1950m well (1.85mm, 100%) to test the structure

Forward Plan Complete interpretation over PEDL 241 Shoot 3D programme and evaluate

24

East Midlands PEDL 180 and 181 (new licences)

The licence interests across PEDLs 180 and 182 have now been harmonised; Celtique equity in PEDLs 180 will increase from 25% to 33.33%. Equity in PEDL 181 will be Europa 50%, Celtique 25% and Egdon 25% JOA voting agreed as majority vote on well commitments and unanimous on other wells (subject to sole risk). Novations and assignment and DECC registration agreements are being finalised The principal target in PEDL 180 is the Wressel Lead that extends into PEDL 182 and it will be delineated by the new 3D seismic discussed under PEDL 182. Egdon would like to drill in 2012 subject to 3D confirmation In PEDL 181 the main potential lies in the Caister fault trend that lies to the southeast although concerns exists over timing and migration. The feature has potential for 5.5mmbbls. The work by the operator, Europa, is awaited

25

East Midlands PEDL 201

The recently acquired seismic over the main lead identified, Burton on the Wolds, has now been processed and interpretation has begun A well to 500m (1 mm, 100%) is required to hold licence beyond the first term

Future Plans Await interpretation of new seismic before making drill or drop decision in June 2012

26

Zechstein Basin

30/6/11 Resource Potential: 100 mmboe (gross contingent) Land Position at 30/6/11 : Production: Wells Planned: 2,137 net square kms NA Laski well 4Q2012, Drill or drop decision before Oct 2011 (Block 243) Q4 2011 in Germany 100% Celtique

Seismic Plans: Ownership: Operator:

(Block 242 relinquished)

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Germany Exploration
Working to resolve the seismic permitting issue in Germany Pillgram licence (CO sequestration concerns). Meetings of local councils are now scheduled for late September. If the problem cant be resolved Celtique can ask for LBGR to enforce our right to shoot seismic under the Mining Law. Seismic is still planned for 4Q2011, after the bird breeding season Farminee wishes to extend seismic acquisition to the south an extension of the seismic permitting permission to the south is underway to provide this option LBGR have agreed to a two year licence Pillgram licence extension to July 2014 Future Plans Finalise seismic permitting & pursue farmout of Pillgram for past costs, seismic contribution and well promote

28

110 kms of 2D seismic estimated cost - 1.3 mm but planning increase to over 200 kms estimated cost - 2 mm

Polish License Renewals and Timetable

At a meeting with the Polish Ministry in early August Celtique committed to the extension of the Laski Permit into the second licence phase with a well obligation which must be drilled before August 2014 At that meeting it was demonstrated that a structure extends from Laski into the adjacent licence Block 243. A well in LASKI is the best location to test it. It was also explained that Block 243 has a drill or drop decision by October 2011. The Ministry recommended that we renew the licence in October 2011 (with a well commitment) but apply for a licence extension on the Block when the Laski well plans are more advanced so that the licence term will be extended to October 2014 to bring it in line with the Laski Permit The future of block 243 would then be determined by the well result: - If successful we would drill the well in 243 as an appraisal well - If the Laski well fails we would drop the licence without drilling A new Polish manager will be required by end September 2011

Forward Plan Pursue farmout of LASKI/243 concessions for past costs and well promote
29

Poland - Well Planning Status (Laski prospect)

Activity
Well Proposal (design basis) Drilling Programme (1st) EIA Archeological Study Specific flora/fauna studies Aquifer Studies Drilling Programme (review & final draft) Well Test Programme Land Acquisition Planning Submission/DOT document

Progress

Comments
Not started Not started Not started Requirement unknown Requirement unknown Requirement unknown Not started Not started Not started Not started

Post submission work

Rig/services tendering AFE
30

Not started
Not started Not started

Italy

30/6/11 Resource Potential: 6 mmboe (gross contingent) Land Position at 30/6/11 : Production: Wells Planned: Seismic Plans: Drilling Locations: 444 net square kms (gross) NA Drilling in 2012 (Nervesa)

Purchase old data in 2011, contingent new seismic 2012 (Bradano only)
Crestal Nervesa appraisal,

Ownership: Operator:

Horizontal Strombone appraisal

50% Apennine (Carita) Celtique (Monte Negro, Torrente Alvo)

31

Italy
Carita permit
At the April OCM Apennine agreed to undertake preparatory work for commitment drilling in 2012 (earliest 1Q2012) and purchase 50Km seismic and source long-lead items for first well Apennine have not yet been able to access seismic data from ENI and reprocess it and therefore requested approval to drill a high angle well based on the old seismic. Celtique refused to agree to the proposed BHL based on the existing data and therefore the surface location cannot be agreed for permitting. Bradano permits An OCM was held in early August. Torrente Alvo permit : to propose purchase 59 Km ENI data 310,000 (gross, 2011) and contingent budget to shoot 200 Km of new 2D seismic at 450,000 (gross, 2012). MonteNegro permit : to propose purchase 112.4 Km ENI seismic 605,000 (gross, 2012) Net cost to Celtique : Firm 155,000, Contingent 527,500 Apennine have not approved the programme, they prefer early drilling to new seismic and wish to await the outcome of the Celtique sale to discuss with the new owner. Apennine have subsequently made an offer for the position (see farmout section)

32

Romania

30/6/11 Resource Potential: Land Position at 30/6/11 : Production: Wells Planned: Seismic Plans: Ownership: Operator:

TBD mmboe 3 net square kms NA 2 wells in 2012/2013 Possible Stoeinita 2D 50% Expert Petroleum

33

Romania
The Licences were formally gazetted on 21st July A meeting was held in late July with Expert to discuss their technical views of the licences and their forward plans, as well as a briefing on their recent operations on their neighbouring acreage at the Valuta Field It was agreed that the 2D seismic data over the licences be obtained from Petrom (OMV). This data has now been received and will be reprocessed immediately. It is anticipated that revised maps will be available by year end Since the amount of free 3D was very limited and therefore virtually uninterpretable it was decided not to purchase a larger 3D volume at this stage until the 2D data has been reviewed based on considerations of cost Expert will also be accessing digital well data from Petrom

NAMR approval requested to assign the concessions to the Romanian SRL subsidiary

Forward Plan Evaluate fields to determine whether to swop interests with Expert, market position with a view to selling SRL subsidiary or farmout/drill

34

3. Farmout Status

Farmout / Sale status

Aquitaine - Claracq
SCDM providing for 2:1 drilling carry (fund up to 8 million of the Loncon well) for 50% of Claracq equity, await mutation approval Poland/Germany Jura Energy (Canada) Exclusivity granted until end Sept 2011. Term Sheets signed definitive agreements advanced nearing signature
To fund $US19 million work programme for 40% equity in Poland & Germany positions, past costs paid on completion and future work programme all in escrow Poland: 1.76mm past costs + 70% of 6.39mm well + 2011 G&A = total 6.4mm Germany: pay 0.7mm past costs, plus 1.3mm plus 70% of 7.1mm well + 2011 G&A = total 7.1 mm

Gallic Energy (Canada) withdrawn owing to fund raising difficulties in the current market

Italy sale
Oilquest (private company) offer $5mm cash still negotiating SPA (deal subject to finance ) Sound Oil (Apennine) recent offer $6.5mm cash + $2.5mm performance payment negotiating for increase in cash and SPA terms (they have advised finance is in place) ADX (ASX:ADX - market cap $AUS 39mm) discussions ongoing (unlikely) BRS Resources (CVE:BRS market Cap $7.5mm), now undertaking technical review ENEL (Italy utility BIT:ENEL - market cap 28.8 billion) now signed CA, technical review
36

Italy sale Revised Sound Oil offers (2 alternatives)

A)US$6.5mm cash plus US$3.0mm cash contingent on a production metric to be agreed (US$9.5mm in total)
Triggers for the contingent payment to be negotiated: 33.33% on start-up of first production from any licence,

33.33% on first production threshold (to be agreed),

33.33% on a second production threshold (to be agreed)

B) US$6.5mm cash plus US$2.5mm in shares immediately (US$9mm in total but no contingent element) Some form of lock to be negotiated (linked to warranties / indemnities as a minimum)

Forecast end November Sound Oil completion, to give time for tax/legal diligence which would commence after we accept their offer

37

Italy sale - Options

Wait for other offers from BRS, ADX and or ENEL (may take 2+ months before offers and will delay completion).
BRS and ADX (minnows) are highly unlikely to beat the Sound offer ENEL might bid much higher but the deal may take a long time to complete. ENEL may consider assets immaterial Ask Oilquest to increase bid from $5mm to $10mm cash - no longer to be subject to finance. Sound oil might remain as a first reserve (whilst they still have funds) but the Sound offer price could change over time (Italy political/environmental risk may reduce value) Pursue Sound Oil offer now and tie down share lockin. Propose Sound Oil option B (cash + shares) as preference because they may never be allowed to drill Nervesa to trigger the production payment thresholds (environmental risk parliament review of Venice subsidence).

38

Farmout status (continued)

Central Weald (PEDL 231, 234, 243)
Halliburton Meetings held and data being reviewed appear keen Alliance Bernstein Meetings held more diligence underway, tyre kicking? South Weald PEDL 232

Newton Energy in diligence

France/Swiss Jura Halliburton (unconventional) no discussion yet whilst focus is on Weald Alliance Bernstein (conventional/unconventional) no discussion yet

Neuchatel
definitive agreements on hold with Sorgenia and Sun Resources Gaznat Bottom Hole Cost contribution (10%) and non compete agreement concept proposed, possible farmin alternative with extra salt coring more meetings planned Cheshire Newton Energy Challenger Energy
39

4. Business Development

New Ventures Update

Evaluation of areas has begun. A special study on acreage availability and data access in Germany is nearing completion Work on the Triassic Bunter Sandstone play fairway in Germany, France and Switzerland is underway Evaluations of open acreage in the Molasse Basin and Rhine Graben in Germany are underway. In both areas the principal objectives are the Triassic Bunter sandstone Data gathering trips to visit data archives have been made in France and Switzerland and the collected data has been used to update the maps in the area. The work confirms that the Triassic sand fairway extends into open acreage northeast of Neuchatel. Access to well data in parts of Switzerland and Germany is still difficult. No access to the very limited seismic data is possible at the moment The next UK Onshore Round is likely to be delayed until next year. DECC is currently awaiting reports on Cuadrillas earthquake incidents in the Blackpool area, which are expected in late October. The Round will not take place until they have had the chance to review this work in detail

41

Swiss Jura New Ventures Status

Meetings to introduce Celtique to Canton Authorities in Berne, Basel Land and Solothurn have been undertaken. Attempts have been made to set up a meeting with the Jura Canton. All areas are open and unlicensed. Information on the current licensing framework and fiscal terms has been collected. Energy Policy and therefore fossil fuel exploration is a very key political issue at the moment
There is limited heritage seismic data and therefore a subsurface structural understanding will be based largely on geological models until new data is acquired. Due to the difficult terrain this data will be expensive to acquire

42

Swiss Jura New Ventures Application Proposal

A Proposal has been made and submitted to the Board to apply for all the remaining open acreage in the Swiss
Jura mountains area covering 4 Cantons It is intended to apply for the licences with a commitment to review all the available geological and geophysical data as well as some geological studies. We will also try to access and reprocess the previously acquired seismic data. No geophysical data acquisition will take place in the first licence period. The work programme is expected to cost 1 million, split 0.5mm over first 3 years and 0.5mm following 2 years (excluding tax/legal)

43

New Ventures Forward Plan

Make Application in the four Cantons in the Jura Mountains, Switzerland Complete studies on the Triassic Bunter Sandstone play fairway in Germany, France and Switzerland Complete evaluations of open acreage in the Molasse Basin and Rhine Graben in Germany Discuss with Egdon and Magellan their plans for the next UK Onshore Licensing round Review open acreage in the French part of the Jura mountains

44

5. Corporate Legal and Tax Matters

Staff
COO - Stuart Catterall (Employment Contract signed, started 5th Sept 2011) CFO - Peter Coulson (Employment Contract signed August, to start 14 th Nov 2011)

Geoff Davies CEO

Val Wroe Office Manager Chris Pullan Exploration Director Stuart Catterall COO Country Managers (France, Germany, Italy, Poland, Romania, Switzerland) Peter Coulson CFO

Derek Howard Orchard Drilling Manager

Gavin Milne Finance Controller

Martin Berry Chief Geologist

Sarah Shirt Geologist

Ken Dups/ Brian Hodgson Contract Geophysics

HSE & OTHER SPECIALISTS Contractors

Joe Staffurth Contract Geologist TBA Technical Assistant

Michaelides Bookeepers

Akin Gump / Mildwaters Legal

46

Staff

Vacant

Contractor

Country Manager

Accounts/Tax/Legal
Auditors / Accounts
Audited accounts approved IN Sept 2011 New Sun Accounts system implemented, effective 1st April 2011, live from Oct 2011:
Tried and tested within the oil and gas industry for independent / medium cap players Bespoke accounting structure for Joint Venture Accounting, Multi currency facility

More transparent absorption of UK office and general overheads to corporate / licence / permit / asset activities
Monthly management accounts will be prepared with greater alignment / reconciliation to statutory format

Tax CW Energy Tax residency Report finalised and issued Jurisdiction board meetings in Neuchatel, Poland, Germany and Italy were held in June/July 2011 New subsidiary board members Guy Feugere and Raffa Di Cuia proposed to be in place before year end

Legal
Articles to implement C share scheme approved and registered at Companies House

To initiate the C share test issue for HMRC valuation and to use Stuart Catteralls award and subsequently apply same ruling to Peter Coulson. Baker Tilly to draft letter
Bribery Policy & Procedures implemented and compliance request certificates issued to partners and key contractors
47

6. Environmental & political impacts & Public Relations

Environmental & political impacts

UK planning issues
New UK Planning laws causing headlines Drilling through aquifers France and Swiss Jura not a big government/canton issue but strong local sensitivity

Fracking
France has implemented fracking moratorium - knock on effects, industry image, potential permit work approval delays for drilling Germany/Switzerland frack moratorium predicted (recent Canton Vaud formal non frack letter)

Poland full steam ahead with fracking - but new tax being mooted
Frack induced earthquakes Fylde UK, Cuadrilla Bowland Shale frack induced minor earthquakes in 2011, impact next UK onshore Round Public Relations Considering position, corporate and local PR, plan management workshop in November with recommendations for Dec board meeting
49

UK shale gas - Cuadrilla

On 22nd Sept Cuadrilla announced a 200 TCF gas resource (in place) in the UK Bowland shale. Appear to be emphasing reserve upside to concentrate minds (comparing their gas in place with recoverable gas in Norway)
Clearly initiating a national and local debate on benefits of shale gas exploitation, quantifying local benefits - before drilling 10 more wells Threatened UK withdrawal to Netherlands/Poland if not supported Appear to have a very focused PR strategy Outcome of this debate may impact Celtique UK unconventional viability are Cuadrilla paving the way for us in the UK? Do Celtique stay below the parapet on UK unconventional whilst permitting Weald conventional or do we join the debate now? Halliburton farmin to Weald unconventional may force this issue early
Multi well (3 wells + contingent frac) farmin offer expected in October
50

7. Financial Summary

Work programme net Celtique equity (pre farmout)

Net equity, pre-farmout
$ * 1,000 Claracq Vallorbes Subtotal CEL CEPL Les Moussieres Pontarlier Block 242/243 Laski Stoeinita & Grivita Field Pillgram / Guben Neuchatel S England (Triassic) S England PEDL 232 East Midl - PEDL 201 East Midl - PEDL241 East Midl - PEDL 182 East Midl - PEDL 180 East Midl - PEDL 181 Cheshire Basin Veneto Basin Bradano - Torrente Alvo Bradano Montenegro Subtotal CEPL G&A costs Total (CEL & CEPL) Accumulated Wells Wells contingent Seismic Seismic contingent France Swiss 2011 Q3 268 25 293 197 33 154 84 112 82 968 14 69 8 1 3 8 75 20 29 49 1,906 764 2,963 2,963 Q4 338 25 363 182 33 59 17 80 217 378 27 6 142 170 187 7 65 275 9 49 1,901 1,161 3,425 6,388 2012 Q1 249 5 254 162 53 59 29 3,057 167 51 17 4 29 0 2 8 25 638 381 457 5,139 1,240 6,633 13,021 Q2 249 5 254 9,832 3 59 29 457 67 25 46 6 29 0 37 8 25 2,035 59 62 12,778 919 13,951 26,972 Q3 11,849 705 12,554 40 0 159 29 157 8,139 64 70 5 31 967 37 8 35 500 4,465 12 14,718 919 28,191 55,163 Q4 11,511 5 11,516 62 700 8,779 1,059 157 35 3,028 2,964 55 179 0 990 7 25 2,000 0 1,562 21,601 919 34,036 89,198 2013 Q1 0 50 50 6,562 100 0 1,059 9,697 0 3,020 0 54 979 0 2 6 1,700 0 0 69 23,248 917 24,215 113,413 Q2 0 50 50 2,062 203 0 0 0 0 0 0 1,456 29 0 4 5 0 0 0 62 3,821 916 4,786 118,199 Q3 0 8,640 8,640 62 8,049 0 0 0 0 0 4 5 31 0 3 6 0 0 0 4,012 12,172 914 21,726 139,926 Q4 0 0 0 6,745 0 0 0 0 0 0 0 5 29 0 3 4 0 0 0 0 6,786 913 7,699 147,625

France France Poland Romania Germany Swiss UK UK UK UK UK UK UK UK Italy Italy Italy

52

Work programme net Celtique equity (post farmout)

Seismic in Germany, South England, East Midlands included (no seismic farmed out) All drill costs assumed farmed out except La Chandeliere horizontal well, 60% Neuchatel well and all E. Midlands wells All contingent wells (except East Midlands) assumed to be farmed out Claracq SCDM past cost recovery assumed 2Q2012 No Italy SPA sale proceeds or past cost refunds from farmouts included
2011 Q3
2012 2013 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Expenditure Forecast (post farmout) $ * 1,000

Q4

Q1

Claracq Vallorbes Les Moussieres Pontarlier Block 242/243 Laski Stoeinita & Grivita Field Pillgram Neuchatel S England (Triassic) S England PEDL 232 East Midl - PEDL 201 East Midl - PEDL241 East Midl - PEDL 182 East Midl - PEDL 180 East Midl - PEDL 181 Cheshire Basin Veneto Basin Bradano - Torrente Alvo Bradano Montenegro Subtotal licences G&A costs Accruals Total Accumulated

France Swiss France France Poland Romania Germany Swiss UK UK UK UK UK UK UK UK Italy Italy Italy

268 25 197 33 154 84 112 82 968 14 69 8 1 10 8 75 20 29 49 2206 764 1156 4126 4126

338 25 182 33 59 17 80 217 378 13 6 95 170 187 7 65 275 9 49 2203 1161 3364 7490

249 5 162 53 59 29 3057 167 51 17 4 19 0 2 8 25 77 381 457 4822 1240 6063 13553

-695 5 9832 3 59 29 457 67 25 46 6 19 0 37 8 25 0 59 62 10043 919 10962 24515

124 5 40 0 159 29 157 3750 64 70 5 21 967 37 8 35 250 65 12 5798 919 6717 31232

0 5 62 0 159 59 157 25 8 4 55 119 0 990 7 25 0 0 62 1736 919 2655 33887

0 50 6562 50 0 59 20 0 0 0 54 653 0 2 6 0 0 0 69 7524 917 8441 42328

0 50 62 102 0 0 0 0 0 0 1456 19 0 4 5 0 0 0 62 1760 916 2675 45003

0 0 62 2 0 0 0 0 0 2 5 21 0 3 6 0 0 0 12 112 914 1026 46030

0 0 62 0 0 0 0 0 0 0 5 19 0 3 4 0 0 0 0 94 913 1007 47036

53

1H 2011 Expenditure Forecast Variance to Control Budget

Celtique $ * 1,000 Claracq Vallorbes Les Moussieres Pontarlier New Ventures Block 242/243 Laski Stoeinita & Grivita Field Pillgram Neuchatel New Ventures S England (Triassic) S England (Singleton South) East Midl - PEDL 201 East Midl - PEDL241 East Midl - PEDL 182 East Midl - PEDL 180 East Midl - PEDL 181 Cheshire Basin Veneto Basin Bradano - Torrente Alvo Bradano Montenegro Subtotal licences G&A costs Diligence costs Accruals Grand Total
54

2011 2011 Variance Variance Comments Q1+Q2 Q1+Q2

actual budget

France 68 790 722 Swiss 6 120 114 France 258 280 22 France 147 116 -31 France 4 0 -4 Poland 1,216 1,869 653 Romania 3 59 56 Germany 266 1,894 1,628 Swiss 239 556 317 Swiss 20 0 -20 UK 105 570 465 UK 201 81 -121 UK 6 150 144 UK 19 38 20 UK 1 0 -1 UK 1 0 -1 UK 15 240 224 UK 24 210 186 Italy 99 947 848 Italy 107 316 209 Italy 90 414 323 2,896 8,649 5,753 2,392 1,815 -577 2,219 1,100 -1,119 240 619 379 7,747 12,183 4,437

91% 95% 8% -27% 35% 95% 86% 57% 82% -150% 96% 51%

Jura focus, deferred well reduced activity deferred activity accelerated seimic interpretation new activity lower cost seismic shoot deferred concession award deferred seismic deferred well approvals new activity accelerated work accelerated work Egdon defer seimic Egdon defer seimic Egdon defer seimic new licence new licence

89% 89% 66% 78% 67% -32% -102% 61% 36%

deferred activity deferred activity deferred activity deferred activity

higher legal fees lower accruals value of work done

Subscription Agreement compared to forecast for 2011

Celtique $ * 1,000 Claracq Vallorbes Les Moussieres Pontarlier New Ventures Block 242/243 Laski Stoeinita & Grivita Field Pillgram Neuchatel New Ventures S England (Triassic) S England (Singleton South) East Midl - PEDL 201 East Midl - PEDL241 East Midl - PEDL 182 East Midl - PEDL 180 East Midl - PEDL 181 Cheshire Basin Veneto Basin Bradano - Torrente Alvo Bradano Montenegro Subtotal licences G&A costs Diligence costs Accruals Grand Total
55

2011 Total
fcast

2011 Variance Variance Comments Total

budget

France 674 Swiss 56 France 637 France 213 France 4 Poland 1,429 Romania 103 Germany 458 Swiss 538 Swiss 20 UK 1,451 UK 229 UK 81 UK 122 UK 172 UK 198 UK 30 UK 164 Italy 394 Italy 145 Italy 188 7,305 4,318 2,219 1,395 15,237

82 245 9,693 272

0

-591 189 9,056 59

-4

-719% deferred well to 2Q 2012 delays SCDM past cost payment 77% resource allocation 93% deferred well 22%
new activity

1,954 118 1,946 3,900

0

525 15 1,488 3,362

-20

27% 12% 76% 86% -8% -78% 52% -100% 33% na na 41% 62% 63% 63% 67% -19% -102% -125% 45%

lower cost seismic shoot late concession award deferred seismic deferred well new activity accelerated work deferred work increased scope for share of Wressle prospect seismic shoot shared seismic cost with 180 new licence new licence lower data purchase costs

1,342 -108 128 -101 170 89 61 -61 258 86 0 -198 0 -30 278 114 1,028 634 386 241 514 325 22,375 15,070 3,630 -687 1,100 -1,119 619 -777 27,724 12,487

higher legal fees

Short Term Expenditure and Cash Requirement

Cost and Cash forecast $ * 1,000 CEL Claracq Vallorbes Subtotal CEL costs CEPL Les Moussieres Pontarlier Block 242/243 Laski Stoeinita & Grivita Field Pillgram Neuchatel S England (Triassic) S England (Singleton South) East Midl - PEDL 201 East Midl - PEDL241 East Midl - PEDL 182 East Midl - PEDL 180 East Midl - PEDL 181 Cheshire Basin Veneto Basin Bradano - Torrente Alvo Bradano Montenegro Subtotal CEPL costs G&A costs Accruals Subtotal G&A / accruals Total Expenditure Accumulated cash position Cash end Sep-11 Oct-11 Nov-11 Dec-11 Jul-11 2012 Q1 2012 Q2 2012 Q3 2012 Q4

France Swiss

$89 $8 $98

$113 $8 $121

$113 $8 $121

$113 $8 $121

$249 $5 $254 $162 $53 $59 $29 $3,057 $167 $51 $17 $4 $19 $0 $2 $8 $25 $77 $381 $457 $4,569 $1,240 $1,240 $6,063

-$695 $5 -$690 $9,832 $3 $59 $29 $457 $67 $25 $46 $6 $19 $0 $37 $8 $25 $0 $59 $62 $10,734 $919 $919 $10,962

$124 $5 $129 $40 $0 $159 $29 $157 $3,750 $64 $70 $5 $21 $967 $37 $8 $35 $250 $65 $12 $5,669 $919 $919 $6,717

$0 $5 $5 $62 $0 $159 $59 $157 $25 $8 $4 $55 $119 $0 $990 $7 $25 $0 $0 $62 $1,731 $919 $919 $2,655

France France Poland Romania Germany Swiss UK UK UK UK UK UK UK UK Italy Italy Italy

$66 $61 $61 $61 $11 $11 $11 $11 $51 $20 $20 $20 $28 $6 $6 $6 $37 $27 $27 $27 $27 $72 $72 $72 $628 $126 $126 $126 $5 $4 $4 $4 $23 $2 $2 $2 $3 $32 $32 $32 $0 $57 $57 $57 $3 $62 $62 $62 $3 $2 $2 $2 $25 $22 $22 $22 $7 $92 $92 $92 $10 $3 $3 $3 $16 $16 $16 $16 $943 $613 $613 $613 $255 $387 $387 $387 $578 $578 $833 $965 $387 $387 $1,873 $1,699 $1,121 $1,121 $4,955 $3,082 $1,382 $261 -$860

-$6,923 -$17,885 -$24,602 -$27,257

Monthly forecasts divided from quarterly estimates New share issue required Nov 2011 unless Germany seismic slips or is farmed out COO commences Sept 2011 and CFO commences mid Nov 2011
56

8. Proposed Board Actions

Proposed Board Actions and Proposals

Approval of the Board is requested for the following:

Pursue Swiss Jura new venture permit applications in 4 cantons The Subsidiary Boards met to agree: A commitment to apply for a commitment well in Poland 243 to enter in to 3rd Exploration phase (1 year period) Romania SRL agreed to purchase Grivita and Stoeinita from CEPL under an SPA for a consideration of $US500,000

58

Appendix A. Project Area Forecasts

Expenditure Forecast Gross 100% licence basis

Unrisked (100% pre-farmout) $ * 1,000 Claracq Vallorbes Subtotal CEL CEPL Les Moussieres Pontarlier Block 242/243 Laski Stoeinita & Grivita Field Pillgram / Guben Neuchatel S England (Triassic) S England PEDL 232 East Midl - PEDL 201 East Midl - PEDL241 East Midl - PEDL 182 East Midl - PEDL 180 East Midl - PEDL 181 Cheshire Basin Veneto Basin Bradano - Torrente Alvo Bradano Montenegro Subtotal CEPL G&A costs Total France Swiss 2011 Q3 268 25 293 197 33 154 168 112 82 1936 29 138 17 2 10 32 75 39 58 98 3180 764 4237 4237 Q4 338 25 363 182 33 59 33 80 217 755 53 12 284 510 560 26 65 550 18 98 3536 1161 5060 9296 2012 Q1 249 5 254 162 53 59 59 3057 167 102 33 7 58 0 7 32 25 1275 762 914 6773 1240 8268 17564 Q2 249 5 254 9832 3 59 59 457 67 49 91 12 58 0 112 31 25 4070 118 123 15166 919 16339 33903 Q3 11849 705 12554 40 0 159 59 157 8139 128 140 10 62 2902 110 32 35 1000 8930 23 21927 919 35399 69302 Q4 11511 5 11516 62 700 8779 2119 157 35 6056 5928 110 358 0 2970 26 25 4000 0 3123 34448 919 46882 116184 2013 Q1 0 50 50 6562 100 0 2119 9697 0 6040 0 107 1958 0 7 22 1700 0 0 137 28450 917 29417 145601 Q2 0 50 50 2062 203 0 0 0 0 0 0 2912 58 0 12 21 0 0 0 123 5391 916 6357 151958 Q3 0 8640 8640 62 8049 0 0 0 0 0 9 10 62 0 10 22 0 0 0 8023 16248 914 25802 177760 Q4 0 0 0 6745 0 0 0 0 0 0 0 10 58 0 10 16 0 0 0 0 6839 913 7752 185512

France France Poland Romania Germany Swiss UK UK UK UK UK UK UK UK Italy Italy Italy

60

Appendix B. Activity Schedule & Licence summary

Activity Forecast
Sept 2011 forecast
Les Moussieres Claracq Pontarlier Neuchatel Vallorbes Cheshire Basin S England (Singleton South) S England (Triassic) Block 243/LASKI Pillgram Stoeinita & Grivita Field East Midl - PEDL 201 East Midl - PEDL241 East Midl - PEDL 182 East Midl - PEDL 180 East Midl - PEDL 181 Veneto Basin Bradano - Torrente Alvo Bradano Montenegro Firm Firm Contingent

Operator 2011 Q1 France Celtique France Celtique France Celtique Swiss Celtique Swiss Celtique UK Celtique UK Celtique UK Celtique Poland Celtique seismic Germany Celtique Romania Expert UK Egdon UK Egdon UK Egdon UK Egdon UK Egdon Italy Apennine Italy Apennine Italy Apennine
drill seismic seismic/drill

Q2

Q3

Q4

2012 Q1

Q2
appraisal drill

Q3

Q4
drill seismic

2013 Q1

Q2

Q3

Q4
drill

End 1st Term seismic

drill

drill seismic (drill/drop decision) (drill/drop decision) drill seismic seismic End 2nd Term seismic award seismic seismic seismic seismic seismic (drill/drop decision) (drill/drop decision) drill (drill/drop decision) drill seismic seismic appraisal seismic appraisal seismic (drill/drop decision) drill drill seismic appraisal 243 End 3rd Term drill drill drill appraisal End 1st Term drill drill drill drill

62

Licence Summary
Country Region Licence Celtique Licence Holder Equity 100% 100% 100% 100% 100% 100% 100% 100% 100% 50% 50% 50% 100% 50% 50% 50% 50% 50% 50% 50% 50% 50% CEL CEPL CEP SARL CEL CEPL CE GmbH CEP CEP CEP CE SpA CE SpA CE SpA CEPL CEPL & Egdon CEPL & Egdon CEPL & Egdon Operator Award Date Expiry date Gross(km2 ) Net (km2 ) Licences awarded France Aquitaine Basin France France Switzerland Switzerland Germany Poland Poland Poland Italy Italy Italy UK UK UK UK UK UK UK UK Romania Romania Jura Jura Jura Jura Zechstein Basin Zechstein Basin Zechstein Basin Zechstein Basin Veneto Basin Bradano Basin Bradano Basin Cheshire East Midlands East Midlands East Midlands Southern England Southern England Southern England Southern England Eastern Romania SW Romania

Claracq Les Moussieres Pontarlier Leman Vallorbe Neuchatel Pillgram Laski Block 242 Block 243 Carita Torrente Alvo Monte Negro PEDL 197 PEDL 182 PEDL 201 PEDL 241 PEDL 231 PEDL 232 PEDL 234 PEDL 243 Grivita Stoeinita

Celtique Celtique Celtique Celtique Celtique Celtique Celtique Celtique Celtique Apennine Celtique Celtique Celtique Egdon Egdon Egdon

03-Nov-06 04-Mar-08 30-Sep-10 23-May-06 (exclusive to 2012) 26-Jul-07 29-Aug-08 07-Oct-07 07-Oct-07 09-Jul-10 Oct-10 Oct-10 01-Jul-08 01-Jul-08 01-Jul-08 01-Jul-08 01-Jul-08 01-Jul-08 01-Jul-08 01-Jul-08 Jul-11 Jul-11

03-Nov-12 04-Mar-13 5 year period 09-Jun-12 26-Jul-12 29-Aug-14 07-Oct-12 07-Oct-12 5 year period 5 year period 5 year period 01-Jul-14 01-Jul-14 01-Jul-14 01-Jul-14 01-Jul-14 01-Jul-14 01-Jul-14 01-Jul-14 2 year period 2 year period

463 3269 1470 802 803 938 242 533 957 529 81 277 200 40 100 110 400 94 300 300 3 3

463 3269 1470 802 803 938 242 533 957 264.5 40.5 138.5 200 20 50 55 200 47 150 150 1.5 1.5

CEWL &Magellan Celtique CEWL &Magellan Celtique CEWL &Magellan Celtique CEWL &Magellan Celtique CEPL & Expert CEPL & Expert Expert Expert

Total
63

11914

10796