Advent Energy Ltd.

Advent Energy Ltd

Projects - Sydney Offshore Basin (Pep 11)

Advent, through wholly owned subsidiary Asset Energy Pty Ltd, holds 85% of Petroleum Exploration Permit PEP 11 – an exploration permit prospective for natural gas located in the Offshore Sydney Basin. Joint Venture partner Bounty Oil & Gas NL holds the remaining 15%.

PEP 11 is a significant offshore exploration area with large scale structuring and potentially multi-Trillion cubic feet (Tcf) gas charged Permo-Triassic reservoirs. Mapped prospects and leads within the Offshore Sydney Basin are generally located less than 50km from the Sydney-Wollongong-Newcastle greater metropolitan area. This area has a population of approximately 5,000,000 people.

Heightening the prospectivity and critical positioning of PEP11, the Australian Energy Market Operator (AEMO) has warned that the developed gas reserves in eastern and south-eastern Australia are not sufficient to meet forecast demand. The supply of gas into NSW has historically been from gas fields in the Bass Strait and Cooper Basin in South Australia. These gas reserves are declining. Australian east coast industrial gas prices are high because of these factors.

Wide ranging implications of AEMO’s forecast gas shortage include the inability to maintain a stable and efficient electricity supply to retail, commercial and industrial electricity consumers, an anticipated rise in natural gas prices and significant pricing and supply constraints that can affect the manufacturing industries and productivity on the Australian east coast. A forecast shortage in domestic demand has been demonstrated by AEMO for periods between 2018 – 2024, and again from approximately 2029. AEMO have also indicated an expectation that gas will become increasingly expensive for gas purchasers.

The total P50 Prospective Resource calculated for the PEP11 prospect inventory is 5.9 Tcf with a net 5 Tcf to Advent Energy (85%WI). The two largest prospects in the inventory are Fish and Baleen. The Fish prospect is assessed to contain a P50 prospective resource of 2.1 Tcf with Advent’s 85%WI share equal to 1.785 Tcf. The Baleen prospect is assessed to contain a P50 prospective resource of 0.475 Tcf with Advent Energy’s net share equal to 0.404Tcf (85%WI). Therefore, Advent’s working interest share of the two largest prospects is 2.189 Tcf.

The prospectivity of this proven petroleum basin has been enhanced by the confirmation of the presence of apparent ongoing hydrocarbon seeps. Sub-bottom profile data, swath bathymetry, seismic and echosounder data collected by Geoscience Australia along the continental slope / permit margin has demonstrated active erosional features in conjunction with geophysical indications of gas escape

Advent has previously interpreted significant seismically indicated gas features. Key indicators of hydrocarbon accumulation features have been interpreted following review of the 2004 seismic data (reprocessed in 2010). The seismic features include apparent Hydrocarbon Related Diagenetic Zones (HRDZ), Amplitude Versus Offset (AVO) anomalies and potential flat spots.

Advent has demonstrated considerable gas generation and migration within PEP11, with the mapped prospects and leads highly prospective for the discovery of gas. Advent Energy has successfully completed a focused seismic campaign around a key potential drilling prospect in PEP11, in the offshore Sydney Basin.

A high resolution 2D seismic survey covering approximately 200 line km was performed to assist in the drilling of the Baleen target approximately 30 km south east of Newcastle, New South Wales. A drilling target on the Baleen prospect with total depth of approximately 2150 metres has been identified in a review of previous seismic data. Intersecting 2D lines suggest an extrapolated 6000 acre (24.3 km2) seismic amplitude anomaly area at that drilling target. The report on this drilling target noted previous 2D seismic data showed that the Permian aged section of the Bowen Basin has producing conventional gas fields at a similar time and depth to PEP11 at the Triassic/Permian age boundary.

An Environment Plan has been prepared for lodgement with the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) and must be approved prior to commencement of drilling.