African Continental Energy An early stage oil development and - PowerPoint PPT Presentation

African Continental Energy An early stage oil development and production company focused on high quality discovered reserves opportunities in West Africa Presentation - March 2014

Forward Looking Statements The information in this presentation is an overview and does not contain all information necessary for investment decisions. In making investment decisions, investors should rely on their own examination of Africa Continental Energy and consult with their own legal, tax, business and/or financial advisors in connection with any acquisition of securities. The information contained in this presentation has been prepared in good faith by Africa Continental Energy. However, no representation or warranty, expressed or implied, is made as to the accuracy, correctness, completeness or adequacy of any statement, estimates, opinions or other information contained in this presentation. Given the highly speculative nature of exploration for oil and gas, there are significant uncertainties associated with forecasting future revenue. Certain information in this presentation refers to the intentions of Africa Continental Energy, but these are not intended to be forecasts, forward looking statements, or statements about future matters for the purposes of the Corporations Act or any other applicable law. Oil and gas development and production company focused on West Africa 2 March 2014

Introduction Incorporated in 2013 to acquire selected development and production opportunities in West Africa initially Nigeria Access to a portfolio of assets at various stages of development including production and development, located in functioning hydrocarbon systems Strong board and management team who have a proven track record, have previously worked together and delivered results in oil & gas, fundraisings, public markets and M&A Strategic alliances with leading oil and gas service companies

Strategy Acquire and advance a balanced portfolio of oil and gas assets at various stages of development including: – Production – Development – Near field Exploration Opportunity to leverage indigenous experience and to export Marginal Field Development Expertise – Access to local geological and finance expertise – Innovative facilities design – Cost effective development concepts – Third party tie in legal and fiscal agreements – Experience in optimising and maximising production from mature / marginal fields Initial Focus on Nigeria

Investment Themes Indigenisation: • Governments proactively encouraging local content Strong Management: West Africa is • Emerco based in Lagos opportunity rich : • Highly experienced in West Africa • Numerous and North Sea undeveloped discoveries • Access to technology, project • Rationalisation management and of assets by capital markets majors • Successful track • Licencing round record in company from Government formation and growth Technology: • World class • Opportunity for dramatic reservoirs production optimisation • Deployment of modern technology and knowhow

Corporate Structure African Nigerian Continental Energy Shareholders Equatorial Guinea UK Registered Gabon PSC Angola Agreement Liberia 60% 40% * Ghana EMERCO Nigerian incorporated Onshore / Shallow Water Assets Low risk exploration Selective development Selective producing * Split between ACE and UK shareholders

Management Peter r Buchanan Prior to founding Africa Continental Energys , Peter was the founder and CEO of Valiant Petroleum plc an independent CEO oil & gas company formed in 2004, and listed on the AIM market of the London Stock Exchange in March 2008. Valiant was sold to Ithaca Energy in 2013. Peter has had a career spanning 22 years in the oil industry. After a Shell sponsored PhD Grad Dip Applied MSc at Imperial College, Peter completed a PhD in structural geology with BP. This was followed by various senior Finance technical and managerial roles with companies such as Oil Search Limited and Premier Oil plc.. Peter spent five years as a Director on the oil & gas team at The Royal Bank of Scotland with specific responsibility for North Sea structured finance and was involved in several hundred million pounds of debt, mezzanine and equity fundings to independent oil and gas companies Robert Gherghetta Robert is a Chartered Accountant with approximately 20 years experience in the natural resources industry, public CFO practice and investment banking.Robert was co-founder of London-based oil and gas exploration and production Bcom, , Char artered company, Valiant Petroleum plc, listed on AIM. Prior to this he held various senior roles with Royal Bank of Scotland and Ac Accountant ant Credit Suisse First Boston, spending several years in London, and Horwath Chartered Accountants Australia. Andre rew w Macfarl rlane Andrew has 39 years’ experience in Asset Management, Field Development for Operated and Non Operated offshore oil and gas projects in the North Sea, Indonesia and Kazakhstan with Conoco & ConocoPhillips. His Multi discipline skill set COO covers the full life cycle of oil and gas field management, field development concept and front-end engineering, B. Eng.( .(Tech) Mech. . Eng. reservoir management, major project management, drilling and commercial Tosin Shobo 25 Years of International Business Development experience with Centrica Plc., Marathon Oil Corporation, Business Development Citibank, Mobil Oil and 5 years of Gulf of Guinea strategy consulting experience for Mid Cap (Market Cap circa Director US$ 20 billion) oil and gas Exploration and Production companies. BSc, MBA, , ACCA UK ACCA qualified Accountant with MBA and BSc Chemical Engineering from University of Lagos.

Management Rupert Miller Qualified in Human Resource Management with Post Graduate studies include Vice President Sustainable the Executive Leadership Programme at Ashridge Business School and the completion of the University of Development Cambridge Post Graduate Certificate in Sustainable Business. Over ten years working overseas within the international development sector. Responsible for the planning and delivery of community partnership programmes in West and East Africa including working with MedecinsSans Frontieres in Kenya, Somalia and South Sudan. Advised on the set up and delivery of two international NGO's in Rwanda and Uganda including the relevant monitoring and evaluation processes. • Strong legal, company secretarial and risk management skills gained from working in top tier law firms and Michael Sullivan public listed companies General Counsel • Highly developed legal skills focusing on oil and gas, mining, public companies and banking and finance; • Experienced company secretary; • In depth knowledge of Listing Rules & Business Rules, Corporations Act, Trade Practices Act, Income Tax Assessment and Duties Act; • Strong relationships with stock market regulators and Government revenue services gained from working on large scale and complex transactions • Strong risk management, corporate governance & compliance skills;

Focus Countries Acquisition of Exploration Licensing Corporate Selection Discovered Oil Opportunities Rounds Acquisitions Criteria Reserves Nigeria Shallow Water     Prospectivity Selected Land     Selected Swamp     Commercial Upside Equatorial Guinea Time to production Offshore    Fiscal Regime Gabon Working Interest and Partnering Strategy Offshore     Entry Cost Angola Mitigation of political risk Onshore   Achievability Liberia Offshore   Ghana Offshore  

Nigeria Oil & Gas Fundamentals • Nigeria is an established world class petroleum province, Established oil & gas infrastructure ranked 10 th in world oil reserves and 9 th highest for gas resources • Hundreds of undeveloped discoveries • Only one third of discoveries in production • IOCs divesting non-core assets • Government is encouraging local content and facilitating incentives for the acquisition of reserves and production by indigenous companies • Prolific reservoirs, typical productivity of 2-4 mbod/well, high quality crude, production infrastructure in place, 3D seismic and other technical data available 300 Proven Oil Reserves (Billion Barrels) 1,800 250 Proven Gas Reserves (Tcf) 1,500 200 1,200 150 900 100 600 50 300 0 0

Nigeria Oil & Gas Fundamentals Cont’d Technology and know-how Fiscal • Opportunity to leverage indigenous expertise derived • Attractive fiscal regime from over 100 years of IOC experience in EMERCO • Strong incentives for indigenous companies • Leverage North Sea Expertise • Marginal field technology Current Fiscal Regime Royalty • Modern seismic processing and interpretation < 5,000 bopd 2.5% • Third party commercial structures 5,000 – 10,000 bopd 7.5% • Project management 10,000 – 15,000 bopd 12.5% • HSE 15,000 – 25,000 bopd 18.5% UK / Nigeria Oil Production Petroleum Profits Tax 3.5 140 < 5 years 65.75% 3.0 120 Oil Production (MMbbls/d) 5 years + 85.00% Investment Tax Allowance 20.00% 2.5 100 Oil Price ($/bbl) 2.0 80 Capital Allowances 5 yr SL 1.5 60 1.0 40 Niger Delta Development 3% of total annual Capex 0.5 20 Commission Tax & Opex budget 0.0 0 Mar-94 Mar-97 Mar-00 Mar-03 Mar-06 Mar-09 Mar-12 Education Tax 2% of assessable profit Nigeria Oil Production UK Oil Production Brent Crude Spot Price