INVESTOR PRESENTATION Q3 2017 Updated 05/09/17
A MID-CAP AFRICAN & EUROPEAN GAS COMPANY REGIONAL GAS STRATEGY SIGNIFICANT EXPLORATION KEY SHAREHOLDERS I T UNDERPINNED BY POTENTIAL A L Y Strong European gas demand and local pricing Eastern Morocco up to 31 Tcf Pan European / African Strategic Partnership Southern Morocco up to 9 Tcf 28.8% with Schlumberger FURTHER CONSOLIDATION Supportive Cornerstone Investors 54.6% OPPORTUNITIES IN MOROCCO STRONG THEMATIC 7.1% POSITIONING 9.5% Carbon consciousness and global warming driving transition to gas METRICS LOW COST MULTI Italian Cornerstone Investor Key Shareholders: CIP , OGIF TCF DEVELOPMENT IN (Continental Investment Partners) Stock Ticker: O SOU.LN EASTERN MOROCCO Moroccan Cornerstone Investor (OGIF) C C Market Cap: £370 million O Retail R Volumes: O 6m shares/day Other M JOURNEY SO FAR... Slide Acquisition of Securing cost Introduction of Acquisition of Introduction Successful drilling 1 Italian onshore gas covering Cornerstone Moroccan onshore of Strategic and extended well portfolio production Investors gas portfolio Partner test in Eastern Morocco Investor Presentation Rapagnano Continental Investment Tendrara, Anoual, Schlumberger Q3 2017 Partners, Oil and Gas Matarka Investment Fund (OGIF) All volumetric estimates are Gross unrisked GOIP
THE TEAM JJ Traynor Brian Mitchener Chief Financial Offjcer Exploration Director Over 28 years experience in oil & gas and Over 36 years experience in Oil & Gas fjnancial markets, including as Executive exploration including as Regional General James Parsons Vice President of Investor Relations at Shell, Manager Exploration at BG, Vice President Chief Executive Offjcer Managing Director of oil & gas research at International Exploration for Africa at Statoil Deutsche Bank, and as an Exploration and 22 years with BP Exploration. Chartered Over 20 years in Oil & Gas Geologist with BP . Geologist, and a past President of the strategy, general management, Geological Society’s Petroleum Group M&A and fjnance across Europe, South America and Central America Mohammed Seghiri Luca Madeddu 12 years with Royal Dutch Shell Country Chairman, Morocco Managing Director, Morocco Specialist in restructuring, Over 25 years managerial experience across Over 18 years’ experience in leading complex funding and growing small Europe, Asia and South America. Reservoir European and African projects across difgerent listed upstream companies; geologist background with 22 years with sectors, including Gas Storage, Oil&Gas qualifjed accountant ENI E&P Exploration and Power Production. Joined Sound Energy from OGIF where he was Joined Sound Energy in 2011 Managing Partner. Slide 2 Investor Presentation Q3 2017
COMPELLING REGIONAL CASE FOR GAS Morocco Italy • Low risk emerging market • Stable demand with high gas Growing gas Casa Tiberi dependency penetration • Gas increasingly Rapagnano replacing other fuels • Strong domestic gas network SMG Dalla • Circa 90% hydrocarbons • Circa 90% hydrocarbons Disadvantaged I imported from Algeria imported from Algeria supply position T A and Russia • GME pipeline ownership L Y transitions to Morocco in 2021 • Recently introduced energy policy to encourage • New Gas Agency under commercialisation of domestic discussion Laura hydrocarbons Posta Del Giudice • 10 year tax holiday • 37.9% government net take Top quartile (24% corporation tax ((FY2017 fiscal terms • Thereafter 36% net government onwards)), 3.9% regional take (31% Corporation tax and Solfara Mare income tax plus 10% royalty 5% royalty after 10.6 Bcf) above 0.9 Bcf annually) Costa Del Sole Matarka Tendrara I Slide Anoual Tendrara II 3 Tendrara Investor Presentation Sidi Moktar O Q3 2017 C Exploration C O R O M
EASTERN MOROCCO: EXTENSION OF PROVEN NORTH AFRICAN BASIN TENDRARA* 47.5% interest 8 exploration 14,500 km 2 permits acreage, Operated 7 wells drilled ANOUAL* Atlas Mountains 47.5% interest Exploration 8,863 km 2 T U N I S I A permit Operated High Plateau Atlas MATARKA* Mountains Benoud 47.5% interest Reconnaissance 5,185 km 2 licence Operated Ghadames Oued M O R O C C O Mya A L G E R I A Continuity of the Algerian Triassic Province Timimoun and Saharan Hercynian platform Play type: gas discovery with condensate- light oil shows in the Lower Triassic sequence; Illizi TAGI and Paleozoic sand objectives Ahnet Slide Strategic Partnership where Schlumberger own 27.5% and co-fund and technically 4 de-risk the asset N 0 km 300 Geophysical Survey (including seismic) underway ($27.2m) fully carried by Investor Schlumberger Presentation Q3 2017 *Subject to completion of OGIF and Schlumberger transactions
EASTERN MOROCCO: EARLY DRILLING RESULTS EXISTING WELLS JK-1 A N O U A L TE-6 TE-6 N TE-2 TE-2 Triassic TAGI TE-7 discovery and TE-8 TE TE leads 21.2 Tcf RR-1 TE-5 potential TE-6 TE-8 2500-3500 mMD TE-3 SBK-1 K 1 Paleozoic Play 28m net pay, Opener and 17 mmscf/d TE-1 TE-1 T E N D R A R T T N R A R R A R A A Extension of achieved & M A T A T A R K A T A T A R K A T A T A A K TE-4 TAGI Reservoir. post- stimulation Paleozoic concepts TE-7 additional ca. 10 Tcf potential 32 mmscf/d 3000-4000 mMD Slide after clean up: Option under Successful consideration 5 Extended Well Test 5 0 K M Investor Presentation Based on current seismic data Q3 2017
EASTERN MOROCCO: N A Tahaddart Power E N COMMERCIALISATION A R R 2 x 400 MW E T I D E M The Tendrara fjeld will connect to the GME Oued Dhar Doum El Makhazine pipeline near Ain Beni Mathar village, a few 4 x 400 MW 2 x 400 MW km from the Morocco-Algeria border via a new Pipeline Oujda Ofgtake expected to be either domestic power C I T plants for gas-to-power generation (transit via N Al Wahda A GME line) or export to Southern Europe L Rabat 120km Anoual 4 x 400 MW T A The GME can accommodate c.200 mmscfd of Moroccan-source gas immediately, additional Casablanca capacity opening in the short-term with contracted exports Indicative terms for pipeline funding under discussion Tendrara PROSPECTS, LEADS AND RESOURCES Matarka Marrakech Paleozoic 31 O HIGH C Anoual Identified C TAGI leads 5.5 O GAS VOLUME (TCF) 21.2 TCF Slide R Tendrara & Matarka 17 Identified TAGI O A leads 14.7 I M 6 R MID E G L A 9 Investor LOW Eastern Morocco Presentation Development Volumes 1.0 Q3 2017 Gas Maghreb-Europe Pipeline 0 Gas Pipeline Project All volumetric estimates are Gross unrisked GOIP
SOUTHERN MOROCCO: EXTENSION OF THE MESKALA PETROLEUM SYSTEM Jorf Lasfar Power Plant SIDI MOKTAR 75% interest Exploration 2,699.7 km 2 permits Operated Tahaddart Power 2 x 400 MW Safi Chemicals State owned Plant Phosphate Oued Plant (OCP) Dhar Doum El Makhazine Asset located 10km from the Meskala 4 x 400 MW 2 x 400 MW gas processing plant and close to state owned phosphate plant Al Wahda Rabat Chichaoua 4 x 400 MW Meskala Gas Field Casablanca Planned New Phosphate Plant O C C Marrakech O R Slide O M 7 Investor Triassic (TAGI) leads Presentation Gas Maghreb-Europe Pipeline Q3 2017 Gas Pipeline Project All volumetric estimates are 100% - Gross unrisked GOIP
SOUTHERN MOROCCO: PLAY SUMMARY Sidi Shallow (1000m to 3000m) 0 1 0 2 0 3 0 4 0 k m N T Gas discovery (Kechoula) in the Argovian and Lower Liassic with 2 wells on structure ( Koba-1 and Kamar-1) Jurassic gas Koba-1 and oil Recent success perforating discoveries Kamar-1 and clean up test of Argovian in Meskala 1000-3000mMD JRP-1 Kechoula discovery (Koba -1 well); Extended well test planned Q4 2017; Near term cash fmow Sidi Deep (3000m to 4500m) Deeper pre-salt potential up to 9 Tcf unrisked Triassic TAGI 2D seismic programme planned leads for 2018, focused on pre-salt 9Tcf potential 3000-4500mMD Drilling pre-salt thereafter Slide KEY Exploration wells 8 MESKALA targeting the Jurassic GAS FIELD GAS DISCOVERY TAGI LEADS Investor Line of Section Presentation Q3 2017
UPCOMING NEWSFLOW July 2D Seismic and Aerial Gradiometry Ongoing 2017 TENDRARA Forward work programme September 2017 EASTERN MOROCCO Koba-1 (Argovian): Well test Q4 2017 SIDI MOKTAR Drilling: Further multi Tcf exploration drilling Q4 2017/Q1 2018 TENDRARA Concession & FDP End 2017/ Early 2018 TENDRARA 2D Seismic Q2 2018 onwards SIDI MOKTAR Slide 9 Investor Presentation Q3 2017
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