ALASKA OPERATIONS UPDATE: DRILLING COMMENCED

18 February 2019

Red Emperor Resources NL

ALASKA OPERATIONS UPDATE:

DRILLING COMMENCED

The Board of Red Emperor Resources NL (ASX/AIM: RMP) ("RMP", "Red Emperor" or the "Company"), is pleased to provide an operational update with respect to the drilling of the Winx-1 exploration well ("Winx-1"), located on the Western Blocks, North Slope of Alaska.

Highlights

· Spud of Winx-1 commenced on 15 February 2019 at 15:15 (AK time) - on schedule

Red Emperor is pleased to announce that 88 Energy Limited (ASX/AIM: 88E), in its capacity as consortium operator, has advised that the Nordic Rig#3 commenced drilling of Winx-1 on schedule at 15:15 (AK time) on 15 February 2019. The well was drilled to 600ft prior to pulling out of the hole to pick up the smart bottom hole assembly, with logging while drilling tools were attached. At 11:45 on 17 February 2019 (AK time), the Nordic Rig#3 was drilling ahead at 880ft. The forward plan is to deepen the hole to approximately 2,500ft before setting surface casing. Regular updates will be made throughout the drilling operations.

http://www.rns-pdf.londonstockexchange.com/rns/3270Q_1-2019-2-18.pdf

Figure 1: Nordic Rig#3 on location, drilling ahead

As previously announced, drilling and testing of Winx-1, in a success case scenario, is scheduled to take approximately 50 days. For further details please refer to the announcement of 31 January 2019 made by 88 Energy Limited.

The Winx prospect is a 3D seismic defined conventional oil prospect in the successful Nanushuk play fairway with a gross mean unrisked prospective resource of 400 million barrels ("MMbbls") (126MMbbls net to Red Emperor) and is adjacent to the Horseshoe 1/1A discovery well drilled by the Armstrong/Repsol JV in 2017. Refer to the Company's announcement of 25 June 2018 for further details.

Cautionary Statement: The estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration, appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.

http://www.rns-pdf.londonstockexchange.com/rns/3270Q_2-2019-2-18.pdf

Figure 2: Winx-1 exploration well, Western Blocks, Pikka B well, Alaska North Slope and Nanushuk Fairway

The primary objective of Winx-1 is the Nanushuk Topset play, targeting the Nanushuk 4 and 5 sands. As can be seen in Figure 3, the Winx prospect has been identified using the Nanuq South 3D which covers the third party 2017 Horseshoe discovery plus a large swathe of the "Western Blocks". Similar amplitude response is observed at the Winx prospect to that seen at the successful Horseshoe well location, which is situated approximately 4 miles (6 kilometres) to the west.

http://www.rns-pdf.londonstockexchange.com/rns/3270Q_3-2019-2-18.pdf

Figure 3: Winx-1 targeting multiple stacked prospects with strong amplitude support

For further information, please visit www.redemperorresources.com or contact:

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.

About Red Emperor Resources NL

Red Emperor Resources NL is an Australian natural resource exploration company listed on both the Australian Securities Exchange (ASX: RMP) and the AIM Market (AIM: RMP). Red Emperor has oil and gas interests on the Alaska North Slope and in South East Asia.

Alaska

Red Emperor has entered into Definitive Agreements with its consortium partners, 88 Energy Limited and Otto Energy Limited, that will see the Company participate in the drilling of a highly prospective Nanushuk oil trend exploration well on the Alaska North Slope in early 2019. The drill target is immediately adjacent to and a direct analogue of the third party Horseshoe-1/1A oil well drilled in 2017. Horseshoe is part of the billion-barrel plus Nanushuk oil play-fairway, one of the largest conventional oil fields discovered in the US in more than 30 years.

Technical work on the Western Blocks has identified a gross best estimate prospective resource volume of 400 MMbbls (126 MMbbls net to RMP), and a geological chance of success of 25%-35%. The estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration, appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.

Philippines

Red Emperor also holds an equity interest of 37.5% of Block SC55, which is located in the southwest Palawan Basin. SC55 covers an area of 9,880km2 and was awarded to Otto Energy Investments Ltd (formerly NorAsian Energy Ltd) in 2005. It is a deep-water block in the middle of a proven regional oil and gas fairway that extends from the productive offshore Borneo region in the southwest to the offshore Philippine production assets northwest of Palawan.

Red Emperor participated in a USD25m exploration well (Hawkeye-1) within the block in 2015 and contributed in excess of AUD5m towards drilling costs. Over USD50m has been spent exploring SC55 to date and a number of drill-ready targets remain, including the "Cinco" gas prospect which has a best estimate prospective resource of 1.6 trillion cubic feet ("tcf") recoverable gas.

Prospective Resources Reporting Notes

The Company announced the prospective resources estimate for the Western Blocks in its announcement titled "Red Emperor to acquire interest in large oil prospect in prolific Alaska North Slope" made on 25 June 2018. The Company confirms that it is not aware of any new information or data that materially affects the information included in that announcement, and that all material assumptions and technical parameters underpinning the estimates in that announcement continue to apply and have not materially changed.

(i) The prospective resources information in this announcement is effective as at 30 April 2018. (ii) The prospective resources information in this announcement has been estimated and is classified in accordance with SPE PRMS (Society of Petroleum Engineers Petroleum Resources Management System). (iii) The prospective resources information in this announcement is reported according to the Company's economic interest in each of the resources and net of royalties. (iv) The prospective resources information in this announcement has been estimated and prepared using the deterministic method. (v) The prospective resources information in this announcement has been estimated using a 6:1 BOE conversion ratio for gas to oil; 6:1 conversion ratio is based on an energy equivalency conversion method and does not represent value equivalency. (vi) The prospective resources information in this announcement has been estimated on the basis that products are sold on the spot market with delivery at the sales point on the production facilities. (vii) Prospective resources are reported on a best estimate basis. (viii) For prospective resources, the estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration, appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons. (ix) In respect to the prospective resources referred to in this announcement, Red Emperor's working interest in the four leases (ADL#s 391718, 391719, 319720 and 391721), totalling 22,711 acres all of which are located on the North Slope, Alaska, USA will be 31.5% upon completion of the transaction. (x) The prospective resources have been estimated on the following basis: the best estimate prospective recoverable resource calculation was based on a consideration of offset well information and seismic expression; a combination of volumetric assessment and field analogues have been used to estimate the prospective resources; exploration drilling will be required to assess these resources. (xi) The chance of discovery is considered moderate as the prospective resources are near developed and undeveloped reserves and in a proven oil and gas producing province. There is a risk that exploration will not result in sufficient volumes of oil and/or gas for a commercial development. (xii) Prospective resources are un-risked and have not been adjusted for an associated chance of discovery and a chance of development.