Arckaringa Project Update

4 February 2013

Arckaringa Project Update

Drilling Program - Tender and Selection of Drilling Services Provider

Altona Energy (AIM:ANR) is pleased to provide an update on the tender and selection of a company for the role of Drilling Services Provider to manage a test drilling program and associated technical analysis work at Arckaringa. The program is an important step in the Bankable Feasibility Study for Altona's flagship Arckaringa 30,000 BPD Clean Energy Coal to Liquids Project in South Australia.

Altona's JV partner CNOOC NEIA has completed the Pre-Qualification phase. During this phase, five companies, each with Australian and international experience in managing coal drilling programs and associated analytical work have attained pre-qualification under CNOOC's rigorous internal evaluation procedures. The Invitation to Bid ("ITB") to be sent to the pre-qualified bidders includes two parts: commercial evaluation and technical evaluation.

Documentation for the commercial evaluation part has been finished. Documentation for the technical evaluation part is now being completed, with a particular focus on ensuring that the scope of work, and technical requirements for the drilling program, are consistent with exploration industry standards under Australian and South Australian conditions.

The issue of the ITB is subject to final internal CNOOC approval. If this occurs following Chinese New Year holidays, it is then expected that the ITB process can be completed in time for the successful tenderer to commence work by April, subject to the normal Notices of Entry to landowners and lease holders in the Arckaringa area.

The fieldwork covers a program comprising up to 8 boreholes, focussing on hydro-geological test and observation wells, to enable refinement of the existing hydro-geological model, and the extraction of coal and overburden core for geotechnical and coal quality analysis. This work is the first stage of a larger program of more than 30 boreholes already covered by the regulatory approvals. Decisions concerning the implementation and function of the remainder of the larger program will depend on the results of the first stage work.

As announced previously, all the necessary regulatory approvals for the program have been received from South Australian authorities, with the PEPR from the Department of Manufacturing, Innovation, Trade, Resources and Energy (DMITRE) recently extended to November 2013 and the Water Affecting Activity Permit from the Arid Lands Natural Resources Management Board (SAALRM) already in place. A Work Area Clearance from the relevant Native Title Claimant Group (AMYAC) has also been granted.

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

About Altona Energy

Altona Energy is listed on the London Stock Exchange's AIM market. Its current focus is firmly on the evaluation and development of the Company's 49% interest in its flagship coal-to-liquids Arckaringa Project to exploit the huge coal resources contained in three exploration licences covering 2,500 sq. kms in the northern portion of the Permian Arckaringa Basin in South Australia. The Project is designed to include a modern, combined-cycle power station adding 560Mw to the national grid and to produce clean burning fuel for Australia and the world from a resource equivalent to 7.8 billion barrels. Altona Energy has forged a Joint Venture with CNOOC New Energy Investment Co., Ltd., a subsidiary of the China National Offshore Oil Corporation (CNOOC), to complete the Project Bankable Feasibility Study and expedite the Project's development.

In addition to its Arckaringa interest, Altona Energy holds interests in two coal exploration licences in the Xinjiang Autonomous Region of the People's Republic of China. These interests are expected to provide early cash flow to enable the Company to progress the Arckaringa project and to continue to investigate additional opportunities to deploy the management team's expertise in clean energy.

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