Company update

New World Oil and Gas Plc/Index: AIM/Epic: NEW/ Sector: Oil & Gas

8 October 2014

New World Oil and Gas Plc ('New World' or 'the Company')

Company Update

Despite efforts to conclude the Niel Petroleum ('NP') subscription involving a US$25 million equity investment into New World and to progress a strategic Joint Venture with the Al Maram Group in Kuwait, the Directors have been informed by NP that NP have not received the required funding from Al Maram by the agreed deadline of 7 October 2014 to be in a position to proceed with the subscription.

The Company is in the process of discussing with NP the closing of a subscription (on a basis to be agreed) on an accelerated basis due to the failure of the Al Maram Group to perform its obligations. In the meantime, NP continues to fund the running costs of the Company from funds held in an escrow account controlled by the Company. As of 1 October 2014, the account held $1.742 million, which is considered sufficient to fund the Company for at least the next 12 months.

New World is considering its options vis-a-vis its relations with Al Maram, and will vigorously defend its rights under the share purchase agreement signed with Al Maram to recover, among others, the EURO 1 million advance paid thereunder. It should be noted that the investment made by New World is without recourse to New World as it was made at NP's direction from the funds provided by NP held in escrow by New World.

The Company has received notice of the resignation of its Brokers with immediate effect. The Company expects to confirm its ongoing arrangements in this regard as part of the further announcement referred to below.

In light of the above, the Board of New World is considering, and will announce shortly, appropriate actions as regards (i) significant reductions in corporate overheads and other spending reductions, (ii) Board and management structure; (iii) the Director loans currently due; and (iv) the appointment of a new broker.

For further information please visit www.nwoilgas.com or contact: