Completion of acquisition and Corporate update

Northern Petroleum Plc

("Northern Petroleum" or "the Company")

Completion of Canadian acquisition

and

Corporate update

Northern Petroleum (AIM: NOP) confirms that the acquisition of the Canadian production and reserves assets (the "Rainbow Assets") announced on 12 November 2015 has now completed. The Company provides the following corporate update.

Highlights

Canada

§ Enlarged Company production of approximately 200 barrels of oil equivalent per day ("boe/d") of which approximately 80 per cent. is oil

§ Independently evaluated proved plus probable reserves of 1.5 million boe

- of which proved reserves account for 0.9 million boe

§ Q1 winter work programme now started:

- target of doubling Company production

- primarily repair and replacement of pumps, rods, and engines, combined with other facilities and pipeline maintenance

- no drilling capital required

- forecast cost of work programme has almost halved to approximately US$0.6 million

Italy

§ Environmental submission being prepared for an appraisal well on the 26 million barrel ("mmbbls") 2C contingent resource, 100 per cent. owned Giove oil discovery

§ Planning underway to acquire 3D seismic in the second half of 2016, subject to finance, over the permits in the southern Adriatic, including the Cygnus prospect which is estimated to contain 446 mmbbls of mean prospective resource

§ Exploration programme started on the Shell operated Cascina Alberto permit onshore northern Italy, which contains the Gattinara prospect, previously interpreted by Enterprise and ENI to contain 300 mmbbls of prospective resource

Corporate

§ Unaudited cash at 31 December 2015 of approximately US$2.4 million, after payment of the consideration for the Rainbow Assets and other year end payables

§ Forecast 2016 total group general and admin cost of less than US$3.0 million

§ Positive cashflow contribution forecast from Canadian production even in the current oil price environment

Keith Bush, Chief Executive Officer, commented:

"The completion of the Rainbow Assets acquisition has put the Company on a much stronger financial footing. With a relatively low risk and low cost Canadian work programme, the Company should be able to generate cashflow to help support the business through this year and beyond. Something that is extremely important during this difficult economic period for the industry.

"The Company has a very good mix of opportunities which have differing levels of risk and reward for shareholders that will mature over different time scales. We are now in a good position to progress each opportunity and benefit from the success of any project."

Canada

Following the payment of the cash consideration for the acquisition of the Rainbow Assets to the vendor, as announced on 15 December, the Alberta Energy Regulator ("AER") has now assigned the Rainbow Assets leases to the Company following the deposit by the Company with the AER of approximately US$1.2 million. The deposit represents the cost of the asset abandonment liability netted off against the value of the last 12 months of production, as deemed by the AER. Due to the shutting-in of production during 2015, the assigned asset value has steadily decreased, which has resulted in a larger temporary cash deposit being made on completion of the acquisition than previously forecast. This deposit will be returned to the Company by the AER once production, and therefore asset value, increases, which is expected to occur as a result of the winter work programme.

Canadian production from the enlarged Company currently totals approximately 200 boe/d, of which approximately 80 per cent. is oil and includes the oil production from the Company's 100/16-19 well in the Virgo area. Relying on a third party reserves report, written for the vendor of the Rainbow Assets as at the end of 2014, and combining this with the third party reserves report written by GLJ Petroleum Consultants Ltd of Calgary for the Company on its original Virgo assets, the Company's audited reserves as at 31 December 2014 (as if the Rainbow Assets had been acquired at that date) were:

§ total proved plus probable reserves of 1.48 million boe

§ of which total proved reserves are 0.92 million boe

The winter work programme focuses on the replacement and repair of pump and rods and engines on the Rainbow Assets, as well as returning the previously shut-in 09-25 battery into production.

In the Virgo area, the 102/15-23 well has been shut in for nearly a year due to a pipeline integrity issue on a third party operated gathering system. After extensive discussions, the Company has agreed to take ownership of the affected section of pipeline and carry out the necessary repair work during February 2016 to bring the well back into production.

There is no drilling or well workover activity planned for this winter. Due to the oil services industry adapting to the changing industry environment and a further refinement of the programme, it is anticipated that this work programme will now cost approximately US$0.6 million, almost half as much as originally forecast and will take approximately three to four months. The Company expects that the work programme should lead to an approximate doubling of production for the Company.

Italy

The focus in Italy over the next six months will be on three key areas:

§ the submission of an environmental impact assessment for the approval of an appraisal well to be drilled on the Giove oil discovery in 2017;

§ planning for a 3D seismic acquisition in the southern Adriatic in the second half of 2016, primarily over the Cygnus exploration prospect; and

§ the ongoing exploration campaign on the Cascina Alberto permit, for which the Company is being carried by Shell, the operator.

Both the proposed 3D seismic over Cygnus and the appraisal well on Giove will require external funding and the Company is in discussions with different industry participants including oil companies, service providers and oil and gas focused financial institutions to understand if appropriate funding can be structured for the proposed work programmes.

In addition to these activities, the Company awaits the final decree from the Ministry of Economic Development for the award of five contiguous exploration permits, which adjoin the Company's existing permits in the southern Adriatic. Once awarded, the Directors believe that the Company will have the largest exploration position in the southern Adriatic.

Following recent regulatory changes by the Italian government, which affect what activities can be undertaken by the oil and gas industry within coastal waters, the Company confirms that its permits and applications in the southern Adriatic are more than 12 nautical miles from the Italian coast and not affected by these changes.

-Ends-

For further information please contact:

Northern Petroleum Plc Tel: +44 (0)20 7469 2900

Keith Bush, Chief Executive Officer

Nick Morgan, Finance Director

Stockdale Securities Limited (Nomad and Joint Broker) Tel: +44 (0)20 7601 6100

Alastair Stratton

Robert Finlay

FirstEnergy Capital LLP (Joint Broker) Tel: +44 (0)20 7448 0200

Jonathan Wright

In Accordance with the AIM Rules - Guidance for Mining and Oil & Gas Companies, the information contained in this announcement has been reviewed and signed off by the CEO of Northern Petroleum, Mr Keith Bush, who has 24 years' experience as a petroleum engineer. He has read and approved the technical disclosures in this regulatory announcement. The technical disclosures in this announcement comply with the SPE standard.

Note to Editors:

Northern Petroleum is an oil and gas company focused on production led growth. The Company is undertaking a redevelopment and production project in north west Alberta and has a broader portfolio of exploration and appraisal opportunities in countries of relatively low political risk, primarily Italy. Comprehensive information on Northern Petroleum and its oil and gas operations, including press releases, annual reports and interim reports are available from Northern Petroleum's website: www.northernpetroleum.com