Investing Update

Mercom Oil Sands plc

("Mercom" or "the Company")

Investing update

The Company announces that it has made the following investments totalling £768,000 pursuant to its investing policy.

Investment in NWT Coal Limited

The Company has made an investment in NWT Coal Limited ("NWT Coal") of £300,000 for a 35 per cent. interest in NWT Coal. 

NWT Coal, an unquoted company, has an 80 per cent. interest in a local company which owns two coal concessions in the Bac Giang Province of Northern Vietnam.

The mining concessions are located in the huge Quang Yen Basin, currently the major coal basin in Vietnam with over 80 per cent. of the nation's coal production. The coal deposit, which is typically of anthracite quality with low volatiles and low ash, was probably laid down in the Triassic period and is of Mesozoic age.

The concessions are situated approximately 170 km NE of Hanoi and can be accessed by a good network of tar roads. Both projects are roughly 10 km apart and potentially could represent a single exploration area by adding additional claims. Artisan mining has taken place within the mining concessions.

The estimated coal resource (non-JORC compliant) for the larger concession is about 80Mt and for the smaller concession about 10Mt. However, these estimates are not based on systematic exploration. The local company is in the process of launching an exploration programme in order to establish a JORC-compliant reserve.

The remaining 65 per cent. interest in NWT Coal is held by Niketo Ltd, a wholly-owned subsidiary of NWT Uranium Corporation ("NWT"). John Zorbas, Mercom's CEO, is Chairman and Interim President of NWT. Niketo has a separate board and management to NWT.

Investment in Lion Natural Resources plc

The Company has invested £400,000 for a 30 per cent. interest in Lion Natural Resources plc ("Lion"). Lion holds investments in two companies with projects in Sierra Leone and Kenya respectively. 

Askia Gold Limited

Lion's major asset is its interest in Askia Gold Limited (www.askiagold.com), which has developed strong links between the Sierra Leone Government, principal Chiefs and local community leaders in highly productive gold production areas. The company is developing an alluvial gold project and has entered into various partnership agreements with a major mining company, investors and equipment manufacturers. It is projecting output of 25kg of gold per month for its phase one expansion which is scheduled to be completed during Q3 2014. It is expected that production costs will be 28 per cent. of output and scalable without increase in cost up to 60kg per month.

Advanced Gold Corp.

In Kenya, Lion holds a small minority interest in Advance Gold Corp. ("AGC") which is quoted on the TSX Venture Exchange under the symbol AAX (www.advancegold.ca).

Investment in Maverick Petroleum Limited

The Company has invested approximately £68,000 in 7% convertible debentures of Maverick Petroleum Limited ("Maverick").

Maverick is an unquoted oil and gas company focused on late stage development oil projects in north western African states with a focus in the Republic of Chad. The company is under the lead of its Chairman, Mr. Lutfur Rahman Khan and its President, Dr. Waseem Rahman. Mr. Khan and Dr. Rahman are experienced oil and gas entrepreneurs who were previously executives of Arakis Energy Corp. ("Arakis"). Arakis, formerly a NASDAQ listed company, drilled some 70 successful wells which significantly enhanced the value of the Heglig and Unity oil fields in Sudan.

Implementation of investing policy

As a result of these investments, the Company is deemed to have implemented its investing policy for the purposes of Rule 15 of the AIM Rules for Companies.

These investments will be managed with a view to generating returns for shareholders and, as such, investments may be realised from time to time.

The Company is continuing to review a number of other investment opportunities in accordance with its investing policy and further announcements will be made as appropriate.