Issue of Debt

For Immediate Release

24 February 2015

LGO ENERGY PLC

("LGO" or the "Company")

US$25 million Long-term Oil Swap Agreement with BNP Paribas

Further to its announcements on 23 February, LGO Energy is today delighted to announce that Goudron E&P Limited, a wholly owned subsidiary of LGO Energy plc, has signed a US$25m pre-paid oil swap facility agreement with BNP Paribas to fund the ongoing development drilling program in the Goudron Field in Trinidad.

Neil Ritson, LGO's Chief Executive, commented:

"This is truly a milestone event for the Company. At a time when the industry is facing uncertainty and reductions in investment, LGO has demonstrated both the quality of the Goudron Field, even at lower oil prices, and the capability of our team to operate the field and develop a long term relationship with a major financial institution. The Company believes that this relationship will be instrumental in supporting the future growth of the business."

The first tranche of this new facility, estimated at US$12 million, with the exact amount to be confirmed on the closing date, will have a 30 month duration and a 6 month repayment holiday. The initial tranche of the facility will fund the planned 2015 drilling of at least seven development wells at the Goudron Field. This ensures that the drilling program is fully funded and the Company is able to maintain the momentum of the development. The closing date, within 45 days from today, at LGO Energy's election, will fix the final amount drawn from the facility, allowing the Company to potentially optimise the amount drawn and the ultimate price per barrel under the contracted terms.

Subsequent funds from the remaining US$13 million of the facility will, as and when approved, be available to fund the remaining 15 wells of the original 30 well primary development program already approved at Goudron.

The first eight development wells were drilled in 2014, in part, using the short-term loan facility from YA Global Master SPV Limited. The remaining net balance drawn from that facility of approximately US$5 million will now be fully repaid from the equity raised in the recent share placements.

The BNP Paribas facility is a pre-paid oil production swap and has been structured to allow repayment via future sales of oil. The facility has been secured against LGO's Goudron assets and the funds advanced by BNP Paribas will be used predominantly at Goudron and for other limited corporate working capital purposes. The initial drawdown of US$12 million will be used primarily to complete the planned 2015 Goudron drilling program.

Under the facility the Group has sold forward approximately 250 thousand barrels of crude oil indexed to the price of West Texas Intermediate (WTI). The forward-sold barrels represents a conservative 15% of forecast sales from the reactivated wells and the first 15 new wells at Goudron over the 30 month duration of the agreement. Repayments are linked to the oil price offering a hedge to falls in the price of oil, whilst increases in payments are capped at an average price of approximately US$80/barrel such that the loan repayments have a ceiling and will not increase beyond this point should oil prices return to their historic levels.

James Thadchanamoorthy, LGO's Finance Director, commented:

"We are delighted to have signed this agreement with a pre-eminent global institution. This facility is ideally structured for the current environment, not only fully funding the 2015 drilling program, but also protecting LGO against downside oil price risk, whilst allowing the Company to benefit once the oil price recovers from this downturn."

Further announcements will be made when the initial tranche has been drawn, at which time the final value of the first drawdown and other parameters under the agreement are known.

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