Placing, update on Mexico Activities, US Update

Northcote Energy Ltd / Index: AIM / Epic: NCT / ISIN: VGG6622A1057 / Sector: Oil & Gas Northcote Energy Ltd (`Northcote' or `the Company') Placing, update on activities in Mexico and US operations Update Northcote (AIM: NCT) is pleased to announce that it has raised £2.80million viathe issue of 1,244,444,444 new nil par value ordinary shares ("Placing Shares")at 0.225 pence ("Placing Price") to new and existing investors (the "Placing").The proceeds of the Placing will be used primarily to pursue investmentopportunities in the Mexican energy sector and for general working capital. Overview * Placing to expedite participation in the extensive opportunities in the Mexican energy sector which is being opened up to international companies * Multiple projects currently being evaluated in Mexico both within the Company's joint venture with Gaia Ecologica ("Gaia"), a local Mexican company, as well as through its own contacts * Whilst nothing formal has been agreed at this stage, due diligence is underway on an opportunity to participate in a JV to construct and operate a waste remedial plant in a prime onshore oil and gas basin in Mexico - this could offer a low cost opportunity to generate cash flows in the near term and has potential for expansion in line with expected increase in drilling activity * Advanced discussions with US-based companies with experience in midstream and downstream oil and gas services with a view to partnering in their expansion into Mexico * 70% owned Shoats Creek well expected to spud within the next 10 days following receipt of drilling permit Northcote Managing Director Randall Connally said, "We would like to thank ourexisting and new shareholders for their show of support in this fundraise. Thefinancial firepower we now have gives us the flexibility to takedown newbusiness opportunities in Mexico. In addition to generating near term recurringrevenues and solid cash flows for Northcote these steps will solidify ourposition as a strong partner for Mexican and international companies inopportunities emerging through the energy reform in Mexico and will, webelieve, lead to opportunities across the sector, including participation inlucrative oil & gas concessions as well as other major projects in the future. "At the same time we are pleased to have been notified by the operator ofShoats Creek that we have received a new permit for the first new drill well onthat property. Preparations for the drill are underway and we expect to executeour drilling plan very soon. A further update once we have spudded this wellwill be provided in due course." Details of the Placing The Company has raised £2.80million (before expenses) in new equity to furtherits pursuit of opportunities arising from the deregulation of the Mexico energysector. The Placing Shares represent approximately 20.77 per cent. of the Company'sissued share capital as enlarged by the Placing Shares (the "Enlarged ShareCapital"). The Placing Price is at a discount of approximately 18.2 per cent.to the closing middle market price on 1 May 2015, being the last practicabledate prior to the publication of the announcement. The Placing is conditional,inter alia, on admission of the Placing Shares to trading on AIM ("Admission").It is expected that admission of the Placing Shares to trading on AIM will beadmitted to trading at 8.00 a.m. on 11th May 2015. The Placing Shares will rankpari passu in all respects with the Company's existing Ordinary Shares.Following the issue of the placing shares as described above, the issued sharecapital of the Company will consist of 5,992,582,327 Ordinary Shares. In connection with the Placing, the Company has issued 90,750,000 warrants toits brokers to subscribe for new shares in the Company exercisable during threeyears from Admission, at a price of 0.225p per share. Gaia Opportunity Further to the Company's announcement of its joint venture with Gaia on 30March 2015, the Company and its joint venture partners have been reviewingpotential investments. The most advanced opportunity is to participate in a JV focused on theconstruction of a plant to remediate rock, water and other waste generated inthe drilling and workover of oil wells ("the facility"). The plant will bestrategically located in one of the primary onshore oil and gas basins inMexico with easy access to port facilities to allow for treatment of wasteassociated with both onshore and offshore drilling. The joint venture partnersare performing due diligence on this opportunity, it is expected that the plantcould be commissioned within six months of construction commencing and isexpected to be a significant driver of positive cash flows should it becomefully operational. Once the first facility is in production, the joint venture partners expect tobe able to use their existing relationships with major international and localservice companies to ensure that it can tender for new contract awards arisingfrom the expected increase in drilling activity in the area. The plant has amodular design, which would facilitate expansion alongside the expected growthwith drilling activity. Having closed the Placing, Northcote is now well positioned to complete its duediligence on this opportunity and, should this proceed to a formal investmentagreement, the Company will update the market at this stage. Other Initiatives The remainder of the placing proceeds will support Northcote's joint venturewith Gaia and also its initiative of identifying US-based companies withexperience in midstream and downstream oil and gas services with a view topartnering with them in their expansion into Mexico. The Company is in advanceddiscussions with certain companies and, subject to the satisfactory completionof price negotiations and due diligence, the Company will advise the marketshould any of these investments be agreed. Shoats Creek The Company has now received the permit from the State of Louisiana departmentof Natural Resources to drill its first new well on its 70% owned Shoats Creekproject. With the permit in hand, the Company is working with the drillingcontractor to mobilise the rig to site and expects that the well will spudwithin the next 10 days at which point further updates will be provided. * * ENDS * * For further information visit www.northcoteenergy.com or contact the following: Randy Connally Northcote Energy Ltd +1 214 550 5082 Ross Warner Northcote Energy Ltd +44 7760 487 769 Dan Jorgensen Northcote Energy Ltd +44 20 7024 8391 Roland Cornish Beaumont Cornish Ltd +44 20 7628 3396 James Biddle Beaumont Cornish Ltd +44 20 7628 3396 Elliot Hance Beaufort Securities Ltd +44 20 7382 8300 Nick Bealer Cornhill Capital Limited +44 20 7710 9612 Elisabeth Cowell St Brides Partners Limited +44 20 7236 1177 Notes: Northcote Energy Limited is an entrepreneurial energy company with diverseinterests. The Company combines a portfolio of US exploration and productionassets in Louisiana and Oklahoma with the development of new businessopportunities in the US and also in Mexico, such as its participation agreementwith MX Oil PLC and agreement with Gaia Ecologica.