Potential Acquisition of Producing Oil Field

Immediate Release

16 July 2014

Leni Gas & Oil PLC

("LGO" or the "Company")

Potential Acquisition of a Producing Oil Field in Trinidad

Leni Gas & Oil plc today announces the signing of a binding Heads of Agreement ("HOA") to acquire a 100% interest of the producing Trinity-Inniss Field in south-eastern Trinidad, close to the Company's existing Goudron Field operations. LGO plans to acquire 100% of Fram Exploration (Trinidad) Limited ("Fram"), the company holding the Incremental Production Service Contract ("IPSC") for the Petroleum Company of Trinidad and Tobago Limited ("Petrotrin") owned Trinity-Inniss Field (the "Field").

The HOA is subject to a number of material conditions, including the negotiation in good faith of a definitive agreement and legal, financial, taxation, stakeholders consent, and commercial due diligence on Fram and its business, assets and liabilities.

Highlights:

· The Field covers an area of 810 acres and has extensive operational sales tanks and export facilities.

· The Trinity- Inniss Oil Field lies approximately 20 kilometres west of the Goudron Field.

· Existing production averages between 140-150 barrels of oil per day ("bopd") from approximately 25 active wells.

· Production is derived from the Herrera Sandstone at depths between 1,500 and 5,000 feet.

· There is an existing Certificate of Compliance ("CEC") granted in 2012 for the drilling of 12 new wells and 50 sidetracks/replacement wells.

· Oil quality ranges from 28 to 38 degree API and is sold by means of a Petrotrin-owned pipeline to the Petrotrin refinery at Pointe-a-Pierre.

· LGO has identified approximately 20 well reactivation targets and there is considerable infill drilling potential within the Field area.

· Stock Tank Oil Originally in Place ("STOOIP") has been estimated at 68 million barrels ("mmbbls") with an upside of up to 200 mmbbls.

· Historic production totals approximately 23 mmbbls.

· The Field may also be a candidate for enhanced oil recovery by water-flood.

Neil Ritson, LGO's Chief Executive, commented:

"We are delighted to have the opportunity of adding a further producing IPSC in the Eastern Fields Area of Trinidad to our portfolio. This transaction will, subject to the conditions being satisfied, add approximately 150 bopd to LGO Trinidad's current production and we see many similarities between Goudron and Trinity-Inniss, and the scope for rapid production improvements. This acquisition is a natural extension of our Trinidad-focused oil field redevelopment strategy and is ideally timed to take advantage of our growing capability."

"Although our current focus is the drilling of new well developments at Goudron, we would be able to quickly transfer Goudron's work-over expertise and some of the work-over equipment to Trinity-Inniss to significantly increase the Field's oil production from 150 bopd. In the medium term, we would be able to extend drilling work to new production wells and the Trinity-Inniss Field also has longer term water-flood potential. "

The Trinity-Inniss Oil Field:

The Trinity and Inniss fields were originally discovered in 1956, and were developed by Texaco from 1958 with the drilling of a total of 134 wells targeting the Herrera Sandstones in thrust fold structures along the Rock Dome anticline in the Southern Range Thrust and Fold Belt. Production to-date totals approximately 23 mmbbls, derived from five Herrera Sandstone intervals of which Units 3 to 5 are the most productive and account for approximately 80% of the production to-date. Peak production was realized by Texaco in 1958 at a level of 4,200 bopd.

The net pay interval ranges from 100 to 280 feet with an average porosity of 27%. Based on studies carried out in the last 5 years the estimated STOOIP ranges from 68 to over 200 mmbbls. There is extensive 2D seismic data over the Field area and recent studies have collated all relevant historic production and pressure data to allow more accurate reservoir models to be built.

LGO will commission additional studies and a Competent Persons Report to better define the overall reserves potential following completion of the acquisition.

Historic initial production rates from wells range from 80 to over 100 bopd, and the initial rate of the last well, which was drilled in 1976, was 126 bopd. As in the Goudron Field, LGO expects that the use of more advanced drilling and completion techniques can materially improve on the historic averages. Undepleted reservoir zones and areas where additional infill wells can be drilled are evident, as well as a general need for pressure maintenance that could be achieved by means of a water-flood. An earlier water-flood was undertaken in the Trinity Field in 1973 and showed promising results with a production response in under a year.

Following the issue of several supplementary amendments to the original 2010 IPSC, Fram now has access to all the wells on the Field and has been granted improved notional overriding royalty terms similar to those LGO has obtained at Goudron. A commitment for the drilling of five new wells has been made and an extension of the initial IPSC term to the year 2024 has been granted.

Oil from individual wells is collected at a number of tank batteries located at several points within the Field before being piped to a sales battery which houses a 10,000 barrel bulk tank and a 1,500 barrel sales tank, from where oil is pumped into the Petrotrin sales line to Pointe-a-Pierre.

Fram is presently 100 percent owned by Caribbean Rex Limited ("CRL") a St. Lucian company which is part of the West Indian Energy Group. The assignment of the IPSC and the transfer of operatorship may be subject to the final approval of Petrotrin.

Based on unaudited financial accounts to 31 December 2013 Fram reported gross turnover of £627,000, a loss of £548,000 for the year ending 2013 and had gross assets of £679,000. The loss in 2013 reflects a lower production period under a higher royalty regime and is not representative of the current operating conditions. LGO envisages paying for the acquisition from cash reserves and drawing on debt facilities available to LGO if required.

Consideration:

· Subject to completion of due diligence (as described above) on Fram, LGO has agreed to pay CRL the sum in cash of US$5 million for all the outstanding shares in Fram.

· Should the transaction not be completed by 27 September 2014 due to LGO acting without cause, LGO will pay CRL a break-fee of US$250,000.

· The current intention is that the consideration is either paid by drawing down from the remaining balance of the Company's loan from YA Global Master Fund or partially from cashflow from the Company's Goudron development program which is beginning to yield significant positive cashflow for the Group.

Competent Person's Statement:

The information contained in this announcement has been reviewed and approved by Neil Ritson, Chief Executive Officer and Director for Leni Gas & Oil Plc who has over 35 years of relevant experience in the oil industry. Mr. Ritson is a member of the Society of Petroleum Engineers, an Active Member of the American Association of Petroleum Geologists and is a Fellow of the Geological Society of London.

Enquiries:

Leni Gas & Oil plc

Beaumont Cornish Limited

Old Park Lane Capital Plc

Pelham Bell Pottinger

Glossary:

API - American Petroleum Institute

bopd - barrels oil per day

mmbbls - million barrels of oil

STOIIP - stock tank barrels oil initially in place