Prospective Structures Identified

14 February 2013

UMC Energy PLC

("UMC Energy" or the "Company") (AIM: UEP)

Prospective Structures Identified at Offshore Licences, PNG

UMC Energy today announces results of an independent technical and prospectivity review of the two offshore Petroleum Prospecting Licences (PPL) 374 and 375. UMC Energy holds a 30% interest in the licences alongside its exploration partner, energy company CNOOC Ltd ("CNOOC"), a Chinese State Owned Enterprise. CNOOC is responsible for funding all exploration and appraisal expenditure to the point of a development decision in respect of the PPLs and is required to comply with the minimum statutory work obligations during the exploration phase.

Highlights - PPL374 & 375 Offshore Permits

·; Offshore lead mapping of permits identified a number of potentially large structures

·; Nine leads have been identified across the two permits - with mean recoverable gas estimates of over 10 Tcf for the four largest leads

·; Lead H in PPL375 presented a phase reversal (or soft kick) in the 2D data, interpreted at the Cretaceous reservoir horizon. Such observations are often regarded as a direct hydrocarbon indicator, or DHI, which may be indicative of a gas cap.

o Lead H is a fault block closure with up to 135 km2 of closure

o 3.76 Tcf or 1,570 MMbbls - mean recoverable gas/recoverable oil volume estimates contained in Lead H.

Next stage

De-risking of these leads will require acquisition of new seismic data and further interpretation and mapping. The development of the leads inventory was required so that the 2D seismic survey planned for this year can be optimally designed. The offshore permits are located approximately 100 km south of the Exxon PNG LNG project, located in Port Moresby. The PNG LNG project expects to commence production in early 2014.

Commenting today Mr. Chris Hart, Technical Director of UMC Energy, said "The results of the offshore technical studies are encouraging, and now provide UMC and CNOOC with a number of large prospective leads as we develop our 2D acquisition seismic program so that the most prospective leads can be elevated to drillable targets."

Further detail on the PPL374 & 375 Offshore Permits

Gini Energy Ltd ("Gini") has a 100% interest in these highly prospective permits. UMC Energy holds a 30% interest in Gini, with CNOOC holding the remaining 70% interest. While CNOOC is the operator of the permits, UMC and its consultants continue to provide key technical support to the joint venture, having recently completed a prospectivity review of the 2006 Lahara 2D seismic data covering the permits.

3D-GEO conducted the offshore permit review, including interpretation of the 2D data, regional reservoir and source rock studies, source generation timing and hydrocarbon migration studies utilizing proprietary Genesis and Trinity software packages to model the probability of hydrocarbon charge within trap timing, and the development of a leads inventory.

Lead mapping of the offshore permits has identified a number of potentially large structures, including Lead H in PPL375, where a phase reversal (or soft kick) was observed in the 2D seismic data in the interpreted Cretaceous reservoir horizon. This observation is often regarded as a direct hydrocarbon indicator, or DHI, which may be indicative of a gas cap. Lead H is a fault block closure with up to 135 km2 of closure. Probabilistic volumes of potential resources contained in Lead H indicate mean recoverable gas estimates of 3.76 Tcf or 1,570 MMbbls of recoverable oil.

Figure 1: Lead H 2D seismic line and mapping at Miocene and Cretaceous reservoir horizons

http://www.rns-pdf.londonstockexchange.com/rns/8950X_-2013-2-14.pdf 

Nine leads have been identified across the two permits, many with closure at both Cretaceous and Miocene reservoir horizons. The seismic grid is too sparse across the offshore permits to have sufficient confidence in the structural mapping to elevate any of the leads to prospect status at this time. However, several large structures have been mapped with recoverable gas volumes estimated in the multi Tcf range (a mean of over 10Tcf for the four largest leads). Un-risked, probabilistic volume calculations of the potential resources have provided the following recoverable gas values of these four highest ranked untested leads within the permit:

De-risking of these leads will require acquisition of new seismic data and further interpretation and mapping. The development of the leads inventory was required so that the 2D seismic survey planned for this year can be optimally designed.

Competent person

Dr Jeffrey Keetley, Director and Subsurface Specialist with 3D-GEO Pty Limited, managed a group of specialist geophysicists conducting the study to develop the prospectivity of the permits, and has, in conjunction with Mr Hart, reviewed and approved the technical information contained in this announcement in his capacity as a qualified person under the AIM Rules for Companies. Dr Keetley graduated with a Bachelor of Sciences with Honours (Geology) from the University of La Trobe, Australia, in 1996 and a Doctor of Philosophy (Ph.D, Geology) from the University of Melbourne, Australia in 2001.

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