Quarterly Report

Wildhorse Energy ('WHE' or 'the Company'), the AIM and ASX listed company focussed on developing underground coal gasification ('UCG') and uranium projects in Central and Eastern Europe, is pleased to announce its Quarterly Report for the three months to 30 June 2013.

Highlights:

UCG Portfolio

·; Proposed amendments to the regulatory and legislative framework to allow for the licensing of UCG have been prepared by the Hungarian Mining Authority and are pending Parliamentary approval - anticipated for Q3 2013

o Follows completion of a study which concluded that UCG, as a clean coal technology, can provide Hungary with an opportunity to develop its extensive stranded coal reserves and no risks were found that would limit the development of UCG in Hungary

·; Further to the announcement on 5 March 2013, strategic partner discussions are progressing positively focused on evaluating the potential of WHE's initial commercial demonstration project ('CDP') at the Mecsek Hills UCG Project in Hungary

·; Operational progress made at Mecsek Hills UCG Project in Hungary - 2D seismic completed. Successful expansion of UCG portfolio obtaining a 54.3km2 Polish coal exploration licence - in line with strategy to implement WHE's first mover advantage and roll out its UCG activities in Europe:

o The Alwernia Coal Project is located in south-western Poland, 12km from a power station and approximately 20km from Cracow

o UCG potential underpinned by archive data which suggests that four of the seams are gently dipping and display good continuity

Uranium Interests

·; MECSEKÉRC Zrt., MVM Zrt. and Kővágószőlős Municipality have now joined the uranium Special Purpose Vehicle for the Mecsek Hills Uranium Project

·; WHE's due diligence study, requested by the Hungarian Government, shared with all government and JV parties for evaluation - no issues found that would rule out the project or would pose significant risks

·; Subject to the successful evaluation of the study the JV Partners will seek formal Hungarian government approval to finalise the joint venture agreements between the parties and permit development of the project

WHE Managing Director Matt Swinney said, "WHE has both interests in UCG and uranium and each division has been marked by success during Q2 2013. We are first movers in European UCG and this prominent position in the UCG arena is evidenced by our involvement in the proposed amendments to the Hungarian regulatory framework to provide for UCG licencing. Importantly, a study submitted during the quarter recognised the benefits of developing UCG regulations in Hungary and found no risks that would limit future UCG development in Hungary, which significantly strengthens our proposition. Additionally, if legislation is successfully adapted, Hungary will be propelled to the forefront of the European UCG sector in terms of policy and expertise. With this in mind, we look forward to providing updates regarding the Parliamentary approval process over the coming months. Another highlight, which is also testament to our long-standing involvement in these geographies, is the successful application and grant of a Polish coal licence with UCG potential to our wholly owned Polish subsidiary. This represents an important step in terms of increasing our UCG footprint in Central and Eastern Europe, where a lack of domestic sources of power drives gas prices higher, thus making the economics of implementing UCG attractive.

"Alongside this, our work with our Joint Venture Partners and the Hungarian government in respect of the Mecsek Hills Uranium Project continues solidly. Once again, due diligence required by the Hungarian Government has not posed any risks to the development of this significant uranium deposit, which is one of the largest in Europe, and we continue to build momentum in terms of finalising JV agreements and henceforth gaining permits for development."

UCG Cooperation Agreement Update

With the view of introducing UCG regulation in Hungary, the government required a study regarding the "Guidelines for Implementing Underground Coal Gasification in Hungary". This was completed in January 2013 in cooperation between the Hungarian Geological and Geophysical Institute, the University of Miskolc, Golder Associates and WHE.

Key aspects of the study are:

·; UCG technology

·; UCG potential in Hungary

·; Environmental considerations

·; Geological aspects of site selection

·; Risk assessment

·; Legislative aspects of UCG and its application in Hungary and the rest of the world

The study concluded that UCG, as a clean coal technology, can provide Hungary with an opportunity to develop its extensive stranded coal reserves. No risks were found to exist that would limit the development of UCG in Hungary. The main findings of the study were presented by all the authors to the relevant authorities of the Hungarian Government in April 2013.

A proposal for the amendments to the existing legislation to allow for the licensing of UCG has been prepared by the Hungarian Mining Authority and is pending Parliamentary approval. This is expected in Q3 2013 following the summer Parliamentary recess.

Operations Update - Mecsek Hills UCG Project, Hungary

WHE continues to focus on strengthening its geological understanding of the Váralja target within the licence area. This target has a current Inferred JORC resource of 185Mt and will be the location for the commercial demonstration UCG to Combined Cycle Gas Turbine facility ('CDP') of approximately 50MWe Gross (100MWt LHV fuel input).

Following the successful completion of the 3D seismic reinterpretation at the Váralja target in Q1 2013, the Company completed high resolution 2D seismic measurements in June 2013. This was aimed at increasing the level of confidence regarding the geological continuity of the coal seams within the Váralja target, thus de-risking it before drilling commences to upgrade the current Inferred resource to Indicated status. The processing interpretation of the 2D seismic results is expected to be completed in September 2013.

Strategic Partner Selection

Further to the announcement dated 5 March 2013, the Company continues to progress the strategic partner selection process. Once secured, the Company intends to recommence the BFS and initiate a drilling programme to upgrade selected areas of its current JORC compliant Inferred resource of 184.5Mt to the Indicated and Measured categories.

Uranium Project - Mecsek Hills

WHE is progressing the development of the Mecsek Hills Uranium Project which combines WHE's 42.9km2 Pécs-Abaliget uranium licence and Hungarian state owned Mecsek-Öko ('MO') adjoining 19.6km2 MML-E uranium licence. The project has a total JORC Inferred Resource of 48.3Mt at 0.072% U3O8 for 77Mlbs of U3O8 and an Exploration Target of an additional 55-90Mlbs of U3O8 with a grade range of 0.075-0.10% U3O8, making it one of the largest uranium deposits in Europe.  

On 27 June 2012, the Hungarian Government formally pledged its support for the development of a Joint Venture ('JV') between the Company, MO and Mecsekérc ('ME'), and Hungarian Electricity Ltd ('MVM'), the owner of Paks Nuclear Power Plant ('Paks NPP'), to evaluate the necessary conditions to restart uranium mining.

With this in mind, a Special Purpose Vehicle ('SPV') uranium entity was established in September 2012. In Q2 2013 all parties, namely ME, MVM and Kővágószőlős Municipality, joined the uranium administrative SPV and signed agreements to purchase an initial nominal shareholding in the SPV. The main objective of the SPV, in accordance with the Government Resolution of June 2012, is to conduct due diligence to assess the feasibility of the property ('the Study').

The Study was completed in November 2012 and following the joining of these shareholders as joint company partners, the Study has been shared with all parties and the competent ministries. When the assessment is complete, the JV Partners will seek formal Hungarian government approval to finalise the joint venture agreements between the parties and permit development of the project.

The authors of the Study thoroughly examined all conditions that may rule out or pose significant risks to restarting uranium mining. 18 companies and 63 experts contributed, among them several nationally and internationally recognised professionals of their field. The Study did not find any issues that would rule out the project or would pose significant risks.

Alwernia Coal Exploration Licence, Poland

In line with the Company's strategy to utilise its first mover advantage and increase its acreage in Europe, WHE is pleased to announce that the application process for the Alwernia Coal Exploration Licence ('Alwernia') was formally closed at the end of May 2013 and it has since been awarded to WHE. The official process concerning various other Polish coal exploration areas are currently on-going.

Alwernia is situated in the eastern part of the Upper Silesian Coal Basin ('USCB'). The historical mining of the USCB goes back to the 17th century with peak production experienced in the 1970s. Although Alwernia has never been exploited, there are 10 historical boreholes and two seismic lines in the area and the licence is adjacent to documented carbon deposits: Wisła - Północ, Spytkowice and Tenczynek. The qualities of these deposits, and the data available from previous exploration, indicate the Alwernia deposit's potential suitability for UCG.

Infrastructure

Numerous coal -power plants are located in the USBC area and can be targeted as potential customers. The Siersza power plant is the closest and has electric power of 786MWe and thermal power of 36.5MWt, located approximately 8km to the north. Alwernia is also located about 1km from the high-pressure gas pipeline, which currently transfers high-methane gas through the Polish pipeline system and is managed by GAZ-SYSTEM S.A.

Geology

The main target for UCG is the Cracow Sandstone Series which has eight seams between 1-2 metres thickness. Four seam groups have indicated thickness values greater than 2m and occur at depths deeper than 800m. The best continuity in seam thickness is in the 500-1000 mbsl interval and therefore has potential as resources for UCG.

According to American Standard Classification of Coals by Rank (ASTM D 388), Alwernia is known to contain significant bituminous and sub-bituminous coal:

·; Moisture content: 8-12%

·; Volatile matter: 40-41%

To view the Company's Appendix 5B form, please click on the following link:

 http://www.rns-pdf.londonstockexchange.com/rns/5137K_-2013-7-30.pdf

**ENDS**

For further information please visit www.wildhorse.com.au or contact:

Further Information on Wildhorse:

Wildhorse Business Model

The WHE business model is focussed upon applying UCG technology to convert coal into syngas and then selling the syngas to power stations as a gas feedstock. The development and expansion of the UCG portfolio is underpinned by a potentially world class uranium project which the Company is advancing with its Hungarian uranium development partners Mecsek-Öko and Mecsekérc, with the support of the Hungarian Government.

Business Strategy

The Company's business strategy is to become a major supplier of gas feedstock to power stations in Central and Eastern Europe. WHE's project development strategy is based primarily upon acquiring strategic UCG sites in key locations in Central and Eastern Europe where gas markets are dominated by gas imports, energy security is a major factor for governments and large scale industrial consumers of gas and gas prices are correspondingly high.

Alongside its UCG assets, the Company also has a significant interest in a highly prospective uranium deposit in Hungary, which has a JORC Inferred resource of 48.3Mt at 0.072% uranium U3O8 for 77Mlbs of U3O8. As announced on 27 June 2012, the government has issued a formal decree in support of the formation of a joint venture ('JV') with state-owned organisations, Mecsek-Öko, and Mecsekérc and Hungarian Electricity Ltd ('MVM') (the owner of Paks Nuclear Power Plant). The JV's initial purpose will be to evaluate the necessary conditions to restart uranium mining in the Mecsek Hills with the ultimate aim of recommencing uranium mining at the Mecsek Hills Uranium Project.