THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF REGULATION 11 OF THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS 2019/310.

24 October 2022

Baron Oil Plc

("Baron", or the "Company")

Chuditch PSC Update

Significant increases in management's aggregate Gas-in-Place and Recoverable Gas Resource estimates

Baron Oil Plc (AIM:BOIL), the AIM-quoted oil and gas exploration and appraisal company, is pleased to provide a further update on the TL-SO-19-16 Production Sharing Contract, offshore Timor-Leste ("Chuditch", the "Chuditch PSC" or "PSC") and the preliminary interpretation of the reprocessed Chuditch 3D seismic data.

Chuditch Highlights

·    Best case aggregate gross Gas-In-Place estimate of approximately 5,500 BCF versus an equivalent estimate of 3,889 BCF prior to 3D seismic data reprocessing

·    Best case Recoverable Resource estimate of 3,625 BCF, using preliminary gas recovery factors of between 50% and 75%, versus an equivalent estimate of 2,924 BCF prior to 3D seismic data reprocessing

·    Chuditch-1 gas discovery best case Recoverable Resource estimate of 1,350 BCF is materially larger and may independently represent a Liquefied Natural Gas ("LNG") scale resource

·    ERCE engaged to prepare a Competent Person's Report ("CPR") - potential for contingent resources to be assigned to the Chuditch-1 discovery

·    Chuditch SW prospect Gas-In-Place estimate has increased, but greater structural complexity may imply a lower recovery factor

·    Extension of sizable Chuditch NE Lead onto 3D seismic data area confirmed

·    The previously unevaluated 'Quokka' Lead extends onto the 3D seismic data area

Technical Update

Preliminary interpretation of the Chuditch PSC reprocessed 3D seismic data is leading to significant increases in management's aggregate Gas-in-Place and Recoverable Gas Resource estimates (the "Update") compared to the previous independent Prospective Resource estimates by THREE60 Energy (the "2021 Report", 14 July 2021).

The preliminary interpretation has led to a significant uplift in seismic imaging quality and has significantly reduced subsurface risk. Mapping indicates a greater concentration of resources into the Chuditch-1 discovery in a simplified and robust structure with relatively high gas recovery expected. The adjacent prospectivity has evolved; its understanding is now more robust, including confirmation of leads extending onto the 3D seismic data area.

Consultancy group ERCE has been engaged to prepare a CPR to provide an independent validation of Baron's internal resource estimates to a SPE PRMS compliant standard, which will include a probabilistic estimate of Resources and revised risk factors.

Revised Gas-in-Place and Recoverable Gas Resource estimates, gross for the Chuditch PSC, are detailed in the table below:

SundaGas Banda Unipessoal Lda. ("SundaGas"), a wholly owned subsidiary of Baron, is the operator of the Chuditch PSC and holds a 75% effective interest in the Chuditch PSC. Revised Gas-in-Place and Recoverable Gas Resource estimates, net attributable to Baron, for the Chuditch PSC are therefore as detailed in the table below:

Notes

Other Chuditch PSC Matters

PSC Extension

As announced on 18 October 2022, SundaGas was granted a six-month extension to Contract Year Two of the PSC which now expires on or before 18 June 2023.

Development and gas commercialisation

As the preliminary subsurface interpretation is indicating an uncomplicated structural configuration for Chuditch, and subject to an ongoing revision of the Chuditch engineering concept study, a simpler field development concept is likely. The apparent increase in gas resources in the Chuditch-1 discovery itself suggests that a single appraisal well will suffice to determine commerciality of the project without the need for immediate follow-on exploration wells.

Multiple potential export solutions for gas have been previously identified which are not dependent on any single concept or route. The fastest development and export option is expected to be to utilise a hybrid floating and platform LNG system, which does not require export pipelines or border crossings.

A revision of the Chuditch engineering concept study has commenced. It is anticipated that this work will illustrate and quantify a fast-track development pathway that targets first production in 2028.

Management estimates of project economics continue to be attractive at current and long term average gas prices in Asia.

Development strategies for handling carbon dioxide could include Carbon Capture and Storage ("CCS") at Bayu-Undan or for disposal within the Chuditch PSC. SundaGas aspires to achieve net zero LNG through long term supply arrangements with buyers that have an effective Scope 3 strategy.

Farmout

The Company continues to evaluate options to secure further investment for the Chuditch project, including an ongoing farmout process, which is accelerating with the availability of the revised interpretation. The Company remains in talks with multiple potentially interested parties.

The combination of the PSC extension, availability of the new reprocessed 3D seismic data, and the external validation of Resources that are to be provided via the CPR will be of significant benefit to this process as we move into 2023.

Investor Webinar

Baron will hold an investor webinar for existing and potential shareholders at 6.00 p.m. (London time) on 26 October 2022.

Those wishing to attend should register via the following link after which they will be provided with log in details:

https://us02web.zoom.us/webinar/register/WN_B-Rp7LJDRbGzCLh8IqIkag

There will be the opportunity for participants to ask questions at the end of the presentation. Questions can also be emailed to [email protected] ahead of the presentation.

For further information, please contact:

Qualified Person's Statement

Pursuant to the requirements of the AIM Rules - Note for Mining and Oil and Gas Companies ("AIM MOG"), the technical information and resource reporting contained in this announcement has been reviewed by Jon Ford BSc, Fellow of the Geological Society, Technical Director of the Company. Mr Ford has more than 40 years' experience as a petroleum geoscientist. He has compiled, read and approved the technical disclosure in this regulatory announcement and indicated where it does not comply with the Society of Petroleum Engineers' SPE PRMS standard.

* The Update supplements the previous SPE PRMS compliant 2021 Report. However, the Update has not been prepared to the standards set forth in the SPE PRMS or in accordance with an appropriate Standard as set out in the AIM MOG Note. The CPR commissioned by the Company will be SPE PRMS compliant.

The updated Gas-in-Place and Recoverable Resource estimates included in the Update are not directly comparable to those in the 2021 Report or those required under SPE PRMS. 

Glossary