3 September 2021

The following amendments have been made to Challenger Energy's announcement "Saffron Project Update, Funding Update & Share Issuance" released on 2 September 2021 at 07:00 a.m. under RNS No. 4496K, as follows:

The Company has noticed that in the penultimate paragraph, the figure of '2,270,522' was a typographical error, and should have read '7,270,522'. However, the figure given in the announcement as being the total voting rights following Admission, being 796,522,914 Ordinary Shares, is correct. In addition, the defined term 'BPC' should have been 'CEG'. The intended date for Admission of the New Shares is now 8 September 2021.

All other details remain unchanged. The full amended announcement is shown below.

Challenger Energy Group PLC

("Challenger Energy" or the "Company")

Saffron Project Update, Funding Update & Share Issuance - Replacement

Challenger Energy (AIM: CEG), the Caribbean and Atlantic margin focused oil and gas company, with production, appraisal, development and exploration assets across the region, is pleased to provide the following update in relation to the ongoing clean-up of the Saffron-2 appraisal well, as well as the timing and funding plans for the development of the field.

·    The Saffron-2 well production offtake continues to be optimised as the well cleans up over a range of reservoir zones. All production currently emanates solely from the Middle Cruse reservoirs. The Company plans to continue clean-up operations and to perforate and production test additional zones, so as to continue to develop the technical understanding of the field's production capacity whilst at the same time maximising revenues and cashflow being generated by the Saffron-2 well. A further update as to ongoing production rates will be provided in due course.

·    With Saffron-2 having proved the presence of moveable hydrocarbons in the Lower Cruse reservoirs, the Company considers that these reservoirs can ultimately contribute toward production, both at Saffron-2 and in future Saffron wells (once engineering solutions to technical issues encountered in drilling and producing deeper Saffron-2 zones are implemented). As noted, no production from the Lower Cruse is currently contributing to overall well production rates.

·    Based on current production rates from Safffon-2, the Company considers a development of the Saffron field can be justified economically - even without assuming production contribution from the Lower Cruse (and noting that development wells targeting only the shallower reservoirs will be more cost effective and quicker to drill than that experienced to date across the Saffron field).

·    In this context, work is underway to incorporate the results of Saffron-2 into an updated geological and reservoir model leading to a revised forward development plan for the Saffron field (and associated revised permitting and approvals). Subject to approval of a revised field development plan the Company is now targeting a development of Saffron to commence in H1 2022.

·    The Company and Arena Investors LP continue to discuss funding options for a Saffron field development, with those discussions to be further advanced once the revised development plan for the Saffron field is finalised.

·    In parallel, based on the outcomes of Saffron-2, the Company has begun investigating options for a farm-out of the Saffron project, which, if achieved, would present a fundamentally different approach and risk profile for development of the project than has been considered to-date. The Company has also begun investigating various Reserve Based Lending options, as a potential debt component of any project funding plan.

·    The Company has previously advised of £3 million drawn under its Conditional Convertible Note facility, of which £2.5 million was subsequently converted to equity with £0.5 million outstanding (repayable in April 2023 if not converted prior). A further £2 million of Convertible Notes became available to the Company on an unconditional basis on 14 June 2021. Pending the results of the Saffron-2 well the Company elected not to avail of this funding and has managed working capital needs and reduced overhead costs materially so to avoid the costs associated with draw-down under this facility (and given that, if drawn, funds would be senior secured and thus would in any case need to be immediately repaid in the event of any other funding being secured). In the absence of imminent Saffron development drilling, and in view of other funding alternatives currently being considered, the Company does not at this time expect to issue any further Convertible Notes under this facility, which otherwise expired in July 2021.

The Company further notes that it will be issuing 7,270,522 new ordinary shares in aggregate (representing less than 0.025% of the total shares in issues), to certain advisors of the Company in settlement of fees owing as well as to some legacy creditors in Trinidad in full settlement of amounts owing (the "New Shares"), with 1.2 million unlisted warrants issued alongside, to subscribe for new Ordinary Shares at the 3.5 pence per share, valid for a period of 48 months. Application has been made for the New Shares to be admitted to trading on the AIM market of the London Stock Exchange and it is expected that admission will take place on or around 8 September 2021 at 08:00 a.m. Following admission of the New Shares, CEG's issued share capital will consist of 796,522,914 ordinary shares, with each ordinary share carrying the right to one vote. The Company does not hold any ordinary shares in treasury. This figure of 796,522,914 ordinary shares may therefore be used by shareholders in the Company, as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules. 

Eytan Uliel, Chief Executive Officer, commented:

" On 25 August 2021, Challenger Energy advised of initial production test results at the Saffron-2 appraisal well in Trinidad's South West Peninsula. Testing is ongoing, but we have since received queries as to the implication of the well results so far for the project as a whole, in response to which I'd make two general comments: one, Saffron-2 has told us that a project at Saffron is likely viable, but two, it will not look the same as the project we had envisaged pre-drill. Specifically, we now know that a project based solely on shallower, cheaper wells targeting just the Middle Cruse can stand on its own, and we are working on revising technical models and development plans accordingly. We also now know that there are moveable hydrocarbons in the Lower Cruse, although more work is needed to figure out how to get sustained production from those zones, which has the potential to then expand the scope of any development over time. And finally, what we have learned from Saffron-2 will allow us to systematically revisit all available financing options, plus there is a body of work to be done in terms of updating relevant regulatory and planning requirements. The important point is that based on the results of Saffron-2 we believe Saffron is a commercial project, and so we are doing the work needed to advance to a development as soon as possible, until which time we will continue to maximise cashflow from the Saffron-2 well itself. We will keep shareholders appraised of developments. "

For further information, please contact:

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014, which forms part of United Kingdom domestic law by virtue of the European (Withdrawal) Act 2018.

Notes to Editors

Challenger Energy is a Caribbean and Atlantic margin focused oil and gas company, with a range of exploration, appraisal, development and production assets and licences, located onshore in Trinidad and Tobago, and Suriname, and offshore in the waters of The Bahamas and Uruguay. In Trinidad and Tobago, Challenger Energy has five (5) producing fields, two (2) appraisal / development projects and a prospective exploration portfolio in the South West Peninsula. In Suriname, Challenger Energy has on onshore appraisal / development project. Challenger Energy's exploration licence in each of Uruguay and The Bahamas are highly prospective, and offer high-impact value exposure within the overall portfolio value.

Challenger Energy is quoted on the AIM market of the London Stock Exchange.