confidence, page-17

DM.
Kockatea is an extremely important shale formation through the Perth basin but was a secondary target along with HCSS.

There was gas and oil recorded by drill stem tests(DST) at both Mountain Ridge and Arrowsmith-1.

To my knowledge. No one has ever stimulated Kockatea to see how it would react.
The fact that they managed to stimulate oil out of this oil producing zone my have been one of the objectives.

This could have huge ramifications for not only NWE but other company's that had marginal commercial oil from Kockatea.

What you take form this Gov report is it's all about location.
The Woodada gas field seems to be our closest parallel.
Out of the 14 or so wells drilled. Only 7 are producers.

Woodada deep is some 25km away from Arrowsmith-1.
Woodada deep was one of the wells sharing the frac'ing with us. As seen below. AWE clearly did not get the results they wanted to date.

Aug 30
Woodada Deep-1 (AWE 100%, Operator) is a shale gas well
targeting the Middle and Upper Carynginia Formation.
Following the successful hydraulic fracture stimulation of
the well, gas was recovered and flared during the initial well clean-up and flow back period. Field operations have been temporarily suspended while options are being evaluated
for further testing

Yet 400 meters away from A-2. A-1 flowed 4mmcf/d.

It is also worth noting that our upper/mid Caryninia is deeper by 400 meters.
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Remind yourself of the objective of A-2

Arrowsmith-2 vertical well is being used to establish that the target zones are commercial, after which the flow rates from this vertical well can be scaled up to estimate expected production rates from a horizontal well in the same
formation.

HCSS

July 2011

Whilst this target was secondary in the overall campaign objectives, it has so far presented encouraging results based on initial log interpretation. The deep (3,300m) High Cliff Sandstones have not been actively explored in this part of the Basin in recent times due to the high costs of drilling, however the drilling of vertical shale gas exploration well Arrowsmith -2 presented the ideal opportunity to explore its potential for conventional deep tight gas in addition to the shale objectives. The High Cliff Sandstones will also be hydraulically fracture
stimulated and flow tested in the current program.

Sept 2011

The Lower Permian HCSS is the deepest target in the well, and is a tight gas target. If on flow back and testing, this zone proves to be laterally extensive and flows at a sufficient rate, there is the potential for the Arrowsmith-2 well to be completed as a High Cliff production well.

Aug 2012

Stabilized gas rate of 777Mscf/d recorded after 10 days which they believe will increase.

Kockatea first flowed at 70Mcf/d.

Putting us at 847Mcf/d

AWE are putting Senecio-2 into production at 1.3Mmcf/d.

I have very little doubt we have a commercial well and the primary targets are test to be tested.