Ann: Half Yearly Report and Accounts, page-4

Business Strategy

Whilst Central has historically been a pure oil and gas exploration company, over the past 3 years Central has developed and successfully pursued a strategy to gain critical mass in conventional gas production, including contracted gas sales and uncontracted gas reserves. This strategy first crystallised through the acquisition of the Palm Valley and Dingo gas fields from Magellan in April 2014, marking Central’s entry into commercial gas production.

Central’s business strategy was bolstered significantly on 1 September 2015 when Central completed the acquisition of 50 percent of the Mereenie oil and gas field from Santos and became Operator for the Joint Venture.

These acquisitions are consistent with Central’s business strategy to become a substantive domestic gas producer.

Currently Central has approximately 11 TJ/d contracted sales equity accounted and uncontracted gas reserves available for sale from proven fields.

With Mereenie, Palm Valley and Dingo fields under our common Operatorship, Central is now in a unique position to sell gas through the Northern Gas Pipeline (“NGP”) connecting the Northern Territory to the eastern seaboard.

This project is driven by clear fundamentals of a domestic gas shortfall on the East Coast and underexplored onshore gas potential in the Northern Territory. In linking supply and demand, Central’s sound business strategy of acquiring gas assets and uncontracted reserves in advance of the NGP has positioned it to be a direct and substantive beneficiary. In addition, there is significant focus on pipelines to ensure the gas market is functioning in a fair and efficient manner. Central could be a beneficiary of any pipeline tariff reform, particularly with respect of back-haul pipeline tariff pricing.

Whilst the implementation of Central’s Business Strategy has been relatively swift, the downturn in oil prices since its peak in 2014 has served to justify our transition into gas starting 3 years ago. The acquisition of Palm Valley, Dingo and Mereenie have all been based on existing gas contracts which are structured as long-term fixed price, CPI escalation. This provides a solid revenue stream going forward to cover Central’s operating activities and debt financing arrangements secured on long term gas contracts that are not affected by oil price or currency movements and therefore largely unaffected by turmoil in international oil or LNG markets.

Creating a market for our gas should materially re-rate our significant under explored permits throughout the Amadeus, Pedirka and Wiso Basins in Central Australia. Going forward, new gas sales will allow Central to generate critical free cash flow after debt service which can then be applied towards high growth and value adding activities, notably initially targeting growing high value conventional gas reserves throughout our various exploration permits.