HIGHLIGHTS

• Indicative approval has been received from DNRM for the transfer of the Roma Shelf assets to Armour Energy.
• Sale and Purchase Agreement relating to 100% owned tenements and assets now unconditional.

The Directors of Armour Energy Limited (ASX: AJQ; Armour) are pleased to advise that Origin Energy has received indicative approval from the Queensland Department of Natural Resources and Mines (“DNRM”)to transfer the Roma Shelf assets to Armour as first announced by the Company on 2 September 2015. The Roma Shelf assets are shown in the Figure 1 within the detailed announcement as below.

Sale and Purchase Agreement 7 between the parties which relates to 100% Origin owned tenements and assets is now unconditional and completion will occur in 10 business days as set out in the timeline below.Following completion, a transition period will commence until title is registered.

The remaining Sale and Purchase Agreements which relate to interests involving third party joint ventures remain subject to further conditions precedent relating to transfer of joint venture arrangements. This process is well advanced and expected to be completed in the next few weeks.

Receiving indicative approval sets Armour on a firm path to registration of title to the tenements over the coming months. Planning and other preparation work is progressing well to enable Armour to recommission the oil and gas assets safely and efficiently as well as ensuring that key operations staff from Origin Energy will be retained.

This acquisition sets Armour up to become a significant producer of oil, gas, LPG and condensate, strategically located near the Wallumbilla gas hub on the east coast of Australia. Furthermore the Newstead storage facility with a capacity of 7.5 PJs (including 2.3 PJs of contained sales gas) provides Armour with a significant business opportunity to manage this facility to maximise returns during periods of high gas demand.

Over the coming year demand for gas on the east coast of Australia is expected to increase to more than 2,000 PJs per year, more than triple the level of demand existing prior to the LNG plants being commissioned at Gladstone, Queensland.

Armour expects to re‐commence oil production well within 3 months from registration of title to the relevant tenements. Gas, and associated LPG and condensate production is expect to re‐commence within 6 – 12 months from registration of title and detailed planning work for project re‐commissioning has already commenced.

Armour expects initial oil production rates of approximately 50 barrels of oil per day and initial gas production rates of approximately 7 TJs per day. The Company intends to ramp up production quickly through a large number of cost effective production improvement opportunities identified from existing wells.