ADX ENERGY LTD — Capital/Financing Update 2019

May 29, 2019

ASX Release

==> picture [136 x 269] intentionally omitted <==

30 May 2019

Final Drilling Approvals Received For Iecea Mica-1

SUMMARY OF RELEASE

• Local environmental and site construction permits received this week.

• All the necessary land owner, statutory and local government approvals and permits have now been received to commence operations.

• All key services and materials have been secured to enable the drilling of well.

• The construction of the well site and access road necessary prior to spud are expected to take approximately 6 to 8 weeks.

IECEA MICA-1 WELL SUMMARY

• The upper 2350 metres of Iecea Mica 1 (IM-1) appraisal well is effectively a redrill of a historic discovery well drilled in the 1980’s.

• IM-1 will evaluate multiple gas zones mapped on 3D seismic including a flow tested gas zone and an uncontrolled gas flow in the historic discovery well.

• The Contingent Resources based on an Independent Experts Report of the historic well data with recently acquired 3D seismic is 6.1 Bcf 2C and Prospective Gas Resources are 13 Bcf Best Estimate potential (see Iecea Mica-1 Well Overview attached).

• The well will be deepened to a depth of 2600 meters to evaluate larger untested exploration potential which is a proven play in other fields in the basin.

• The Best Case Prospective Resource for the deeper exploration upside potential accessible by the well that is mapped on 3D seismic is 16 Bcf (for a gas success case) and 2 MMBBLS (for an oil success case).

  • Note: Prospective Resources are those estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) related to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further explorations appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons .

• The well is not only highly prospective, it has the benefit of being proximal to infrastructure for both gas, oil and electricity enabling low cost, highly profitable commercialisation.

• If the deeper exploration target is successful it is expected to de-risk several follow up prospects with good upside potential.

ADX Energy Ltd (ASX Code: ADX ), further to the Drilling Update on 20 March 2019, is pleased to advise that it has now received all necessary statutory, landowner and environment approvals as well as local government construction permits required to construct a road and well site required prior to the commencement of drilling the IM-1 well. The environmental permit and the construction authorization are both issued at a local county level (Timis County). It should be noted that all approvals and permits have already been secured for the IM- 2 well, the second planned well in the Parta Appraisal program.

ADX will immediately commence road construction and drill site preparations within the Iecea Mare production license (“License”). The License is owned 100% by ADX Energy Panonia SRL, a wholly owned subsidiary of Danube Petroleum Limited (Danube). ADX holds a 63% shareholder interest in Danube and is contract Operator for the License and the surrounding Parta Exploration Permit (“Permit”) in which the License is located. The well is being funded through equity contributions of approximately US$3 million in Danube by 37% shareholder, Reabold Resources PLC (“Reabold’).

Well Reporting

ADX will provide further regular updates as we progress towards the spud date of IM-1 well.

Asset Ownership Structure

ADX holds a 63% shareholding in Danube Petroleum Limited (Danube). The remaining shareholding in Danube is held by Reabold Resources Plc. Danube via its’ Romanian subsidiary, ADX Panonia, holds a 100% interest in the Parta Exploration license (including a 100% interest in the Parta Appraisal Sole Risk Project) and a 100% interest in the Iecea Mare Production license.

For further details please contact: Paul Fink Ian Tchacos Chief Executive Officer Executive Chairman +61 (08) 9381 4266 +61 (08) 9381 4266

www.adxenergy.com.au

Iecea Mica -1 Well Overview

ADX together with Danube’s 37% shareholder, Reabold have elected IM-1 as the first drilling candidate for the two well Parta Appraisal Program. IM-1 is located in the Iecea Mare Production License which is within the Parta Exploration License in the Panonian Basin, onshore Romania.

==> picture [208 x 240] intentionally omitted <==

Location Map – Showing IM-1 Well location, Iecea Mare Production License and Parta License

Well Prognosis and Resource Potential

IM-1 is a structural trap targeting multiple (Pliocene to Miocene) pay zones including established appraisal potential from historic wells drilled in the 1980’s that were tested but never produced as well as deeper not tested exploration potential defined on recently acquired 3D seismic. The independently assessed contingent and prospective resource potential of IM-1 is summarised in the following table extracted from the ERC Equipoise Independent Report (ERCE). This evaluation excludes deeper exploration potential which can be accessed by the IM-1 well.

ERCE Independent Resource Estimates for Parta Appraisal Program (refer ADX’s ASX release 11/7/2018)

Recoverable Hydrocarbon Volumes	Recoverable Hydrocarbon Volumes	Recoverable Hydrocarbon Volumes	ERCE Estimates	ERCE Estimates	ERCE Estimates
Prospect	TargetReservoir	PRMSCategory	P90(bscf)	P50(bscf)	P10(bscf)
IM-1	Pa IV	Contingent1	2.0	6.1	16
IM-1	Pa VI	Prospective2	2.4	4.4	7.3
IM-1	Pa VIII inf.	Prospective	2.7	8.3	21.3
IM-2	PsB4.3	Prospective	5.4	15.6	39.1
IM-2	Pa IV	Contingent	4.8	15.5	43
Total Program		Contingent	6.8	21.6	59.0
Total Program		Prospective	10.5	28.3	67.7

1. Contingent Resources are those quantities of petroleum estimated, as at a given date, to be potentially recoverable from known accumulations but, for which the applied project(s) are not yet considered mature

enough for commercial development due to one or more contingencies. 1C, 2C, 3C Estimates: in a probabilistic resource size distribution these are the estimates that have a respectively 90% (P90), 50% (P50) and 10% (P10) probability that the quantities actually recovered will be exceeded

1. Prospective Resources are those estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) related to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further explorations appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons .

==> picture [304 x 260] intentionally omitted <==

A Simplified Stratigraphic X section through IM-1 and IM-2 showing the potential deeper Badenian (Miocene) build up carbonate play or the alternate fractured basement play.

In addition to the ERCE independently assessed Contingent and Prospective Resource volumes shown in the previous table, IM-1 offers a larger deeper exploration potential which was not included in ERCE’s estimates that can be reached within the current planned 2500 meters TD of the IM-1 well. It is predicted that the well will test a Badenian (Miocene) calcareous sandstone and/or a proven fractured basement play which has been successful in the Satchinez and Calacea fields 12km to the north of IM-1 well location. The Miocene Badenian age carbonate build up play is proven by gas discoveries to the East. Either one of, both of, or none of the deeper upside exploration plays may be present.

The Pa IV (Pannonian – Pliocene) horizon intersected in the original exploration discovery well tested at a rate of 1 MMSCFPD in 1989. It is expected the IM-1 well, with modern drilling and completion practices, will achieve significantly higher rates from this zone. Depending on which hydrocarbon charge model is assumed for the previously undrilled, deeper exploration plays there is also potential for an oil discovery at basement level. It should be noted that the previous Iecea Mare production license operator assessed the potential of the for the basement play to be in excess of 2 mmbbls of recoverable oil. ADX estimates 16 bscf for a best case recoverable prospective gas resource, assuming the intersection of a Miocene Badenian age (Miocene) calcareous sandstone is encountered as a gas bearing reservoir in an deeper exploration play success case. Based on nearby well data the intersection of potential basement reservoir is considered the most likely outcome.

==> picture [460 x 271] intentionally omitted <==

IM-1 Map and 3D Seismic Section through IM-1 well location

The above 3D seismic section through the IM-1 well location highlights the various currently identified reservoir targets and their respective depths. Note that the original exploration well only had electric logs down to the Pa VIII reservoir. The well was deepened further but experienced a major kick and overpressure around 2400 meters TVD that was not able to be tested. This is described as an uncontrolled flow in some old well reports for the discovery well.

Planning and Approvals

ADX has been active since mid-2018 to obtain all necessary permits and statutory approvals for the two wells. The program delay has resulted primarily due to Danube’s preference to drill the IM-1 well from within the Iecea Mare production license acquired from Amromco and the fact that the government authority could not issue a drilling permit (“AVIZ”) prior to ADX securing the transfer of the license to ADX Energy Panonia SRL. Furthermore the full data set utilized for prospect evaluation and planning for the production license was only handed over to ADX on the 19[th] December 2018.

ADX recently achieved the two key remaining milestones, the environmental permit and the construction authorization, for the commencement of operations issued at a local county level (in Timis County).

Well Design

Due to expected overpressure starting around 2400 meters (“the historic well blow out reservoir”) 7” casing is programmed to be run to a depth of 2350 meters TVD. The well will then be drilled through the overpressure zone in a smaller 6 1/8 “ hole size and will reach TD around 2600 meters.

==> picture [507 x 199] intentionally omitted <==

The most likely well cost estimate for the well is approximately US$3 million, including evaluation, logging and running casing. The above mentioned cost estimate does but not include well testing operations which are planned to be undertaken with a much smaller and cheaper work over unit. Included in the well cost estimate is a well head and production tubing which has already been purchased.

The IM-1 well is designed to enable the evaluation of an over pressured zone encountered in the original discovery well as well as highly prospective and potentially material deeper exploration targets not reached previously. These deeper exploration targets which are now mapped on 3D seismic are particularly exciting due to their materiality and the fact they can potentially be reached at minimal incremental cost.

End of Release