BEACH ENERGY LIMITED — Capital/Financing Update 2012

Feb 20, 2012

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Strike Energy Limited ABN 59 078 012 745 21 February 2012
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OUR STRENGTHS
• Quality Assets
• Experienced Team
• Major Growth Potential
Strike Energy Limited
Ground Floor, 10 Ord Street
West Perth WA 6005
T: 61 8 6103 0999
F: 61 8 6103 0990
E: strike@strikeenergy.com.au
www.strikeenergy.com.au
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The Company Announcement Officer ASX Limited via electronic lodgement

STRIKE ENERGY’S SOUTHERN COOPER BASIN EXPLORATION PROGRAM COMMENCES

• Strike’s Marsden 1 unconventional coal and shale evaluation well to spud on Wednesday 22 February

• The Southern Cooper Basin emerging as a centre for coal and shale evaluation with six unconventional wells by mid-2012

OVERVIEW:

Strike Energy Limited has been advised by Beach Energy, the operator of PEL 95 (Strike 50%, Beach 50%), that the Marsden 1 well is expected to spud on Wednesday, 22 February. Marsden 1 is one of a series of wells being drilled in coming months specifically focused on evaluating the potential of the Southern Cooper Basin gas and liquids unconventional fairway.

Marsden 1 will be followed back-to-back by Strike’s second unconventional evaluation well, Davenport 1, that will test the Permian sections within PEL 94 (Strike 35%).

Map 1 – Southern Cooper Basin unconventional wells

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Strike Energy Limited ABN 59 078 012 745 21 February 2012
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MANAGING DIRECTOR’S QUOTE:

Managing Director, David Wrench, said:

“Strike Energy is uniquely placed to capitalise on its strategic permit holding in the Southern Cooper Basin, which has emerged as one of the most active regions in Australia for unconventional coal and shale exploration.

“The spudding of Marsden 1 marks the first stage of Strike’s unconventional coal and shale exploration and development program which is focused on evaluating the gas and liquids potential of the coals and shales in this region.

“We are confident in the liquids potential of this region which together with the lower cost of drilling and the ready access to infrastructure creates a clear path to commercialisation,” he said.

MARSDEN 1 COAL & SHALE EVALUATION WELL:

Strike has been advised by Beach Energy, the operator of PEL 95 (Strike 50%, Beach 50%), that the Marsden 1 coal and shale evaluation well will spud tomorrow. Ensign rig 918 has moved into position and will drill the well, located in the Battunga Trough, to a planned total depth of 2,640 metres. Strike anticipates that Marsden 1 will intersect 700 to 800 metres of Permian sediments including the Toolachee, the Roseneath, Epsilon and Murteree formations (together ‘REM’) and the Patchawarra. The well will be extensively cored and logged and is expected to take 25 – 30 days to drill.

Map 2 – Marsden 1 well location (Battunga Trough)

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Strike Energy Limited ABN 59 078 012 745 21 February 2012
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Marsden 1 will be followed back-to-back by Strike’s second unconventional evaluation well, Davenport 1, that will test the Permian sections within PEL 94 (Strike 35%).

SOUTHERN COOPER BASIN UNCONVENTIONAL FAIRWAY:

The Southern Cooper Basin is emerging as a major centre for unconventional exploration with leading operators, Beach Energy and Senex Energy, each conducting drilling programs to evaluate the Permian coal and shale formations. While there is still considerable work ahead, the path to commercialisation of the large unconventional Southern Cooper Basin resource will be aided by the following factors:

1. Liquids potential – The Permian formations are significantly shallower than the dry gas plays within the centre of the Cooper Basin and Strike believes they are at depths consistent with a potential wet gas window

2. Lower cost – Shallow formation depths will result in lower drilling and completion costs

3. Infrastructure access – The Southern Cooper Basin has access to east coast domestic and LNG markets via existing export pipelines that have substantial unused capacity

4. Land access – The Southern Cooper Basin is not subject to competing agricultural land and aquifer use claims that are impacting gas development projects elsewhere in eastern Australia

The Southern Cooper Basin unconventional fairway will be extensively evaluated over the next few months. In addition to Strike’s and Beach’s Marsden 1 and Davenport 1 evaluation wells within PELs 95 and 94 respectively, Senex Energy is advancing an active unconventional program within the adjacent PEL 516 (Senex 100%). Following on from its successful Vintage Crop 1 that was drilled approximately 10 kilometres from Strike’s Marsden 1 location and recorded the ‘presence of liquids rich gas’, Senex is currently drilling the Sasanof 1 evaluation well. It will be followed in coming months by two other unconventional evaluation wells, Skipton 1 and Talaq 1 (see Map 1), with all three wells being fracture stimulated and flow-tested.

Data from Strike’s Marsden 1 and Davenport 1 wells will be used to confirm the company’s resource model and to develop a follow-on evaluation and development program.

Yours faithfully

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DAVID WRENCH Managing Director

Further information:

Investors:

Strike Energy Limited David Wrench – Managing Director

• T: +61 (0) 2 8261 1000

• E: strike@strikeenergy.com.au

Media:

Fowlstone Communications Geoff Fowlstone

T: +61 (0) 413 746 949 E: geoff@fowlstone.com.au

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