BLOCK ENERGY PLC — Capital/Financing Update 2018

Feb 14, 2018

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the contents of this document or the action you should take, you are recommended to seek your own financial advice immediately from an appropriately authorised stockbroker, bank manager, solicitor, accountant or other independent financial adviser who, if you are taking advice in the United Kingdom, is duly authorised under the Financial Services and Markets Act 2000 (‘‘FSMA’’) or, if you are not resident in the United Kingdom, from another appropriately authorised independent financial adviser in your own jurisdiction.

This document comprises a prospectus relating to Rockrose Energy plc (the ‘‘Company’’ or ‘‘Rockrose’’) prepared in accordance with the prospectus rules of the United Kingdom Financial Conduct Authority (the ‘‘FCA’’) made under section 73A of FSMA (the ‘‘Prospectus Rules’’) and approved by the FCA under section 87A of FSMA. This document has been filed with the FCA and made available to the public in accordance with Rule 3.2 of the Prospectus Rules by being made available, free of charge, at www.rockroseenergy.com and at the Company’s registered office at c/o Cooley Services Limited, Dashwood, 69 Old Broad Street, London EC2M 1QS.

The current entire issued share capital of the Company (the ‘‘Ordinary Shares’’) is admitted to the standard listing segment of the Official List (‘‘Standard Listing’’) maintained by the FCA (the ‘‘Official List’’), in its capacity as competent authority under FSMA (the ‘‘UKLA’’) (under Chapter 14 of the listing rules published by the FCA under section 73A of FSMA (the ‘‘Listing Rules’’) and to the main market for listed securities (the ‘‘Main Market’’) of the London Stock Exchange plc (the ‘‘London Stock Exchange’’).

As the Company’s acquisition of the entire issued share capital of Idemitsu Petroleum UK Limited (‘‘Idemitsu UK’’) from Idemitsu Kosan Co., Limited (‘‘Idemitsu Group’’) (the ‘‘Idemitsu UK Acquisition’’) is classified as a ‘‘reverse takeover’’ under the Listing Rules (‘‘Reverse Takeover’’), upon announcement of the Idemitsu UK Acquisition on 18 October 2017, the Standard Listing of the Ordinary Shares was suspended by the UKLA. It is anticipated that, in accordance with the Listing Rules, upon completion of the Acquisitions and publication of this document the UKLA will cancel the Company’s existing Standard Listing, and applications have been made for the immediate admission of the Ordinary Shares to a Standard Listing on the Official List and to trading on the Main Market of the London Stock Exchange (together, ‘‘Admission’’). It is expected that Admission will become effective, and that unconditional dealings in the Ordinary Shares will commence, at 8.00 a.m. on 19 February 2018.

The whole of the text of this document should be read by prospective investors. Your attention is specifically drawn to the discussion of certain risks and other factors that should be considered in connection with an investment in the Ordinary Shares, as set out in Part II – Risk Factors of this document.

The Company and the directors, whose names appear on page 39 of this document (the ‘‘Directors’’), accept responsibility for the information contained in this document. To the best of the knowledge of the Company and the Directors (each of whom have taken all reasonable care to ensure that such is the case), the information contained in this document is in accordance with the facts and does not omit anything likely to affect the import of such information.

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Rockrose Energy plc

(Incorporated and registered in England and Wales with registered number 09665181)

Admission to the Official List of 15,333,334 Ordinary Shares of nominal value 20p each (by way of a Standard Listing under Chapter 14 of the Listing Rules) and to trading on the Main Market of the London Stock Exchange

Financial Adviser and Broker

Hannam & Partners (Advisory) LLP

This document does not constitute an offer to sell or an invitation to subscribe for, or the solicitation of an offer or invitation to buy or subscribe for, Ordinary Shares in any jurisdiction.

A Standard Listing will afford investors in the Company a lower level of regulatory protection than that afforded to investors in companies with listings on the premium segment of the Official List (‘‘Premium Listing’’), which are subject to additional obligations under the Listing Rules.

The Ordinary Shares have not been and will not be registered under the US Securities Act of 1933 (the ‘‘Securities Act’’), or the securities laws of any state or other jurisdiction of the United States or under applicable securities laws of Australia, Canada or Japan. Subject to certain exceptions, the Ordinary Shares may not be, offered, sold, resold, transferred or distributed, directly or indirectly, within, into or in the United States or to or for the account or benefit of persons in the United States, Australia, Canada, Japan or any other jurisdiction where such offer or sale would violate the relevant securities laws of such jurisdiction.

The Ordinary Shares have not been approved or disapproved by the US Securities Exchange Commission, any State securities commission in the United States or any other US regulatory authority, nor have any of the foregoing authorities passed comment upon or endorsed the merits of the adequacy of this document. Any representations to the contrary is a criminal offence in the United States.

Prospective investors should only rely on the information contained in this document. No person has been authorised to give any information or make any representations other than those contained in this document and, if given or made, such information or representation must not be relied upon as having been so authorised.

Apart from the responsibilities and liabilities, if any, which may be imposed on Hannam & Partners (Advisory) LLP (‘‘Hannam’’ or ‘‘Financial Adviser and Broker’’) by FSMA or the regulatory regime established thereunder, Hannam does not accept any responsibility whatsoever for, or make any representation or warranty, express or implied, as to the contents of this document or for any other statement made or purported to be made by it, or on its behalf, in connection with the Company, the Ordinary Shares and nothing in this document will be relied upon as a promise or representation in this respect, whether or not to the past or future. Hannam accordingly disclaims all and any responsibility or liability, whether arising in tort, contract or otherwise (save as referred to above), which they might otherwise have in respect of this document or any such statement.

Neither Hannam nor any of its representatives, is making any representation to any prospective investor of the Ordinary Shares regarding the legality of an investment in the Ordinary Shares by such prospective investor under the laws applicable to such prospective investor. The contents of this document should not be construed as legal, financial or tax advice. Each prospective investor should consult his, her or its own legal, financial or tax adviser for legal, financial or tax advice.

Hannam is authorised and regulated by the FCA and is acting exclusively for the Company and for no one else in connection with the production of this document and/or Admission. Hannam will not regard any other person as a client in relation to the production of this document and/or Admission and will not be responsible to anyone (whether or not a recipient of this document) other than the Company for providing the protections afforded to its clients, nor for providing advice in connection with the production of this document and/or Admission or any other matter, transaction or arrangement referred to in this document.

The distribution of this document in or into jurisdictions other than the United Kingdom may be restricted by law and therefore persons into whose possession this document comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of securities laws of any such jurisdiction.

14 February 2018

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CONTENTS

PART	I	SUMMARY	4
PART	II	RISK FACTORS	21
PART	III	IMPORTANT INFORMATION	34
PART	IV	EXPECTED TIMETABLE	38
PART	V	DIRECTORS, AGENTS AND ADVISERS	39
PART	VI	THE ACQUISITIONS AND THE GROUP	40
PART	VII	REGULATORY AND OPERATING ENVIRONMENT	55
PART	VIII	THE COMPANY, THE BOARD, THE SENIOR MANAGERS, AND THE	60
		FURTHER ACQUISITION STRATEGY
PART	IX	UNAUDITED PRO FORMA FINANCIAL INFORMATION FOR THE	65
		ENLARGED GROUP
PART	X	SELECTED FINANCIAL INFORMATION ON THE COMPANY	72
PART	XI	OPERATING AND FINANCIAL REVIEW OF ROCKROSE (INCLUDING	75
		LIQUIDITY AND CAPITAL RESOURCES AND CAPITALISATION AND
		INDEBTEDNESS)
PART	XII	TAXATION	78
PART	XIII	CONSEQUENCES OF A STANDARD LISTING	82
PART	XIV	ADDITIONAL INFORMATION	83
PART	XV	DEFINITIONS	100
PART	XVI	HISTORICAL FINANCIAL INFORMATION ON THE COMPANY	105
PART	XVII	HISTORICAL FINANCIAL INFORMATION ON IDEMITSU UK	178
PART	XVIII	COMPETENT PERSON’S REPORT	313

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PART I

SUMMARY

Summaries are made up of disclosure requirements known as ‘‘Elements’’. These Elements are numbered in Sections A – E (A.1 – E.7).

This summary contains all the Elements required to be included in a summary for this type of securities and issuer. Because some Elements are not required to be addressed, there may be gaps in the numbering sequence of the Elements.

Even though an Element may be required to be inserted in the summary because of the type of securities and issuer, it is possible that no relevant information can be given regarding the Element. In this case a short description of the Element is included in the summary with the mention of ‘‘not applicable’’.

Section A – Introduction and warnings

A.1	Warning to investors	This summary should be read as an introduction to this document. Any decision to invest in the Ordinary Shares should be based on consideration of this document as a whole by the investor. Where a claim relating to the information contained in this document is brought before a court, the plaintiff investor might, under the national legislation of the EEA States, have to bear the costs of translating this document before legal proceedings are initiated. Civil liability attaches only to those persons who have tabled this summary including any translation thereof, but only if this summary is misleading, inaccurate or inconsistent when read together with the other parts of this document or it does not provide, when read together with the other parts of this document, key information in order to aid investors when considering whether to invest in such securities.
A.2	Subsequent resale of securities or fnal placement of securities through fnancial intermediaries	Not applicable. There will be no sale or placement of securities nor any resale or fnal placement of securities by fnancial intermediaries.

Section B – the Issuer

		Section B – the Issuer
B.1	Legal and commercial name	Rockrose Energy plc.
B.2	Domicile and legal form	The Company was incorporated in England and Wales on 1 July 2015 as a public company with limited liability under the Companies Act with an indefnite life.
B.3	Current operations / principal activities and markets	Introduction The Company was formed to make acquisitions of companies or businesses in the upstream oil and gas and power sector. Following the Initial Admission, the Company identifed and has subsequently acquired a number of targets. Acquisition history On 14 September 2016, the Company announced that it had agreed non-binding heads of terms with respect to the acquisition of the Maersk Interests. As the proposed acquisition of the Maersk Interests constituted a Reverse Takeover, the Standard Listing of the Ordinary Shares was suspended on 14 September 2016 pending the Company publishing of a prospectus in relation to the readmission on 4 July 2017, and readmission taking place on 6 July 2017.

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On 21 December 2016, Rockrose (UKCS1) signed an agreement with Maersk to acquire the Maersk Interests. The consideration for the Maersk Acquisition was £14,540,000, payable to Rockrose (UKCS1) plus a further sum payable to Rockrose (UKCS1) by way adjustments for income, expenditure and working capital (reflecting an effective economic date for the transaction of 1 January 2016) receivable by the Company in cash on, or shortly after completion. The long stop date for completion of the Maersk Acquisition was 31 December 2017, which date has passed without completion having taken place. On 26 January 2018 the Company announced that it had withdrawn from the completion process in respect of the proposed Maersk Acquisition. No penalties or termination costs accrue for the account of the Company in respect of the failure to complete by the relevant long stop date or at all.

On 22 March 2017, the Company executed agreements to make the Egerton Acquisition. The total consideration for the Egerton Acquisition is £1.00 payable to the Company in cash and deferred consideration payable to the Company of £666,000 over an 18 month period on the basis that Egerton will have net cash at completion of £333,000. The Egerton Acquisition was not material in the context of resources, net assets or potential liabilities. Completion of the Egerton Acquisition was conditional on the OGA confirming that it had no objection to the change of control of Egerton. On 20 December 2017, the Company received a letter from the OGA confirming that it currently has no objection to the change of control of Egerton, and the Egerton Acquisition completed on 22 December 2017.

On 3 August 2017, Rockrose (UKCS1) signed an acquisition agreement in the form of a put and call option with the Sojitz Sellers for the acquisition of the entire issued share capital of Sojitz, and on 3 August 2017 entered into a sale and purchase agreement with the Sojitz Sellers. The total consideration for the acquisition was $2,500,000, however $1,750,000 was receivable by the Company at completion (reflecting an effective economic date for the transaction of 1 January 2016). Completion of the Sojitz Acquisition was conditional on the OGA confirming that it had no objection to the change of control of Sojitz. On 20 December 2017, the Company received a letter from the OGA confirming that it currently has no objection to the change of control of Sojitz, and the Sojitz Acquisition completed on 22 December 2017.

On 18 October 2017, the Company signed an agreement with Idemitsu Group for the acquisition of the entire issued share capital of Idemitsu UK. The total consideration was US$29.7m (subject to certain adjustments). As the Idemitsu UK Acquisition constituted a Reverse Takeover, the Standard Listing of the Ordinary Shares was suspended by the UKLA on 18 October 2017 pending the Company publishing a prospectus in relation to Admission. Completion of the Idemitsu UK Acquisition was conditional on the OGA confirming that it had no objection to the change of control of Idemitsu UK.

On 30 November 2017, the Company received a letter from the OGA confirming that it currently has no objection to the change of control of Idemitsu UK, and the Idemitsu UK Acquisition completed on 8 December 2017. Business objective, strategy and execution The objective of the Company is to operate the Group and implement a strategy with a view to generating value for its Shareholders through the acquisition of operated and non-operated interests in onshore and offshore oil and gas production and power generation projects.

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			The strategy will involve the making of further acquisitions. Further acquisitions will need to be assessed under the Listing Rules and depending on the size of further acquisitions the transaction may be deemed a Reverse Takeover and the Company’s Standard Listing may be cancelled in such circumstances. The Company would then intend to seek admission of the enlarged group to listing on the Offcial List and trading on the Main Market of the London Stock Exchange but may, in certain circumstances, seek admission to trading on AIM or admission to another stock exchange dependent on the nature of the specifc acquisition which may be considered by the Directors to be suited to a Premium Listing or Standard Listing, or if a smaller earlier-stage growth business, more suited to a listing on AIM. Furthermore, it may be appropriate, dependent on the geography of any target business’ manufacturing locations or target markets, for the Company’s securities to be additionally listed on a non-UK stock exchange. The Company’s efforts in identifying further acquisitions in the upstream oil and gas and power sector will not be limited to a particular geographic region, however the Company’s present focus will be the UK and Western Europe. It is possible that a future acquisition with compelling potential may be found in Continental Europe, Ireland or the Scandinavian region. Unless required by applicable law or other regulatory process, no Shareholder approval will be sought by the Company in relation to any further acquisition(s). The Directors will draw on their experience, in conjunction with their contacts and advisers, to target suitable further acquisition candidates in the upstream oil, gas and power sector.
B.4a	Signifcant recent trends		Not applicable. The Company is a new entrant and there are no signifcant trends which can be derived from the Company’s business as it is at a very early stage.
B.5	Group structure		The Company is a public company with limited liability domiciled in England and Wales and is the holding company of the Group. As at the date of this document and Admission, the Company holds the following percentages of the share capital in the Group companies listed below, all of which are incorporated in England and Wales: Name of Group company: Company’s percentage ownership in the issued share capital of the relevant Group company: Rockrose (UKCS1) Limited(1)(3) 100% Rockrose (UKCS2) Limited(1) 100% Rockrose (UKCS3) Limited(1) 100% Rockrose UKCS4 Limited(1) 100% Rockrose UKCS5 Limited(2)(3) 100% Rockrose UKCS6 Limited(2)(3) 100% Rockrose UKCS7 Limited(2)(3) 100% (1) The Company holds a 100% direct ownership interest in this entity. (2) The Company holds a 100% direct ownership interest in Rockrose UKCS4 Limited, which in turn holds a 100% direct ownership stake in this entity. (3) This entity is dormant.

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B.6	Major shareholders		Save for the interests of the Directors, which are set out below, as at the date of this document and Admission the Directors are aware of the following holdings of Ordinary Shares, which will represent 3 per cent. or more of the Company’s issued share capital or voting rights: As at the date of this document and Admission Name Number of Ordinary Shares Percentage of share capital Andrew Philip Austin 3,548,335 23.01% Arunvill Capital Limited 2,666,666 17.39% City Financial Investment Company Limited 1,866,666 12.17% Legal & General Group plc 1,133,333 7.39% Macquarie Capital (Europe) Limited 999,998 6.52% Includes 720,000 Ordinary Shares held in Mr Austin’s SIPP, administered by Rowanmoor Trustees. As at the date of this document and Admission, respectively, the interests of the Directors and each of their respective connected persons in the share capital of the Company, all of which are benefcial, are and will be as follows: As at the date of this document and Admission Name Number of Ordinary Shares benefcially owned, controlled or directed, directly or indirectly Percentage of share capital Andrew Philip Austin 2,828,335 18.45% Andrew Philip Austin’s SIPP 720,000 4.70% John Andrew Corran Morrow 210,000 1.37% Richard Alan Benmore 186,667 1.22% Administered by Rowanmoor Trustees. Other than those person described above, as at 13 February 2018, the Company had not been notifed, nor was it otherwise aware of, any persons who directly or indirectly, have an interest in the Company’s share capital or voting rights which is notifable under English law.
B.7	Selected historical key fnancial information		The selected fnancial information set out below has been extracted without material adjustment from the audited historical fnancial information of the Company for the 18 month period ended 31 December 2016, and unaudited historical fnancial information of the Company for the six month periods ended 30 June 2017 and 30 June 2016.

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Selected Financial Information of the Company:

Consolidated Income Statement and Consolidated Statement of Comprehensive Income

Unaudited 6 months ended 30 June 2017 £ Administrative expenses (1,381,377) Exceptional items (529,375) Operating loss (1,910,752) Finance income 845 Finance costs — Loss before taxation (1,909,907) Tax — Loss for period and total comprehensive expense (1,909,907) Consolidated Statement of Financial Position 30 June 2017 £ Assets Current assets Trade and other receivables 1,085,433 Cash and cash equivalents 1,438,848 Total assets 2,524,281 Current liabilities Trade and other payables 2,204,386 Total liabilities 2,204,386 Equity and liabilities Share capital and reserves Share capital 2,000,000 Share premium 2,224,816 Accumulated losses (4,020,264) Share option reserve 115,343 Total equity 319,895 Total equity and liabilities 2,524,281	18 months ended 31December 2016 £ (1,292,584) (48,164) (1,340,748) 3,893 (2) (1,336,857) — (1,336,857) 31December 2016 £ 244,428 2,387,968 2,632,396 441,042 441,042 2,000,000 2,224,816 (2,110,357) 76,895 2,191,354 2,632,396	Unaudited 6 months ended 30 June 2016 £ (263,072) (42,434) (305,506) 2,163 (1) (303,344) — (303,344) 30 June 2016 £ 788,951 3,137,844 3,926,795 39,626 39,626 2,000,000 2,224,816 (337,647) — 3,887,169 3,926,795

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Consolidated Statement of Cash Flows Unaudited 6 months ended 30 June 2017 £ Cash fows from operating activities Loss for the period (1,909,907) Share based payments 38,448 Finance cost — Finance income (845) Increase in trade and other receivables (841,005) Increase in trade and other payables 1,763,344 Net cash used in operating activities (949,965) Cash fows from investing activities Interest paid — Interest received 845 Net cash used from investing activities 845 Cash fows from fnancing activities Proceeds from issue of shares net of treasury shares — Initial public offering costs — Net cash generated from fnancing activities — Net increase in cash and cash equivalents (949,120) Cash and cash equivalents at beginning of period 2,387,968 Cash and cash equivalents at end of period 1,438,848	18 months ended 31December 2016 £ (1,336,857) 76,895 2 (3,893) (244,428) 441,040 (1,067,241) — 3,893 3,893 4,226,500 (775,184) 3,451,316 2,387,968 — 2,387,968	Unaudited 6 months ended 30 June 2016 £ (303,344) — 1 (2,163) 173,495 (1,132,385) (1,264,396) (1) 2,163 2,162 4,400,000 — 4,400,000 3,137,766 78 3,137,844

During the period covered by the historical financial information set out above, the significant change to the Company’s financial position was the receipt of net proceeds from the issue of Ordinary Shares in conjunction with the Initial Admission, the Fundraise and on completion of the Acquisitions. There was no significant change to the Company’s operating results during the period.

Since 30 June 2017 (being the end of the last financial period of the Company for which financial information has been published), there has been no significant change in the operating results of the Company.

Subsequent to the balance sheet date of 30 June 2017 the following significant changes to the Company’s financial position have occurred:

(a) on 6 July 2017, 5,333,334 Ordinary Shares were placed and a total of £8 million (£7.2 million net of placing costs) of capital was raised for the Company;

(b) on 22 December 2017, the Egerton Acquisition completed; (c) on 22 December 2017, the Sojitz Acquisition completed, and the Company paid US$2.7m pursuant to the Sojitz Acquisition but benefited from a working capital receipt of US$1.9m; and (d) on 8 December 2017, the Idemitsu UK Acquisition completed, and the total consideration was US$29.7m but the cash at bank held by the acquired entity was US$139.7m.

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B.8	Selected key pro forma fnancial information	The unaudited consolidated pro forma statement of net assets and income statement of the Enlarged Group set out in this Element have been prepared in a manner consistent with the accounting policies adopted by the Company in preparing the Group’s audited consolidated fnancial statements for the period ended 31 December 2016 and the Company’s unaudited Interim Report for the six months ended 30 June 2017. Thepro formafnancial information is prepared on the basis set out in the notes to the pro forma fnancial information in accordance with Annex II to the Prospectus Directive Regulation. The adjustments in the unaudited pro forma fnancial information are expected to have a continuing impact on the Enlarged Group, unless stated otherwise. The unaudited pro forma statement of net assets has been prepared based on the net assets of the Group as at 30 June 2017 and has been prepared to illustrate the impact of: (i) the Idemitsu UK Acquisition, which completed on 8 December 2017; (ii) the Sojitz Acquisition, which completed on 22 December 2017; and (iii) the Egerton Acqusition, which completed on 22 December 2017, on the net assets of the Group as if they had been completed on 30 June 2017. The unauditedpro formaincome statement has been prepared based on the consolidated income statement of the Group for the six month period ended 30 June 2017. The unaudited pro forma income statement has been prepared to illustrate the impact of the Acquisitions on the consolidated income statement of the Group as if it had been completed on 1 January 2017. Due to its nature, the unaudited pro forma income statement and net assets statement address a hypothetical situation. They do not represent the Group’s actual results of operations or fnancial condition or what the Enlarged Group’s actual results of operations or fnancial condition would have been if the Acquisitions had been completed on the dates indicated. The unaudited consolidated pro forma loss before tax for the six month period ended 30 June 2017 is $8.8 million. The unaudited consolidatedpro formanet assets as at 30 June 2017 (or at completion date of acquisitions in respect of the Sojtiz and Egerton net assets) is $9.8 million.

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1. Unaudited pro forma statement of net assets

		1. Unaudited pro forma statement of net assets Adjustments Rockrose as at 30 June 2017 Idemitsu UK as at 30 June 2017 Sojitz on completion Egerton on completion Adjustments arising and capital raise Enlarged Group at 30 June 2017 US$m (note 1) US$m (note 2) US$m (note 3) US$m (note 4) US$m (note 5) US$m ASSETS Non-current assets Intangible Assets — 1.7 — — 93.0 94.7 Property, plant and equipment — 52.9 8.1 — — 61.0 Investment in subsidiaries — — — — — — Deferred tax asset — 34.1 — — — 34.1 — 88.7 8.1 — 93.0 189.8 Current assets Inventories — 1.0 0.7 — — 1.7 Trade and other receivables 1.4 19.8 2.1 — 0.9 24.2 Loan to the group undertaking — 105.0 — — (105.0) — Cash and cash equivalents 1.9 33.9 — — 83.3 119.1 3.3 159.7 2.8 — (20.8) 145.0 TOTAL ASSETS 3.3 248.4 10.9 — 72.2 334.8 LIABILITIES Current liabilities Amount owed to fellow subsidiaries — (0.1) — — 0.1 — Trade and other payables (2.9) (23.1) (0.4) (0.1) — (26.5) Tax payable — (0.1) — — — (0.1) (2.9) (23.3) (0.4) (0.1) 0.1 (26.6) Non-current liabilities Decommissioning provision — (278.0) (13.2) (7.2) — (298.4) Other provision — — — — — — Employee benefts — — — — — — Deferred tax liability — — — — — — — (278.0) (13.2) (7.2) — (298.4) TOTAL LIABILITIES (2.9) (301.3) (13.6) (7.3) 0.1 (325.0) NET ASSETS/ (LIABILITIES) 0.4 (52.9) (2.7) (7.3) 72.3 9.8

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Notes

• 1: The Rockrose financial information as at 30 June 2017 has been extracted from the Company’s unaudited Interim Report for the six month period ended 30 June 2017. The financial information has been translated from GBP to USD due to the Enlarged Group having adopted US Dollars as its presentational currency following completion of the Acquisitions:

ASSETS Current assets Trade and other receivables Cash and cash equivalents TOTAL ASSETS LIABILITIES Trade and other payables Total Current Liabilities TOTAL LIABILITIES NET ASSETS	Rockrose as at 30 June 2017 (£m) (note 1(a)) 1.1 1.4 2.5 2.5 (2.2) (2.2) (2.2) 0.3	Rockrose as at 30 June 2017
		(US$m) (note 1(b)) 1.4 1.9
		3.3
		3.3
		(2.9)
		(2.9)
		(2.9)
		0.4

1(a): This is the historical consolidated statement of net assets for Rockrose as at 30 June 2017 as extracted from the Company’s unaudited Interim Report for the six month period ended 30 June 2017.

1(b): Rockrose’s consolidated statement of net assets has been translated from GBP to USD using the exchange rate on 30 June 2017 of GBP1:USD1.299. 2: The Idemitsu UK financial information as at 30 June 2017 has been extracted, without material adjustment, from the unaudited Interim Report of Idemitsu UK for the six months ended 30 June 2017.

3: Rockrose completed the Sojitz Acquisition on 22 December 2017. This column reflects the net assets of Sojitz at completion on 22 December 2017. The completion date balance sheet of the Company was used since this accurately reflects the impact of all pre-completion adjustments attributable to the acquisition. The completion date balance sheet was prepared based on management accounts, which were adjusted to remove balances associated with the Gryphon field which was transferred to another company within the Sojitz group prior to acquisition by Rockrose as per the terms of the Sojitz Acquisition Agreement. These adjustments were prepared with reference to billing statements provided by the operator of the Gryphon field. The unaudited completion date balance sheet of the Company has been further adjusted to decrease the decommissioning provision to account for this provision under Rockrose’s accounting policies. This gave rise to a decrease of $0.8m in the Company’s decommissioning liability.

4: Rockrose completed the Egerton Acquisition on 22 December 2017. This column reflects the net assets of Egerton at completion on 22 December 2017. The completion date balance sheet of the Company was used since this accurately reflects the impact of all pre-completion adjustments attributable to the acquisition. The financial information has been extracted from the unaudited completion date balance sheet of Egerton. The completion date balance sheet was constructed from the management accounts of the company, adjusted to include balances attributable to the Galahad and Mordred fields which were derived from billing statements provided by the operator of these fields. The financial information has been translated from GBP to USD using the exchange rate prevailing on the completion date of the Egerton Acquisition which was GBP1:USD1.3387. There was also an adjustment made to the completion date balance sheet to record a decommissioning provision of $7.2m, which was recognised and measured in accordance with Rockrose’s accounting policies. This adjustment to the completion date balance sheet was required because the provision for decommissioning in respect of the Galahad and Mordred fields was previously held in a different Egerton group company, but the obligation was assumed by Rockrose on acquisition of Egerton in line with the terms of the Egerton Acquisition Agreement.

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• 5: Adjustments attributable to the transaction: 5(a): The unaudited pro forma statement of net assets has been prepared on the basis that the Acquisitions will be treated as acquisitions of a business in accordance with IFRS 3 Business Combinations. The pro forma statement of net assets does not reflect the fair value adjustments to the acquired assets and liabilities as the fair value measurement of these items are still being finalised. For the purposes of the pro forma statement of net assets, the excess purchase consideration over the carrying amount of the net assets acquired has been attributed to intangible assets (goodwill).

Consideration Less carrying value of net liabilities acquired Goodwill	Idemitsu UK (US$m) 30.6 (52.9) 83.5	Sojitz (US$m) 0.8 (2.7) 3.5	Egerton (US$m) (1.3) (7.3) 6.0	Total (US$m) 30.1 (62.9) 93.0

• 5(b): The increase to debtors relates to deferred consideration due on the Egerton Acquisition. The total consideration for the Egerton Acquisition was negative cash consideration of $1.3m of which $0.4m was received on completion and a further $0.9m receivable on the first anniversary of the Egerton Acquisition.

• 5(c): Repayment of $105m funds owed by an Idemitsu group company to Idemitsu UK, which was repaid prior to completion of the Idemitsu UK Acquisition in accordance with the terms of the Idemitsu UK Acquisition Agreement.

• 5(d): Total increase in cash of $83.3m arises due to a number of adjustments attributable to the Acquisitions, which were:

• receipt of $105m funds previously held as a receivable by Idemitsu UK as described in note 5(c);

• net payment of cash consideration of $30.5m for the acquisitions of Idemitsu UK and Sojitz;

• negative consideration received of $0.4m for the Egerton Acquisition;

• • transaction costs arising from the Acquisitions of $0.9m; and * receipt of funds of $9.4m (net of transaction costs of $1.0m) from a Rockrose Ordinary Share issue. On 4 July 2017, Rockrose placed 5,333,334 Ordinary Shares raising gross proceeds of $10.4m).

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2. Unaudited pro forma income statement

Revenue Other income Cost of sales Depreciation, depletion or amortisation Foreign exchange movements on decommissioning Trading (Loss)/ Proft Administrative expenses Exceptional items Operating (Loss)/ Proft Finance income Finance costs Foreign exchange gain/(loss) (Loss)/Proft before taxation Taxation (Loss)/Proft for the period	Rockrose 6 months to 30 June 2017 (note 6) US$m — — — — — — (1.7) (0.7) (2.4) — — — (2.4) — (2.4)	Adjustments (notes 11 and 12) Idemitsu UK 6 months to 30 June 2017 (note 7) US$m Sojitz 6 months to 30 June 2017 (note 8) US$m Egerton 6 months to 30 June 2017 (note 9) US$m Acquisition adjustments (note 10) US$m 40.5 1.6 0.2 — 0.9 — — — (21.6) (3.3) (0.3) — (4.3) — — — (9.7) — — — 5.8 (1.7) (0.1) — (3.3) (0.5) — 0.9 — — — — 2.4 (2.2) (0.1) 0.9 0.7 — — — (5.2) (1.1) — — (0.3) — — — (2.3) (3.3) (0.1) (0.9) 0.3 (0.1) — — (2.0) (3.4) (0.1) (0.9)	Adjustments (notes 11 and 12) Idemitsu UK 6 months to 30 June 2017 (note 7) US$m Sojitz 6 months to 30 June 2017 (note 8) US$m Egerton 6 months to 30 June 2017 (note 9) US$m Acquisition adjustments (note 10) US$m 40.5 1.6 0.2 — 0.9 — — — (21.6) (3.3) (0.3) — (4.3) — — — (9.7) — — — 5.8 (1.7) (0.1) — (3.3) (0.5) — 0.9 — — — — 2.4 (2.2) (0.1) 0.9 0.7 — — — (5.2) (1.1) — — (0.3) — — — (2.3) (3.3) (0.1) (0.9) 0.3 (0.1) — — (2.0) (3.4) (0.1) (0.9)	Adjustments (notes 11 and 12) Idemitsu UK 6 months to 30 June 2017 (note 7) US$m Sojitz 6 months to 30 June 2017 (note 8) US$m Egerton 6 months to 30 June 2017 (note 9) US$m Acquisition adjustments (note 10) US$m 40.5 1.6 0.2 — 0.9 — — — (21.6) (3.3) (0.3) — (4.3) — — — (9.7) — — — 5.8 (1.7) (0.1) — (3.3) (0.5) — 0.9 — — — — 2.4 (2.2) (0.1) 0.9 0.7 — — — (5.2) (1.1) — — (0.3) — — — (2.3) (3.3) (0.1) (0.9) 0.3 (0.1) — — (2.0) (3.4) (0.1) (0.9)	Rockrose 6 months Enlarged Group US$m 42.3 0.9 (25.2) (4.3) (9.7) 3.9 (5.5) (1.6) (3.2) 0.7 (6.3) (0.3) (9.0) 0.2 (8.8)
		Idemitsu UK 6 months to 30 June 2017 (note 7) US$m 40.5 0.9 (21.6) (4.3) (9.7) 5.8 (3.3) — 2.4 0.7 (5.2) (0.3) (2.3) 0.3 (2.0)	Sojitz 6 months to 30 June 2017 (note 8) US$m 1.6 — (3.3) — — (1.7) (0.5) — (2.2) — (1.1) — (3.3) (0.1) (3.4)	Egerton 6 months to 30 June 2017 (note 9) US$m 0.2 — (0.3) — — (0.1) — — (0.1) — — — (0.1) — (0.1)

Notes 6: The Rockrose financial information for the six month period ended 30 June 2017 has been extracted from the Company’s unaudited interim report for that period. The financial information has been translated from GBP to USD due to the Enlarged Group having adopted US Dollars as its presentational currency following completion of the Acquisitions:

	6 months to	6 months to
	June 2017	June 2017
In millions	(£m)	(US$m)
	(note 6(a))	(note 6(b))
Revenue	—	—
Other income	—	—
Cost of sales	—	—
Trading proft	—	—
Adminstrative expenses	(1.4)	(1.7)
Exceptional items	(0.5)	(0.7)
Impairment of exploration assets	—	—
Operating proft	(1.9)	(2.4)
Finance income	—	—
Finance costs	—	—
Foreign exchange gain/(loss)	—	—
(Loss)/Proft before taxation	(1.9)	(2.4)
Taxation	—	—
(Loss)/Proft for the period	(1.9)	(2.4)
6(a): This is the historical consolidated income statement for Rockrose for the six
months ended 30 June 2017 as extracted from the Company’s unaudited
Interim Report for the six month period ended 30 June 2017.

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		6(b): Rockrose’s consolidated income statement has been translated from GBP to USD using the average exchange rate over the six month period to 30 June 2017 of GBP1:USD1.255. 7: The Idemitsu UK fnancial information as at 30 June 2017 has been extracted, without material adjustment, from the audited Interim Report of Idemitsu UK for the six month period ended 30 June 2017. 8: Rockrose completed the Sojitz Acquisition on 22 December 2017. The pro forma income statement for Sojitz for the six month period ended 30 June 2017 has been derived from management accounts for the period. The fnancial information has been adjusted to remove income and expenses associated with the Gryphon feld which was transferred to another company within the Sojitz group prior to acquisition by Rockrose as per the terms of the Sojitz Acquisition Agreement. Balances attributable to the Gryphon feld were removed with reference to billing statements provided by operator of the Gryphon feld. 9: Rockrose completed the Egerton Acquisition on 22 December 2017. The pro forma income statement for Egerton for six month period ended 30 June 2017 has been derived from management accounts for the period. The management accounts were adjusted to include balances attributable to the Galahad and Mordred felds which were derived from billing statements provided by the operator of these felds. The fnancial information was translated from GBP to USD using the average exchange rate for the period of GBP1:USD1.255 due to the management accounts being prepared in GBP, compared to the Group presentation currency of USD. 10: For the purposes of the unaudited pro forma income statement, transaction costs of $0.9m incurred by the Group in respect of the Acquisitions have been refected as an expense. These costs are not expected to be incurred on an ongoing basis in the Enlarged Group. 11: No additional depreciation and amortisation charge has been applied to refect the impact of any fair value adjustments that might arise under IFRS 3 ‘‘Business Combinations’’ in relation to intangible assets and property, plant and equipment, for any of the Acquisitions as it is considered impractical to do so given the fair value adjustments are still being calculated. 12: No adjustment has been made to refect the fnancial results of Rockrose or Idemitsu UK since 30 June 2017. No adjustment has been made to refect the fnancial results of Sojitz or Egerton since 30 June 2017 or the net assets since 22 December 2017.
B.9	Proft forecast or estimate	Not applicable. The Company has not made any proft forecasts or estimates which remain outstanding as at the date of this document.
B.10	Qualifed audit report	Not applicable. There are no qualifcations in the accountant’s report on the historical fnancial information.
B.11	Insuffcient working capital	Not applicable. The Company is of the opinion that the working capital available to the Group is suffcient for the present requirements of the Group, that is, for at least the next 12 months following the date of this document.

Section C – Securities

		Section C – Securities
C.1	Description of the type and the class of the securities being offered	No new Ordinary Shares are being offered in connection with Admission. Application will be made for the Ordinary Shares to be admitted to the Offcial List with a Standard Listing and to be admitted to trading on the Main Market of the London Stock Exchange. The Ordinary Shares will be registered with ISIN GB00BYNFCH09, SEDOL BYNFCH0 and have a TIDM RRE. The nominal value of the Ordinary Shares is £0.20 each.
C.2	Currency of the securities issue	UK Pounds Sterling.
C.3	Issued share capital	15,333,334 Ordinary Shares of a nominal value of 20p each in issue and fully paid.
C.4	Rights attached to the securities	Shareholders will have the right to receive notice of and to attend and vote at any meetings of Shareholders. Each Shareholder entitled to attend and being present in person or by proxy at a meeting of

15

		Shareholders will, upon a show of hands, have one vote and upon a poll each such Shareholder present in person or by proxy will have one vote for each Ordinary Share held by him. In the case of joint holders of an Ordinary Share, if two or more persons hold an Ordinary Share jointly, either of them may be present in person or by proxy at a meeting of Shareholders and may speak on behalf of all joint owners as a Shareholder, and if two or more joint holders are present at a meeting of Shareholders, in person or by proxy, they must vote as one. Pre-emption rights were disapplied (in respect of future share issues whether for cash or otherwise) in favour of existing Shareholders up to a maximum nominal amount of £2,000,000 at the Company’s annual general meeting on 29 June 2017 for a period of 15 months of that date or the holding of the Company’s next annual general meeting, whichever is the earlier. Subject to the Companies Act, on a winding-up of the Company the assets of the Company available for distribution shall be distributed, provided there are suffcient assets available, frst to the holders of Ordinary Shares in an amount up to £0.20 in respect of each fully paid up Ordinary Share. If, following these distributions to holders of Ordinary Shares there are any assets of the Company still available, they shall be distributed to the holders of Ordinary Shares pro rata to the number of such fully paid up Ordinary Shares held (by each holder as the case may be) relative to the total number of issued and fully paid up Ordinary Shares.
C.5	Restrictions on transferability	The Ordinary Shares are freely transferable and tradable and there are no restrictions on transfer. Each member may transfer all or any of his shares which are in certifcated form by means of an instrument of transfer in any usual form or in any other form which the Directors may approve. Each member may transfer all or any of his shares which are in uncertifcated form by means of a ‘relevant system’ (i.e. CREST) in such manner provided for, and subject as provided in, the CREST Regulations.
C.6	Application for admission to trading on a regulated market	As the Idemitsu UK Acquisition was classifed as a Reverse Takeover, upon publication of this document the Standard Listing of all of the Ordinary Shares will be cancelled, and an application will be made for the immediate admission of the Share Capital to Standard Listing and to trading on the Main Market of the London Stock Exchange. It is expected that Admission will become effective and that unconditional dealings will commence on the London Stock Exchange at 8.00 a.m. on 19 February 2018. The Ordinary Shares will not be listed on any other regulated market.
C.7	Dividend policy	On 26 January 2018, the Company announced proposals for a ‘‘B share scheme’’ to return £1.50 per Ordinary Share to Shareholders which are due to be considered by Shareholders on 14 February 2018 and in respect of which the Company has received irrevocable undertakings to vote in favour of the implementing resolutions for a total of 8,226,640 Ordinary Shares representing 56.65% of the issued share capital of the Company. Going forward, the Company intends to pay dividends on the Ordinary Shares following at such times (if any) and in such amounts (if any) as the Board determines appropriate. The Company will only pay dividends

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to the extent that to do so is in accordance with the Companies Act and all other applicable laws, and the Directors will review the Company’s dividend policy from time to time.

Section D – Risks

D.1	Key information on the key risks that are specifc to the issuer or its industry	* The Group, through its licence interests, will have certain obligations in respect of the decommissioning of its wells, felds and related infrastructure. These liabilities are derived from legislative and regulatory requirements concerning the decommissioning of wells and production facilities. It is diffcult to accurately forecast the costs that the Group will incur in satisfying its decommissioning obligations. When its decommissioning liabilities crystallise, the Group will be liable either on its own or jointly and severally liable for them with any other former or current partners in the feld. In the event that it is jointly and severally liable with other partners and such partners default on their obligations, the Group will remain liable and its decommissioning liabilities could be magnifed signifcantly through such default. Any signifcant increase in the actual or estimated decommissioning costs that the Group incurs may adversely affect its fnancial condition. The Group will be required to contribute potentially substantial sums to fund its share of planned and actual decommissioning costs. Generally decommissioning costs are paid by the holders of the interests in a licence in proportion to their respective working interests in the relevant licence. The current total decommissioning obligations of the Group amount to £158.1m on a ‘‘post-tax’’ basis of which £29m has been posted in cash under existing decommissioning security agreements alternative interim arrangements and £4m in insurance backed bonds. Whilst the estimated decommissioning liabilities have been factored into the Company’s fnancial projections and working capital assumptions, there can be no assurance that these estimates will transpire to be accurate nor that timing of the payments might not be accelerated. There is no recent decommissioning plan in respect of the Galahad field where the Group gives security for its obligations of up to £4m under an annually renewable insurance bond. In respect of the Idemitsu UK Acquisition the Company has posted £16.2m to a bilateral security agreement pending formal operator led arrangements and, in addition Idemitsu UK has posted £12.8m in the Nelson field decommissioning security agreement (which was put in place on 21 December 2010) on 1 December 2017. The Group currently has £33m of postings, made up of cash and insurance backed bonds, under decommissioning security agreements and expects to post a further £12.5m in new and existing decommissioning security agreements over the course of the next 18 months. Whilst all of these payments have been fully refected in the Group’s fnancial projections and cashfow requirements and whilst the Group will budget conservatively for its decommissioning liabilities, a lack of detailed plans, budgets and formal decommissioning agreements combined with the risk of early decommissioning create uncertainties and potentially material fnancial risks for the Group in the longer term. The fact that the Group will be a minority interest holder in many of the feld interests creates the additional risk that the Group may have little or no control over the timing of decommissioning or the ability to

17

influence the planning and costings for decommissioning, which is generally determined and decided by the operator and the holders of the majority interests in each field interest. * The prevailing oil price may also have a significant impact on the timing of decommissioning. Whilst UK Government strategy is to maximise economic recovery, clearly this is only achievable in the event that field life extension plans are economically viable, which in turn is almost entirely dependent on the prevailing oil price. * The risk associated with these projects relates to uncertainty in areas that impact the project costs, namely: stakeholder requirements; specific conditions related to individual assets; costs for major contracts; and rig and vessel rates, estimates of costs being insufficient and assumption inaccurate all of which could lead to significant and material unplanned liabilities. * The Acquisition Agreements contain certain indemnities and warranties given by the Company in favour of the sellers and the wider group entities of the sellers. These indemnities and warranties have the potential to create significant liabilities. Whilst the indemnification of vendors in respect of all decommissioning and environmental liabilities in respect of acquired licence interests is customary in transactions of the nature of those concluded by the Group in the North Sea, these indemnities and the assumption of these liabilities have the potential to expose the Group to significant liabilities which may have arisen historically prior to the Group acquiring the licence interest and in respect of which the Group will have no recourse to the vendor or historic owner. * The Group will hold interests of such a size in the underlying assets which will result in limited influence. All of the licence interests acquired pursuant to the Acquisition Agreements are operated by joint venture partners and any further acquisitions of licence interests may also be operated by joint venture partners, and the Group’s ability to influence these operating partners may sometimes be limited due to the Group’s limited equity in such ventures. The objectives and drivers of joint venture partners may not be aligned with those of the Group and this may lead to operational or production inefficiencies and/or delays, or a disruptive departure by one or more partners from the joint venture. Any mismanagement of these projects by the operator may result in increased costs to the Group which could adversely affect its business, results of operations, cash flow and prospects. * The Company may be unable to complete further acquisitions in a timely manner or at all, or to fund the operations of any potential target business if it is unable to obtain additional funding in the form of equity or debt finance. Further execution of the acquisition strategy is accordingly subject to the significant risk that additional equity or debt finance may not be available to the Company or on terms which are commercially acceptable to the Company or at all. * The Company is dependent on the Directors and Senior Managers to identify potential acquisition opportunities and to execute the further acquisition and the loss of the services of the Directors could materially adversely affect it. * The Directors may allocate a portion of their time to other businesses leading to the potential for conflicts of interest in their determination as to how much time to devote to the Company’s affairs.

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		A substantial or extended decline in oil, natural gas and power prices or consumption may adversely affect the Company’s prospects, business, fnancial condition and results of operations. The expense of meeting environmental regulations could cause a signifcantly negative effect on the Company’s long term proftability, as could the failure to obtain certain necessary environmental permits. * The Company will be a small enterprise compared to many other companies in its industry and may not have the resources (both fnancial and technical) that larger, more established enterprises may have.
D.3	Key information on the key risks that are specifc to the securities	The proposed Standard Listing of the Ordinary Shares may not afford Shareholders the opportunity to vote to approve any further acquisition. A suspension or cancellation of the Ordinary Shares, as a result of the FCA determining that there is insuffcient information in the market about a further acquisition or a target, would materially reduce liquidity in such shares, which may affect an investor’s ability to realise some or all of its investment and/or the price at which such investor can effect such realisation. In the event of such suspension or cancellation, the value of the investors’ shareholdings may be materially reduced.

Section E – Offer

		Section E – Offer
E.1	Total net proceeds / expenses	Not applicable. There is no offer of the Company’s securities.
E.2a	Reasons for the offer and use of proceeds	Not applicable. There is no offer of the Company’s securities.
E.3	Terms and conditions of the offer	Not applicable. There is no offer of the Company’s securities.
E.4	Material interests	Not applicable.
E.5	Selling Shareholders / Lock-up agreements	Not applicable. There is no offer of the Company’s securities and there are no selling shareholders. In connection with the Fundraise, Mr Austin entered into a lock-in and orderly market agreement dated 2 July 2017 (replacing and extending a lock-in and orderly market agreement on similar terms entered into on 12 January 2016) with the Company and Hannam pursuant to which he has agreed that he will not transfer or dispose of, or grant option, or other rights (including any grant or right of security) directly or indirectly over any Ordinary Shares which he holds in the Company or any interests in the Ordinary Shares of the Company, for a period commencing on 6 July 2017 and ending on 6 July 2018 with a further 12 month orderly marketing arrangement. It is expected that the lock-in and orderly market agreement will terminate on 6 July 2019.

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		The restrictions on the ability of Mr Austin to transfer his Ordinary Shares, are subject to certain usual and customary exceptions including for: transfers pursuant to the acceptance of, or provision of, an irrevocable undertaking to accept, a general offer made to all Shareholders on equal terms, transfers pursuant to an offer by or an agreement with the Company to purchase Ordinary Shares made on identical terms to all Shareholders, transfers made pursuant to any court order or if required by law, or transfers with the prior consent of the Company and Hannam. Mr Austin also agreed that, during the period commencing on 6 July 2018 and ending on 6 July 2019, he will not sell, pledge or otherwise dispose of any Ordinary Shares except through Hannam (or a third party broker nominated by Hannam) and in such orderly manner as Hannam may determine so as to ensure an orderly market for the issued share capital of the Company. Pursuant to the terms of the Egerton Acquisition Agreement, Arunvill agreed to enter into a lock-in and orderly market agreement dated 2 July 2017 with the Company and Hannam pursuant to which it has agreed that it will not transfer or dispose of, or grant option, or other rights (including any grant or right of security) directly or indirectly over any Ordinary Shares which it holds in the Company or any interests in the Ordinary Shares of the Company, for a period commencing on 6 July 2017 and ending on 6 July 2018 with a further 12 month orderly marketing arrangement. In any event, this lock-in and orderly market agreement will terminate on the same date as Mr Austin’s lock-in and orderly market agreement. The restrictions on the ability of Arunvill to transfer its Ordinary Shares, are subject to certain usual and customary exceptions including for: transfers pursuant to the acceptance of, or provision of an irrevocable undertaking to accept, a general offer made to all Shareholders on equal terms, transfers pursuant to an offer by or an agreement with the Company to purchase Ordinary Shares made on identical terms to all Shareholders, transfers made pursuant to any court order or if required by law, or transfers with the prior consent of the Company and Hannam. Arunvill also agreed that, during the period commencing on 6 July 2018 and ending on 6 July 2019, it will not sell, pledge or otherwise dispose of any Ordinary Shares except through Hannam (or a third party broker nominated by Hannam) and in such orderly manner as Hannam may determine so as to ensure an orderly market for the issued share capital of the Company. In any event, the agreement will cease to be in effect from the day Mr Austin’s lock-in and orderly market agreement is terminated.
E.6	Dilution	Not applicable. There is no offer of the Company’s securities.
E.7	Expenses charged to investors	Not applicable. There are no commissions, fees or expenses to be charged to investors in connection with Admission. The costs and expenses of Admission will be borne by the Company and are not expected to exceed an aggregate of £550,000.

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PART II

RISK FACTORS

Investment in the Company and the Ordinary Shares carries a significant degree of risk, including risks in relation to the Company’s business strategy, risks relating to taxation and risks relating to the Ordinary Shares.

Prospective investors should note that the risks relating to the Company and its subsidiaries from time to time (the ‘‘Group’’), its industry and the Ordinary Shares summarised in Part I – Summary of this document are the risks that the Directors believe to be the most essential to an assessment by a prospective investor of whether to consider an investment in the Ordinary Shares. However, as the risks which the Group faces relate to events and depend on circumstances that may or may not occur in the future, prospective investors should consider not only the information on the key risks summarised in Part I – Summary of this document but also, inter alia, the risks and uncertainties described below.

The risks referred to below are those risks the Group and the Directors consider to be the material risks relating to the Group. However, there may be additional risks that the Group and the Directors do not currently consider to be material or of which the Group and the Directors are not currently aware that may adversely affect the Group’s business, financial condition, results of operations or prospects. Investors should review this document carefully and in its entirety and consult with their professional advisers before acquiring any Ordinary Shares. If any of the risks referred to in this document were to occur, the results of operations, financial condition and prospects of the Group could be materially adversely affected. If that were to be the case, the trading price of the Ordinary Shares and/or the level of dividends or distributions (if any) received from the Ordinary Shares could decline significantly. Further, investors could lose all or part of their investment.

RISKS RELATING TO THE ACQUIRED LICENCE INTERESTS

Indemnities, warranties and parent company guarantees under acquisition agreements

The Group has developed its business through the making of acquisitions. The agreements governing those acquisitions, each contain certain indemnities and warranties given by the Company in favour of the sellers and the wider group entities of the sellers. In particular, the agreements contain indemnities in respect of decommissioning liabilities and environmental liabilities. Further details of the relevant agreements are set out in Part VI – The Acquisitions and the Group of this document.

The Group may be subject to unforeseen liabilities and risks arising from the Acquisitions

Whilst the Company has access to information on the underlying licence interests it has acquired and reviewed information disclosed by the respective sellers during the acquisition processes, there can be no assurance that the licence assets are not subject to third party rights and liabilities of which the Company is unaware. Whilst some warranty and other protection is provided for by the sellers under the relevant acquisition agreements, these warranties and protections are subject to financial and other customary limitations and there is no certainty that the Group would be able to enforce its contractual or other rights against the sellers or recover the full amount of any losses suffered by the Group. Further details of the relevant agreements are set out in Part VI – The Acquisitions and the Group of this document. The effect of these provisions is that the Group has assumed all future responsibility for decommissioning and environmental liabilities regardless of when those liabilities arose. Whilst this reflects market practice with respect to the sale and purchase of interests in licences in the North Sea (or the sale of corporate entities owning licence interests), particularly where the vendor has not been the designated operator, it substantially increases risks associated with historic liabilities, some of which may be unknown at the time of the acquisition. Whilst decommissioning is a certain future event and decommissioning liabilities are capable of reasonable estimation, environmental liabilities relating to historic acts or omissions may take many years to manifest themselves or even be capable of discovery (particularly at sub-sea level) at which point they may have become issues of significant magnitude. There is accordingly a significant risk that, particularly in respect of environmental liabilities, an issue wholly unknown or undiscoverable at the time of acquisition may give rise to a material future liability for which the Group will have no recourse to the relevant vendor or historic owner.

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The Group cannot predict its future decommissioning liabilities with complete accuracy

The Group, through its licence interests, has assumed certain obligations in respect of the decommissioning of its wells, fields and related infrastructure. These liabilities are derived from legislative and regulatory requirements concerning the decommissioning of wells and production facilities contained in, inter alia, the Petroleum Act 1998, the Energy Act 2008, the Marine & Coastal Access Act 2009, the Marine (Scotland) Act 2010, the Convention on the Protection of the Marine Environment of the North East Atlantic 1992, the OSPAR Decision 98/3 and OSPAR Recommendation 2006/5 on a management scheme for offshore cuttings piles and require the Group to make provisions for and/or underwrite the liabilities relating to such decommissioning. It is difficult to accurately forecast the costs that the Group will incur in satisfying its decommissioning obligations. When its decommissioning liabilities crystallise, the Group will be liable either on its own or jointly and severally liable for them with any other former or current partners in the field. In the event that it is jointly and severally liable with other partners and such partners default on their obligations, the Group could remain liable and its decommissioning liabilities could be magnified significantly through such default. Any significant increase in the actual or estimated decommissioning costs that the Group incurs may adversely affect its financial condition.

Decommissioning Planning

The Group will be required to contribute potentially substantial sums to fund its share of planned and actual decommissioning costs. Generally the liability for decommissioning cases falls upon the licence holders in proportion to their respective working interests in the relevant licences.

The current total decommissioning obligations of the Group amount to an estimated £158.1m on a ‘‘post-tax’’ basis, of which £33m has been posted under existing decommissioning security agreements (‘‘DSAs’’) or alternative interim arrangements, of which £29m is in cash and £4m in insurance backed bonds. It is expected that the Group will be required to post a further £12.5m to existing and new DSAs over the course of the following 18 months, all of which have been factored into the Group’s financial projections and working capital requirements.

There are as yet no formalised decommissioning plans in respect of the Galahad field however the Group’s net share of the decommissioning costs for the Galahad and Mordred fields are currently estimated at £4m (US$5m) (based on operator estimates) and these are backed by an annually renewable decommissioning insurance bond, which the Company expects to renew on materially similar terms in 2018.

In respect of the Idemitsu UK Acquisition, the Company has posted £16.2m to a bi-lateral security agreement pending formal operation led arrangements. In addition, Indemitsu UK has posted £12.8m to the Nelson field DSA (which was put in place on 21 December 2010) on 1 December 2017.

Whilst all estimated decommissioning liabilities have been factored into the Company’s financial projections, there can be no assurance that these estimates will transpire to be accurate nor that the timing of the required payments might be accelerated should the operator of the fields seek to bring forward decommissioning plans. Where operator plans have been prepared there can be no guarantee or assurance, given such plans are prepared several years in advance of the actual decommissioning activity, that circumstances may not materially change, costs estimates may become dated, assumptions may turn out to be unrealistic and unreliable nor the actual timing of activities or contributions may not materially change in an adverse way.

Whilst the Group will continue to budget conservatively for its decommissioning liabilities, a lack of detailed plans, budgets and formal decommissioning agreements combined with the risk of early decommissioning create uncertainties and potentially material financial risks for the Group. The fact that the Group is a minority interest holder in many of the field interests creates the additional risk that the Group may have little or no control over the timing of decommissioning or the ability to influence the planning and costings for decommissioning, which is generally determined and decided by the operator and the holders of the majority interests in each field interest.

The risk associated with these projects relates to uncertainty in areas that impact the project costs, namely: stakeholder requirements; specific conditions related to individual assets; costs for major contracts; and rig and vessel rates, estimates of costs being insufficient and assumptions inaccurate, all of which could lead to significant and material unplanned liabilities. For these reasons initial operator estimates of decommissioning costs may be unreliable and significantly

22

underestimated the eventual liabilities of the parties with interests in the fields to be decommissioned.

Timing of decommissioning

Whilst it is clearly UK Government strategy to maximise economic recovery in the North Sea, field life extension plans, often at lower levels of production and at a marginally greater cost of recovery, will be highly sensitive in terms of economic viability in the comparatively low levels of prevailing oil price. Fluctuations in the oil price, or prolonged periods of low oil prices, may render field life extension plans uneconomic or practicably unachievable and this in turn may lead to an acceleration of decommissioning plans and the payment of the associated costs with such plans. DSAs are designed to ensure that the holders of licence interests post cash or alternative security for their decommissioning liabilities over a period of time, particularly towards the later stage of the producing life of a field, so that all partners in the licence have protection in the event that one of their number was unable to finance a significant sum on cessation of production. However regular postings of cash or equivalent security are determined by the operator, generally annually, on the basis of the then prevailing circumstances, including primarily anticipated costs and remaining life of the field. A sudden and sustained drop in oil prices or a technical event or events leading to the bringing forward of cessation of production and the licence interest holders having to fund decommissioning costs which they might have expected to have been funded out of future production. In such circumstances the Group may have to use existing cash resources to fund accelerated decommissioning programmes. Whilst the Group has adopted a prudent and conservative approach to maintaining cash reserves to cover such contingencies, it is possible that unexpected or unanticipated accelerated decommissioning costs might have a negative effect on the Group’s ability to pursue other acquisitions or development opportunities whiten the existing portfolio of licence interests.

Joint venture partner alignment and other contractual counterparties

In many cases the Group will be a holder of relatively small economic interests in the underlying assets and will not be the operator of any of the acquired licence interests. Participation in the licence interests is conducted in a joint venture environment. All of the licence interests are operated by joint venture partners and the Group’s ability to influence these operating partners is sometimes limited due to the Group’s limited equity in such ventures. There is a risk that joint venture partners are not aligned in their objectives and drivers and this may lead to operational or production inefficiencies and/or delays, or a disruptive departure by one or more partners from the joint venture. Any mismanagement of these projects by the operator may result in increased costs to the Group which could adversely affect its business, results of operations, cash flow and prospects. Compared to many other companies in its industry the Group will not have the resources (both financial and technical) that larger, more established participants may have.

The Group’s business is subject to government regulation with which it may be difficult to comply and which may change

The Group’s oil and gas operations are principally subject to the laws and regulations of England (and in certain instances Scotland), including those relating to health and safety, the environment and the production, pricing and marketing of oil and gas. In addition, the Group will be subject to laws affecting taxation, royalties and duties. In order to conduct its operations in compliance with these laws and regulations, the Group must obtain licences and permits from various government authorities. The grant, continuity and renewal of the necessary approvals, permits, licences and contracts, including the timing of obtaining such licences and the terms on which they are granted, are subject to the discretion of the relevant governmental and local authorities in the United Kingdom and cannot be assured. In addition, the Group may incur substantial costs in order to maintain compliance with these existing laws and regulations and additional costs if these laws are revised or if new laws affecting the Group’s operations are passed. On 23 June 2016, the UK referendum on whether to remain in or leave the EU resulted in a majority voting in favour of leaving the EU. The UK will continue to be a member of the EU until the expiry of a two year notice period following the UK’s formal notification to the European Council under Article 50 of the Treaty of the EU which occurred on 29 March 2017, or such other date as is agreed by all 28 Member States. It is anticipated that, during such time, the UK Government will negotiate new arrangements with the EU and the rest of the world, and, at the same time, restructure UK domestic law and regulation to take account of this. Accordingly, the current laws and regulations to which the Group is subject could change significantly in these circumstances, which could

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potentially have a material adverse effect on the Group’s business, financial condition and prospects.

There can be no assurance that the Company will be able to make returns for Shareholders in a manner

It is intended that the Company will structure and operate the Group, including any company or business acquired, to maximise returns for Shareholders in as fiscally efficient a manner as is practicable. The Company has made certain assumptions regarding taxation of the Group. However, if these assumptions are not correct, taxes may be imposed with respect to the assets of the Group, or the Group may be subject to tax on its income, profits, gains or distributions (either on a liquidation and dissolution or otherwise) in a particular jurisdiction or jurisdictions in excess of taxes that were anticipated. This could alter the post-tax returns for Shareholders (or Shareholders in certain jurisdictions). The level of return for Shareholders may also be adversely affected. Any change in laws or tax authority practices could also adversely affect any post-tax returns of capital to Shareholders or payments of dividends. In addition, the Group may incur costs in taking steps to mitigate any such adverse effect on the post-tax returns for Shareholders.

RISKS RELATING TO OPERATING IN THE OIL AND GAS EXPLORATION AND PRODUCTION SECTOR

A substantial or extended decline in oil, natural gas and power prices or consumption may adversely affect the prospects, business, financial condition and results of operations of the Group

Historically, hydrocarbon and energy prices have been subject to large fluctuations in response to a variety of factors beyond the control of individual companies, including operation issues, natural disasters, weather, political instability or conflicts, and economic conditions or actions by major oilexporting countries. Price fluctuations can affect business assumptions, investment decisions and financial position of the companies in the upstream oil gas and power sector and therefore prospectively the Company. In particular, a substantial or extended decline in the price or consumption of oil and gas could have a short or long term effect on the Company’s strategy and ultimately its business financial condition. Lower hydrocarbon prices or reduced demand for oil and gas or power could reduce the economic viability of the Company’s strategy and ultimately its business, result in a reduction in revenues or net income, adversely affect the Company’s ability to maintain working capital requirements, impair its ability to make planned expenditures and could materially adversely affect its prospects, financial condition and results of operations.

Oil and natural gas exploration and development are highly speculative activities

Oil and natural gas exploration is a highly speculative activity and there are a number of risks which may impact on the overall investment. There is no certainty that the expenditures the Company makes towards the search and evaluation of oil and gas deposits will result in discoveries of commercial quantities. The Company’s longer-term profitability is directly related to the success of the project development and exploration activities. In the event that an exploration project is unsuccessful, the value of the Company’s business and any associated exploration licences may be diminished.

The longer-term success of the Group is dependent on accessing oil and natural gas resources

The further appraisal and development of discoveries are uncertain and may involve unprofitable efforts, not only from dry wells, but also from wells that are productive but uneconomic to develop. Appraisal and development activities may be subject to delays in obtaining governmental approvals or consents, shut-ins of connected wells, insufficient storage or transportation capacity or other geological and mechanical conditions all of which may variously increase the Company’s costs of operations. Producing natural gas reservoirs are typically characterised by declining production rates that vary depending upon reservoir characteristics and other factors. Producing wells may be enhanced by supplemental work programmes and by the drilling of new wells, however these processes carry an inherent risk of failure. In addition, the Company may not be able to economically develop, find, or acquire future reserves at acceptable costs.

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The Group’s actual future exploration and production costs may differ materially from its estimates, which may materially and adversely affect its viability in the long term

Exploration and production expenditure estimates are based on certain assumptions with respect to the method and timing of activities. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, the actual costs may materially differ from estimates and assumptions. Additionally, unconventional methods of exploration, recovery and production enhancement (often of particular importance in context of fields in the later stages of their productive life) are required which can be more expensive than conventional exploration methods or production from fields in the initial stages of their productive lives. This could materially and adversely affect the Group’s viability and long term prospects.

If the Group is not granted licences or licence extensions, it could have a material adverse effect on its reserves, business, operations and prospects

The Group may be unable or unwilling to comply with the terms or requirements of a licence in circumstances that entitle the relevant authority to refrain from granting, suspend or withdraw the terms of such licence. Moreover, exploration and production licences may expire before the end of what might be the productive life of the licensed fields. There can be no assurance that extensions will be granted and any failure to receive such extensions or any premature termination, suspension or withdrawal of licences may have a material adverse effect on the Group’s reserves, business, results of operations and prospects if the terminated licence relates to material assets of the Group.

The Group may suffer material losses from uninsurable or uninsured risks or insufficient insurance coverage

The Group may be subject to substantial liability claims due to the inherently hazardous nature of the business of the target company or for acts and omissions of subcontractors, operators or joint venture partners. Any contractual indemnities it may receive from such parties may be difficult to enforce if such sub-contractors, operators or joint venture partners lack adequate resources. There can be no assurance that the proceeds of insurance applicable to covered risks will be adequate to cover related losses or liabilities. In addition, the Group may also suffer material losses from uninsurable or uninsured risks. The occurrence of any of these risks could adversely affect the financial performance of the Group.

Estimation of resources, reserves and production profiles are based on judgements and assumptions

In general, there is inherent risk in estimates of oil reserves, gas reserves and power generation, and their anticipated production profiles, because it involves subjective judgements and determinations based on available geological, technical, contractual and economic information. They are not exact determinations and the actual resources, reserves and production may be greater or less than those calculated. In addition, these judgements may change based on new information from production or drilling activities or changes in economic factors, as well as from developments such as acquisitions and disposals, new discoveries and extensions of existing fields and the application of improved recovery techniques. If any estimates of hydrocarbon resources, reserves or production profiles (including any competent person’s report (‘‘Competent Person’s Report’’) upon which the Company relies upon in making any operational decision) prove to be substantially incorrect, the Company may be unable to recover and produce the estimated levels or quality of hydrocarbons set out in such estimates and the business, prospects, financial condition or results of operations of the Company could be materially adversely affected.

The Group’s operations expose it to significant compliance costs and liabilities in respect of environmental and health and safety (‘‘EHS’’) matters

The operations and assets in which the Group will be involved are affected by numerous laws and regulations concerning EHS matters including, but not limited to, those relating to discharges of hazardous substances into the environment, the handling and disposal of waste and the health and safety of employees. The technical requirements of these laws and regulations are becoming increasingly complex, stringently enforced and expensive to comply with and this trend is likely to continue. Any failure to comply with EHS laws and regulations may result in regulatory action (which strict, joint and several liability can include statutory orders requiring steps to be taken or prohibiting certain operations), the imposition of fines or the payment of compensation to third

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parties. All of these liabilities and any other regulatory actions could have a material adverse effect on the Group’s business, financial condition, results of operations and prospects.

A violation of EHS requirements and the occurrence of any accidents could disrupt the Group’s operations and increase operating costs

EHS authorities such as the UK Department for Business, Energy & Industrial Strategy, Health and Safety Executive and Offshore Safety Directive Regulator have extensive enforcement powers under EHS laws. These powers extend to statutory notices to require operational steps and to prohibit certain activities or operations until compliance is achieved. A violation of EHS laws or failure to comply with the instructions of the relevant EHS authorities could therefore lead to, among other things, a temporary shutdown of all, or a portion of, the Group’s facilities and the imposition of costly compliance procedures. If EHS authorities shut down all, or a portion of, the Group’s facilities or impose costly compliance measures, the Group’s business, financial condition, results of operations and prospects would be materially and adversely affected.

The nature of the operations in which the Group will be participating creates a risk of accidents and fatalities among its workforce, and the Group may be required to pay compensation or suspend operations as a result of such accidents or fatalities, which could have a material adverse effect on the Group’s business, financial condition, results of operations and prospects.

RISKS RELATING TO THE COMPANY’S BUSINESS AND ACQUISITION STRATEGY

The Group’s principal source of operating cash will be income received from the sale of petroleum products extracted from the wells on the licence interests

The Group will be dependent on the income generated by its licence interests to meet the expenses and operating cash requirements of the Group in the longer term. The amount of distributions and dividends, if any, which may be paid from any operating subsidiary to the Company will depend on many factors, including such subsidiary’s results of operations and financial condition, limits on dividends under applicable law, its constitutional documents, documents governing any indebtedness of the Company, and other factors which may be outside the control of the Company. If the licence interests fail to generate sufficient cash flow in the longer term, the Company may be unable to pay its expenses or make distributions and dividends on the Ordinary Shares.

There can be no certainty that the Company will have access to sufficient funds to make further acquisitions

To date the Company has successfully raised equity finance to make acquisitions and has concluded acquisitions on terms that have been cash accretive to the Company. Whilst the Company intends to make further acquisitions to further advance its strategic objectives, such acquisitions may require finance in excess of the Company’s current cash resources. This may involve the Company seeking to raise further finance by way of an issue (or issues) of equity, the raising of debt finance or the use of other financing strategies (including the forward sale of production). There can be no guarantee that any of these funding options will be available in the future and the Company currently has no committed facilities or lines of credit in place. Accordingly there is a significant risk that future acquisition opportunities may not be executable by the Company if the Company is unable to secure additional investment or debt finance.

There is no assurance that any operating improvements will be successful or that they will be effective in increasing the valuation of any business acquired

There can be no assurance that the Company will be able to propose and implement effective operational improvements for any company or business which the Company acquires, particularly if the Company acquires a stake in a licence asset which does not give it operational control or significant influence. In addition, general economic and market conditions or other factors outside the Company’s control could make the Company’s operating strategies difficult or impossible to implement. Any failure to implement these operational improvements successfully and/or the failure of these operational improvements to deliver the anticipated benefits could have a material adverse effect on the Company’s results of operations and financial condition.

The Company may face significant competition for further acquisition opportunities

There may be significant competition in some or all of the further acquisition opportunities that the Company may explore. Such competition may for example come from strategic buyers, sovereign

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wealth funds, other special purpose acquisition companies and public and private investment funds many of which are well established and have extensive experience in identifying and completing acquisitions. A number of these competitors may possess greater technical, financial, human and other resources than the Company. The Company cannot assure investors that it will be successful against such competition. Such competition may cause the Company to be unsuccessful in executing a further acquisition or may result in a further acquisition being made at a significantly higher price than would otherwise have been the case.

Any due diligence by the Company in connection with a further acquisition may not reveal all relevant considerations or liabilities of the target business, which could have a material adverse effect on the Company’s financial condition or results of operations

The Company intends to conduct such due diligence as it deems reasonably practicable and appropriate based on the facts and circumstances applicable to any potential further acquisition. The objective of the due diligence process will be to identify material issues which might affect the decision to proceed with any one particular further acquisition target or the consideration payable for a further acquisition. The Company also intends to use information revealed during the due diligence process to formulate its business and operational planning for, and its valuation of, any target company or business. Whilst conducting due diligence and assessing potential further acquisitions, the Company will rely on publicly available information, if any, information provided by the relevant target company to the extent such company is willing or able to provide such information and, in some circumstances, third party investigations.

There can be no assurance that the due diligence undertaken with respect to potential further acquisitions will reveal all relevant facts that may be necessary to evaluate such further acquisitions including the determination of the price the Company may pay for an acquisition target, or to formulate a business strategy. Furthermore, the information provided during due diligence may be incomplete, inadequate or inaccurate. As part of the due diligence process, the Company will also make subjective judgments regarding the results of operations, financial condition and prospects of a potential opportunity. If the due diligence investigation fails to correctly identify material issues and liabilities that may be present in a target company or business, or if the Company considers such material risks to be commercially acceptable relative to the opportunity, and the Company proceeds with an acquisition, the Company may subsequently incur substantial impairment charges or other losses. In addition, following a further acquisition, the Company may be subject to significant, previously undisclosed liabilities of the acquired businesses that were not identified during due diligence and which could contribute to poor operational performance, undermine any attempt to restructure the acquired company or business in line with the Company’s business plan and have a material adverse effect on the Company’s financial condition and results of operations.

The Company is dependent on the Directors and Senior Managers to identify potential acquisition opportunities and to execute further acquisitions and the loss of the services of any of the Directors and Senior Managers could materially adversely affect it

The Company remains materially dependent upon the Directors and Senior Managers to identify potential additional acquisition opportunities and to execute further acquisitions. The unexpected loss of the services of any or all of the Directors and Senior Managers could have a material adverse effect on the Company’s ability to identify potential additional acquisition opportunities and to execute further acquisitions.

The Directors will allocate their time to other businesses leading to potential conflicts of interest in their determination as to how much time to devote to the Company’s affairs, which could have a negative impact on the Company’s ability to complete further acquisitions

None of the Directors (save for Mr Austin who has agreed to spend such hours engaged in the Company’s affairs as may be necessary for the proper performance of his duties) are required to commit their full time or any specified amount of time to the Company’s affairs, which could create a conflict of interest when allocating their time between the Company’s operations and their other commitments. The Directors are engaged in other business endeavours and if the Directors’ other business affairs require them to devote more substantial amounts of time to such affairs, it could limit their ability to devote time to the Company’s affairs and could have a negative impact on the Company’s ability to consummate further acquisitions.

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The Group is dependent on Senior Managers to operate the business and may be unable to recruit replacement personnel with the requisite skills

The Group depends on Senior Managers to lead its business effectively. Although it is not anticipated that any Senior Managers will be lost or replaced in the near future, competitors may seek to recruit the Group’s key personnel and the loss of the services of any or all of the Senior Managers could have a material adverse effect on the Group’s business, results of operations and overall financial condition. There may be a limited number of persons with the requisite skills to serve in such positions and the Group cannot be certain that it would be able to locate or employ such qualified personnel on acceptable terms in a timely manner or at all.

The Company may be subject to foreign investment and exchange risks

The Company’s presentational currency is US Dollars. As a result, the Company’s consolidated financial statements will carry the Company’s assets in US Dollars. Any business the Company acquires may denominate its financial information in a currency other than US Dollars, conduct operations or make sales or incur expenditure in currencies other than US Dollars. When consolidating a business that has functional currencies other than US Dollars, the Company will be required to translate, inter alia, the balance sheet and operational results of such business into US Dollars. Due to the foregoing, changes in exchange rates between US Dollars and other currencies could lead to significant changes in the Company’s reported financial results from period to period. Among the factors that may affect currency values are trade balances, levels of short-term interest rates, differences in relative values of similar assets in different currencies, long-term opportunities for investment and capital appreciation and political or regulatory developments. Although the Company may seek to manage its foreign exchange exposure, including by active use of hedging and derivative instruments, there is no assurance that such arrangements will be entered into or available at all times when the Company wishes to use them or that they will be sufficient to cover the risk.

The Company may be subject to risks particular to one or more countries in which it ultimately operates, which could negatively impact its operations

The Company’s efforts in identifying a prospective target company or business in the upstream oil and gas and power sector are not limited to a particular geographic region. The Company may therefore acquire a target company or business in, or with substantial operations in, a number of jurisdictions, any of which may expose it to considerations or risks associated with companies operating in such jurisdictions, including but not limited to: regulatory and political uncertainty; tariffs, trade barriers and regulations related to customs and import/export matters; international tax issues, such as tax law changes and variations; cultural and language differences; rules and regulations on currency conversion or corporate withholding taxes on individuals; currency fluctuations and exchange controls; employment regulations; crime, strikes, riots, civil disturbances, terrorist attacks and wars; and deterioration of relevant political relations. Any exposure to such risks due to the countries in which the Company operates following a further acquisition could negatively impact the Company’s operations.

RISKS RELATING TO THE ORDINARY SHARES

The Company may be unable to seek admission to a Premium Listing or other appropriate listing venue following a further acquisition

The Company is not currently eligible for a Premium Listing under Chapter 6 of the Listing Rules. Upon completion of any further acquisitions, the Company’s Standard Listing may again be cancelled and it will be treated as a new applicant. The Directors may then seek admission either by way of a Premium Listing or other appropriate listing, based on, inter alia, the track record of the Company or business it acquires, and fulfilling the relevant eligibility criteria at the time. There can be no guarantee that the Company will meet such eligibility criteria or that the Company will qualify for a Premium Listing or other appropriate listing (e.g. AIM, the market of that name operated by the London Stock Exchange (‘‘AIM’’)). For example, such eligibility criteria may not be met, if the Company acquires less than a controlling interest in the target. In addition there may be a delay, which could be significant, between the completion of any further acquisitions and the date upon which the Company is able to seek or achieve a Premium Listing or a listing on another stock exchange.

If the Company does not achieve, or is not capable of achieving, a Premium Listing or the Directors decide, subject to eligibility, upon a Standard Listing, the Company will not be obliged to

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comply with the higher standards of corporate governance or other requirements which it would be subject to upon achieving a Premium Listing and, for as long as the Company continues to have a Standard Listing, it will be required to continue to comply with the lesser standards applicable to a company with a Standard Listing. This would mean that the Company could be operating a substantial business but would not need to comply with such higher standards as a Premium Listing provides. Alternatively, in addition to, or in lieu of seeking a Premium Listing, the Company may determine to seek a listing on another stock exchange, which may not have standards or corporate governance comparable to those required by a Premium Listing or which Shareholders may otherwise consider to be less attractive or convenient.

If the Company proposes making a further acquisition and the FCA determines that there is insufficient information in the market about that acquisition or the target, the Ordinary Shares may be suspended from listing or cancelled and may not be readmitted to listing thereafter, which will reduce liquidity in the Ordinary Shares, potentially for a significant period of time, and may adversely affect the price at which a Shareholder can sell them

Any further acquisition has the potential to be treated as a Reverse Takeover depending upon the size of that acquisition.

Generally, when a Reverse Takeover is announced or leaked, there will be insufficient publicly available information in the market about the proposed transaction and the listed company will be unable to assess accurately its financial position and inform the market appropriately. In this case, the FCA will often consider that suspension of the listing of the listed company’s securities will be appropriate. The London Stock Exchange will suspend the trading in the listed company’s securities if the listing of such securities has been suspended. However, if the FCA is satisfied that there is sufficient publicly available information about the proposed transaction it may agree with the listed company that a suspension is not required. The FCA will generally be satisfied that a suspension is not required in the following circumstances: (i) the target company is admitted to listing on a regulated market or another exchange where the disclosure requirements in relation to financial information and inside information are not materially different than the disclosure requirements under the disclosure guidance and transparency rules of the FCA made in accordance with section 73A of FSMA (‘‘Disclosure Guidance and Transparency Rules’’); or (ii) the issuer is able to fill any information gap at the time of announcing the terms of the transaction, including the disclosure of relevant financial information in relation to the target and a description of the target.

If information regarding a significant proposed transaction were to leak to the market, or the Board considered that there were good reasons for announcing the transaction at a time when it was unable to provide the market with sufficient information regarding the impact of the Acquisitions on its financial position, the Ordinary Shares may be suspended. Any such suspension would be likely to continue until sufficient financial information on the transaction was made public. Depending on the nature of the transaction (or proposed transaction) and the stage at which it is leaked or announced, it may take a substantial period of time to compile the relevant information, particularly where the target does not have financial or other information readily available which is comparable with the information a listed company would be expected to provide under the Disclosure Guidance and Transparency Rules and the Listing Rules (for example, where the target business is not itself already subject to a public disclosure regime), and the period during which the Ordinary Shares would be suspended may therefore be significant.

Furthermore, the Listing Rules provide that the FCA will generally seek to cancel the listing of a listed company’s securities when it completes a Reverse Takeover. In such circumstances, the Company will be required to seek admission to listing as a new applicant either simultaneously with completion of any such acquisition or as soon thereafter as is possible but there is no guarantee that such admission would be granted.

A suspension or cancellation of the listing of the Ordinary Shares would materially reduce liquidity in such shares which may affect an investor’s ability to realise some or all of its investment and/or the price at which such investor can effect such realisation.

There may be a limited market for the Ordinary Shares. A market for the Ordinary Shares may not develop, which would adversely affect the liquidity and price of the Ordinary Shares

The price of the Ordinary Shares after Admission can vary due to a number of factors, including but not limited to, general economic conditions and forecasts, the Company’s general business

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condition and the release of its financial reports. Although the Company’s current intention is that its Ordinary Shares should continue to trade on the Main Market of the London Stock Exchange, it cannot assure investors that it will always do so. In addition, an active trading market for the Ordinary Shares may not develop or, if developed, may not be maintained. Investors may be unable to sell their Ordinary Shares unless a market can be established and maintained, and if the Company subsequently obtains a listing on an exchange in addition to, or in lieu of, the London Stock Exchange, the level of liquidity of the Ordinary Shares may decline.

Disapplied pre-emption rights and indebtedness related liquidity

The Directors anticipate that the Company may issue a substantial number of additional Ordinary Shares, or incur substantial indebtedness to complete one or more further acquisitions.

Pre-emption rights were disapplied (in respect of future share issues whether for cash or otherwise) in favour of existing Shareholders up to a maximum nominal amount of £2,000,000 at the Company’s annual general meeting on 29 June 2017 for a period of 15 months of that date or the holding of the Company’s next annual general meeting, whichever is earlier. In addition, the Company may issue shares or convertible debt securities or incur substantial indebtedness to complete a further acquisition, which may dilute the interests of Shareholders.

Any issue of Ordinary Shares, preferred shares or convertible debt securities may:

• significantly dilute the value of the Ordinary Shares held by existing Shareholders;

• cause a change of control if a substantial number of Ordinary Shares are issued, which may, inter alia, result in the resignation or removal of one or more of the Directors;

• in certain circumstances, have the effect of delaying or preventing a change of control;

• subordinate the rights of holders of Ordinary Shares if preferred shares are issued with rights senior to those of Ordinary Shares; or

• adversely affect the market prices of the Ordinary Shares.

If Ordinary Shares, preferred shares or convertible debt securities are issued as consideration for a further acquisition, existing Shareholders will have no pre-emptive rights with regard to the securities that are issued. The issue of such Ordinary Shares, preferred shares or convertible debt securities is likely to materially dilute the value of the Ordinary Shares held by existing Shareholders. Where a target company has an existing large shareholder, an issue of Ordinary Shares, preferred shares or convertible debt securities as consideration may result in such shareholder subsequently holding a significant or majority stake in the Company, which may, in turn, enable it to exert significant influence over the Company (to a greater or lesser extent depending on the size of its holding) and could lead to a change of control.

If the Company were to incur substantial indebtedness in relation to a further acquisition, this could result in:

• default and foreclosure on the Company’s assets, if its cash flow from operations were insufficient to pay its debt obligations as they become due;

• acceleration of its obligation to repay indebtedness, even if it has made all payments when due, if it breaches, without a waiver, covenants that require the maintenance of financial ratios or reserves or impose operating restrictions;

• a demand for immediate payment of all principal and accrued interest, if any, if the indebtedness is payable on demand; or

• an inability to obtain additional financing, if any indebtedness incurred contains covenants restricting its ability to incur additional indebtedness.

The occurrence of any or a combination of these factors could decrease an investor’s ownership interests in the Company or have a material adverse effect on its financial condition and results of operations.

A further acquisition may result in adverse tax, regulatory or other consequences for Shareholders which may differ for individual Shareholders depending on their status and residence

It is possible that any further acquisition structure determined necessary by the Company to complete a further acquisition may have adverse tax, regulatory or other consequences for

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Shareholders which may differ for individual Shareholders depending on their individual status and residence.

Investors may not be able to realise returns on their investment in Ordinary Shares within a period that they would consider to be reasonable

Investments in Ordinary Shares may be relatively illiquid. There may be a limited number of Shareholders and this factor may contribute both to infrequent trading in the Ordinary Shares on the London Stock Exchange and to volatile Ordinary Share price movements. Investors should not expect that they will necessarily be able to realise their investment in Ordinary Shares within a period that they would regard as reasonable. Accordingly, the Ordinary Shares may not be suitable for short-term investment. Admission should not be taken as implying that there will be an active trading market for the Ordinary Shares. Even if an active trading market develops, the market price per Ordinary Share may fall below the market price per Ordinary Share prevailing immediately prior to the suspension of the Company’s listing on 18 October 2017.

Dividend payments on the Ordinary Shares are not guaranteed

To the extent the Company intends to pay dividends on the Ordinary Shares, it will pay such dividends at such times (if any) and in such amounts (if any) as the Board determines appropriate and in accordance with applicable law, but expects to be principally reliant upon dividends received on shares held by it in any operating subsidiaries in order to do so. Payments of such dividends will be dependent on the availability of any dividends or other distributions from such subsidiaries. The Company can therefore give no assurance that it will be able to pay dividends going forward or as to the amount of such dividends, if any.

Ordinary Shares in the Company may be subject to market price volatility

The price of the Ordinary Shares could be subject to significant price and volume fluctuations that may be unrelated to the operating performance of the Group. The market price of the Ordinary Shares may, in addition to being affected by the Company’s actual or forecast operating results, fluctuate significantly as a result of factors beyond the Company’s control, including changes in securities analysts’ recommendations or estimates of earnings or financial performance of the Company, its competitors or the industry, or the failure to meet expectations of securities analysts; the occurrence (or lack of occurrence) of events such as natural disasters, fluctuations in stock market prices and volumes; general market volatility; changes in laws, rules, regulations and taxes, applicable to the Group, its operations and operations in which the Group has interests; loss of key personnel, and involvement in litigation. In addition, stock markets have in the recent past experienced significant price and volume fluctuations, which, as well as general economic and political conditions, could adversely affect the market price for the Ordinary Shares.

The price of the Ordinary Shares may also fluctuate significantly as a result of many other factors, including perceived prospects for the Group’s business and operations and the oil and gas industry in general, announcements by the Group of significant acquisitions, strategic alliances or joint ventures, changes in perceptions on the geographic areas where the Group operates and broad stock market price fluctuations.

The market price of the Ordinary Shares could be negatively affected by sales of substantial amounts of such shares in the public markets

As set out in Part XIV – Additional Information of this document, certain shareholders hold significant shareholdings in the Company. Such shareholders may sell Ordinary Shares in the public or private market. The Company may also (subject to any applicable shareholder approvals) undertake a public or private offering of Ordinary Shares. There can be no assurance as to what effect, if any, future sales of Ordinary Shares will have on the market price of the Ordinary Shares. If such shareholders were to sell Ordinary Shares or the Company were to issue and sell a substantial number of Ordinary Shares in the public market, the market price of the Ordinary Shares could be adversely affected. Sales by such shareholders also could make it more difficult for the Company to sell equity securities in the future at a time and price that it deems appropriate. There can be no assurance that such shareholders will not effect transactions in relation to their shares. The sale of a significant amount of Ordinary Shares in the public market, or the perception that such sales may occur, could materially affect the market price of the Ordinary Shares and could also impede the Company’s ability to raise capital through the issue of equity securities in the future.

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The issuance of additional Ordinary Shares in the Company in connection with future acquisitions or the share option plan, or otherwise, may dilute all other shareholdings

The Company may, over the longer term, seek to raise finance to fund future acquisitions and other growth opportunities and may, for these and other purposes (for example, in connection with share incentive and share option plans), issue additional equity or convertible equity securities. As a result, the Company’s then-existing Shareholders would suffer dilution in their percentage ownership of the Company following any such issue.

Transfer restrictions for Shareholders in the United States may make it difficult to resell the Ordinary Shares or may have an adverse impact on the market price of the Ordinary Shares

The Ordinary Shares have not been registered in the United States under the Securities Act or under any other applicable securities laws and are subject to restrictions on transfers contained in such laws. There are additional restrictions on the resale of Ordinary Shares by Shareholders who are in the United States and on the resale of Ordinary Shares by any Shareholders to any person who is in the United States. These restrictions will make it more difficult to resell the Ordinary Shares in many instances and this could have an adverse effect on the market value of the Ordinary Shares. There can be no assurance that Shareholders in the United States will be able to locate acceptable purchasers or obtain the required certifications to effect a sale.

The ability of Overseas Shareholders to bring actions or enforce judgments against the Company or the Directors may be limited

The ability of an Overseas Shareholder to bring an action against the Company may be limited under law. The Company is a public company with limited liability incorporated in England and Wales. The rights of holders of Ordinary Shares are governed by English law and by the Company’s articles of association (‘‘Articles’’). These rights may differ from the rights of shareholders in non-UK corporations. An Overseas Shareholder may not be able to enforce a judgment against some or all of the Directors and Senior Managers. The Directors are residents of the UK. Consequently, it may not be possible for an Overseas Shareholder to effect service of process upon the Directors and executive officers within the Overseas Shareholder’s country of residence or to enforce against the Directors and Senior Managers judgments of courts of the Overseas Shareholder’s country of residence based on civil liabilities under that country’s securities laws. There can be no assurance that an Overseas Shareholder will be able to enforce any judgments in civil and commercial matters or any judgments under the securities laws of countries other than the UK against the Directors or Senior Managers who are residents of the UK or countries other than those in which judgment is made. In addition, English or other courts may not impose civil liability on the Directors or executive officers in any original action based solely on foreign securities laws brought against the Company or the Directors in a court of competent jurisdiction in England or other countries.

The ability of Shareholders to participate in rights offerings may be limited and Shareholders could therefore experience dilution of their holdings

The Company may, from time to time, distribute rights to its shareholders, including rights to acquire securities. Compliance with securities laws or other regulatory provisions in some jurisdictions may prevent certain purchasers of Ordinary Shares from participating in any rights issuances and thereby result in dilution of their existing shareholdings. The Company is under no obligation to register the shares in any jurisdiction to permit foreign purchasers of Ordinary Shares to participate in any rights offerings the Company may undertake. Accordingly, Shareholders who are based outside of the UK may be unable to participate in rights offerings and may experience dilution of their holdings as well as further dilution in their voting interest following any such offering. In addition, if the rights that are not exercised or not distributed are not sold or if the sale is not lawful or reasonably practicable, the Company may allow the rights to lapse, in which case holders of the Company’s shares would receive no value for these rights.

RISKS RELATING TO TAXATION

Taxation of returns from assets located outside of the UK may reduce any net return to investors

To the extent that the assets, company or business which the Company acquires is or are established outside the UK, it is possible that any return the Company receives from it may be reduced by irrecoverable foreign withholding or other local taxes and this may reduce any net return derived by investors from a shareholding in the Company.

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Changes in tax law and practice may reduce any net returns for investors

The tax treatment of Shareholders of the Company, any special purpose vehicle that the Company may establish and any company which the Company may acquire are all subject to changes in tax laws or practices in England and Wales or any other relevant jurisdiction. Any change may reduce any net return derived by investors from a shareholding in the Company.

Investors should not rely on the general guide to taxation set out in this document and should seek their own specialist advice. The tax rates referred to in this document are those currently applicable and they are subject to change.

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PART III

IMPORTANT INFORMATION

The distribution of this document may be restricted by law in certain jurisdictions and therefore persons into whose possession this document comes should inform themselves about and observe any restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

General

No action has been or will be taken in any jurisdiction that would permit a public offering of the Ordinary Shares, or possession or distribution of this document in any other country or jurisdiction where action for that purpose is required. Accordingly, the Ordinary Shares may not be offered or sold, directly or indirectly, and this document may not be distributed or published in or from any country or jurisdiction except under circumstances that will result in compliance with any and all applicable rules and regulations of any such country or jurisdiction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

This document has been approved by the FCA as a prospectus, but is not being used by the Company to offer securities to the public for the purposes of section 85 of FSMA and the Prospectus Directive. No arrangement has been made with any competent authority in any other EEA State (or any other jurisdiction) for the use of this document as an approved prospectus in such jurisdiction and accordingly no public offer is to be made in any jurisdiction.

The Company does not accept any responsibility for the accuracy or completeness of any information reported by the press or other media, nor the fairness or appropriateness of any forecasts, views or opinions expressed by the press or other media regarding Admission or the Group. The Company makes no representation as to the appropriateness, accuracy, completeness or reliability of any such information or publication.

The Financial Adviser and Broker does not accept any responsibility or liability whatsoever for the contents of this document, including its accuracy, completeness or verification, or for any other statement made or purported to be made by it, or on its behalf, in connection with the Company, the Ordinary Shares or Admission and nothing in this document will be relied upon as a promise or representation in this respect, whether or not in the past or future. The Financial Adviser and Broker accordingly disclaims all and any liability whether arising in tort, contract or otherwise (save as referred to above) which they might otherwise have in respect of this document or any such statement. No representation or warranty, express or implied, is made by the Financial Adviser and Broker as to the accuracy or completeness of information contained in this document and nothing in this document is, or shall be relied upon as, a representation by the Financial Adviser and Broker.

For the attention of all investors

The contents of this document are not to be construed as legal, business or tax advice. Each prospective investor should consult his or her own lawyer, financial adviser or tax adviser for legal, financial or tax advice in relation to any investment in Ordinary Shares. In making an investment decision, each investor must rely on his or her own examination, analysis and enquiry of the Company, including the merits and risks involved.

An investment in the Company should be regarded as a long-term investment. There can be no assurance that the Company’s objectives will be achieved. It should be remembered that the price of the Ordinary Shares, and any income from such Ordinary Shares, can go down as well as up. All Shareholders are entitled to the benefit of, are bound by, and are deemed to have notice of, the provisions of the Articles, which prospective investors should review.

Forward-looking statements

This document includes statements that are, or may be deemed to be, ‘forward-looking statements’. In some cases, these forward-looking statements can be identified by the use of forward-looking terminology, including the terms ‘targets’, ‘believes’, ‘estimates’, ‘anticipates’, ‘expects’, ‘intends’, ‘may’, ‘will’, ‘should’ or, in each case, their negative or other variations or comparable terminology. They appear in a number of places throughout the document and include statements regarding the intentions, beliefs or current expectations of the Company and the board

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of Directors of the Company (the ‘‘Board’’) concerning, inter alia: (i) the Company’s objectives, acquisition and financing strategies, results of operations, financial condition, capital resources, prospects, capital appreciation of the Ordinary Shares and dividends; and (ii) future deal flow and implementation of active management strategies, including with regard to acquisitions. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. The Company’s actual performance, results of operations, financial condition, distributions to shareholders and the development of its financing strategies may differ materially from the forward-looking statements contained in this document. In addition, even if the Company’s actual performance, results of operations, financial condition, distributions to shareholders and the development of its financing strategies are consistent with the forward-looking statements contained in this document, those results or developments may not be indicative of results or developments in subsequent periods.

Prospective investors should carefully review the ‘Risk Factors’ set out in Part II – Risk Factors of this document for a discussion of additional factors that could cause the Company’s actual results to differ materially, before making an investment decision. For the avoidance of doubt, nothing appearing under the heading ‘Forward-looking statements’ constitutes a qualification of the working capital statement set out in paragraph 7 of Part XIV – Additional Information of this document.

Forward-looking statements contained in this document apply only as at the date of this document. Subject to any obligations under the Listing Rules, the Disclosure Guidance and Transparency Rules and the Prospectus Rules, the Company undertakes no obligation publicly to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Presentation of reserves and resources

Unless otherwise stated, statements in this document relating to the Group’s reserves and resources have been prepared using the classification system set out in the Petroleum Resources Management System published in 2007 and jointly sponsored by the Society of Petroleum Engineers, the American Association of Petroleum Geologists, the World Petroleum Council and the Society of Petroleum Evaluation Engineers. All references to ‘‘reserves’’ are to proved and probable.

The accuracy of reserves estimates and associated economic analysis is, in part, a function of the quality and quantity of available data and of engineering and geological interpretation and judgment. This document should be accepted with the understanding that reserves, resources and financial performance subsequent to the date of the estimates may necessitate revision. These revisions may be material. Unless otherwise stated, all information about oil and gas reserves and resources, forward-looking production estimates and other geological information has been extracted without material adjustment from the Competent Person’s Report in Part XVIII – Competent Person’s Report of this document.

Rounding

Percentages in tables have been rounded and accordingly may not add up to 100%. Certain financial data have also been rounded. As a result of this rounding, the totals of data presented in this document may vary slightly from the actual arithmetic totals of such data.

Data protection

The Company may delegate certain administrative functions to third parties and will require such third parties to comply with data protection and regulatory requirements of any jurisdiction in which data processing occurs. Such information will be held and processed by the Company (or any third party, functionary or agent appointed by the Company) for the following purposes:

• (a) verifying the identity of the prospective investor to comply with statutory and regulatory requirements in relation to anti-money laundering procedures;

• (b) carrying out the business of the Company and the administering of interests in the Company;

• (c) meeting the legal, regulatory, reporting and/or financial obligations of the Company in the United Kingdom or elsewhere; and

• (d) disclosing personal data to other functionaries of, or advisers to, the Company to operate and/or administer the Company.

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Where appropriate it may be necessary for the Company (or any third party, functionary or agent appointed by the Company) to:

• (a) disclose personal data to third party service providers, agents or functionaries appointed by the Company to provide services to prospective investors; and

• (b) transfer personal data outside of the EEA to countries or territories which do not offer the same level of protection for the rights and freedoms of prospective investors as the United Kingdom.

If the Company (or any third party, functionary or agent appointed by the Company) discloses personal data to such a third party, agent or functionary and/or makes such a transfer of personal data it will use reasonable endeavours to ensure that any third party, agent or functionary to whom the relevant personal data is disclosed or transferred is contractually bound to provide an adequate level of protection in respect of such personal data.

In providing such personal data, investors will be deemed to have agreed to the processing of such personal data in the manner described above. Prospective investors are responsible for informing any third party individual to whom the personal data relates of the disclosure and use of such data in accordance with these provisions.

Presentation of information

Prospective investors should consult their own professional advisers to gain an understanding of the financial information contained in this document. An overview of the basis for presentation of financial information in this document is set out below. Part X – Selected Financial Information on the Company of this document presents selected financial information extracted without material adjustment from the audited historical financial information on the Company for the 18 month period ended 31 December 2016 and unaudited historical financial information for the Company for the six month periods ended 30 June 2017 and 30 June 2016, which is set out in full in Part XVI – Historical Financial Information of the Company of this document. Part XVII – Historical Financial Information on Idemitsu UK of this document presents the audited historical financial information on Idemitsu UK for the 12 month periods ended 31 December 2016, 31 December 2015 and 31 December 2014, and the unaudited historical financial information for the six month period ended 30 June 2017.

The financial and volume information in the Prospectus, including in a number of tables, has been rounded to the nearest whole number or the nearest decimal place. The sum of the numbers in a column in a table may not conform exactly to the total figure given for that column. In addition, certain percentages presented in the tables in this document reflect calculations based on the underlying information prior to rounding, and, accordingly, may not conform exactly to the percentages that would be derived if the relevant calculations were based upon the rounded numbers.

Pro forma wording

In this document, any reference to ‘‘pro forma’’ financial information is to information which has been extracted without material adjustment from the unaudited pro forma financial information contained in Part IX – Unaudited Pro Forma Financial Information for the Enlarged Group of this document. The unaudited pro forma statement of net assets and the unaudited pro forma income statement of the Enlarged Group have been prepared for illustrative purposes only in accordance with Annex II of the Prospectus Rules and should be read in conjunction with the notes set out in Part IX – Unaudited Pro Forma Financial Information for the Enlarged Group of this document. The unaudited pro forma financial information has been prepared to illustrate the effect of the Idemitsu UK Acquisition, the Sojitz Acquisition and the Egerton Acquisition (together, the ‘‘Acquisitions’’) as if these acquisitions had taken place on 30 June 2017. By its nature, the pro forma financial information addresses a hypothetical situation and, therefore, does not represent the Group’s actual financial position nor is it indicative of the results that may or may not be expected to be achieved in the future.

Market data

Where information contained in this document has been sourced from a third party, the Company and the Directors confirm that such information has been accurately reproduced and, so far as

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they are aware and have been able to ascertain from information published by that third party, no facts have been omitted which would render the reproduced information inaccurate or misleading.

CREST

CREST is a paperless settlement procedure enabling securities to be evidenced otherwise than by a certificate and transferred otherwise than by written instrument. The Articles permit the holding of Ordinary Shares under the CREST System. The Ordinary Shares are admitted to CREST and accordingly, settlement of transactions in the Ordinary Shares following Admission may take place within the CREST System if any investor so wishes.

CREST is a voluntary system and Shareholders who wish to receive and retain certificates for their Ordinary Shares will be able to do so. Shareholders may elect to receive Ordinary Shares in uncertificated form if such Shareholder is a system-member (as defined in the CREST Regulations) in relation to CREST.

Transferability

The Ordinary Shares are freely transferable and tradable and there are no restrictions on transfer.

International Financial Reporting Standards

As required by the Act and Article 4 of the European Union (‘‘EU’’) IAS Regulation, the financial statements of the Company are prepared in accordance with International Financial Reporting Standards as adopted by the EU (‘‘IFRS’’) issued by the International Accounting Standards Board (‘‘IASB’’) and interpretations issued by the International Financial Reporting Interpretations Committee of the IASB as adopted by the EU.

Incorporation of information by reference

The contents of the Company’s website (www.rockroseenergy.com), any website mentioned in this document or any website directly or indirectly linked to these websites have not been verified and do not form part of this document, and prospective investors should not rely on them.

A list of defined terms used in this document is set out in ‘Definitions’ at Part XV – Definitions of this document.

Currency

Unless otherwise indicated, all references in this document to:

• ‘‘Pounds Sterling’’, ‘‘GBP’’, ‘‘£’’, ‘‘p’’ or ‘‘pound’’ is to the lawful currency of the United Kingdom; and

• ‘‘US Dollars’’, ‘‘USD’’, ‘‘US$’’ or ‘‘$’’ is to the lawful currency of the United States.

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PART IV

EXPECTED TIMETABLE

Publication of this document 14 February 2018 Cancellation of trading of Ordinary Shares 7.30 a.m. on 19 February 2018 Admission of the Company’s share capital effective and commencement of dealings in Ordinary Shares 8.00 a.m. on 19 February 2018

All references to time in this document are to London time, unless otherwise stated.

Any changes to the expected timetable will be notified by the Company through a Regulatory Information Service.

ADMISSION STATISTICS

Total number of Ordinary Shares[(1)] 15,333,334 Market capitalisation at Admission[(2)] £19.78 million

• (1) In accordance with Listing Rule 4.2.2, at Admission at least 25 per cent. of the Ordinary Shares of this listed class will be in public hands (as defined in the Listing Rules).

• (2) The market capitalisation of the Company at any given time will depend on the market price of the Ordinary Shares at that time. The market price per Ordinary Share may fall below the market price prevailing immediately prior to the suspension of the Company’s listing on 18 October 2017.

DEALING CODES

The dealing codes for the Ordinary Shares will be as follows:

ISIN GB00BYNFCH09 SEDOL BYNFCH0 TIDM RRE

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PART V

DIRECTORS, AGENTS AND ADVISERS

Directors Andrew Philip Austin (Executive Chairman) Richard Alan Benmore (Non-Executive Director) John Andrew Corran Morrow (Non-Executive Director) Company Secretary Cooley Services Limited Dashwood 69 Old Broad Street London EC2M 1QS Registered Office c/o Cooley Services Limited Dashwood 69 Old Broad Street London EC2M 1QS Financial Adviser and Broker Hannam & Partners (Advisory) LLP 2 Park Street London W1K 2HX Auditors and Reporting PricewaterhouseCoopers LLP Accountants 1 Embankment Place London WC2N 6DX Solicitors to the Company Cooley (UK) LLP Dashwood 69 Old Broad Street London EC2M 1QS Registrar Link Asset Services The Registry 34 Beckenham Road Beckenham Kent BR3 5TU Competent Person ERC Equipoise Limited 6th Floor Stephenson House 2 Cherry Orchard Road Croydon CR0 6BA

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PART VI

THE ACQUISITIONS AND THE GROUP

Introduction and background

At the time of the initial admission of the Ordinary Shares to Standard Listing and to trading on the Main Market of the London Stock Exchange on 13 January 2016 (‘‘Initial Admission’’), the Company stated that its strategy was to:

‘‘...pursue a targeted acquisition strategy focused on onshore and offshore production opportunities, power generation and infrastructure, and is differentiated by its approach to asset stewardship and capital efficiency, to create a scalable energy business that is able to deliver shareholder returns in a low oil price environment.’’

The Acquisitions are a demonstration of this strategy. In January 2016 the Company also stated that it would be:

‘‘Targeting offshore cash generative production assets and accretive onshore opportunities, where the potential exists to consolidate working interests and operatorship to a size capable of attracting major industry players’’.

The Acquisitions completed to date fit with this objective and the Board’s stated criteria for the making of Acquisitions.

In the case of corporate acquisitions (as opposed to the direct acquisition of licence interests where formal consent of the OGA is required), it is important for investors to note that the OGA issue a comfort letter to the acquirer confirming no deficit to change of control of the entity holding the relevant licence interests. The comfort letter is not a formal concent from the OGA and does not prevent the OGA from subsequently raising objections. However, in respect of each of the Acquisitions the subject of this document, the Company engaged in an extensive review process with the OGA and is not aware of any grounds upon which the OGA might subsequently raise an objection.

The Directors believe that the assets comprised in the completed Acquisitions have the potential to perform above expectations both in terms of production of oil and gas and the timing of decommissioning. There is also the potentially significant opportunity created by delays in decommissioning to extend the life of fields, which is also a stated objective of the UK Government.

The Group’s portfolio is summarised in the table set out on page 41 of this document.

The Competent Person’s Report covers all licence interests which have a positive net present value (‘‘NPV’’). The NPV is an estimate of the post-tax net present value, at a 10% discount rate, of the forward cash-flows of the projects associated with production of the relevant reserves. Full details of all of the assumptions and sensitivities applied in estimating the NPVs set out in the table below are presented in the Competent Person’s Report.

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Seven Totals	Blake Ross Nelson Howe Balmoral Stirling Burghley Beauly Tain Galley Sedgwick Mordred Galahad Tors Seas Grove (£m)	Field:	P729,	P810, P307, P69, P77,	Licences included P101 P973 P87 P77 P344 P344 P240 P344 P983 P324 P205 P142 P142 P1034 P1354 P083	Working interest 30.82% 30.82% 7.47% 20.00% 6.75% 16.00% 41.10% 40.00% 50.00% 17.42% 40.00% 8.33% 27.77% 15.00% 10.00% 7.50%	Operator Repsol Repsol Shell Shell Premier Premier Repsol Repsol Repsol Repsol Taqa Perenco Perenco Alpha Centrica Centrica	Seller IDU IDU IDU IDU IDU IDU IDU IDU IDU IDU IDU Egerton Egerton Sojitz Sojitz Sojitz	CPR results – 31/12/17	Provider ERCE ERCE ERCE ERCE Company Company Company Company Company Company Company Company Company Company Company Company	1P 5.1 0.1 1.3 0.5 — — — — — — — — — — — — 7.0	2P 6.5 0.5 1.9 1.1 — — — — — — — — — — — — 10	3P 8.8 0.4 2.5 1.6 — — — — — — — — — — — — 13.3	NPV – 1P 40.3 -16.6 11.7 18.15 — — — — — — — — — — — — 53.47	NPV – 2P 73.0 -13.5 20.4 31.5 — — — — — — — — — — — — 111.5	NPV – 3P 128.4 -10.1 30.4 41.1 — — — — — — — — — — — — 189.8	Totals	Cessation of production 2024 2024 2031 2031 2019 2019 2019 2019 n/a 2020 2018 2019 2019 2021 2020 2022 (£m)	Abandonment expenditure (ABEX)	DSA and section 29	postings (£m) NIL NIL 12.8 NIL 8.7 3.0 NIL 4.5 NIL NIL NIL NIL NIL NIL NIL NIL 29.0	Net post-tax ABEX (£m) 30.8 47.8 11.3 4.3 12.7 4.0 6.7 5.8 NIL 23.3 0.1 0.1 4.4 2.8 1.2 3.1 158.1		Note: (1) NPV fgures in this table are estimates of the post-tax value, at a 10% discount, of the forward cash-fows of the projects associated with production of the relevant reserves, and the full assumptions	and sensitivities are set out in full in the ERC Equipoise (ERCE) report; (2) cessation of production dates are on the basis of the directors’ review of operator communications.	Source: Resources and NPV – Competent Persons Report; cessation of production dates – current operator communicated plans; ABEX and DSA postings – Group records.

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				Totals	(£m)	53.29	6.5		6.0			Obligations	None	None	None	None	None	None	None	None	None	None	None	None	None	None	None	None	None	None	None	None	None
Balmoral,	Sitrling,	Burghley,	Beauly, Tain,	Blake and Nelson and Galley and	Ross Howe Galley Galahad Mordred Grove Tors Seven Seas Sedgwick	Operating Expenditure (£m) 31.5 8.1 0 0.42 0.06 1.53 1.3 0.28 10.1	Capital Expenditure (£m) 4.2 2.2 0 0 0 0 0 0.1 0	Abandonment/	Decommissioning (£m) 0 0 0.5 0 0 0 0 0 5.5	Source: Operator budgets communicated to the Group.	(c) Summary Licence data	Field Licence Licence Start Date Initial Term End Date Second Term End Date Licence End Date Licence Type	Blake P729 14/06/1991 13/06/1997 13/06/2009 13/06/2027 (Anticipated) Production	P810 03/07/1993 02/07/1999 02/07/2011 02/07/2029 (Anticipated) Production	P101 09/06/1970 08/06/1976 N/A N/A Production	Ross P307 05/09/1979 04/09/1983 04/09/1986 N/A Production	P973 25/09/1997 24/09/2009 24/09/2027 24/09/2027 (Anticipated) Production	Balmoral P344 17/12/1980 16/12/1986 N/A N/A Production	Stirling P344 17/12/1980 16/12/1986 N/A N/A Production	Burghley P240 16/03/1972 15/03/1978 15/03/2018 15/03/2018 (Anticipated) Production	Beauly P344 17/12/1980 16/12/1986 N/A N/A Production	Nelson P69 25/11/1965 24/11/1971 N/A N/A Production	P77 25/11/1965 24/11/1971 N/A N/A Production	P87 25/11/1965 24/11/1971 N/A N/A Production	Howe P77 25/11/1965 24/11/1971 N/A N/A Production	Tain P983 23/12/1998 22/12/2004 22/12/2018 22/12/2034 (Anticipated) Production	Galley P324 10/06/1981 N/A N/A 14/03/2018 (Anticipated) Production	Sedgwick P205 16/03/1972 15/03/1978 15/03/2018 15/03/2018 (Anticipated) Production	Mordred P142 01/12/1971 30/11/1977 N/A N/A Production	Galahad P142 01/12/1971 30/11/1977 N/A N/A Production	Tors P1034 07/02/2002 06/02/2008 06/02/2020 06/02/2038 (Anticipated) Production	Seven Seas P1354 22/12/2005 21/12/2009 21/12/2013 21/12/2031 (Anticipated) Production	Grove P083 25/11/1965 24/11/1971 N/A N/A Production	Source: OGA.

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The Group’s portfolio

(a) The Idemitsu interests

(i) Overview

The Company announced on 18 October 2017 that it had signed a sale and purchase agreement to acquire the entire issued share capital of Idemitsu UK from Idemitsu Group (the ‘‘Idemitsu UK Acquisition Agreement’’). On 30 November 2017, the Company received a letter from the OGA confirming that it currently has no objection to the change of control of Idemitsu UK, and the Idemitsu UK Acquisition completed on 8 December 2017. By virtue of the Idemitsu UK Acquisition, the Company acquired interests in a number of producing fields in the North Sea, as follows:

Field Ross Blake Tain Nelson Howe Balmoral Stirling Beauly Burghley Galley	Working Interest 30.8% 30.8% 50.0% 7.5% 20.0% 6.8% 16.0% 40.0% 41.1% 17.4%	Operator
		Repsol Repsol Repsol Shell Shell Premier Premier Repsol Repsol Repsol

Of the licence interests acquired pursuant to the Idemitsu UK Acquisition, the interests in the Nelson, Howe, Ross and Blake fields are considered to be material and significant assets and are accordingly the subject of the ERC Equipoise report, which is set out in full on pages T-1 to T-59 of this document. The interests in the remaining fields (being Tain, Balmoral, Stirling, Beauly, Burghley and Galley) are not considered to be material producing interests and accordingly are not included in the Competent Person’s Report. However the decommissioning obligations associated with these field interests are set out in the table on page 42 of this document.

(ii) The Idemitsu UK Acquisition Agreement

The Idemitsu UK Acquisition Agreement was entered into on 17 October 2017 and was conditional upon the OGA confirming that it had no objection to the change of control of Idemitsu UK and the release of Idemitsu Group and its affiliates from any guarantee given to a bank in respect of any DSAs to which Idemitsu UK was a party. As noted above, the Company received a letter from the OGA on 30 November 2017 confirming that it currently has no objection to the change of control of Idemitsu UK and the remaining condition was also satisfied.

The consideration for the Idemitsu UK Acquisition was US$29.7m, effective, for economic purposes as at 1 July 2017. The Idemitsu UK Acquisition was subject to certain adjustments recorded in the Indemitsu UK Acquisition Agreement relating to certain tax refunds and proceeds of an insurance claim, the effect of which was to increase the consideration payable to Idemitsu Group by US$652,000. At completion, the Company acquired Idemitsu UK with cash at bank of US$139.7m.

The Idemitsu UK Acquisition Agreement contained customary warranties and representations relating to Idemitsu Group’s interests in Idemitsu UK, which were given to the Company by Idemitsu Group on the one hand, and by the Company to Idemitsu Group on the other hand, as at the date of signing of the Idemitsu UK Acquisition Agreement; each such representation and warranty was repeated on the date of completion of the Idemitsu UK Acquisition (i.e. 8 December 2017).

Claims under the Idemitsu UK Acquisition Agreement were subject to certain financial, time and other limitations that are customary in agreements of this type. Idemitsu Group will not be liable in respect of a claim under the Idemitsu UK Acquisition Agreement unless the liability under such claim exceeds £10,000. The overall cap and aggregate liability of Idemitsu Group in respect of claims under the Idemitsu UK Acquisition Agreement was £50,000. The limitation period in respect of a claim under the Idemitsu UK Acquisition Agreement expires 12 months following completion of the Idemitsu UK Acquisition (i.e. 8 December 2018).

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Pursuant to the terms of the Idemitsu UK Acquisition Agreement, the Company agreed to indemnify Idemitsu Group and its affiliates against, and agreed to assume full responsibility for, any and all environmental liabilities (including but not limited to claims, demands, actions, proceedings and costs) in relation to the licences to which Idemitsu UK was a party, provided that the Company shall not be responsible for, and shall not be required to make, any payment in respect of amounts actually paid by Idemitsu Group and its affiliates prior to 1 July 2017.

The Idemitsu UK Acquisition Agreement was governed by the laws of England and Wales and the parties irrevocably agreed to the exclusive jurisdiction of the courts of England and Wales in relation to any action or proceeding arising out of the Idemitsu UK Acquisition Agreement.

(iii) The Nelson field

The Group owns a 7.8% interest in the Nelson field. The interest will continue to be operated by Shell.

The Nelson field is located south east of the Forties field in the Central North Sea. It is operated by Shell and has been on production for ca. 24 years. The Nelson structure is a low relief anticline at a depth of some 7000 ft ss. The quality of the Palaeocene Forties sandstone is very good. Recovery is through a combination of aquifer influx and water injection, as well as gas lift.

The Nelson field has been developed through several cycles of infill drilling following the initial development of the Nelson field. A total of 37 production wells and four water injectors have been drilled. 23 producers and zero were in use in Q4 2017. The oil production rate peaked at around 185 Mbbl/d in 1994. The Nelson field is now at a mature stage of production, producing some 10 Mbbl/d of oil and 125 Mbbl/d of water, a water cut of some 93%. The cumulative oil production as at 31/07/2017 is 463 MMbbl pipeline barrels.

Oil from the fixed platform is transported by pipeline to the Forties field, and then to shore via the Forties pipeline system. Excess gas not used for fuel is exported via a separate pipeline to St Fergus for sale.

In 2009 Shell completed a four dimensional study of the Nelson field.

In 2017 a number of further well interventions were undertaken as part of the operator’s well services campaign. The first campaign was undertaken in Q2 2017, and a further campaign is Q4 2017 involved works on gas lift valves on four wells, (N34, N02, N29y and N15), with a target of increasing oil production by 485 bbl/d.

As part of the well services campaign for 2018, N12 and N20x are planned to undergo restoration. Well N12 has been suspended since 2015 due to a casing leak, and N20x was suspended in April 2017 due to sand production following perforation of the sand screens in 2016. These wells are due to be restored at a combined oil rate forecast by the operator at approximately 1,700 bbl/d. ERC Equipoise has incorporated the successful restoration of these wells in its forecasts.

Regarding the 2017 production performance, the operator has reduced its availability forecast for the year from 78% to 73% due to a number of unplanned outages impacting production. These outages were related to, amongst others, compression issues, water handling problems, sand management in Well N20x and gas leaks. The compression and water handling problems have been addressed this year during the August 2017 TAR, which was extended by seven days.

Rockrose Interest (%) Gross Remaining Reserves (MMstb) Reserves Attributable to Rockrose (MMstb) NPV10 Attributable to Rockrose (GBP MM) Economic Limit (Year)	1P 7.48% 17.30 1.29 11.67 2026	2P 7.48% 24.99 1.87 20.43 2029	3P 7.48% 33.54 2.51 30.40 2034

These figures have been extracted without material adjustment from the ERC Equipoise report (which is set out in full on pages T-1 to T-59 of this document). The discount factor applied is 10% and the full assumptions and sensitivities are set out in full in the ERC Equipoise report.

(iv) The Howe field

The Group owns a 20% interest in the Howe field. The interest will continue to be operated by Shell.

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The Howe field (also identified as the Howe Main area) lies 14 kilometres east of Nelson. It is operated by Shell and contains 41 degrees of API oil in good quality Fulmar Jurassic sandstone at a depth of ca 10,300 ft TVDSS. The Howe field was appraised by Well 22/12a-8, which encountered an oil water contact in a 160 feet thick reservoir section down dip of crestal Well 21/ 12a-1. The initial reservoir pressure was a 6700 psi, some 2700 psi over-pressured.

The Howe field well produced through a sub-sea template tied back by pipeline to the Nelson field.

The Howe field has been developed through this single sub-horizontal well following the initial appraisal of the field. The oil production rate peaked at around 11 Mstb/d in 2005. The Howe field is now at a mature stage of production, producing some 2.5 Mstb/d oil and 0.4 Mbbl/d water, a water cut of some 14%. The cumulative oil production as at 31/07/2017 is 15.4 MMstb.

In 2016 the operator prepared a material balance model. The model comprises simulation of three connecting tanks which account for field geometry. Of note is the existence of a structural saddle in Howe Main, described by splitting the Howe Main tank into a near and a far tank. Basic assumptions include the presence of an aquifer and of a secondary gas cap across the saddle. A secondary gas cap forms in the crest of the far tank, and gas flow occurs only after this secondary gas cap grows to a size where it can spill across the saddle. The production forecast is controlled by a maximum gas rate. Therefore the gas oil ratio (GOR) becomes a main driver for any production forecast. We have reviewed this material balance model, and we accept the match proposed for historical GOR and pressure behaviour. The model provides a STOIIP estimate of 48 MMsbt.

Rockrose Interest (%) Gross Remaining Reserves (MMstb) Reserves Attributable to Rockrose (MMstb) NPV10 Attributable to Rockrose (GBP MM) Economic Limit (Year)	1P 20.00% 2.46 0.49 18.15 2026	2P 20.00% 5.28 1.06 31.50 2029	3P 20.00% 7.77 1.55 41.09 2034

These figures have been extracted without material adjustment from the ERC Equipoise report (which is set out in full on pages T-1 to T-59 of this document). The discount factor applied is 10% and the full assumptions and sensitivities are set out in full in the ERC Equipoise report.

(v) The Blake field

The Group owns a 30.8% interest in the Blake field. The interest will continue to be operated by Repsol.

The Blake field lies some 12 km north east of the Ross field and has been on production since 2001. Repsol Sinopec is the operator of the Blake field. Hydrocarbons are contained in Lower Cretaceous turbiditic sands. The main reservoir is a massive channel sand sequence known as the Blake Channel which has excellent quality reservoir properties. Blake Flank comprises lower quality, thinner sands located to the north east of Blake Channel.

The two areas of the field have been developed separately. A total of six production wells and two water injectors have been drilled in the Channel, of which four and two respectively were in use in 2017. In the Flank, two production wells and one injection well have been drilled, all of which remain in use in 2017. The oil production rate in the Channel peaked at around 68 Mstb/d in 2001 and in the Flank at around 13 Msbt/d in 2004. The Blake field is now at a mature stage of production, producing some 9.5 Mstb/d oil and 25 Mstb/d water in the Channel, a water curt of some 73%, and producing around 3.5 Msbt/d oil and 0.02 Mstb/d in the Flank, a water cut of around 1%. The cumulative production from the whole Blake field as at 20/09/2017 is 98 MMstb.

The Blake Channel is at a depth of ca 5,200 ft ss and contains a 97 ft thick oil rim overlain by a gas cap. Blake Channel has been developed by six horizontal producers and two deviated water injectors. Oil production from the Blake field commenced in June 2001, and water injection commenced at the same time as production.

The oil from the Blake field is produced via a subsea manifold and dual flowlines to the Ross floating production storage and offloading unit (‘‘FPSO’’). Since 2015 Ross stopped participating in the cost share for the FPSO. Instead OPEX for Ross was limited to a tariff based on produced oil rate, plus field specific OPEX.

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The operator is in the process of executing a field life extension (‘‘FLE’’) project, which will maintain FPSO operability until 2024. With respect to costs, the operator and Rockrose continue to execute the FLE work scope and refine costs. Rockrose provided ERC Equipoise with a revised forecast of cost from July 2017, which ERC Equipoise reviewed and have taken into account in their analysis.

Rockrose Interest (%) Gross Remaining Reserves (MMstb) Reserves Attributable to Rockrose (MMstb) NPV10 Attributable to Rockrose (GBP MM) Economic Limit (Year)	1P 30.82% 16.45 5.07 40.29 2024	2P 30.82% 20.93 6.45 73.03 2024	3P 30.82% 28.60 8.81 128.43 2024

These figures have been extracted without material adjustment from the report of ERC Equipoise (which is set out in full on pages T-1 to T-59 of this document). The discount factor applied is 10% and the full assumptions and sensitivities are set out in full in the ERC Equipoise report.

(vi) The Ross field

The Group owns a 30.8% interest in the Ross field. The interest will continue to be operated by Repsol.

The Ross field lies approximately 110km NE of Aberdeen. It has been on production since 1999, producing undersaturated oil from variable quality, relatively thin Ross sands of Upper Jurassic age at a depth from 2700 to 3200 m ss, and also from the underlying Parry sand, Reservoir performance is influenced by faulting, which causes compartmentalisation.

The Ross sand has been developed by six horizontal gas lifted production wells and four water injectors. The oil is produced into a leased FPSO where it is processed and then exported via shuttle tanker. Gas not used as fuel is exported by pipeline via the Frigg transportation system.

The Ross field has been developed through (several) cycles of infill drilling following the initial development of the Ross field. A total of six horizontal gas lifted production wells and five water injectors have been drilled, of which three of the gas lifted production wells and no water injectors were in use in 2017. The oil production rate peaked briefly at around 39 Mstb/d oil in 199. The Ross field is now at a mature stage of production, producing some 0.8 Mstb/d oil and 1.5 Mbbl/d water, a water cut of some 65%. The cumulative oil production as at 20/09/2017 is 33 MMstb.

The Ross field has experienced downtime throughout 2016 and 2017 due to, amongst other factors, high oil in water levels, high H2S levels and gas lift problems. Wells RP2 and RP3 have both suffered from gas lift unavailability: gas lift mandrels could not be opened due to high wellbore pressure. At the time of wiring this report, high wellbore pressure is still reported in Well RP3. The well is expected to progressively de-pressure until Q1 2018, when full potential is expected to be reinstated. Well RP2 is also currently shut in due to a leak in the hydraulic line, but is expected to be reinstated in Q2 2018. Well RP2 is currently producing.

There is no cost share with the Blake field, and instead the Ross field pays a tariff. With respect to cost allocation all Bleo-Holm upgrade and repair costs are therefore borne by the Blake field. With respect to the field specific costs (OPEX), ERC Equipoise has accepted the operator’s forecast for 2018, and maintained our historical assumptions. These costs include subsea inspections carried out in alternating years.

Rockrose Interest (%) Gross Remaining Reserves (MMstb) Reserves Attributable to Rockrose (MMstb) NPV10 Attributable to Rockrose (GBP MM) Economic Limit (Year)	1P 30.82% 0.46 0.14 -16.64 2024	2P 30.82% 0.90 0.28 -13.51 2024	3P 30.82% 1.40 0.43 -10.10 2024

These figures have been extracted without material adjustment from the ERC Equipoise report (which is set out in full on pages T-1 to T-59 of this document). The discount factor applied is 10% and the full assumptions and sensitivities are set out in full in the ERC Equipoise report.

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(vii) The Tain, Balmoral, Stirling, Beauly, Burghley, Sedgwick and Galley fields

The Group also has interests ranging from 6.8% to 50% in the Tain, Balmoral, Stirling, Beauly, Burghley, Sedgewick and Galley fields (together, the ‘‘Secondary Field Interests’’). The Secondary Field Interests are all late stage assets and are new in the process of having ceased production or being close to cessation of product.

Accordingly the reserves attributable to the Secondary Field Interests are not material (to the extent that any reserves might exist) and on that basis have not been included in the scope of the ERC Equipoise report.

The Group’s contributions to decommissioning costs (or abandonment expenditure) with respect to the Secondary Field Interests are set out in the table below and amount, in aggregate, to £52.6m (on a net post-tax basis), of which DSA postings to date of £16.2m have been made.

Licence Working Interest Operator Cessation of production: Seller date Wood Mac date DSA in place (Y/N) DSA and section 29 postings (£m) Net post-tax ABEX (£m)	Balmoral Stirling Burghley Beauly Tain Galley Sedgwick P344 P344 P240 P344 P983 P324 P205 6.75% 16% 41.1% 40% 50% 17.42% 40% Premier Premier Repsol Repsol Repsol Repsol Taqa 2019 2019 2019 2019 — 2020 2018 2018 — 2018 — — — — N N N N N N N 8.7 3.0 0 4.5 0 0 0 12.7 4.0 6.7 5.8 0 23.3 0.1

(viii) Decommissioning with respect to the Idemitsu Interests

In respect of the Idemitsu UK Acquisition the Company has paid £16,219,073 to a bi-lateral security agreement pending formal operator led arrangements for the Balmoral, Beauly and Stirling fields. In addition Idemitsu UK has posted £12.8m to the Nelson field DSA (which was put in place on 21 December 2010) on 1 December 2017.

(ix) Rationale for the Idemitsu UK Acquisition

The Directors believe that the Idemitsu UK Acquisition was an excellent opportunity to expand the Group’s portfolio in the UK North Sea, with the potential of adding long term value by making a further significant acquisition in a low oil price environment.

The Directors believe that the key benefits of the Idemitsu UK Acquisition are:

• the acquisition of quality assets, albeit late life assets, solidifying the Group’s base in the UK North Sea;

• a compelling acquisition valuation that is immediately and materially value enhancing; and

• a portfolio with limited decommissioning risk and decommissioning provisions estimated and provided for.

(b) The Egerton interests

(i) Overview

On 22 March 2017 the Company announced that it had entered into an agreement, conditional, inter alia, upon certain regulatory approvals, to acquire the entire issued share capital of Egerton from the Egerton Sellers for the sum of £1.00 with deferred consideration payable to the Company of £666,000 (in two instalments on the first anniversary of completion and the date which falls 18 months from completion) (the ‘‘Egerton Acquisition Agreement’’). At completion (and as a result of a pre-completion reorganisation), Egerton will have net cash of £333,000. At the same time the Company entered into a subscription agreement with Arunvill Capital Limited (‘‘Arunvill’’) pursuant to which Arunvill agreed to subscribe in cash in the total amount of £4,000,000 for Ordinary Shares in the Company at a price of £1.50 per Ordinary Share, on the basis that such funds would be sufficient to cover anticipated decommissioning costs of the Egerton Interests.

(ii) The Egerton Acquisition Agreement

The Egerton Acquisition Agreement was entered into on 22 March 2017 pursuant to which the Egerton Sellers conditionally agreed to sell and the Company conditionally agreed to purchase (through Rockrose (UKCS1)) the entire issued share capital of Egerton.

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The transaction was subject to confirmation from the OGA that the Egerton Acquisition would neither result in the revocation of the petroleum exploration and/or production licences held by Egerton nor would it require any further change of control of Egerton. On 20 December 2017, the Company received a letter from the OGA confirming that it currently has no objection to the change of control of Egerton, and the Egerton Acquisition completed on 22 December 2017.

The Egerton Acquisition Agreement contained customary warranties and representations relating to Egerton, which were given by the Egerton Sellers to the Company (on a several basis), on the one hand, and by the Company to the Egerton Sellers on the other hand, as at the date of signing of the Egerton Acquisition Agreement; each such representation and warranty was repeated on the date of completion of the Egerton Acquisition (i.e. 22 December 2017).

Claims under the Egerton Acquisition Agreement were subject to certain financial, time and other limitations that are customary in agreements of this type. The threshold to be exceeded in respect of the aggregate amount of all warranty claims was £100,000 in which case the Egerton Sellers shall be liable for the whole amount claimed and not only the excess, save that each Egerton Seller shall only be liable in respect of its relevant percentage of such amount claimed. The limitation period in respect of warranty and indemnity claims under the Egerton Acquisition Agreement expires 18 months following completion of the Egerton Acquisition in the case of the general warranties (i.e. 22 June 2018) and four years following completion of the Egerton Acquisition in the case of a claim under the tax warranties or the tax covenant (i.e. 22 December 2018). The overall cap and aggregate liability of the Egerton Sellers in respect of claims under the Egerton Acquisition Agreement will not exceed £300,000.

The Egerton Acquisition Agreement was governed by the laws of England and Wales and the parties irrevocably submitted to the exclusive jurisdiction of the courts of England and Wales in relation to any action or proceeding arising out of the Egerton Acquisition Agreement.

(iii) Information on the Egerton Interests

The assets acquired from Egerton are a 27.77% interest in the Galahad Field and a 8.33% interest in the Mordred Field. Both fields will continue to be operated by Perenco. Perenco is an independent oil & gas company with operations in 13 countries across the globe, and is an experienced operator involved in operations both onshore and offshore.

The interests in the Mordred field and the Galahad field are not covered by the Competent Person’s Report. This is because the 1P and 2P reserves attributable to those field interests are so small that they are not capable of producing a measurable NPV. As is explained below, the Company has now received notice from the Secretary of State under section 26 of the Petroleum Act 1998 of an intention to require the preparation of abandonment and decommissioning plans and accordingly in terms of asset value the field interests are not material or significant. Estimates of decommissioning obligations are set out below.

(iv) The Galahad field

The Lancelot area includes Lancelot, Guinevere, Galahad, Mordred, Malory and Excalibur fields. The Galahad field is located to the northeast of the Lancelot and Guinevere fields.

The Galahad field is a unitised 30% interest in block 48/12a and 70% interest in block 48/13b, both of which were originally awarded to a Mobil-led group in the Fourth UK Offshore Licensing Round in December 1971.

The Galahad field was originally discovered by Mobil in 1975. The Galahad field is located approximately 12 kilometres southwest of the Shell-operated Barque field. An extension of the Galahad field was discovered in 1982. Two horizontal wells have been used to develop the Galahad reserves and have been in commercial production since 1994.

The Group holds a 27.77% non-operated minority interest in the Galahad field. Production from the Galahad field is currently not meaningful in amount. On 15 January 2018, the Company received initial notice under section 29 of the Petroleum Act 1998 of an intention on the part of the Secretary of State to serve formal notice to prepare an abandonment and decommissioning plan for the Galahad field. Perenco, the operator, is now likely to commence the process of formalising a decommissioning plan.

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(v) The Mordred field

The Mordred field, located approximately two kilometres to the southwest of the Galahad field, has been developed via extended reach drilling from the Galahad platform.

The Mordred field was discovered in 1989. Originally named Galahad South, the Mordred field was appraised in 1996, and came into commercial production in late in the same year. The Mordred field subsequently received development approval in May 1997 and the first commercial production began in the same month.

The Group holds an 8.33% non-operated minority interest in the Mordred field. Production from the Galahad field is currently also not meaningful in amount, however, as with the Galahad field interest.

On 15 January 2018, the Company received initial notice under section 29 of the Petroleum Act 1998 of an intention on the part of the Secretary of State to serve formal notice to prepare an abandonment and decommissioning plan for the Mordred field. Perenco, the operator, is now likely to commence the process of formalising a decommissioning plan.

(vi) Rationale for the Egerton Acquisition

The Company believes that the Egerton Acquisition, which is essentially the acquisition of the 27.77% interest in the Galahad field and the 8.33% interest in the Mordred field, Egerton itself having no other assets, gives the Company the opportunity to participate in assets where the timing of decommissioning may be extended (subject to the agreement of other participants in the relevant field assets) and, which at current hydrocarbon prices (where the fields are marginally viable), could present a significant future opportunity for the Company.

In connection with the Egerton Acquisition, Arunvill, the principal vendor, subscribed for 2,666,666 Ordinary Shares in the Company on 6 July 2017, at a price of £1.50 per Ordinary Share. In commercial terms, Arunvill wished to exit the licences held by Egerton (by disposing of Egerton) and the £4,000,000 received by the Company in cash (together with the consideration paid by Arunvill to the Company in connection with the Egerton Acquisition) was in excess of the estimated decommissioning costs associated with Egerton which the Group then assumed.

(vii) Decommissioning obligations in respect of the Egerton Acquisition

In respect of the Egerton Acquisition, the net to Egerton share of anticipated decommissioning costs (based on operator estimates of total decommissioning costs) for the Galahad and Mordred field is currently estimated at US$5m and the Group has assumed this liability and provides security for the oblibation by way of an annually renewable decommissioning insurance bond, which the Company expects to renew on materially similar terms in 2018. There are as yet no formalised decommissioning plans in respect of the Galahad and Mordred fields, the last operator plan having been prepared in 2008. As a result of the notices served by the Secretary of State on all of the licence interest holders in the Galahad and Mordred fields on 15 January 2018, it is likely that a new abandonment and decommissioning plan (for both fields) will now be prepared by Perenco, the operator. The Company has no expectation that its current provisions for its share of the decommissioning costs is other than a prudent and fair estimate at the current time.

(c) The Sojitz Interests

(i) Overview

The Company announced on 3 August 2017 that it had entered into an agreement to acquire a subsidiary of a major trading company which holds small non-operated interests in gas fields located in the Southern North Sea (the ‘‘Sojitz Acquisition Agreement’’). The Company noted that the Sojitz Acquisition also included significant tax assets.

The Sojitz Acquisition involved the purchase of the entire issued share capital of Sojitz Energy Project Limited (‘‘Sojitz’’) from Sojitz Corporation, a Japanese corporate entity and Sojitz Europe plc, an English company, who have together agreed in principal to sell Sojitz to the Company.

The transaction was subject to confirmation from the OGA that the Sojitz Acquisition would neither result in the revocation of the petroleum exploration and/or production licences held by Sojitz nor would it require any further change of control of Sojitz. On 20 December 2017, the Company received a letter from the OGA confirming that it currently has no objection to the change of control of Sojitz, and the Sojitz Acquisition completed on 22 December 2017.

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The interests in the Tors field unit area, the Grove field unit area and the Seven Seas field unit area are not covered by the Competent Person’s Report. This is because whilst there are reserves attributable to those field unite areas, the reserves are not considered by ERC Equipoise to be of a magnitude that are capable of producing a material NPV.

(ii) The Sojitz Acquisition Agreement

The Sojitz Acquisition Agreement was entered into on 10 July 2017 and the Sojitz Acquisition was subject to confirmation from the OGA that the Sojitz Acquisition would neither result in the revocation of the petroleum exploration and/or production licences held by Sojitz nor would it require any further change of control of Sojitz. As noted above, such confirmation was received from the OGA on 20 December 2017.

The consideration for the Sojitz Acquisition was expected to be US$2,500,000, payable in cash by the Company, less adjustments for income, expenditure and working capital (reflecting an effective economic date for the transaction of 1 January 2016). The Sojitz Acquisition took the form of a put and call option on the shares in Sojitz and was subject to the Sojitz Sellers completing a corporate reorganisation prior to the sale to remove certain assets that were not subject to the Sojitz Acquisition. The Company received US$1.7m pursuant to adjustments applicable to the sale, giving a net cash consideration of US$1.8m.

The Sojitz Acquisition Agreement contained extensive business warranties and representations relating to Sojitz and the Sojitz Sellers’ interests in Sojitz, which were given to the Company by the Sojitz Sellers. The Company gave customary title and capacity warranties and representations to the Sojitz Sellers in respect of its obligations under the Sojitz Acquisition Agreement.

Claims under the Sojitz Acquisition Agreement were subject to certain financial, time and other limitations that are customary in agreements of this type. The threshold to be exceeded in respect of the aggregate amount of all warranty claims is £150,000 in which case the Sojitz Sellers shall be liable only for the excess above the threshold, save that each Sojitz Seller shall only be liable in respect of its relevant percentage of such amount claimed. The limitation period in respect of warranty and indemnity claims under the Sojitz Acquisition Agreement expires 12 months following completion of the Sojitz Acquisition in the case of the general warranties (i.e. 22 December 2018) and three years following completion of the Sojitz Acquisition in the case of a claim under a tax warranty or the tax covenant (i.e. 22 December 2020). The overall cap and aggregate liability of the Sojitz Sellers in respect of all claims under the Sojitz Acquisition Agreement will not exceed 100% of the consideration paid under the terms of the Sojitz Acquisition Agreement.

Pursuant to the terms of the Sojitz Acquisition Agreement, the Company agreed to indemnify the Sojitz Sellers and their affiliates against all losses caused by a breach of the Company’s undertaking to such persons that Sojitz would comply with its obligations in respect of its licence interests and field property and facilities. The Company also agreed to indemnify the Sojitz Sellers and their affiliates against all losses arising from environmental liabilities incurred in respect of any of Sojitz’s field property and facilities and/or the transportation, processing, sale and offloading of any petroleum by Sojitz.

The Sojitz Acquisition Agreement was governed by the laws of England and the parties irrevocably agreed to refer any dispute arising out of the Sojitz Acquisition Agreement to an arbitral tribunal in London for arbitration under the London Court of International Arbitration Rules.

(iii) The Tors field unit area

The Company acquired a 15% minority, non-operated interest in the Tors field. The Tors field unit area development comprises two gas fields: the Kilmar field and the Garrow field, which are linked to the Trent field in the Southern Gas Basin.

Tors received development sanction in August 2005. The Kilmar field has been developed with a normally unmanned installation linked to the Perenco-operated Trent field platform.

The Kilmar field came into commercial production in March 2006 with further wells drilled in late 2006 and December 2007. The Garrow field commenced commercial production in February 2007. Production in 2007 was lower than anticipated due to lower gas prices shutting-in some production and drilling complications causing delays in the startup of production from the final Kilmar field well. Upon taking over operations of the fields in 2014, Alpha Petroleum made investments that helped to increase reliability of the production facilities and improve well performance.

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Gas from the Kilmar field is exported to the Perenco-operated Trent field via a 21 kilometre long pipeline. From the Trent Field, gas is delivered via the Esmond Transportation System line to the Perenco-operated terminal facilities at Bacton.

(iv) The Grove Field Unit Area

The Company acquired a 7.5% minority, non-operated interest in the Grove field. The Grove field unit area is located in part-block 49/10a and 49/9c in the Southern Gas Basin. Following the successful appraisal in September 2006, Sojitz Corporation originally acquired a 15% interest in the Grove field via a farm-in. In September 2007 Centrica announced the purchase of the entire share capital of Newfield UK Holdings Limited, the UK subsidiary of Newfield Exploration Company, which included an operated interest in the Grove field. On 1 July 2007, Centrica also acquired 7.5% of the Grove field from Sojitz Corporation.

The Grove field is being developed with a single normally unmanned installation and five production wells. A further production well was spudded in late 2006 but proved unsuccessful and was plugged and abandoned. The Grove Extension project started in 2008. In February 2009, an additional well was drilled as a side-track and was subsequently tied back to the Grove field platform. Additional drilling activity was completed in July 2014. The Grove field delivers gas produced via the Dutch Markham complex.

(v) The Seven Seas field unit area

The Company has acquired a 10% minority, non-operated interest in the Seven Seas field. The Seven Seas field unit area is in the Southern Gas Basin, approximately 80 kilometres east of the Dimlington terminal. The Seven Seas field started production in October 2012. There is the capacity for an additional well to be tied into existing operations.

(vi) Financing of the Sojitz Acquisition

The Company used existing cash resources to finance the Sojitz Acquisition.

(vii) Rationale for the acquisition of the Sojitz Interests

The Company believes that if the Sojitz Acquisition has the potential to give the Company the opportunity to participate in assets where the there is potential for extended field life and access to significant tax losses, which may be of significant value to the Group.

As at 30 September 2016 Sojitz had losses for these purposes of corporation tax of approximately US$59m and loss for the purposes of supplementary charge of approximately US$34m in respect of the Tors field unit area, the Grove field unit area and the Seven Seas field unit area. Advice received by Rockrose suggests that these losses will be available to utilise in respect of the future profile of the Group. Accordingly whilst the Company has paid US$2,300,000 (less a working capital adjustment of US$1.7m) pursuant to the Sojitz Acquisition it will acquire producing field assets and valuable tax assets as part of the transaction.

(viii) Decommissioning obligations in respect of the Sojitz Interests

In respect of the Sojitz Acquisition, the net to Sojitz post-tax share of anticipated decommissioning costs for the Grove field is currently estimated at US$3.1m, for the Tors field the current estimate is US$2.8m and for the Seven Seas field it is US$1.2m. There are currently no DSAs in place on the Grove, Tors or Seven Seas fields.

(d) The Maersk Interests

The Company announced on 14 September 2016 that it had (through its wholly owned subsidiary, Rockrose (UKCS1)), entered into an agreement with Maersk Oil UK Limited and Maersk Oil North Sea UK Limited to acquire the Scott and Telford Interests.

The Maersk Acquisition was structured as an asset acquisition and accordingly needed the approval of the OGA and of the remaining partners involved in the Scott and Telford Interests. Whilst the OGA consented to the transaction, certain of the other licence interest holders raised issues with the OGA, Maersk and the Company.

Maersk and the Company, with support from the OGA, endeavoured to reach a commercially viable solution to the issues raised by the remaining licence interest holders, and whilst significant progress was made in this respect, certain minority interest holders continued to withhold consent,

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seeking a package of financial measures which would have the effect of rendering the Maersk Acquisition commercially unattractive in the opinion of the Board. The long-stop date for the Maersk Acquisition had been extended until 31 December 2017 and, in light of the prohibitive demands being made by the minority interest holders and despite the efforts of Maersk, the Company and the OGA to facilitate an acceptable resolution, the Company has agreed with Maersk that it would not seek a further extension to the long-stop date. On 26 January 2018, the Company announced that it had formally withdrawn from the proposed Maersk Acquisition, with the mutual agreement of Maersk, having concluded that the gaining of partner consents would have required material changes to the economic and other terms of the Maersk Acquisition which were unattractive to the Company.

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Current corporate structure at the date of this document and Admission

Corporate structure at the date of this document and Admission, following completion of the Acquisitions:

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----- Start of picture text -----

09665181
Rockrose Energy plc
100%
100% 100% 100% 100%
04620801 02552901
10448997 Rockrose (UKCS3) Ltd Rockrose UKCS4 Ltd 08724360
Rockrose (UKCS1) Ltd (was Sojitz Energy Project Ltd) (was Idemitsu Petroluem UK Ltd)� Rockrose (UKCS2) Ltd
(Dormant) Tors Blake & Ross, Nelson & Howe� (Egerton Energy Ventures Ltd)
Grove B Block Gallahad & Modred
Seven Seas
06088753
100% Rockrose UKCS5 Ltd
(was Idemitsu E&P Ltd - Dormant)
03442626
100% Rockrose UKCS6 Ltd
(was Idemitsu UK Oil Ltd - Dormant)
01908768
100% Rockrose UKCS7 Ltd�
(was Idemitsu North Sea Ltd -
Dormant)
----- End of picture text -----

Rockrose (UKCS1) Limited is a special purpose vehicle which was set up to acquire the Maersk Interests and is dormant.

Rockrose (UKCS2) Limited is a company incorporated in England and Wales. This entity holds the licence interests in the Galahad and Mordred fields.

Rockrose (UKCS3) Limited is a company incorporated in England and Wales. This entity holds the licence interests in the Tors, Grove fields and Seven Seas.

Rockrose UKCS4 Limited is a company incorporated in England and Wales. This entity holds the licence interests in the Blake, Ross, Nelson, Hove fields and the remaining licence interests acquired from Idemitsu Group.

Rockrose UKCS5 Limited is a company incorporated in England and Wales. This entity is dormant. Rockrose UKCS6 Limited is a company incorporated in England and Wales. This entity is dormant. Rockrose UKCS7 Limited is a company incorporated in England and Wales. This entity is dormant.

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Current locations of the Group’s licence interests at the date of this document and Admission Location of the Group’s licence interests at the date of this document and Admission, following completion of the Acquisitions:

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Blake
Galley
Balmoral & Stirling
Ross Beauly Burghley
Howe
Nelson
TORS
Seven Seas
Grove
Galahad & Mordred
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PART VII

REGULATORY AND OPERATING ENVIRONMENT

Philip Hammond, UK Chancellor of the Exchequer, had said in his March 2017 Budget speech that an expert panel would examine ways of making it easier to buy and sell North Sea oil and gas fields, with the aim of keeping them in production for longer. The announcement reflected HM Treasury’s focus on how to extract as much as possible out of the remaining North Sea resources as decommissioning costs become an increasing burden for industry and taxpayers. To determine the best approach, the UK Government published a formal discussion paper on 20 March 2017 alongside the Finance Bill 2017 on the case for allowing transfers of tax history between buyers and sellers, which along with the expert panel review, resulted in an announcement in the Autumn Budget on 22 November 2017 that draft legislation will be published in the Finance Bill 2018-19 in late 2018 which will operate retroactively to make transferable tax histories available for transfers of fields on or after 1 November 2018. A paper outlining the proposed mechanism for transferring tax histories was also published on 22 November 2017 and is discussed further below. Additionally, a technical consultation has been announced to take place in Spring 2018 regarding the ability of sellers of assets within the Petroleum Revenue Tax (‘‘PRT’’) regime who retain decommissioning liabilities but do not wish to, or cannot, retain a licence interest in the assets, to benefit from PRT relief in respect of those costs.

The UK already has one of the most competitive tax regimes for oil and gas in the world. HM Treasury has recognised that to maximise economic recovery the fiscal regime needs to ensure support for the transfer of late-life assets. There are an estimated 10bn-20bn barrels of recoverable oil and oil equivalent remaining beneath the North Sea, compared with 43bn barrels extracted since production started in 1967. However, unlocking those resources will depend on the North Sea staying competitive against lower-cost regions elsewhere. HM Treasury and the energy industry are both counting on new investors – especially smaller companies and private equity funds – to help maximize the potential of the last remaining oil and gas just as many large companies seek to sell older fields.

The UK Oil and Gas Authority (the ‘‘OGA’’) was established as an executive agency of the UK Government on 1 April 2015. One of the key roles of the OGA is to engage with oil and gas industry to drive down costs and improve efficiencies and to maximise economic recovery of our offshore oil and gas reserves, both for Britain’s energy security as well as our long-term economic outlook.

The Petroleum Act 1998, as amended by the Infrastructure Act 2015, places a duty of the Secretary of State to produce one or more strategies for enabling the principal objective of ‘‘maximising the economic recovery of UK petroleum to be met’’.

The first maximizing economic recovery UK strategy (‘‘MER UK Strategy’’) was required to be produced within 12 months of the relevant clauses coming into force, therefore by April 2016. It was laid in Parliament for scrutiny on 28 January 2016, and came into force on 18 March 2016.

The OGA became a UK Government company in October 2016, following Parliamentary approval for the Energy Act 2016. The Energy Act 2016 established the OGA as a UK government company and equipped the body with additional powers to maximise economic recovery of oil and gas from beneath UK waters. These powers give the OGA the ability to issue enforcement notices and financial penalties, and to revoke licences for clear or persistent breaches of the MER UK Strategy.

The MER UK Strategy sets out certain principles which ‘‘relevant persons’’ (being the holders of licence interests) must now follow.

In particular:

• (a) relevant persons must ensure that technologies, including new and emerging technologies, are deployed to their optimum effect (as set out in the OGA’s Technology Delivery Programme published in April 2017), in maximising the value of economically recoverable petroleum that can be recovered from relevant UK waters, including in relation to decommissioning (MER UK Strategy paragraph 18);

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• (b) before commencing the planning of decommissioning of any infrastructure in relevant UK waters, owners of such infrastructure must ensure that all viable options for their continued use have been suitably explored, including those which are not directly relevant to the recovery of petroleum such as the transport and storage of carbon dioxide (MER UK Strategy paragraph 20);

• (c) relevant persons must allow others to seek to maximise the value of economically recoverable petroleum from their licences or infrastructure including by divesting themselves of such licences or assets to other financially and technically competent persons who are able to recover economically recoverable petroleum (MER UK Strategy paragraph 30);

• (d) where relevant persons are not able to ensure the recovery of the maximum value of economically recoverable petroleum from their licences or infrastructure for financial reasons they must seek to secure investment from other persons. If they are not able to secure sufficient investment in a reasonable time, the obligation in paragraph 30 applies (MER UK Strategy paragraph 31);

• (e) the obligation in paragraph 30 applies in all other circumstances where relevant persons decide not to ensure the recovery of the maximum value of economically recoverable petroleum from their licences or infrastructure, including where the reason for the decision not to recover is because recovery generates returns which are unsatisfactory to the relevant persons, they cannot raise suitable finance or there are technical or other non-economic reasons (MER UK Strategy paragraph 32); and

• (f) where a relevant person is seeking to comply with the obligation in paragraph 30, that person must seek to do so without demanding compensation in excess of a fair market value or unreasonable terms and conditions, in order that other financially and technically competent persons who are able to recover economically recoverable petroleum may do so (MER UK Strategy paragraph 33).

The MER UK Strategy, which also imposes duties of co-operation on relevant persons, is designed to ensure the North Sea resources are effectively exploited to their maximum potential. Clearly envisaged in the MER UK Strategy was the situation where a particular field or licence block was past prime or optimal production and the participants in that field or block concluded that their own capital investment was better deployed on earlier stage assets which would yield greater returns. In many cases, and absent the obligations created by the MER UK Strategy, this would have led to potentially premature decommissioning of that producing field as many licence participants would prefer to decommission a field rather than become involved in a sale process. The position was further complicated by the tax rules relating to decommissioning which are discussed in more detail below.

In this context the Company was able to negotiate the Acquisitions on the terms set out in this document. In particular, the fact that the Company has been able to agree terms of acquisitions where the Company receives a substantial payment rather than itself pays for the assets, is reflective of the different corporate strategies of the Company and the sellers, who are typically multinational diversified industrial groups and seeking to deploy investment capital to seek maximum returns for its shareholders; exiting certain licence interests where those assets are in the later stages of economic life (and where continuing and uncertain liabilities such as decommissioning costs can be closed off) may make commercial sense. By contrast, to the Company, as a smaller focussed entity, this creates an opportunity to acquire these assets at favourable pricing and, when coupled with the objectives of the MER UK Strategy, the Company sees the potential for the asset life to be extended or for alternative utilisation.

OGA approval

The OGA are required to approve all persons who are new holders of licence interests (where direct interests in assets are acquired) and have the ability to object to any change of control of an entity owning licence interests (and accordingly have the ability to object to corporate acquisitions which would constitute an indirect change in ownership of a licence interest).

The OGA approval process involves a rigorous review of the financial and technical ability of new licence holders. This includes a requirement to share with the OGA the long-term development plan (including decommissioning proposals) for activity on a licence interest being acquired, including the operator’s plans for operating and capital expenditure. In the case of later life assets,

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the OGA will not give its approval unless it is satisfied that the new entrant has the financial resources to meet its share of the financial obligations with respect to that licence.

Decommissioning

On 30 June 2016 the OGA published its strategy paper on decommissioning in the UK continental shelf. The strategy paper sets out a number of targets with respect to decommissioning activity, which are also intended to supplement the MER UK Strategy objectives of maximising economic recovery from all oil resources in the North Sea. One of the key strategy objectives is to maximise the efficiency of decommissioning activities through efficiency and industry transformation with a view to achieving a 35% reduction in current decommissioning cost projections. The OGA, in the strategy paper, specifically notes that the impact of a lower oil price has led to considerable uncertainty in the oil and gas industry and that whilst many operators are looking at bringing forward cessation of production dates, the desire of the OGA remains to delay decommissioning expenditures when possible and appropriate, and to extend field life.

The OGA also notes in the strategy paper that the large liabilities for decommissioning can also negatively impact the ability to transfer assets to many small to medium size operators, leading to premature cessation of production and a failure to maximise the value of production. Rockrose believes that it falls into the category of small operator who may benefit from many of the initiatives set out in the strategy paper.

To manage the costs and liabilities arising from decommissioning the OGA has developed a template for what is known as a DSA. DSAs are established as a trust and allow for parties to a licence to put aside monies so that at the time of decommissioning there is sufficient cash available to the parties to carry out the decommissioning. Parties are generally liable for a share of the total decommissioning costs equivalent to their percentage share in the licence interest but if one party with an interest in the licence were to become insolvent the remaining parties can become liable for the share of the party who is unable to fund.

Parties to the licence can either post cash or letters of credit (provided this is acceptable to the other parties). Each year a calculation is undertaken by the operator to calculate the net present value of the anticipated cost of decommissioning. This is then multiplied by a risk factor, usually between 130% and 150%. From this is then subtracted the net present value of all of the cash flows anticipated from the asset for its remaining life and the amount of security the parties have already provided. If this number is positive, this is the amount that the parties to the licence need to make available to the DSA trust in either cash or letters of credit.

The calculation is repeated each year and additional sums are required to be deposited. The calculation is also independently audited. As the asset approaches cessation of production, funds will have built up in the DSA trust such that the parties should have the liquidity available to meet the cost of decommissioning. In the event of one party going into liquidation, the DSA trust monies are available to the other parties to ensure decommissioning can be completed with no additional liability accruing as a consequence of the party going into liquidation.

Decommissioning Relief Deeds (‘‘DRDs’’) were introduced on 17 July 2013 through the Finance Act 2013 to allow parties to a DSA who have also entered into a DRD with the UK Government to calculate their annual security contributions on a post-tax basis. They operate by calculating a benchmark amount of tax relief for decommissioning expenditure a participant would be entitled to as determined in accordance with the tax legislation in force on 17 July 2013, and providing a guaranteed payment from the UK Government if the tax relief ultimately obtained at the time of decommissioning is less than the benchmark. The intention is to mitigate uncertainties around the tax relief that may be available in future for decommissioning expenditure.

The current fiscal regime in the UK continental shelf provides tax relief in relation to decommissioning costs incurred by oil and gas operators. The relief is only available once the decommissioning costs are incurred; ensuring companies pay the full amount of tax (i.e. ignoring relief on decommissioning expenditure) from all profits generated by the field during its life. Relief is limited to the tax that has been paid.

If a tax loss arises on decommissioning, that loss can be carried back and offset against the profits chargeable to the Ring Fence Corporation Tax (‘‘RFCT’’), Supplementary Charge (‘‘SC’’) and PRT. If tax was paid on profits in previous years, the Company will then be entitled to reclaim some of the previously paid tax. Different rules are used to calculate how much relief can be

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claimed on decommissioning costs, depending on whether the relief is claimed for RFCT/SC or PRT.

Currently, in simple terms (and, in particular, subject to specific rules applicable to PRT), a company owning a licence can only off-set the costs of decommissioning against tax actually paid by that company whilst it owned the relevant licence interest. The review initiated by HM Treasury (referred to above) resulted in a paper published on 22 November 2017 outlining the UK Government’s proposed mechanism to allow the offset of decommissioning costs against the tax paid by prior owners of that licence interest by enabling companies selling North Sea oil and gas fields to transfer some of their historic profit chargeable to RFCT and SC (‘‘tax history’’) to the buyers of those fields. This is intended to facilitate new entrants into licences with a view to extending their economic life. If changes of this nature were to be made they could be economically advantageous to Rockrose.

The paper envisages (broadly) that the tax history does not need to relate to the field being transferred, and will take place on a ‘last in, first out’ basis, with tax history from more recent years being transferred first. The maximum amount of transferrable tax history will be the buyer’s estimated share of the decommissioning cost in the DSA and may be apportioned at the time of transfer in circumstances where multiple fields are acquired in a single deal (although no subsequent adjustments to the amount of tax history transferred or the initial apportionment will be permitted). It is intended that the transferred tax history will only be available for use against carried back decommissioning losses after the transferred field has permanently ceased production, and only to the extent that losses incurred on decommissioning the transferred field exceed the post-acquisition profits of that field. Once the tax history is available for use, however, it can be used against any decommissioning loss within the company. If the field is transferred again, transferred tax history can go with it, however transferable tax history will only be available for intra-group transfers of fields within a short period before and after the asset leaves the group.

The timing and uncertainties surrounding cessation of production dates and the commencement of decommissioning activity are driven by a number of factors, all of which are subject to inherent uncertainty. Petrenel’s report in Part XVIII – Competent Person’s Report of this document assesses potential cessation of production dates based on the probabilities of extractable reserves in place, basing these calculations on current producing wells only. These assessments and calculations are themselves carried out in accordance with industry accepted standards. The potential exists for these estimates to be inaccurate, with the consequence that economic life is shorter than expected, or potentially longer. The other significant risk is that of oil prices; the lower the oil price the less economically viable it may be to extract small volumes of oil towards the end of the life of a field and the less incentive there may be to incur additional capital expenditure on attempting to recover marginal reserves, which efforts may themselves carry a high risk of failure. Clearly factors such as reserve estimation calculations being overstated and a prevailing low oil price (which may contribute substantially to economic viability) are matters wholly beyond the control of any individual company. Timing of decommissioning will be driven by the economic viability or otherwise of remaining reserves and accordingly there is potentially little that the Company can do to mitigate against these risks other than to budget prudently for the anticipated costs of decommissioning.

The Company will inherit decommissioning liabilities upon the making of the Acquisitions. As at 31 December 2017, the Group had approximately £29m of cash held in DSAs and other interim arrangements and £4m of alternative security in place under insurance backed bonds. The operator of each licence typically supplies a financial model which is used to calculate the postings required under the relevant decommissioning arrangements for the licence interest and postings are reviewed annually, typically in December. Using these models for all of its current licence interests the Group estimates that additional postings in new and existing DSAs will amount to approximately £12.5m in the course of the following 18 months. These additional postings are reflected in the Group’s projections and working capital requirements. The Company has carefully reviewed the extent of those obligations and in certain cases, where DSAs already exist, will be required to contribute the DSA on completion of the relevant Acquisition. As decommissioning plans are refined and developed the Company will continue to contribute its share of decommissioning costs via the relevant DSA or alternative funding arrangements. As part of the OGA approval process the OGA has reviewed with the Company the scale of the liabilities identified in the operator plans for decommissioning for the licence interests being acquired pursuant to the Acquisitions in order to assess the ability of Rockrose to meet those obligations.

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The Company has planned for the full extent of all these liabilities where the same are currently known, but expects that, over time, the MER UK Strategy objectives and the OGA’s decommissioning strategy objectives may lead to at least some currently proposed cessation of production and decommissioning plans being delayed as a result of extended field life initiatives.

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PART VIII

THE COMPANY, THE BOARD, THE SENIOR MANAGERS, AND THE FURTHER ACQUISITION STRATEGY

The Company

The Company was incorporated on 1 July 2015 as a public company with limited liability under the Companies Act 2006 (the ‘‘Companies Act’’). In January 2016 the Company raised £4.4m before expenses and was admitted to Standard Listing on the Official List and to trading on the Main Market of the London Stock Exchange. The Company subsequently raised £8m before expenses in July 2017.

The Company’s issued share capital will, on Admission, consist of Ordinary Shares. It is intended that the Ordinary Shares will be admitted by the FCA to a Standard Listing on the Official List in accordance with Chapter 14 of the Listing Rules and to trading on the Main Market of the London Stock Exchange.

The Directors

The Board, collectively, has significant experience in the UK oil and gas sector. Since 2011 the Directors have consummated at least six significant acquisitions and planned and executed three major UK onshore farm-out transactions with energy majors counterparties.

The Directors are very familiar with the key issues facing both onshore and offshore exploration and development activity. The Board has in aggregate more than 60 years of experience in subsurface engineering and geology and have been responsible for running complex and challenging fields and drilling operations, both onshore and offshore.

In addition the Board has significant expertise and experience of dealing with the political and social issues facing the industry at both the local and national governmental levels, having been actively involved in the governmental consultation program surrounding shale gas exploration and in the challenges of local planning issues in connection with exploration activity and asset development.

Details of the Directors are listed below.

Andrew Philip Austin – Executive Chairman (age 52)

Andrew Austin is one of the founders and the former chief executive officer of IGas Energy plc (IGas). He previously specialised in energy projects in the gas, electricity and renewables sector. Mr Austin was an executive director of IGas from 2004 to 2015 and chief executive officer from 2007 to 2015 with full time responsibility for day to day operations and business development. During this period he was responsible for the transformation of IGas from a non-operated partner to the leading onshore hydrocarbon producer in the United Kingdom operating on behalf of major companies including Total, GDF and Ineos. Prior to joining IGas, Mr Austin was involved in ventures as principal and has also raised substantial funds from private and public equity for clients during the course of his career to date. Mr Austin spent 17 years working in investment banking in the City of London with Merrill Lynch, Nomura, Citibank and Barclays Capital. Latterly he was general manager of Creditanstalt Investment Bank in London. He also has six years of management and consultancy experience with clean tech companies including Generics Group and Solar.

Richard Alan Benmore – Non-Executive Director (age 59)

Richard Benmore, B.Sc, M. Sc, Ph.D, has over 30 years of experience in the oil and gas industry with Conoco, Oryx Energy, Nimir Petroleum, Nexen Petroleum and was most recently at IGas Energy. Richard has held a variety of roles starting his career as a petroleum geologist before moving into various commercial, business development and energy and power managerial positions. He recently managed Nexen’s unconventional projects in the U.K. and Poland and was a board member of Nexen Exploration U.K.

John Andrew Corran Morrow – Non-Executive Director (age 63)

John Morrow is a Chartered Engineer and has over 30 years of experience in the oil and gas industry and he is currently head of exploration and Production at Glencore plc, which he joined in

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1. John was previously the chief operating officer and on the board of directors of Bowleven plc, having joined that company in 2005. Prior to that he spent 10 years at BG Group, where he was managing director of the joint venture which operated the giant Karachaganak field in Kazakhstan. Following that he was responsible for BG’s technical effect in the Mediterranean Basin and its African assets and thereafter was project director (Middle East) where he was responsible for the development of new liquefied natural gas projects. Before joining BG Group, John spent the first 15 years of his career at Royal Dutch Shell where he held a variety of operational and commercial roles in the UK, Malaysia and the Netherlands.

The Senior Managers

The Company’s current senior management team (the ‘‘Senior Managers’’), in addition to the Directors listed above, is as follows:

Peter Mann – Managing Director (age 37)

Peter Mann, BA, joined IGas in 2013 where he was initially supporting the executives in the business through the implementation of the company’s core strategic aims. He then went on to work in a number of areas within IGas, being involved with further acquisitions, heading up the restructuring of the company in 2015, asset development and management and working with joint venture partners including Ineos, Total and Engie. Peter then left to join RockRose in the middle of 2017. Prior to IGas, Peter has spent his career in strategic management roles. Attending the Royal Military Academy Sandhurst and commissioning into the British Army in 2004, where he served in different theatres around the world before leaving in 2009. Peter then joined Cazenove Capital’s for over 6 years leaving at the end of 2009. Peter then joined Cazenove Capital’s asset management team working closely with clients on their portfolio management, and in 2011 left to implement and run the private office in London.

Stephen (Steve) Hargrave Pawson – Finance Director (age 62)

Steve Pawson BA, ACMA, has over 35 years of experience in the oil and gas industry where he has held a variety of financial roles. After a brief stint in the construction industry, Steve joined Phillips Petroleum as an assistant accountant where he rapidly moved through various roles as he gained his accounting qualification leaving as assistant chief accountant after 10 years. He then moved to ARCO where he held a number of roles involving the treasury, commercial, exploration and tax areas of the business and also spent two years in Yemen setting up systems, controls and reporting procedures for a start-up venture. Steve then joined the small start-up onshore producer Star Energy as group financial controller and group finance manager where he was involved in an initial public offering, various fund raises and acquisitions, a gas storage project and acquisition by PETRONAS. Subsequent to the break-up of the Star Energy group in 2011, Steve remained with the upstream business which was acquired by IGas where he continued to be involved in various refinancing projects, acquisitions and restructurings prior to joining the Company.

Company objectives

A Rockrose is a plant that grows in harsh environments with minimal external support. Creating an energy company that is equipped to do business in the harsh environment of sub $50 oil with a minimal cost base was the strategy behind the establishment of Rockrose Energy in 2015.

The Board remains focused on pursuing its shared objectives of a targeted acquisition strategy and a focus on onshore and offshore production opportunities, power generation and infrastructure, and believes that it is differentiated by its approach to asset stewardship and capital efficiency, aiming to create a scalable energy business that is able to deliver shareholder returns in a low oil price environment.

The Directors have focussed on acquisition opportunities to acquire licence interests (directly or indirectly) in circumstances where certain key criteria are met, these include situations where the designed operator is experienced and has a history of excellent asset stewardship and situations where the MER UK Strategy principles result in (a) the likely extension of field life; and (b) where existing minority interest holders might regard a late life asset as non-core and hence be prepared to strike a deal on terms advantageous to both the vendor and Rockrose (and which satisfies the commercial objectives of both parties).

The recent Acquisitions, including the Idemitsu UK Acquisition are a demonstration of this strategy and the Company will continue to target offshore cash generative production assets and accretive

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onshore opportunities, where the potential exists to consolidate working interests and operatorship to a size capable of attracting major industry players.

Rockrose is committed to minimising the overheads and administrative costs of running the assets, with a small executive team and purchasing other services as required. It is not anticipated that the Company will become operator of any of the assets the Company has previously acquired or future acquisition targets.

Rockrose is not the designated operator of any of the licence interests owned within the Group. Typically the designated operator of a field licence manages the activity on behalf of all the interest holders pursuant to the terms of a joint operating agreement. The operator produces forward projections of activity and costings for both operational and capital expenditure and the holders of the licence interests are responsible for their respective shares of that expenditure in proportion to their interests in the licence.

Rockrose has reviewed and evaluated the plans and budgets produced by the operators of the licence fields in which it has interests and its share of the relevant costs. Rockrose has specifically chosen licence interests in part based upon the track record of the operators and their approach to asset stewardship. Rockrose expects to be supportive of all economically viable plans which may be advanced by the respective operators to comply with the principals and obligations on all relevant persons under the MER UK Strategy. Rockrose does not have large overheads and operating costs itself and is not an exploration company seeking new discoveries. The Company is able to consider and evaluate marginal projects on a different basis to large oil and gas multinationals (who may have a very different profile for priorities of capital deployment to available projects). It is thus likely that almost all economically viable further development plans will be value generative to Rockrose over time. The Directors accordingly see the business strategy of Rockrose as aligned both to the MER UK Strategy, being designed to take advantage of the initiatives and policies which will be driven by that strategy, and with the OGA’s published principal policy objectives on decommissioning.

Looking forward, Rockrose will continue to evaluate other complimentary acquisitions, with the aim of building a material energy business that is equipped to flourish in the prevailing challenging hydrocarbon price environment.

The Directors believe that Rockrose is currently unique in terms of a business strategy built to maximise the potential offered by being a sustainable participant in UK Continental Shelf licence interests at current low oil prices and designed to capitalise on the opportunities created by the MER UK Strategy. The Directors are not aware of direct competitors to Rockrose with respect to the specific business strategy, but are mindful that competition for further investment opportunities may come from a variety of sources.

It is clearly possible that competition for future acquisitions could come from financial investors (such as private equity funds or hedge funds with an appropriate sector focus) and whilst barriers to entry exist in terms of the requirement for OGA approval to become a participant in a UK licence interest, those barriers to entry may not be significant to the establishment of a direct competitor entity. Competition for licence interests that are available for sale may also come from other established oil and gas companies or indeed from the other holders of interests in the licence for sale.

Rockrose also notes that, as and when the price of oil increases, the level of competition with respect to licence interests that are available is likely to increase. Whilst at current oil prices the capital base and cost structure of Rockrose makes many opportunities financially viable and attractive to Rockrose that would not be so attractive to a larger oil and gas company, this competitive advantage may be significantly eroded if oil prices returned to materially higher levels.

The business strategy of Rockrose is likely to remain materially dependent on the collective experience of the Directors and Senior Managers in identifying and assessing acquisition opportunities and the true potential of those opportunities in the context of the Rockrose business model. In particular the skills and experience of all three Directors will be important to the continued growth of the business and whilst the Directors do not believe that the business is dependent on any particular Director, the loss of any Director is likely to slow or constrain the ability of Rockrose to grow the business at the levels and rates planned by the Board.

The Board does not consider Rockrose to be dependent on a limited number of customers or suppliers at the current time but clearly in the context of being an essentially passive interest

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holder in licence assets, the operational aspects of the business in terms of asset stewardship and management rest with the designated operator of the relevant field interest. Operators in this context are frequently the majority (or largest) interest owner, and so have the greatest economic exposure to the performance of the licence asset. Rockrose has specifically selected licence interests based on the track record and experience of the relevant operators. The assets required for production activities on the licence interests are either jointly owned by the participants in the licence as joint property, or leased by the designated operator for the benefit of the parties to the licence.

Strategy with respect to licence interests

The Company has selected the assets on the basis that whilst they are late-life field assets they remain capable of economic viability even in a low oil price environment. The Company recognises that non-operated interests have, until recently, been of limited interest to larger, traditional, oil and gas exploration companies. The Company also notes that the UK government is considering steps to facilitate the extension of late-life fields by examining steps to make tax treatment favourable to the transfer of such assets and in particular the transfer of associated tax reliefs with the interests in such assets.

The Company has reviewed operator-produced plans for the licence interests comprised in the Acquisitions and continues to conduct diligence on the plans and prospects for certain other prospective targets. The Directors believe that the majority of the licence interests are still capable of producing positive net cash flows in the short-term and, dependent on future longer term development plans and enhanced recovery techniques, of continuing to produce economically beyond what might currently, to date, have been assumed to be an economic life. These income streams could be very material to a company the size of Rockrose.

Rockrose will, where possible, support further development expenditure programs which are evidenced by reasonable expectations of achieving continued positive production cash-flow, potentially in circumstances where a major oil and gas company might not consider such plans meaningful in the context of their own wider asset portfolios.

Working capital

The Company is of the opinion that the working capital available to the Group is sufficient for the present requirements of the Group, that is, for at least the next 12 months following the date of this document.

Dividend policy

On 26 January 2018, the Company announced proposals for a ‘‘B share scheme’’ to return £1.50 per Ordinary Share to Shareholders which are due to be considered by Shareholders on 14 February 2018 and in respect of which the Company has received irrevocable undertakings to vote in favour of the implementing resolutions for a total of 8,226,640 Ordinary Shares representing 56.65% of the issued share capital of the Company. Please see Part XII – Taxation of this document for information on the tax consequences for Shareholders with respect to the B share scheme.

Going forward, the Company intends to pay dividends on the Ordinary Shares following at such times (if any) and in such amounts (if any) as the Board determines appropriate. The Company will only pay dividends to the extent that to do so is in accordance with the Companies Act and all other applicable laws, and the Directors will review the Company’s dividend policy from time to time.

Strategic decisions

Members and responsibility

The Directors are responsible for carrying out the Company’s objectives, implementing its business strategy and conducting its overall supervision, acquisition, divestment and other strategic decisions will all be considered and determined by the Board. Mr Austin will, in addition to acting as Chairman, be the Director charged with day-to-day responsibility for the implementation of the Company’s acquisition strategy in conjunction with the Senior Managers.

The Board will provide leadership within a framework of prudent and effective controls. The Board will establish the corporate governance values of the Company and will have overall responsibility

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for setting the Company’s strategic aims, defining the business plan and strategy and managing the financial and operational resources of the Company.

Unless required by law or other regulatory process, no Shareholder approval will be sought by the Company in relation to the making of any further acquisition(s).

Frequency of meetings

The Board will schedule quarterly meetings and will hold additional meetings as and when required. The expectation is that this will not result in more than four meetings of the Board each year.

Corporate governance

The Company will observe the requirements of the UK Corporate Governance Code (so far as it is practicable). As at the date of this document, the Company is, and at the date of Admission will be, in compliance with the UK Corporate Governance Code, save as set out below:

• Given the composition of the Board, certain provisions of the UK Corporate Governance Code (in particular the provisions relating to the division of responsibilities between the chairman and chief executive and executive compensation), are considered by the Board to be inapplicable to the Company.

• The Company will hold Board meetings periodically as issues arise which require the attention of the Board. The Board will be responsible for the management of the business of the Company, setting the strategic direction of the Company, establishing the policies of the Company and appraising the making of all material investments. It will be the Board’s responsibility to oversee the financial position of the Company and monitor the business and affairs of the Company on behalf of the Shareholders, to whom the Directors are accountable. The primary duty of the Board will be to act in the best interests of the Company at all times. The Board will also address issues relating to internal control and the Company’s approach to risk management.

• The Company has also established a remuneration committee (the ‘‘Remuneration Committee’’), an audit committee (the ‘‘Audit Committee’’), a risk and disclosure committee (the ‘‘Risk and Disclosure Committee’’) and a nomination committee (the ‘‘Nomination Committee’’), with formally delegated duties and responsibilities.

• The Remuneration Committee comprises John Morrow as chairman, and Richard Benmore and will meet normally not less than twice each year. The Remuneration Committee will be responsible for the review of and making recommendations to the Board on the scale and structure of remuneration for Directors and Senior Managers, including any bonus arrangements or the award of share options with due regard to the interests of the Shareholders and other stakeholders.

• The Audit Committee comprises Richard Benmore as chairman and John Morrow and will meet normally not less than twice each year. The Audit Committee will be responsible for making recommendations to the Board on the appointment of auditors and the audit fee and for ensuring that the financial performance of the Company is properly monitored and reported. In addition, the Audit Committee will receive and review reports from management and the auditors relating to the interim report, the annual report and accounts and the internal control systems of the Company.

• The Risk and Disclosure Committee will operate as part of the Audit Committee and will review the operational risks that face the business and monitor and report upon the Company’s obligations under the Disclosure Guidance and Transparency Rules regarding continuous disclosure.

• The Nomination Committee, which will comprise Andrew Austin as chairman and Richard Benmore and will meet normally not less than twice each year. The Nomination Committee is responsible for reviewing succession plans for the Directors, including the Executive Chairman and other senior executives.

• As at the date of this document, the Board has adopted the policies and procedures to comply with applicable market abuse legislation, including a share dealing code (‘‘Share Dealing Code’’) on the dealing in securities of the Company by Directors, Senior Managers and employees. The Board will be responsible for taking all proper and reasonable steps to ensure compliance with the Share Dealing Code by the Directors, Senior Managers and employees of the Company.

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PART IX

UNAUDITED PRO FORMA FINANCIAL INFORMATION FOR THE ENLARGED GROUP

Section A: Unaudited pro forma financial information

The unaudited consolidated pro forma statement of net assets and income statement of the Enlarged Group set out below in this section of this Part IX – Unaudited Pro Forma Financial Information of this document have been prepared in a manner consistent with the accounting policies adopted by the Company in preparing the Group’s audited consolidated financial statements for the period ended 31 December 2016 and the Company’s unaudited Interim Report for the six months ended 30 June 2017 on the basis set out in the notes to the Pro Forma Financial Information in accordance with Annex II to the Prospectus Directive Regulation. The adjustments in the unaudited pro forma financial information are expected to have a continuing impact on the Enlarged Group, unless stated otherwise.

The unaudited pro forma statement of net assets has been prepared based on the net assets of the Group as at 30 June 2017 and has been prepared to illustrate the impact of: (i) the Idemitsu UK Acquisition, which completed on 8 December 2017; (ii) the Sojitz Acqusition, which completed on 22 December 2017; and (iii) the Egerton Acqusition, which completed on 22 December 2017 (together, the ‘‘Acquisition’’) on the net assets of the Group as if they had been completed on 30 June 2017.

The unaudited pro forma income statement has been prepared based on the consolidated income statement of the Group for the six month period ended 30 June 2017. The unaudited pro forma income statement has been prepared to illustrate the impact of the Acquisitions on the consolidated income statement of the Group as if it had been completed on 1 January 2017.

The unaudited pro forma financial information has been prepared on the basis that the Acquisitions will be accounted for under the acquisition method pursuant to IFRS 3 ‘‘Business Combinations’’. Under the acquisition method, assets and liabilities are recorded at their fair values on the date of purchase and any excess of the fair value of the total purchase price over the fair values of the tangible and intangible assets acquired and liabilities assumed is recorded as goodwill. As of the date of this document, the valuation studies necessary to finalise the fair values of the purchase price, the assets acquired and the liabilities assumed have not been finalised.

Accordingly, the unaudited pro forma statement of net assets and income statement do not reflect any fair value adjustments to the acquired assets and liabilities. A final determination of these fair values will reflect, among other things, consideration of the final purchase price, as well as the final valuation based on the actual net tangible and intangible assets, if any, that exist as of the closing of the Acquisitions. Any adjustments will change the allocation of the purchase price, which will affect the fair value assigned to the assets and liabilities and could result in a material change to the figures shown in the unaudited pro forma statement of net assets and the unaudited pro forma income statement.

The unaudited pro forma financial information has been prepared for illustrative purposes only and, by its nature, addresses a hypothetical situation and, therefore, does not represent the Group’s or the Enlarged Group’s actual financial position or results.

The unaudited pro forma financial information does not constitute financial statements within the meaning of Section 434 of the Companies Act. Shareholders should read the whole of this document and not rely solely on the summarised financial information in this Part IX – Unaudited Pro Forma Financial Information for the Enlarged Group of this document. PricewaterhouseCoopers LLP’s report on the unaudited pro forma financial information is set out in Section B of this Part IX – Unaudited Pro Forma Financial Information for the Enlarged Group of this document.

The unaudited pro forma financial information does not purport to represent what the Group’s financial position and results of operations actually would have been if the Idemitsu UK Acquisition, the Sojitz Acquisition and the Egerton Acquisition had been completed on the date indicated nor does it purport to represent the results of operations for any future period or the financial condition at any future date.

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1. Unaudited pro forma statement of net assets

ASSETS Non-current assets Intangible Assets Property, plant and equipment Investment in subsidiaries Deferred tax asset Current assets Inventories Trade and other receivables Loan to the group undertaking Cash and cash equivalents TOTAL ASSETS LIABILITIES Current liabilities Amount owed to fellow subsidiaries Trade and other payables Tax payable Non-current liabilities Decommissioning provision Other provision Employee benefts Deferred tax liability TOTAL LIABILITIES NET ASSETS/(LIABILITIES)	Rockrose as at 30 June 2017 US$m (note 1) — — — — — — 1.4 — 1.9 3.3 3.3 — (2.9) — (2.9) — — — — — (2.9) 0.4		Adjustments	Adjustments	Adjustments arising and capital raise US$m (note 5) 93.0 — — — 93.0 — 0.9 (105.0) 83.3 (20.8) 72.2 0.1 — — 0.1 — — — — — 0.1 72.3	Enlarged Group at 30 June 2017 US$m 94.7 61.0 — 34.1 189.8 1.7 24.2 — 119.1 145.0 334.8 — (26.5) (0.1) (26.6) (298.4) — — — (298.4) (325.0) 9.8
		Idemitsu UK as at 30 June 2017 US$m (note 2) 1.7 52.9 — 34.1 88.7 1.0 19.8 105.0 33.9 159.7 248.4 (0.1) (23.1) (0.1) (23.3) (278.0) — — — (278.0) (301.3) (52.9)	Sojitz on completion US$m (note 3) — 8.1 — — 8.1 0.7 2.1 — — 2.8 10.9 — (0.4) — (0.4) (13.2) — — — (13.2) (13.6) (2.7)	Egerton on completion US$m (note 4) — — — — — — — — — — — — (0.1) — (0.1) (7.2) — — — (7.2) (7.3) (7.3)

Notes

• 1: The Rockrose financial information as at 30 June 2017 has been extracted from the Company’s unaudited Interim Report for the six month period ended 30 June 2017. The financial information has been translated from GBP to USD due to the Enlarged Group having adopted US Dollars as its presentational currency following completion of the Acquisitions:

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ASSETS Current assets Trade and other receivables Cash and cash equivalents TOTAL ASSETS LIABILITIES Trade and other payables Total Current Liabilities TOTAL LIABILITIES NET ASSETS	Rockrose as at 30 June 2017 (£m) (note 1(a)) 1.1 1.4 2.5 2.5 (2.2) (2.2) (2.2) 0.3	Rockrose as at 30 June 2017 (US$m) (note 1(b)) 1.4 1.9 3.3 3.3 (2.9) (2.9) (2.9) 0.4

• 1(a): This is the historical consolidated statement of net assets for Rockrose as at 30 June 2017 as extracted from the Company’s unaudited Interim Report for the six month period ended 30 June 2017, which is included in Part XVI – Historical Financial Information on the Company of this document.

• 1(b): Rockrose’s consolidated statement of net assets has been translated from GBP to USD using the exchange rate on 30 June 2017 of GBP1:USD1.299.

• 2: The Idemitsu UK financial information as at 30 June 2017 has been extracted, without material adjustment, from the unaudited Interim Report of Idemitsu UK for the six months ended 30 June 2017 set out in Part XVII – Historical Financial Information on Idemitsu UK of this document.

• 3: Rockrose completed the Sojitz Acquisition on 22 December 2017, as set out in Part VI – The Acquisitions and the Group of this document. This column reflects the net assets of Sojitz at completion on 22 December 2017. The completion date balance sheet of the Company was used since this accurately reflects the impact of all pre-completion adjustments attributable to the acquisition. The completion date balance sheet was prepared based on management accounts, which were adjusted to remove balances associated with the Gryphon field which was transferred to another company within the Sojitz group prior to acquisition by Rockrose as per the terms of the Sojitz Acquisition Agreement. These adjustments were prepared with reference to billing statements provided by the operator of the Gryphon field. The unaudited completion date balance sheet of the Company has been further adjusted to decrease the decommissioning provision to account for this provision under Rockrose’s accounting policies. This gave rise to a decrease of $0.8m in the Company’s decommissioning liability.

• 4: Rockrose completed the Egerton Acquisition on 22 December 2017, as set out in Part VI – The Acquisitions and the Group of this document. This column reflects the net assets of Egerton at completion on 22 December 2017. The completion date balance sheet of the Company was used since this accurately reflects the impact of all pre-completion adjustments attributable to the acquisition. The financial information has been extracted from the unaudited completion date balance sheet of Egerton. The completion date balance sheet was constructed from the management accounts of the company, adjusted to include balances attributable to the Galahad and Mordred fields which were derived from billing statements provided by the operator of these fields. The financial information has been translated from GBP to USD using the exchange rate prevailing on the completion date of the Egerton Acquisition which was GBP1:USD1.3387. There was also an adjustment made to the completion date balance sheet to record a decommissioning provision of $7.2m, which was recognised and measured in accordance with Rockrose’s accounting policies. This adjustment to the completion date balance sheet was required because the provision for decommissioning in respect of the Galahad and Mordred fields was previously held in a different Egerton group company, but the obligation was assumed by Rockrose on acquisition of Egerton in line with the terms of the Egerton Acquisition Agreement.

• 5: Adjustments attributable to the transaction:

• 5(a): The unaudited pro forma statement of net assets has been prepared on the basis that the Acquisitions will be treated as acquisitions of a business in accordance with IFRS 3 Business Combinations. The pro forma statement of net assets does not reflect the fair value adjustments to the acquired assets and liabilities as the fair value measurement of these items are still being finalised. For the purposes of the pro forma statement of net assets, the excess purchase consideration over the carrying amount of the net assets acquired has been attributed to intangible assets (goodwill).

Consideration Less carrying value of net liabilities acquired Goodwill	Idemitsu UK (US$m) 30.6 (52.9) 83.5	Sojitz (US$m) 0.8 (2.7) 3.5	Egerton (US$m) (1.3) (7.3) 6.0	Total (US$m) 30.1 (62.9) 93.0

• 5(b): The increase to debtors relates to deferred consideration due on the Egerton Acquisition. The total consideration for the Egerton Acquisition was negative cash consideration of $1.3m of which $0.4m was received on completion and a further $0.9m receivable on the first anniversary of the Egerton Acquisition.

• 5(c): Repayment of $105m funds owed by an Idemitsu group company to Idemitsu UK, which was repaid prior to completion of the Idemitsu UK Acquisition in accordance with the terms of the Idemitsu UK Acquisition Agreement.

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• 5(d): Total increase in cash of $83.3m arises due to a number of adjustments attributable to the Acquisitions, which were:

• receipt of $105m funds previously held as a receivable by Idemitsu UK as described in note 5(c);

• net payment of cash consideration of $30.5m for the acquisitions of Idemitsu UK and Sojitz;

• negative consideration received of $0.4m for the Egerton Acquisition;

• transaction costs arising from the Acquisitions of $0.9m; and

• receipt of funds of $9.4m (net of transaction costs of $1.0m) from a Rockrose Ordinary Share issue. On 4 July 2017, Rockrose placed 5,333,334 Ordinary Shares raising gross proceeds of $10.4m.

2. Unaudited pro forma income statement

Revenue Other income Cost of sales Depreciation, depletion or amortisation Foreign exchange movements on decommissioning Trading (Loss)/Proft Administrative expenses Exceptional items Operating (Loss)/Proft Finance income Finance costs Foreign exchange gain/(loss) (Loss)/Proft before taxation Taxation (Loss)/Proft for the period	Rockrose 6 months to 30 June 2017 (note 6) US$m — — — — — — (1.7) (0.7) (2.4) — — — (2.4) — (2.4)		Adjustments (notes 11 and 12)	Adjustments (notes 11 and 12)	Acquisition adjustments (note 10) US$m — — — — — — 0.9 — 0.9 — — — (0.9) — (0.9)	Rockrose 6 months Enlarged Group US$m 42.3 0.9 (25.2) (4.3) (9.7) 3.9 (5.5) (1.6) (3.2) 0.7 (6.3) (0.3) (9.0) 0.2 (8.8)
		Idemitsu UK 6 months to 30 June 2017 (note 7) US$m 40.5 0.9 (21.6) (4.3) (9.7) 5.8 (3.3) — 2.4 0.7 (5.2) (0.3) (2.3) 0.3 (2.0)	Sojitz 6 months to 30 June 2017 (note 8) US$m 1.6 — (3.3) — — (1.7) (0.5) — (2.2) — (1.1) — (3.3) (0.1) (3.4)	Egerton 6 months to 30 June 2017 (note 9) US$m 0.2 — (0.3) — — (0.1) — — (0.1) — — — (0.1) — (0.1)

• 6: The Rockrose financial information for the six month period ended 30 June 2017 has been extracted from the Company’s unaudited interim report for that period. The financial information has been translated from GBP to USD due to the Enlarged Group having adopted US Dollars as its presentational currency following completion of the Acquisitions:

In millions Revenue Other income Cost of sales Trading proft Adminstrative expenses Exceptional items Impairment of exploration assets Operating proft Finance income Finance costs Foreign exchange gain/(loss) (Loss)/Proft before taxation Taxation (Loss)/Proft for the period	6 months to June 2017 (£m) (note 6(a)) — — — — (1.4) (0.5) — (1.9) — — — (1.9) — (1.9)	6 months to June 2017 (US$m) (note 6(b)) — — — — (1.7) (0.7) — (2.4) — — — (2.4) — (2.4)

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• 6(a): This is the historical consolidated income statement for Rockrose for the six months ended 30 June 2017 as extracted from the Company’s unaudited Interim Report for the six month period ended 30 June 2017, which is included in Part XVI – Historical Financial Information on the Company of this document.

• 6(b): Rockrose’s consolidated income statement has been translated from GBP to USD using the average exchange rate over the six month period to 30 June 2017 of GBP1:USD1.255.

• 7: The Idemitsu UK financial information as at 30 June 2017 has been extracted, without material adjustment, from the audited Interim Report of Idemitsu UK for the six month period ended 30 June 2017, set out in Part XVII – Historical Financial Information on Idemitsu UK of this document.

• 8: Rockrose completed the Sojitz Acquisition on 22 December 2017. The pro forma income statement for Sojitz for the six month period ended 30 June 2017 has been derived from management accounts for the period. The financial information has been adjusted to remove income and expenses associated with the Gryphon field which was transferred to another company within the Sojitz group prior to acquisition by Rockrose as per the terms of the Sojitz Acquisition Agreement. Balances attributable to the Gryphon field were removed with reference to billing statements provided by operator of the Gryphon field.

• 9: Rockrose completed the Egerton Acquisition on 22 December 2017. The pro forma income statement for Egerton for six month period ended 30 June 2017 has been derived from management accounts for the period. The management accounts were adjusted to include balances attributable to the Galahad and Mordred fields which were derived from billing statements provided by the operator of these fields. The financial information was translated from GBP to USD using the average exchange rate for the period of GBP1:USD1.255 due to the management accounts being prepared in GBP, compared to the Group presentation currency of USD.

• 10: For the purposes of the unaudited pro forma income statement, transaction costs of $0.9m incurred by the Group in respect of the Acquisitions have been reflected as an expense. These costs are not expected to be incurred on an ongoing basis in the Enlarged Group.

• 11: No additional depreciation and amortisation charge has been applied to reflect the impact of any fair value adjustments that might arise under IFRS 3 ‘‘Business Combinations’’ in relation to intangible assets and property, plant and equipment, for any of the Acquisitions as it is considered impractical to do so given the fair value adjustments are still being calculated.

• 12: No adjustment has been made to reflect the financial results of Rockrose or Idemitsu UK since 30 June 2017. No adjustment has been made to reflect the financial results of Sojitz or Egerton since 30 June 2017 or the net assets since 22 December 2017.

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Section B: Accountant’s report on the Unaudited Pro Forma Financial Information for the Group

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The Directors Rockrose Energy plc c/o Cooley Services Ltd Dashwood 69 Old Broad Street London EC2M 1QS

14 February 2018

Dear Sirs

Rockrose Energy plc (the ‘‘Company’’)

We report on the pro forma financial information (the ‘‘Pro Forma Financial Information’’) set out in section A of Part IX of the Company’s prospectus dated 14 February 2018 (the ‘‘Prospectus’’) which has been prepared on the basis described in the notes to the Pro Forma Financial Information, for illustrative purposes only, to provide information about how the acquisitions of the entire issued capital of Idemitsu Petroleum UK Limited, Sojitz Energy Project Limited and Egerton Energy Ventures Limited might have affected the financial information presented on the basis of the accounting policies to be adopted by the Company in preparing the financial statements for the year ended 31 December 2017. This report is required by item 20.2 of Annex I to the PD Regulation and is given for the purpose of complying with that PD Regulation and for no other purpose.

Responsibilities

It is the responsibility of the directors of the Company to prepare the Pro Forma Financial Information in accordance with item 20.2 of Annex I to the PD Regulation.

It is our responsibility to form an opinion, as required by item 20.2 of Annex I to the PD Regulation as to the proper compilation of the Pro Forma Financial Information and to report our opinion to you. In providing this opinion we are not updating or refreshing any reports or opinions previously made by us on any financial information used in the compilation of the Pro Forma Financial Information, nor do we accept responsibility for such reports or opinions beyond that owed to those to whom those reports or opinions were addressed by us at the dates of their issue.

Save for any responsibility which we may have to those persons to whom this report is expressly addressed and for any responsibility arising under item 5.5.3R(2)(f) of the Prospectus Rules to any person as and to the extent there provided, to the fullest extent permitted by law we do not assume any responsibility and will not accept any liability to any other person for any loss suffered by any such other person as a result of, arising out of, or in connection with this report or our statement, required by and given solely for the purposes of complying with item 23.1 of Annex I to the PD Regulation, consenting to its inclusion in the Prospectus.

Basis of opinion

We conducted our work in accordance with the Standards for Investment Reporting issued by the Auditing Practices Board in the United Kingdom. The work that we performed for the purpose of making this report, which involved no independent examination of any of the underlying financial information, consisted primarily of comparing the unadjusted financial information with the source documents, considering the evidence supporting the adjustments and discussing the Pro Forma Financial Information with the directors of the Company.

We planned and performed our work so as to obtain the information and explanations we considered necessary in order to provide us with reasonable assurance that the Pro Forma Financial Information has been properly compiled on the basis stated and that such basis is consistent with the accounting policies of the Company.

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Opinion

In our opinion:

• a) the Pro Forma Financial Information has been properly compiled on the basis stated; and

• b) such basis is consistent with the accounting policies of the Company.

Declaration

For the purposes of Prospectus Rule 5.5.3 R(2)(f), we are responsible for this report as part of the Prospectus and we declare that we have taken all reasonable care to ensure that the information contained in this report is, to the best of our knowledge, in accordance with the facts and contains no omission likely to affect its import. This declaration is included in the Prospectus in compliance with item 1.2 of Annex I to the PD Regulation.

Yours faithfully

PricewaterhouseCoopers LLP Chartered Accountants

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PART X

SELECTED FINANCIAL INFORMATION ON THE COMPANY

The selected financial information set out below has been extracted without material adjustment from the audited historical financial information of the Company for the 18 month period ended 31 December 2016, and unaudited historical financial information for the six month periods ended 30 June 2017 and 30 June 2016, which is set out in full in Part XVI – Historical Financial Information of the Company of this document.

Selected Financial Information of the Company:

Consolidated Income Statement and Consolidated Statement of Comprehensive Income

Administrative expenses Exceptional items Operating loss Finance income Finance costs Loss before taxation Tax Loss for period and total comprehensive expense	Unaudited 6 months ended 30 June 2017 £ (1,381,377) (529,375) (1,910,752) 845 — (1,909,907) — (1,909,907)	18 months ended 31December 2016 £ (1,292,584) (48,164) (1,340,748) 3,893 (2) (1,336,857) — (1,336,857)	Unaudited 6 months ended 30 June 2016 £ (263,072) (42,434) (305,506) 2,163 (1) (303,344) — (303,344)

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Consolidated Statement of Financial Position

Assets Current assets Trade and other receivables Cash and cash equivalents Total assets Current liabilities Trade and other payables Total liabilities Equity and liabilities Share capital and reserves Share capital Share premium Accumulated losses Share option reserve Total equity Total equity and liabilities	30 June 2017 £ 1,085,433 1,438,848 2,524,281 2,204,386 2,204,386 2,000,000 2,224,816 (4,020,264) 115,343 319,895 2,524,281	31December 2016 £ 244,428 2,387,968 2,632,396 441,042 441,042 2,000,000 2,224,816 (2,110,357) 76,895 2,191,354 2,632,396	30 June 2016 £ 788,951 3,137,844 3,926,795 39,626 39,626 2,000,000 2,224,816 (337,647) — 3,887,169 3,926,795

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Consolidated Statement of Cash Flows

Cash fows from operating activities Loss for the period Share based payments Finance cost Finance income Increase in trade and other receivables Increase in trade and other payables Net cash used in operating activities Cash fows from investing activities Interest paid Interest received Net cash used from investing activities Cash fows from fnancing activities Proceeds from issue of shares net of treasury shares Initial public offering costs Net cash generated from fnancing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	Unaudited 6 months ended 30 June 2017 £ (1,909,907) 38,448 — (845) (841,005) 1,763,344 (949,965) — 845 845 — — — (949,120) 2,387,968 1,438,848	18 months ended 31December 2016 £ (1,336,857) 76,895 2 (3,893) (244,428) 441,040 (1,067,241) — 3,893 3,893 4,226,500 (775,184) 3,451,316 2,387,968 — 2,387,968	Unaudited 6 months ended 30 June 2016 £ (303,344) — 1 (2,163) 173,495 (1,132,385) (1,264,396) (1) 2,163 2,162 4,400,000 — 4,400,000 3,137,766 78 3,137,844

During the period covered by the historical financial information set out above, the significant change to the Company’s financial position was the receipt of net proceeds from the issue of Ordinary Shares in conjunction with the Initial Admission, the Fundraise and on completion of the Acquisitions. There was no significant change to the Company’s operating results during the period.

Since 30 June 2017 (being the end of the last financial period of the Company for which financial information has been published), there has been no significant change in the operating results of the Company.

Subsequent to the balance sheet date of 30 June 2017 the following significant changes to the Company’s financial position have occurred:

• A. on 6 July 2017, 5,333,334 Ordinary Shares were placed and a total of £8 million (£7.2 million net of placing costs) of capital was raised for the Company;

• B. on 22 December 2017, the Egerton Acquisition completed;

• C. on 22 December 2017, the Sojitz Acquisition completed, the Company paid US$2.7m pursuant to the acquisition but benefited from a working capital receipt of US$1.9m; and

• D. on 8 December 2017, the Idemitsu UK Acquisition completed, the total consideration was US$29.7m but the cash at bank held by the acquired entity was US$139.7m.

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PART XI

OPERATING AND FINANCIAL REVIEW OF ROCKROSE (INCLUDING LIQUIDITY AND CAPITAL RESOURCES AND CAPITALISATION AND INDEBTEDNESS)

The following operating and financial review contains financial information that has been extracted or derived without material adjustment from the Company’s financial information for the 18 month period ended 31 December 2016 and the 6 month period ended 30 June 2017, which are the only relevant periods, included in Part XVI – Historical Financial Information on the Company of this document prepared in accordance with IFRS.

This discussion contains forward-looking statements, which, although based on assumptions that the Directors consider reasonable, are subject to risks and uncertainties which could cause actual events or conditions to differ materially from those expressed or implied by the forward-looking statements. Investors should read the notice in relation to forward-looking statements contained on pages 34 and 35 of this document.

The key risks and uncertainties, include, but are not limited to those described in Part II – Risk Factors of this document.

Overview

The Company was incorporated on 1 July 2015 as an investment vehicle to identify and complete an acquisition of a company or business in the services sector which requires further funding for expansion in conjunction with a public quotation for its Ordinary Shares which would prove beneficial to the existing Shareholders, management, employees and shareholders of the business being acquired.

The Company has now executed the Acquisitions and received in aggregate £15,540,000.

The Company published its financial results for the initial period of 18 months ended 31 December 2016, which showed cash balance of £2,387,968. Since the Initial Admission on 13 January 2016 to 30 June 2017, the Company’s operations were limited to investigating potential acquisition targets. Since the end of that period on 30 June 2017 the Company completed the Idemitsu Acquisition on 8 December 2017, and both the Egerton Acquisition and the Sojitz Acquisition on 22 December 2017. The Company has no material liabilities other than in respect of the Acquisitions.

As set out in the table on page 42 of this document, the Group has total committed operating expenditure of £53.29m, committed capital expenditure of £6.5m and planned decommisioning postings of £6m, all of which are included in agreed operator budgets or have been notified to the Group by the relevant field operators. A detailed field by field breakdown of committed expenditure is set out on page 42 of this document.

Capital resources

The Company’s capital resources comprise its share capital and reserves.

In the period ended 31 December 2016, being the period covered by the most recently published audited financial information, cash outflow from operations totalled £1,067,241. Cash inflows from investing activities amounted to £3,893 and cash inflows from financing activities amounted to £3,451,316. No dividends on Ordinary Shares or other cash flows arose during the period. Since the end of that period and during the 6 month period ended 30 June 2017, cash outflow from operations totalled £949,965 and cash inflow from investing activities was £845. Subsequent to the end of that period a funraise by way of a futher equity issue raised £8m gross for the Company.

The Company does not forecast any restrictions on its ability to meet financial commitments as they fall due and anticipates that all planned operational costs, capital expenditure and decommissioning obligations will be met out of revenues with respect to all of the licence interests.

Capitalisation and indebtedness

The following table shows the Company’s indebtedness (distinguishing between guaranteed and unguaranteed, secured and unsecured indebtedness) as at 30 November 2017 and the Company’s capitalisation as at 30 June 2017 (being the last date in respect of which the Company has published financial information).

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Total current debt Guaranteed Secured Unguaranteed/unsecured Total non-current debt (excluding current portion of non-current debt) Guaranteed Secured Unguaranteed/unsecured Shareholders’ equity Share capital Legal reserve Other reserves Total capitalisation	As at 30 June 2017 £
	— — — — — — 4,224,816 — 115,343
	4,340,159

The information above has been extracted without material adjustment from the unaudited interim results of the Company for the 6 month period ended 30 June 2017. On 6 July 2017 the Company raised a further £8m (before expenses) through an issue of 5,333,334 new Ordinary Shares at a price of £1.50 per share.

The following table shows the Company’s unaudited net indebtedness as at 30 November 2017:

Cash Liquidity Current fnancial debt Net current fnancial indebtedness Non-current fnancial indebtedness Net fnancial indebtedness	As at 30 November 2017 £
	6,024,514
	6,024,514 — 6,024,514
	—
	6,024,514

The Company had no indirect or contingent indebtedness at 30 November 2017.

Since 31 December 2016 (being the last date in respect of which the Company has published audited financial information) the Company raised a further £8m (before expenses) on 6 July 2017 by way of the issue of 5,333,334 new ordinary shares at a price of £1.50 per share. The cash balance as at 30 November 2017 was £6,024,514 and there were as at that date no borrowings.

Hedging arrangements and risk management

The Company may use forward contracts, options, swaps, caps, collars and floors or other strategies or forms of derivative instruments to limit its exposure to changes in the relative values of investments that may result from market developments, including changes in prevailing interest rates and currency exchange rates, as previously described. It is expected that the extent of risk management activities by the Company will vary based on the level of exposure and consideration of risk across the business.

The success of any hedging or other derivative transaction generally will depend on the Company’s ability to correctly predict market changes. As a result, while the Company may enter into such a transaction to reduce exposure to market risks, unanticipated market changes may result in poorer

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overall investment performance than if the transaction had not been executed. In addition, the degree of correlation between price movements of the instruments used in connection with hedging activities and price movements in a position being hedged may vary. Moreover, for a variety of reasons, the Company may not seek, or be successful in establishing, an exact correlation between the instruments used in a hedging or other derivative transactions and the position being hedged and could create new risks of loss. In addition, it may not be possible to fully or perfectly limit the Company’s exposure against all changes in the values of its assets, because the values of its assets are likely to fluctuate as a result of a number of factors, some of which will be beyond the Company’s control.

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PART XII

TAXATION

General

The following statements are intended only as a general guide to certain UK tax considerations and do not purport to be a complete analysis of all potential UK tax consequences of acquiring, holding or disposing of the Ordinary Shares. They are based on current UK tax legislation and what is understood to be the current published practice of HMRC as at the date of this document, both of which may change at any time, possibly with retrospective effect. They are written on the basis that the Company is and remains solely resident in the UK for tax purposes. They apply only to Shareholders who are resident and, in the case of individuals, domiciled, for tax purposes in (and only in) the UK (except insofar as express reference is made to the treatment of non-UK residents) (‘‘ISA’’) who hold their Ordinary Shares as an investment (other than in an individual savings account or a Self-Invested Personal Pension (‘‘SIPP’’)) and who are the absolute legal and beneficial owners of both the Ordinary Shares and any dividends paid in respect of them. The tax position of certain categories of Shareholders who are subject to special rules (such as persons acquiring their Ordinary Shares in connection with employment, dealers in securities, insurance companies, charities or tax-exempt organisations and collective investment schemes) is not considered.

These paragraphs summarise the current position and are intended as a general guide only. They do not describe all of the circumstances in which holders of Ordinary Shares may benefit from an exemption or relief from UK taxation. Prospective investors who are in any doubt as to their tax position or who may be subject to tax in a jurisdiction other than the UK are strongly recommended to consult their own professional advisers.

Taxation of dividends

The Company is not required to withhold UK tax when paying a dividend. Liability to income tax on dividends will depend upon the individual circumstances of a Shareholder.

UK resident individual Shareholders

An individual Shareholder who is resident for tax purposes in the UK and who receives a cash dividend from the Company will generally not pay income tax on the first £5,000 of dividend income in the 2017/2018 tax year (the ‘‘nil rate band’’). The nil rate band will reduce to £2,000 for dividends received on or after 6 April 2018. An individual UK resident Shareholder who is subject to income tax at a rate or rates not exceeding the basic rate will (subject to the availability of any income tax personal allowance) be liable to income tax on the dividend in excess of the nil rate band at the rate of 7.5 per cent. An individual UK resident Shareholder who is subject to income tax at the higher rate or the additional rate will (subject to the availability of any income tax personal allowance) be liable to tax on the dividend in excess of the nil rate band at the rate of 32.5 per cent. or 38.1 per cent. respectively to the extent that such sum, when treated as the top slice of that Shareholder’s income, falls above the threshold for higher rate or additional rate income tax.

UK resident corporate Shareholders

It is likely that most dividends paid in respect of the Ordinary Shares to UK resident corporate Shareholders would fall within one or more of the classes of dividend qualifying for exemption from corporation tax. However, it should be noted that the exemptions are not comprehensive and are also subject to anti-avoidance rules. If the conditions for exemption are not, or cease to be, satisfied, or such a Shareholder elects for an otherwise exempt dividend to be taxable, the Shareholder will be subject to UK corporation tax on dividends received from the Company at the current rate of 19%.

Non-UK resident Shareholders

A Shareholder resident outside the UK may be subject to non-UK taxation on dividend income under local law. A Shareholder who is not resident for tax purposes in the UK should not be chargeable to UK income tax on dividends received from the Company unless he or she carries on (whether solely or in partnership) any trade, profession, or vocation in the UK through a branch or agency to which the Ordinary Shares are attributable (subject to certain exceptions for trading through independent agents, such as some brokers and investment managers). A Shareholder who

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is resident outside the UK for tax purposes should consult his own tax adviser concerning his tax position on dividends received from the Company.

Taxation of the ‘‘B share scheme’’

There is no statutory clearance process for a B share scheme and the Company has not sought advance clearance from HMRC with respect to the tax treatment of the B share scheme referred to in Part VIII – The Company, the Board, the Senior Managers, and the Further Acquisition Strategy of this document. The tax treatment of most B share schemes results in the proceeds of the redemption of the B shares being treated as subject to capital gains tax, and this is generally the case in so far as the Company was able to issue the B shares out of qualifying capital. However, this treatment does depend on a number of factors including the nature of the reserves out of which the B shares are issued. Accordingly there is a risk that the tax consequences of the B share scheme might be to deliver a return to Shareholders that is partially subject to capital gains tax and partially subject to income tax (in line with the sources of the reserves out of which they were issued, when these are finally known). Any Shareholder who will be required to record the potential breakdown of the B share redemption on his or her tax return between income and capital distributions respectively should contact the Company for confirmation of this allocation once the process has been completed. The preceding information is not relevant to individual Shareholders who hold their shares in an ISA or in a SIPP, or any other vehicle where income and capital gains are not subject to tax, or to differentiated tax treatment.

Taxation of disposals

A disposal or deemed disposal of Ordinary Shares by a Shareholder who is resident in the UK for tax purposes may, depending upon the Shareholder’s circumstances and subject to any available exemption or relief (such as the annual exempt amount for individuals and indexation for corporate shareholders), give rise to a chargeable gain or an allowable loss for the purposes of UK taxation of capital gains. It should be noted that changes were announced in the Autumn Budget on 22 November 2017, and draft provisions are contained in Finance Bill 2017-18 (as published on 1 December 2017), which (if enacted) will restrict the application of indexation relief to assets acquired prior to 1 January 2018 and, in addition, will change the calculation of the relief for disposals (or deemed disposals) of such assets on or after 1 January 2018 so as to apply the Retail Price Index for December 2017 regardless of the actual date of disposal.

For a Shareholder within the charge to UK capital gains tax, capital gains tax is charged on gains on the disposal of Ordinary Shares to the extent that the gain exceeds any applicable annual exemption. The current rate is 10 per cent. for individuals who are subject to income tax at the basic rate, save to the extent that any capital gains when aggregated the Shareholder’s other taxable income and gains in the relevant tax year exceeds the upper limit of the income tax basic rate band, in which case the excess will be taxed at a rate of 20 per cent. The current rate for all trustees and personal representatives, and individuals who are subject to income tax at the higher or additional rates is 20 per cent. For a corporate Shareholder within the charge to UK corporation tax, corporation tax is charged on chargeable gains at the current rate of 19 per cent.

Non-UK resident Shareholders

Shareholders who are not resident in the UK will not generally be subject to UK taxation of capital gains on the disposal or deemed disposal of Ordinary Shares unless they are carrying on a trade, profession or vocation in the UK through a branch or agency (or, in the case of a corporate Shareholder, a permanent establishment) in connection with which the Shares are used, held or acquired. Non-UK tax resident Shareholders may be subject to non-UK taxation on any gain under local law.

An individual Shareholder who has ceased to be resident for tax purposes in the UK, or is treated as resident outside the UK for the purposes of a double tax treaty, and who disposes of all or part of their Shares during that period may be liable to capital gains tax on their return to the UK if the temporary non-residence rules are met, subject to any available exemptions or reliefs.

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Stamp duty and Stamp Duty Reserve Tax (‘‘SDRT’’)

The statements in this section apply to any holders of Ordinary Shares irrespective of their residence, summarise the current position and are intended as a general guide only. Special rules apply to agreements made by, amongst others, intermediaries.

Issue of Ordinary Shares

No UK stamp duty or SDRT is payable on the issue of the Ordinary Shares.

Transfers of certificated Ordinary Shares

Stamp duty at the rate of 0.5 per cent. (rounded up to the next multiple of £5) of the amount or value of the consideration given is generally payable on an instrument transferring Ordinary Shares. An exemption from stamp duty is available on an instrument transferring Ordinary Shares where the amount or value of the consideration is £1,000 or less, and it is certificated on the instrument that the transaction effected by the instrument does not form part of a larger transaction or series of transactions for which the aggregate consideration exceeds £1,000. A charge to SDRT will also arise on an unconditional agreement to transfer Ordinary Shares (at the rate of 0.5 per cent. of the amount or value of the consideration payable). However, if within six years of the date of the agreement becoming unconditional an instrument of transfer is executed pursuant to the agreement, and stamp duty is paid on that instrument, or the instrument is otherwise exempt, any SDRT already paid will be refunded (generally, but not necessarily, with interest) provided that a claim for repayment is made, and any outstanding liability to SDRT will be cancelled. The liability to pay stamp duty or SDRT is generally satisfied by the purchaser or transferee.

Ordinary Shares transferred through paperless means including CREST

Paperless transfers of Ordinary Shares, such as those occurring within CREST, are generally liable to SDRT rather than stamp duty, at the rate of 0.5 per cent. of the amount or value of the consideration. CREST is obliged to collect SDRT on relevant transactions settled within the system and to pay this to HMRC. The charge is generally borne by the purchaser. Under CREST, no stamp duty or SDRT will arise on a transfer of Ordinary Shares into the system unless such a transfer is made for consideration in money or money’s worth, in which case a liability to SDRT (usually at a rate of 0.5 per cent.) will arise.

Ordinary Shares held through Clearance Systems or Depositary Receipt Arrangements

Special rules apply where Ordinary Shares are issued or transferred to, or to a nominee or agent for, either a person whose business is or includes issuing depositary receipts within Section 67 or Section 93 of the Finance Act 1986 or a person providing a clearance service within Section 70 or Section 96 of the Finance Act 1986, under which SDRT or stamp duty may be charged at a rate of 1.5 per cent. Following litigation, HMRC confirmed that they will no longer seek to apply the 1.5 per cent. SDRT charge on an issue of shares into a clearance service or depositary receipt arrangement on the basis that the charge is not compatible with EU law. It was announced in the Autumn Budget on 22 November 2017 that the government will not seek to reintroduce this charge following the departure of the UK from the European Union. HMRC’s view is that the 1.5 per cent. SDRT or stamp duty charge will continue to apply to transfers of shares into a clearance service or depositary receipt arrangement unless they are an integral part of an issue of share capital. Any liability for stamp duty or SDRT in respect of such a transfer will strictly be accountable by the clearance service or depositary receipt system operator or their nominee, as the case may be, but will, in practice, be payable by the participants in the clearance service or depositary receipt system.

Where a clearance service has made and maintained an election under section 97A of the Finance Act 1986, the 1.5% charge will not apply. Rather, stamp duty or SDRT will be charged at the normal rate of 0.5% on the transfer of existing shares into and within the clearance service.

Accordingly, specific professional advice should be sought before incurring a 1.5 per cent. stamp duty or stamp duty reserve tax charge in any circumstances.

Inheritance tax

The Ordinary Shares will be assets situated in the UK for the purposes of UK inheritance tax. A gift of such assets by, or the death of, an individual holder of such assets may (subject to certain exemptions and reliefs) give rise to a liability to UK inheritance tax even if the holder is neither domiciled in the UK nor deemed to be domiciled there under certain rules relating to long residence or previous domicile. For inheritance tax purposes, a transfer of assets at less than full

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market value may be treated as a gift and particular rules apply to gifts where the donor reserves or retains some

Special rules also apply to close companies and to trustees of settlements who hold Ordinary Shares, bringing them within the charge to inheritance tax. Shareholders should consult an appropriate tax adviser if they make a gift or transfer at less than market value or intend to hold any Ordinary Shares through trust arrangements. They should also seek professional advice in a situation where there is potential for a double charge to UK inheritance tax and an equivalent tax in another country or if they are in any doubt about their UK inheritance tax position.

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PART XIII

CONSEQUENCES OF A STANDARD LISTING

As the Idemitsu UK Acquisition is classified as a Reverse Takeover, upon completion of the Idemitsu UK Acquisition, the Standard Listing of the Ordinary Shares was cancelled and an application will be made for the immediate admission of the Ordinary Shares to Standard Listing (pursuant to Chapter 14 of the Listing Rules) and to trading on the Main Market of the London Stock Exchange. The Company intends to comply with the Listing Principles set out in Chapter 7 of the Listing Rules at Listing Rule 7.2.1 which apply to all companies with their securities admitted to the Official List. In addition, the Company also intends to comply with the Listing Principles at Listing Rule 7.2.1A notwithstanding that they only apply to companies which obtain a Premium Listing. With regard to the Listing Principles at 7.2.1A, the Company is not, however, formally subject to such Listing Principles and will not be required to comply with them by the UKLA.

While the Company has a Standard Listing, it is not required to comply with the provisions of, inter alia:

• Chapter 8 of the Listing Rules regarding the appointment of a sponsor to guide the Company in understanding and meeting its responsibilities under the Listing Rules in connection with certain matters. The Company has not and does not intend to appoint such a sponsor in connection with Admission;

• Chapter 10 of the Listing Rules relating to significant transactions. It should be noted therefore that the Idemitsu UK Acquisition did not require Shareholder consent;

• Chapter 11 of the Listing Rules regarding related party transactions. Nevertheless, the Company will not enter into any transaction which would constitute a ‘related party transaction’ as defined in Chapter 11 of the Listing Rules without the specific prior approval of the Directors;

• Chapter 12 of the Listing Rules regarding purchases by the Company of its Ordinary Shares. In particular, the Company has not adopted a policy consistent with the provisions of Listing Rules 12.4.1 and 12.4.2; and

• Chapter 13 of the Listing Rules regarding the form and content of circulars to be sent to Shareholders.

It should be noted that the UKLA will not have the authority to (and will not) monitor the Company’s compliance with any of the Listing Rules which the Company has indicated herein that it intends to comply with on a voluntary basis, nor to impose sanctions in respect of any failure by the Company so to comply. However, the FCA would be able to impose sanctions for noncompliance where the statements regarding compliance in this document are themselves misleading, false or deceptive.

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PART XIV

ADDITIONAL INFORMATION

1. Responsibility

The Company and the Directors, whose names appear on page 39 of this document, accept responsibility for the information contained in this document. To the best of the knowledge of the Company and the Directors (each of whom has taken all reasonable care to ensure that such is the case), the information contained in this document is in accordance with the facts and does not omit anything likely to affect the import of such information.

1. The Company

2. 2.1 The Company was incorporated on 1 July 2015 as a public company with limited liability under the Companies Act.

3. 2.2 The Company is not regulated by the FCA or any financial services or other regulator. With effect from Admission, the Company will be subject to the Listing Rules and the Disclosure Guidance and Transparency Rules (and the resulting jurisdiction of the UKLA), to the extent such rules apply to companies with a Standard Listing pursuant to Chapter 14 of the Listing Rules.

4. 2.3 The principal legislation under which the Company operates and conforms, and pursuant to which the Ordinary Shares have been created, is the Companies Act and the regulations made thereunder. The Company operates in conformity with its constitution. The Company is subject to the Listing Rules and the Disclosure Guidance and Transparency Rules (and the resulting jurisdiction of the UKLA) to the extent such rules apply to companies with a Standard Listing pursuant to Chapter 14 of the Listing Rules.

5. 2.4 The Company’s registered office is at c/o Cooley Services Limited, Dashwood, 69 Old Broad Street, London EC2M 1QS. The Company’s telephone number is +44 (0) 20 7556 4261.

6. 2.5 On incorporation of the Company, Andrew Austin subscribed for 1,200,000 ordinary shares of 5p in the Company at a price of 12.5p each (equivalent to 300,000 shares at a price of 50p each on a consolidated basis).

7. 2.6 On 5 August 2015 a special resolution was passed to consolidate every four ordinary shares of 5p each into an ordinary share of 20p.

8. 2.7 By a special resolution of the founder shareholder passed by a written resolution of the sole shareholder of the Company on 5 November 2015, the Articles were adopted with effect from Admission in substitution for and to the exclusion of the Company’s then existing articles of association.

9. 2.8 Pursuant to resolutions of the Shareholders passed on 29 June 2017:

10. (a) the Directors were authorised in accordance with section 551 of the Companies Act to exercise all the powers of the Company to allot relevant securities up to an aggregate nominal amount of £2,000,000, provided that such authority, unless renewed, varied or revoked by the Company, expires on 29 September 2018 or at the conclusion of the Company’s next annual general meeting (whichever is the earlier), but so that the Company may, before such expiry, make an offer or agreement which would or might require Ordinary Shares to be allotted and the Directors may allot shares in pursuance of such offer of agreement notwithstanding that the authority conferred by this resolution has expired;

11. (b) the Directors were empowered in accordance with section 570 of the Companies Act to allot equity securities (as defined in section 560 of the Companies Act) of the Company for cash pursuant to the general authorities conferred on them by this resolution as if section 561(1) of the Companies Act did not apply to any such allotment, provided that such power;

12. (c) shall, subject to the continuance of the authority conferred by Resolution 7, expire 15 months after the passing of this Resolution or at the conclusion of the next annual general meeting of the Company following the passing of this Resolution, whichever occurs first, but may be previously revoked or varied from time to time by special resolution but so that the Company may before such expiry, revocation or variation make an offer or agreement which would or might require equity securities to be allotted

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after such expiry, revocation or variation and the directors of the Company may allot equity securities in pursuance of such offer or agreement as if such power had not expired or been revoked or varied; and

• (d) shall be limited to:

  • (i) the allotment of equity securities of up to an aggregate nominal amount of £2,000,000 pursuant to a rights issue, open offer, scrip dividend scheme or other pre-emptive offer or scheme which is in each case in favour of holders of Ordinary Shares and any other persons who are entitled to participate in such issue, offer or scheme where the equity securities offered to each such holder and other person are proportionate (as nearly as may be) to the respective numbers of Ordinary Shares held or deemed to be held by them for the purposes of their inclusion in such issue, offer or scheme on the record date applicable thereto, but subject to such exclusions or other arrangements as the directors of the Company may deem fit or expedient to deal with fractional entitlements, legal or practical problems under the laws of any overseas territory, the requirements of any regulatory body or stock exchange in any territory, shares being represented by depositary receipts, directions from any holders of shares or other persons to deal in some other manner with their respective entitlements or any other matter whatsoever which the directors of the Company consider to require such exclusions or other arrangements with the ability for the directors of the Company to allot equity securities and sell relevant shares not taken up to any person as they may think fit; and

  • (ii) the allotment of equity securities for cash otherwise than pursuant to sub-paragraph (b)(i) up to an aggregate maximum nominal amount of £2,000,000.

• 2.9 On 18 December 2015 Andrew Austin subscribed for 900,000 ordinary shares of 20p in the Company at a price of 50p each.

• 2.10 Pursuant to written resolution of the sole shareholder passed on 6 January 2016 the Directors were authorised in accordance with section 551 of the Companies Act to exercise all the powers of the Company to allot up to 29,000,000 Ordinary Shares, provided that such authority, unless renewed, varied or revoked by the Company, shall expire on 28 February 2016, but so that the Company may, before such expiry, make an offer or agreement which would or might require Ordinary Shares to be allotted and the Directors may allot shares in pursuance of such offer of agreement notwithstanding that the authority conferred by this resolution has expired.

• 2.11 On 12 January 2016, the Company issued 10,000,000 Ordinary Shares, if which 8,800,000 Ordinary Shares were placed with certain investors in connection with a placing at a price of 50p per Ordinary Share.

• 2.12 On 3 July 2017 the Company issued 5,333,334 Ordinary Shares to placees and subscribers in connection with the Fundraise at a price of 150 pence per Ordinary Share.

• 2.12 As at 13 February 2018, being the latest practicable date prior to publication of this document, the Company had the following wholly owned subsidiaries all of which are incorporated in England and Wales.

incorporated in England and Wales.
	Company’s percentage ownership in
	the issued share capital of the
Name of Group company:	relevant Group company:
Rockrose (UKCS1) Limited(1)(3)	100%
Rockrose (UKCS2) Limited(1)	100%
Rockrose (UKCS3) Limited(1)	100%
Rockrose UKCS4 Limited(1)	100%
Rockrose UKCS5 Limited(2)(3)	100%
Rockrose UKCS6 Limited(2)(3)	100%
Rockrose UKCS7 Limited(2)(3)	100%

(1) The Company holds a 100% direct ownership interest in this entity.

• (2) The Company holds a 100% direct ownership interest in Rockrose UKCS4 Limited, which in turn holds a 100% direct ownership stake in this entity.

• (3) This entity is dormant.

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3. Share capital

The following table shows the issued and fully paid shares of the Company at the date of this document and Admission:

Class of share Number Amount paid Ordinary 15,333,334 £13,000,001

• 3.1 Save as disclosed in this document:

• (a) no share or loan capital of the Company has been issued or is proposed to be issued;

• (b) no person has any preferential subscription rights for any shares of the Company;

• (c) no share or loan capital of the Company is unconditionally to be put under option; or

• (d) no commissions, discounts, brokerages or other special terms have been granted by the Company since its incorporation in connection with the issue or sale of any share or loan capital of the Company.

• 3.2 All Ordinary Shares in the capital of the Company are in registered form.

• 3.3 The Ordinary Shares will have a Standard Listing and be traded on the Main Market of the London Stock Exchange. The Ordinary Shares are not listed or traded on, and no application has been or is being made for the admission of the Ordinary Shares to listing or trading on any other stock exchange or securities market.

4. Articles

• 4.1 The Articles were adopted (with effect from Admission) by a special resolution of the Founder Shareholder passed at a general meeting of the Company (held on short notice) on 5 November 2015. A summary of the terms of the Articles is set out below. The summary below is not a complete copy of the terms of the Articles.

• 4.2 The Articles contain no specific restrictions on the Company’s objects and therefore, by virtue of section 31(1) of the Companies Act, the Company’s objects are unrestricted.

• 4.3 The Articles contain, inter alia, provisions to the following effect:

• (a) Share Capital

The Company’s share capital currently consists of Ordinary Shares. The Company may issue shares with such rights or restrictions as may be determined by ordinary resolution, including shares which are to be redeemed, or are liable to be redeemed at the option of the Company or the holder of such shares.

(b) Voting

The Shareholders have the right to receive notice of, and to vote at, general meetings of the Company. Each Shareholder who is present in person (or, being a corporation, by representative) at a general meeting on a show of hands has one vote and, on a poll, every such holder who is present in person (or, being a corporation, by representative) or by proxy has one vote in respect of every share held by him.

(c) Variation of rights

Whenever the share capital of the Company is divided into different classes of shares, the special rights attached to any class may be varied or abrogated either with the consent in writing of the holders of three-fourths in nominal value of the issued shares of that class or with the sanction of a special resolution passed at a general meeting of the holders of the shares of that class and may be so varied and abrogated whilst the Company is a going concern or during or in contemplation of a winding up.

(d) Dividends

The Company may, subject to the provisions of the Companies Act and the Articles, by ordinary resolution from time to time declare dividends to be paid to members not exceeding the amount recommended by the Directors. Subject to the provisions of the Companies Act in so far as, in the Directors’ opinions, the Company’s profits justify such payments, the Directors may pay interim dividends on any class of shares.

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Any dividend unclaimed after a period of 12 years from the date such dividend was declared or became payable shall, if the Directors resolve, be forfeited and shall revert to the Company. No dividend or other moneys payable on or in respect of a share shall bear interest as against the Company.

(e) Transfer of Ordinary Shares

Each member may transfer all or any of his shares which are in certificated form by means of an instrument of transfer in any usual form or in any other form which the Directors may approve. Each member may transfer all or any of his shares which are in uncertificated form by means of a ‘relevant system’ (i.e. CREST) in such manner provided for, and subject as provided in, the CREST Regulations.

The Board may, in its absolute discretion, refuse to register a transfer of certificated shares unless:

• (i) it is for a share which is fully paid up;

• (ii) it is for a share upon which the Company has no lien;

• (iii) it is only for one class of share;

• (iv) it is in favour of a single transferee or no more than four joint transferees;

• (v) it is duly stamped or is duly certificated or otherwise shown to the satisfaction of the Board to be exempt from stamp duty; and

• (vi) it is delivered for registration to the registered office of the Company (or such other place as the Board may determine), accompanied (except in the case of a transfer by a person to whom the Company is not required by law to issue a certificate and to whom a certificate has not been issued or in the case of a renunciation) by the certificate for the shares to which it relates and such other evidence as the Board may reasonably require to prove the title of the transferor (or person renouncing) and the due execution of the transfer or renunciation by him or, if the transfer or renunciation is executed by some other person on his behalf, the authority of that person to do so.

The Directors may refuse to register a transfer of uncertificated shares in any circumstances that are allowed or required by the CREST Regulations and CREST.

• (f) Allotment of shares and pre-emption rights

Subject to the Companies Act and to any rights attached to existing shares, any share may be issued with or have attached to it such rights and restrictions as the Company may by ordinary resolution determine, or if no ordinary resolution has been passed or so far as the resolution does not make specific provision, as the Directors may determine (including shares which are to be redeemed, or are liable to be redeemed at the option of the Company or the holder of such shares).

(g) Alteration of share capital

The Company may by ordinary resolution consolidate or divide all of its share capital into shares of larger nominal value than its existing shares, or cancel any shares which, at the date of the ordinary resolution, have not been taken or agreed to be taken by any person and diminish the amount of its share capital by the nominal amount of shares so cancelled or sub-divide its shares, or any of them, into shares of smaller nominal value.

The Company may, in accordance with the Companies Act, reduce or cancel its share capital or any capital redemption reserve or share premium account in any manner and with and subject to any conditions, authorities and consents required by law.

(h) Directors

Unless otherwise determined by the Company by ordinary resolution, the number of Directors (other than any alternate Directors) shall not be less than two, but there shall be no maximum number of Directors.

Subject to the Articles and the Companies Act, the Company may by ordinary resolution appoint a person who is willing to act as a Director and the Board shall have power at any time to appoint any person who is willing to act as a Director, in both cases either to fill a vacancy or as an addition to the existing Board.

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At every annual general meeting any director who:

• (i) has been appointed by the Directors since the last annual general meeting; or

• (ii) was not appointed or re-appointed at one of the preceding two annual general meetings

must retire from office and may offer themselves for reappointment by the Shareholders by ordinary resolution.

Subject to the provisions of the Articles, the Board may regulate their proceedings as they think fit. A Director may, and the secretary at the request of a Director shall, call a meeting of the Directors.

The quorum for a Directors’ meeting shall be fixed from time to time by a decision of the Directors, but it must never be less than two and unless otherwise fixed, it is two.

Questions and matters requiring resolution arising at a meeting shall be decided by a majority of votes of the participating Directors, with each director having one vote. In the case of an equality of votes, the chairman will only have a casting vote or second vote when an has been completed. The entering into any further acquisition requires the consent of 75 per cent. of the Directors present and entitled to vote.

The Directors shall be entitled to receive such remuneration as the Directors shall determine for their services to the Company as directors and for any other service which they undertake for the Company provided that the aggregate fees payable to the Directors must not exceed £200,000 per annum. The Directors shall also be entitled to be paid all reasonable expenses properly incurred by them in connection with their attendance at meetings of Shareholders or class meetings, board or committee meetings or otherwise in connection with the exercise of their powers and the discharge of their responsibilities in relation to the Company.

The Board may, in accordance with the requirements in the Articles, authorise any matter proposed to them by any Director which would, if not authorised, involve a Director breaching his duty under the Companies Act to avoid conflicts of interests.

A Director seeking authorisation in respect of such conflict shall declare to the Board the nature and extent of his interest in a conflict as soon as is reasonably practicable. The Director shall provide the Board with such details of the matter as are necessary for the Board to decide how to address the Conflict together with such additional information as may be requested by the Board.

Any authorisation by the Board will be effective only if:

• (i) to the extent permitted by the Companies Act, the matter in question shall have been proposed by any Director for consideration in the same way that any other matter may be proposed to the Directors under the provisions of the Articles;

• (ii) any requirement as to the quorum for consideration of the relevant matter is met without counting the conflicted Director and any other conflicted Director; and

• (iii) the matter is agreed to without the conflicted Director voting or would be agreed to if the conflicted Director’s and any other interested Director’s vote is not counted.

Subject to the provisions of the Companies Act, every Director, secretary or other officer of the Company (other than an auditor) is entitled to be indemnified against all costs, charges, losses, damages and liabilities incurred by him in the actual purported exercise or discharge of his duties or exercise of his powers or otherwise in relation to them.

• (i) General Meetings

The Company must convene and hold annual general meetings in accordance with the Companies Act.

No business shall be transacted at any general meeting unless a quorum is present when the meeting proceeds to business, but the absence of a quorum shall not preclude the choice or appointment of a chairman of the meeting which shall not be treated as part of the business of the meeting. Save as otherwise provided by the articles, two Shareholders present in person or by proxy and entitled to vote shall be a quorum for all purposes.

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• (j) Borrowing Powers

Subject to the Articles and the Companies Act, the Board may exercise all of the powers of the Company to:

• (i) borrow money;

• (ii) indemnify and guarantee;

• (iii) mortgage or charge;

• (iv) create and issue debentures and other securities; and

• (v) give security either outright or as collateral security for any debt, liability or obligation of the Company or of any third party.

(k) Capitalisation of profits

The Directors may, if they are so authorised by an ordinary resolution of the Shareholders, decide to capitalise any undivided profits of the Company (whether or not they are available for distribution), or any sum standing to the credit of the Company’s share premium account or capital redemption reserve. The Directors may also, subject to the aforementioned ordinary resolution, appropriate any sum which they so decide to capitalise to the persons who would have been entitled to it if it were distributed by way of dividend and in the same proportions.

• (l) Uncertificated Shares

Subject to the Companies Act, the Directors may permit title to shares of any class to be issued or held otherwise than by a certificate and to be transferred by means of a ‘relevant system’ (i.e. CREST) without a certificate.

The Directors may take such steps as it sees fit in relation to the evidencing of and transfer of title to uncertificated shares, any records relating to the holding of uncertificated shares and the conversion of uncertificated shares to certificated shares, or vice-versa.

The Company may by notice to the holder of an uncertificated share, require that share to be converted into form.

The Board may take such other action that the Board considers appropriate to achieve the sale, transfer, disposal, forfeiture, re-allotment or surrender of an uncertified share or otherwise to enforce a lien in respect of it.

5. Other Relevant Laws and Regulations

• 5.1 Mandatory bid

• (a) The Takeover Code applies to the Company. Under the Takeover Code, where:

  • (i) any person acquires, whether by a series of transactions over a period of time or not, an interest in shares which (taken together with shares in which he is already interested, and in which persons acting in concert with him are interested) carry 30 per cent. or more of the voting rights of a company; or

  • (ii) any person who, together with persons acting in concert with him, is interested in shares which in the aggregate carry not less than 30 per cent. of the voting rights of a company but does not hold shares carrying more than 50 per cent. of such voting rights and such person, or any person acting in concert with him, acquires an interest in any other shares which increases the percentage of shares carrying voting rights in which he is interested;

such person shall, except in limited circumstances, be obliged to extend offers, on the basis set out in Rules 9.3, 9.4 and 9.5 of the Takeover Code, to the holders of any class of equity share capital whether voting or non-voting and also to the holders of any other class of transferable securities carrying voting rights. Offers for different classes of equity share capital must be comparable; the Takeover Panel should be consulted in advance in such cases.

• (b) An offer under Rule 9 of the Takeover Code must be in cash and at the highest price paid for any interest in the shares by the person required to make an offer or any person acting in concert with him during the 12 months prior to the announcement of the offer.

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• (c) Under the Takeover Code, a ‘concert party’ arises where persons acting together pursuant to an agreement or understanding (whether formal or informal and whether or not in writing) actively co-operate, through the acquisition by them of an interest in shares in a company, to obtain or consolidate control of the company. ‘Control’ means holding, or aggregate holdings, of an interest in shares carrying 30 per cent. or more of the voting rights of the company, irrespective of whether the holding or holdings give de facto control.

• (d) There have been no public takeover bids by third parties in respect of the Company’s equity in the current financial year or the previous financial year.

• 5.2 Squeeze-out

• (a) Under sections 979 to 982 of the Companies Act, if an offeror were to acquire 90 per cent. of the Ordinary Shares it could then compulsorily acquire the remaining 10 per cent. It would do so by sending a notice to outstanding Shareholders telling them that it will compulsorily acquire their shares, provided that no such notice may be served after the end of: (a) the period of three months beginning with the day after the last day on which the offer can be accepted; or (b) if earlier, and the offer is not one to which section 943(1) of the Companies Act applies, the period of six months beginning with the date of the offer.

• (b) Six weeks following service of the notice, the offeror must send a copy of it to the Company together with the consideration for the Ordinary Shares to which the notice relates, and an instrument of transfer executed on behalf of the outstanding Shareholder(s) by a person appointed by the offeror.

• (c) The Company will hold the consideration on trust for the outstanding Shareholders.

• 5.3 Sell-out

• (a) Sections 983 to 985 of the Companies Act also give minority Shareholders in the Company a right to be bought out in certain circumstances by an offeror who has made a takeover offer. If a takeover offer relating to all the Ordinary Shares is made at any time before the end of the period within which the offer could be accepted and the offeror held or had agreed to acquire not less than 90 per cent. of the Ordinary Shares, any holder of shares to which the offer related who had not accepted the offer could by a written communication to the offeror require it to acquire those shares. The offeror is required to give any Shareholder notice of his right to be bought out within one month of that right arising. The offeror may impose a time limit on the rights of minority Shareholders to be bought out, but that period cannot end less than three months after the end of the acceptance period, or, if longer a period of three months from the date of the notice.

• (b) If a Shareholder exercises his/her rights, the offeror is bound to acquire those shares on the terms of the offer or on such other terms as may be agreed.

• 5.4 Shareholder notification and disclosure requirements

• (a) Shareholders are obliged to comply with the shareholding notification and disclosure requirements set out in Chapter 5 of the DTRs. A Shareholder is required pursuant to Rule 5 of the DTRs to notify the Company if, as a result of an acquisition or disposal of shares or financial instruments, the Shareholder’s percentage of voting rights of the Company reaches, exceeds or falls below, 3 per cent. of the nominal value of the Company’s share capital or any 1 per cent. threshold above that.

• (b) The DTRs can be accessed and downloaded from the FCA’s website at http://fshandbook.info/FS/html/FCA/DTR. Shareholders are urged to consider their notification and disclosure obligations carefully as a failure to make a required disclosure to the Company may result in disenfranchisement.

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6. Directors’ and Senior Managers’ and Other Interests

• 6.1 Save as disclosed below, no Director nor Senior Manager nor any member of their immediate families has at the date of this document or will have on Admission any interests (beneficial or non-beneficial) in the Ordinary Shares of the Company:

Name Andrew Philip Austin(1)(3) John Andrew Corran Morrow Richard Alan Benmore(2) Peter George Mann(4) Stephen (Steve) Hargrave Pawson(5)	No. of Ordinary Shares
	3,548,335 210,000 186,667 50,252 33,333

• (1) Of the 3,548,335 Ordinary Shares held by Mr Austin, 2,828,335 Ordinary Shares are held by him legally and beneficially, the balance of 720,000 Ordinary Shares are held in his SIPP, administered by Rowanmoor Trustees.

• (2) Mr Benmore’s Ordinary Shares are held in the name of his wife, Judith Helen Benmore.

• (3) Mr Austin previously held an option to acquire 1,533,333 Ordinary Shares, which was exercised in full on the date of this document.

• (4) Of the 50,252 Ordinary Shares held by Mr Mann, 252 Ordinary Shares are held in his SIPP.

• (5) References to Ordinary Shares held by Mr Pawson in this table are to those Ordinary Shares held by SHP Accounting Ltd.

• 6.2 In addition to their directorships of the Group, the Directors and Senior Managers are, or have been, members of the administrative, management or supervisory bodies or partners of the following companies or partnerships, at any time in the five years prior to the date of this document:

Andrew Philip Austin Current directorships/partnerships Previous directorships/partnerships Kulie Austin Make-all Ltd IGas Energy Plc Kulie Austin 100% Make-all Ltd Island Gas Limited Kulie Ausin 100% Annefield Grange Ltd Star Energy Group Limited Star Energy Limited Star Energy (East Midlands) Limited Star Energy Weald Basin Limited Star Energy Oil & Gas Limited Star Energy Oil UK Limited Island Gas (Singleton) Limited IGas Energy (Caithness) Limited IGas Exploration UK Limited Island Gas Operations Limited Dart Energy (Europe) Ltd Dart Energy (Carbon Storage) Limited Dart Energy (East England) Limited Dart Energy (Forth Valley) Limited Dart Energy (Lothian) Limited Dart Energy (West England) Limited GP Energy Limited Greenpark Energy Transportation Limited Dart Energy Limited Dart Energy SPV No1 Pty Ltd Dart Energy SPV No 2 Pty Ltd Dart Energy (Bruxner) Pty Ltd Dart Energy (Overseas) Pty Ltd Dart Energy (China) Pty Ltd Apollo Gas Limited Dart Energy (Apollo) Pty Ltd Dart Energy Global CBM Pty Ltd Dart Energy (India) Pty Ltd

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Andrew Philip Austin Current directorships/partnerships

Current directorships/partnerships Previous directorships/partnerships Dart Energy International Ltd Dart Energy Europe Pte Ltd Dart Energy (Vietnam) Holdings Pte. Ltd Dart Energy (Hanoi Basin CBM) Pte. Ltd Dart Energy (China) Holdings Pte. Ltd Dart Energy (Dajing) Pte. Ltd Dart Energy Asia Holdings Pte Ltd Dart Energy (India) Holdings Pte. Ltd Dart Energy (AS) Pte. Ltd Dart Energy (ST) Pte. Ltd Dart Energy India (CMM) Pte. Ltd Dart Energy (CIL) Pte. Ltd Dart Energy (MG) Pte. Ltd Dart Energy (India) Pte. Ltd Dart Energy (Indonesia) Holdings Pte. Ltd Dart Energy (Tanjung Enim) Pte. Ltd Dart Energy (Muralim) Pte. Ltd Dart Energy (Bontang Bengalon) Pte. Ltd Dart Energy (Sangatta West) Pte. Ltd Dart Energy (CBM Power Indonesia) Pte. Ltd. PT Dart Energy Indonesia PT Coal Bed Methane Power Indonesia Austin and Austin Limited UK Onshore Oil and Gas Richard Alan Benmore Current directorships/partnerships Previous directorships/partnerships — — John Andrew Corran Morrow Current directorships/partnerships Previous directorships/partnerships JACM Consultants Limited Bowleven plc Bowleven Resources Limited FirstAfrica Oil Limited Sand Geophysics Limited Peter George Mann Current directorships/partnerships Previous directorships/partnerships Strae Capital Limited Mann & Co Ltd Stephen (Steve) Hargrave Pawson Current directorships/partnerships Previous directorships/partnerships SHP Accounting Ltd — Lythe Hill Park Management Company Limited Lythe Hill Park Limited

• 6.3 At the date of this document, none of the Directors or Senior Managers has at any time within the last five years:

• (a) had any convictions in relation to fraudulent offences for at least the previous five years;

• (b) been associated with any bankruptcy, receivership or liquidation while acting in the capacity of a member of the administrative, management or supervisory body or of senior manager of any company for at least the previous five years; or

• (c) has been subject to any official public incrimination and/or sanction of him by any statutory or regulatory authority (including any designated professional bodies) or has ever been disqualified by a court from acting as a director of a company or from acting

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as a member of the administrative, management or supervisory bodies of an issuer or from acting in the management or conduct of the affairs of any issuer for at least the previous five years,

• 6.4 None of the Directors or Senior Managers has any potential conflicts of interest between their duties to the Company and their private interests or other duties they may also have.

• 6.5 There are no family relationships between any Directors or Senior Managers.

• 6.6 There are no outstanding loans granted by the Company to the Directors or Senior Managers or any guarantees provided by the Company for the benefit of the Directors or Senior Managers.

• 6.7 Save as set out in paragraph 11 of this Part XIV – Additional Information of this Document, there are no service contracts or consultancy agreements between any of the Directors or Senior Managers and the Company or any of its subsidiaries and no such contract has been entered into or amended or replaced within the six months preceding the date of this document and no such contracts are proposed.

• 6.8 Save as set out in paragraph 11 of this Part XIV – Additional Information of this Document, the Directors and Senior Managers receive no Ordinary Shares or options over Ordinary Shares in lieu of remuneration or as any form of compensation.

• 6.9 Other than as disclosed in paragraph 11 of this Part XIV – Additional Information of this Document, the Company is not party to any service contract with any of the Directors or Senior Managers which provides for benefits on the termination of any such contract.

• 6.10 No Director or Senior Manager has any accrued pension or retirement benefits, other than statutory pension entitlements.

• 6.11 There is no arrangement under which any Director or Senior Manager has waived or agreed to waive future emoluments, save that on the date of this document Mr Austin agreed to waive any further entitlement to equity based compensation.

• 6.12 In the year ended 31 December 2016, the total aggregate remuneration paid, and benefits-inkind granted, to the Directors and Senior Managers was £219,626. The amounts payable to the Directors and Senior Managers by the Company under the arrangements in force at the date of this document in respect of the year ended 31 December 2017 are estimated to be £597,500 (excluding any discretionary payments which may be made under these arrangements).

• 6.13 Save as set out below, the Directors are not aware of any person who, directly or indirectly, had an interest in 3 per cent. or more of the voting rights of the Company as at the date of publication of this document and Admission:

publication of this document and Admission:
Shareholder Andrew Austin(1) Arunvill Capital Limited City Financial Investment Company Limited Legal & General Group Plc Macquarie Capital (Europe) Limited	No. of Ordinary Shares at the date of this document and Admission 3,548,335 2,666,666 1,500,000 1,133,333 999,998	Percentage of issued Ordinary Share capital at the date of this document and Admission
		23.01% 17.39% 12.17% 7.39% 6.52%

(1) Of the 3,548,335 Ordinary Shares held by Mr Austin, 2,828,335 Ordinary Shares are held by him legally and beneficially, the balance of 720,000 Ordinary Shares are held in his SIPP which is administered by Rowanmoor Trustees.

• 6.14 As at 13 February 2018 (being the latest practicable date prior to the publication of this document), the Company was not aware of any person or persons who, directly or indirectly, jointly or severally, exercise or could exercise control over the Company nor is it aware of any arrangements, the operation of which may at a subsequent date result in a change in control of the Company.

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• 6.15 There have been no public takeover bids by third parties in respect of the Company’s equity in the current financial year or the previous financial year.

• 6.16 Those interested, directly or indirectly, in 3 per cent. or more of the issued Ordinary Shares of the Company (as set out in paragraph 6.12 of this Part XIV – Additional Information of this Document) do not now, and, following Admission, will not, have different voting rights from other holders of Ordinary Shares.

Working Capital

The Company is of the opinion that the working capital available to the Group is sufficient for the present requirements of the Group, that is, for at least the next 12 months following the date of this document.

1. Significant Change

2. 8.1 Since 30 June 2017 (being the end of the last financial period of the Company for which financial information has been published), there has been no significant change in the trading position of the Company.

3. 8.2 Subsequent to the balance sheet date of 30 June 2017 the following significant changes to the Company’s financial position have occurred:

4. (a) on 6 July 2017, 5,333,334 Ordinary Shares were placed and a total of £8 million (£7.2 million net of placing costs) of capital was raised for the Company;

5. (b) on 22 December 2017, the Egerton Acquisition completed;

6. (c) on 22 December 2017, the Sojitz Acquisition completed, and the Company paid US$2.7m pursuant to the Sojitz Acquisition but benefited from a working capital receipt of US$1.9m; and

7. (d) on 8 December 2017, the Idemitsu UK Acquisition completed, and the total consideration was US$29.7m but the cash at bank held by the acquired entity was US$139.7m.

8. Litigation

There have been no governmental, legal or arbitration proceedings and the Company is not aware of any governmental legal or arbitration proceedings pending or threatened, nor of any such proceedings having been pending or threatened at any time preceding the date of this document which may have, or have had in the recent past, a significant effect on the financial position or profitability of the Group.

10. Material Contracts

The following are all of the contracts (not being contracts entered into in the ordinary course of business) that have been entered into by the Company since the Company’s incorporation which; (i) are, or may be, material to the Company or the Group; or (ii) contain obligations or entitlements which are, or may be, material to the Company as at the date of this document.

10.1 Egerton Acquisition Agreement

The terms of the Egerton Acquisition Agreement, as amended by side letter dated 21 June 2017, are detailed in Part VI – The Acquisitions and the Group of this document.

10.2 Sojitz Acquisition Agreement

The terms of the Sojitz Acquisition Agreement dated 3 August 2017, are detailed in Part VI – The Acquisitions and the Group of this document.

10.3 Idemitsu UK Acquisition Agreement

The terms of the Idemitsu UK Acquisition Agreement dated 18 October 2017, are detailed in Part VI – The Acquisitions and the Group of this document.

10.4 Warrant Instrument

A warrant instrument dated 8 January 2016 and made between Macquarie Capital (Europe) Limited and the Company pursuant to which the Company granted Macquarie Capital (Europe) Limited a warrant to acquire a number of Ordinary Shares equal to 1 per cent. of the issued share capital of the Company during the period commencing upon Initial Admission and ending on the third anniversary of Initial Admission. The warrant exercise price is the Issue Price in respect of the number of Ordinary Shares available under the warrant at Initial Admission and, in respect of any Ordinary Shares issued after Initial Admission, the mid-

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market closing price on the date upon which the Company announces any corporate action of event resulting in such further Ordinary Shares becoming the subject of the warrant. Macquarie may exercise the warrant at any time by paying the cash exercise price or by electing for nominal exercise. The warrant expires, to the extent not then previously exercised or terminated, on 13 January 2019.

10.5 Lock-in and orderly market agreement

(a) Andrew Austin

In connection with the Fundraise, Mr Austin entered into a lock-in and orderly market agreement dated 2 July 2017 (replacing and extending a lock-in and orderly market agreement on similar terms entered into on 12 January 2016) with the Company and Hannam, pursuant to which he has agreed that he will not transfer or dispose of, or grant option, or other rights (including any grant or right of security) directly or indirectly over any Ordinary Shares which he holds in the Company or any interests in the Ordinary Shares of the Company, for a period commencing on 6 July 2017 and ending on 6 July 2018 with a further 12 month orderly marketing arrangement. It is expected that the lock-in and orderly market agreement will terminate on 6 July 2019.

The restrictions on the ability of Mr Austin to transfer his Ordinary Shares are subject to certain usual and customary exceptions including for: transfers pursuant to the acceptance of, or provision of, an irrevocable undertaking to accept, a general offer made to all Shareholders on equal terms, transfers pursuant to an offer by or an agreement with the Company to purchase Ordinary Shares made on identical terms to all Shareholders, transfers made pursuant to any court order or if required by law, or transfers with the prior consent of the Company and Hannam. Mr Austin also agreed that, during the period commencing on 6 July 2018 and ending on 6 July 2019, he will not sell, pledge or otherwise dispose of any Ordinary Shares except through Hannam (or a third party broker nominated by Hannam) and in such orderly manner as Hannam may determine so as to ensure an orderly market for the issued share capital of the Company.

(b) Arunvill

Pursuant to the terms of the Egerton Acquisition Agreement, Arunvill agreed to enter into a lock-in and orderly market agreement dated 2 July 2017 with the Company and Hannam, pursuant to which it has agreed that it will not transfer or dispose of, or grant option, or other rights (including any grant or right of security) directly or indirectly over any Ordinary Shares which it holds in the Company or any interests in the Ordinary Shares of the Company, for a period commencing on 6 July 2017 and ending on 6 July 2018 with a further 12 month orderly marketing arrangement. In any event, this lock-in and orderly market agreement will terminate on the same date as Mr Austin’s lock-in and orderly market agreement.

The restrictions on the ability of Arunvill to transfer its Ordinary Shares are subject to certain usual and customary exceptions including for: transfers pursuant to the acceptance of, or provision of an irrevocable undertaking to accept, a general offer made to all Shareholders on equal terms, transfers pursuant to an offer by or an agreement with the Company to purchase Ordinary Shares made on identical terms to all Shareholders, transfers made pursuant to any court order or if required by law, or transfers with the prior consent of the Company and Hannam. Arunvill also agreed that, during the period commencing on 6 July 2018 and ending on 6 July 2019, it will not sell, pledge or otherwise dispose of any Ordinary Shares except through Hannam (or a third party broker nominated by Hannam) and in such orderly manner as Hannam may determine so as to ensure an orderly market for the issued share capital of the Company. In any event, the agreement will cease to be in effect from the day Mr Austin’s lock-in and orderly market agreement is terminated.

10.6 Registrar Agreement

The Company and the Registrar have entered into the Registrar Agreement dated 8 January 2016 pursuant to which the Registrar has agreed to act as registrar to the Company and to provide transfer agency services and certain other administrative services to the Company in relation to its business and affairs.

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The Registrar is entitled to receive the annual fee for creation and maintenance of the share register will be £1.25 per holder of ordinary shares appearing on the register during the fee year, with a minimum charge per annum of £2,500 for the provision of its services under the Registrar Agreement.

In addition to the annual fee, the Registrar is entitled to reimbursement for all out-of-pocket expenses incurred by it in the performance of its services.

The Registrar Agreement shall continue for an initial period of three years and thereafter will automatically renew for successive periods of 12 months unless and until terminated upon written notice by either party, by giving not less than six months’ written notice. In addition, the agreement may be terminated as soon as reasonably practicable if either party (i) commits a material breach of the agreement which has not been remedied within 45 days of a notice requesting the same; (ii) goes into liquidation (except voluntary) or becomes bankrupt or insolvent.

11. Related Party Transactions

11.1 Non-Executive Directors’ letters of appointment

Each of Richard Benmore and John Morrow have entered into a Director’s non-executive letter of appointment dated 22 December 2015 with the Company in respect of his appointment as a Director of the Company.

Under the terms of the appointment letters, Richard Benmore is entitled to a fee of £50,000 per annum and John Morrow is entitled to a fee of £50,000 per annum. Fees will accrue on a daily basis and will be payable in equal monthly instalments in arrears on the last Business Day of each month (or as otherwise agreed).

Each of the Directors appointments as a non-executive director of the Company, shall (subject to limited exceptions) be subject to termination by either party on six months’ written notice.

11.2 Service Agreement of Andrew Austin

Andrew Austin has entered into a service agreement with the Company dated 22 December 2015 with respect to his appointment as executive chairman of the Company and director responsible for implementation of the acquisition strategy. Mr Austin’s is a full-time employee of Rockrose. Mr Austin’s service agreement is capable of termination by either party giving 12 months’ notice in writing. Mr Austin is entitled to a salary of £385,000 per annum.

11.3 Senior Managers’ Service Agreements

Each of Peter Mann and Stephen (Steve) Pawson have entered into Senior Managers’ service agreements dated 3 August 2017 and 24 July 2017, respectively, with the Company in respect of their roles as managing director and finance director, respectively. Under the terms of the service agreements, Peter Mann is entitled to a fee of £135,000 per annum and Stephen (Steve) Pawson is entitled to a fee equal to £135,000 per annum. Fees will accrue on a daily basis and will be payable in equally monthly instalments in arrears on the last Business Day of each month (or as otherwise agreed). Each of the Senior Managers’ appointments as senior managers of the Company, shall (subject to limited exceptions) be subject to termination by either party on 3 months’ written notice.

11.4 Unapproved Share Option Plan

The Company believes that the incentive arrangements for the Directors and the Senior Managers should be focused on significant long-term value creation through the delivery of Shareholder returns in order to closely align the interests of Directors and the Senior Managers with those of Shareholders. Under the terms of the non-tax advantaged share option plan (the ‘‘Share Option Plan’’), the Board may issue options over shares up to 15 per cent. of the issued share capital of the Company from time to time.

To recognise the changing requirements of the business over time and to support growth objectives over the medium to long term, a long-term incentive structure has been put in place for Directors and the Senior Managers in the form of a non-tax advantaged share option plan. The structure of the Share Option Plan is designed such that participants will only benefit if significant value is delivered to Shareholders. Its implementation serves to ensure that:

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• Directors and Senior Managers, who are critical to executing the business strategy and driving value for shareholders, are appropriately attracted, retained and motivated;

• The reward structure supports a growth strategy and is heavily weighted towards shareholder value creation over the longer term;

• The interests of Directors and Senior Managers are closely aligned with those of Shareholders; and

• Directors and Senior Managers are provided with an appropriate opportunity to earn levels of reward provided significant returns are delivered to Shareholders.

On closing of the Fundraise in July 2017, Mr Austin held a total of 1,533,333 options over Ordinary Shares. On the date of this document Mr Austin agreed to exercise the options in full and waive all rights to any further options or equity based compensation. Absent the waiver, Mr Austin may have become entitled to further options if the share capital of the Company were to increase.

On the date of this document the Board, following a recommendation of the Remuneration Committee, made the following awards under the Share Option Plan:

		No. of	Exercise
		option	Price	Vesting Conditions
Peter	Mann	212,600	£1.27	In equal thirds on the frst,
Steve	Pawson	159,450	£1.27	second and third anniversaries
				of the date of grant

No payment has been made for the grant of any of the options.

The main features of the Share Option Plan are summarised below.

Eligibility

All executive directors and employees of the Company and any of its subsidiaries are eligible to participate in the Share Option Plan. The remuneration committee selects the individuals to whom options are to be granted from time to time.

Grant of options

Options may be granted at such time or times as the remuneration committee (or the Board, excluding any interested director, until a remuneration committee is formally established) determines.

Exercise price and adjustments to options

While the Ordinary Shares are admitted to trading on the Official List, the exercise price per Ordinary Share may not be less than the average of the middle market quotations for an Ordinary Share for the five dealing days immediately prior to the date of grant. While the Ordinary Shares are not admitted to trading on the Official List, the exercise price will be the amount specified by the remuneration committee. If the Ordinary Shares are newly issued the exercise price may not, in any event, be less than the nominal value of an Ordinary Share.

In the event of any variation in the share capital of the Company the exercise price and/or the number of Ordinary Shares comprised in each option may be adjusted as the remuneration committee determines. No adjustment may be made which will reduce the exercise price below the nominal value of an Ordinary Share.

Rights and restrictions

An option granted under the Share Option Plan is not transferable. The option certificate will specify when the option will lapse and such date may not be later than the tenth anniversary of its date of grant. Except in the circumstances referred to below, an option will only be exercisable on or after the date which is three years after the date of grant.

If the participant ceases to be employed by the Company by reason of injury, disability, illhealth or redundancy; or because the business or company that employs him is transferred out of the ultimate ownership of the Company, his option may be exercised within 6 months after such cessation or transfer. In the event of the death of a participant, the personal representatives of a participant may exercise his option within 6 months after the date of

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death. The extent to which an option may be exercised in these circumstances will be determined by reference to any exercise conditions and time vesting provisions set out in the option certificate unless the remuneration committee decides otherwise and is satisfied that any waiver of such provisions does not constitute a reward for failure.

On cessation of employment for any other reason (or when a participant serves or has been served with, notice of termination of such employment), the option will lapse unless the remuneration committee exercises its discretion to allow the exercise of the option for a period not exceeding 6 months from the date of such cessation or notice. In such circumstances and where exercise is permitted, the extent to which an option may be exercised will be determined by reference to any exercise conditions and time vesting provisions set out in the option certificate unless the remuneration committee decides otherwise and is satisfied that any waiver of such provisions does not constitute a reward for failure.

Corporate events

Options, to the extent not already exercisable, will become exercisable immediately prior to a change in control of the Company, in the event of a takeover of the Company, in the event that an offeror becomes entitled or bound to acquire Ordinary Shares or in the event that the court sanctions a compromise or arrangement for the reconstruction of the Company or its amalgamation with any other company. In such event, all options may be exercised for a limited period and will lapse to the extent not exercised.

Options, to the extent not already exercisable, will become exercisable in the event that the Company is proposed to be voluntarily wound up and all options may be exercised within a limited period in connection with the winding up, failing which they will lapse.

In such circumstances and where exercise is permitted, the extent to which an option may be exercised will be determined by reference to any exercise conditions set out in the option certificate unless the remuneration committee decides otherwise and is satisfied that any waiver of such provisions does not constitute a reward for failure.

Performance conditions

The exercise of options may be subject to the satisfaction of such performance conditions, if any, as may be specified and subsequently varied and/or waived by the remuneration committee.

Issuance of Ordinary Shares

The Ordinary Shares issued upon the exercise of options granted under the Share Option Plan will rank pari passu with the Company’s issued Ordinary Shares on the date of exercise, save as regards any rights arising by reference to a record date prior to the date of such exercise.

Plan limit

Options may not be granted under the Share Option Plan if such grant would result in the total number of ‘‘Dilutive Shares’’ exceeding 15 per cent. of the issued share capital of the Company from time to time. ‘‘Dilutive Shares’’ means, on any date, all shares of the Company which (a) have been issued, or transferred out of treasury, on the exercise of options granted, or in satisfaction of any other awards made, under any share incentive scheme (including the Share Option Plan) in the shorter of the five years ending on (and including) that date and the period since Admission; and (b) remain capable of issue, or transfer out of treasury, under any subsisting options granted by the Company.

Alternative settlement on exercise

Instead of delivering the number of Ordinary Shares specified in the exercise notice, the remuneration committee may make a cash payment with the option holder’s consent or deliver Ordinary Shares equal to the value of the Ordinary Shares over which the option is exercised less the relevant exercise price, or may deliver a combination of the two.

Alteration

The remuneration committee may alter the Share Option Plan except that (apart from minor amendments to benefit the administration of the Share Option Plan, to correct typographical or other errors, to take account of a change in legislation or to obtain or maintain favourable

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tax, exchange control or regulatory treatment for participants or the Company) no alteration to the advantage of participants or to the Share Option Plan limit described above can be made without the prior approval of Shareholders in general meeting.

No amendment may have a materially adverse effect on options granted before the amendment without the relevant optionholder’s consent.

Termination and Plan period

The remuneration committee may terminate or suspend the operation of the Share Option Plan at any time, whereupon no further options shall be granted but in all other respects the provisions of the Share Option Plan shall remain in force. In any event, no options may be granted after the date which is five years after the date the Share Option Plan is adopted.

11.5 Employee benefit trust

On 12 January 2016, Estera Trust (Jersey) Limited, as trustee on behalf of the Company’s employee benefit trust, subscribed for 1,200,000 Ordinary Shares, and funded its subscription by way of a loan from the Company which has been repaid in full. The Company’s employment benefit trust is in the process of being terminated and wound up.

11.6 lease

Andrew Austin leases the Company a property for office use. The lease commenced on 1 January 2017. The current rent is £48,000 per annum. Notice of termination with respect to the lease was given on 31 December 2017.

11.7 Related party transactions

Save as set out in paragraphs 11.1 to 11.6 of this Part XIV – Additional Information of this document, from 1 July 2015 (being the Company’s date of incorporation) up to and including the date of this document, the Company has not entered into any related party transactions.

12. Accounts

The Company’s annual report and accounts will be made up to 31 December in each year, with the first annual report and accounts covering the period from incorporation to 31 December 2016. It is expected that the Company will make public its annual report and accounts within four months of each financial year end (or earlier if possible) and that copies of the annual report and accounts will be sent to Shareholders within six months of each financial year end (or earlier if possible). It is expected that the Company will prepare its unaudited interim report for each six month period ending 30 June thereafter. It is expected that the Company will make public its unaudited interim reports within two months of the end of each interim period.

13. General

• 13.1 By a resolution of Shareholders passed on 29 June 2017, PricewaterhouseCoopers LLP whose address is 1 Embankment Place, London WC2N 6RH, were appointed as the first auditor of the Company. PricewaterhouseCoopers LLP is registered to carry out audit work by the Institute of Chartered Accountants in England and Wales and the Financial Reporting Council.

• 13.2 The Company currently has 14 employees, as at the date of this document.

• 13.3 The Company currently occupies the premises leased from Mr Austin (described at paragraph 11.6 of this Part XIV – Additional Information of this document) and has a lease of premises at 5[th] floor, Halton House, 20-23 Holborn, London EC1N 2JD, which is occupied on a shortterm lease at a cost of £97,500 per annum.

• 13.4 The total expenses incurred (or to be incurred) by the Company in connection with Admission are anticipated to be approximately £550,000.

• 13.5 The Company is not dependent on patents or licences, industrial, commercial or financial contracts or new manufacturing processes which are material to the Company’s business or profitability.

• 13.6 The information in this document which has sourced from third parties has been accurately reproduced and so far as the Company is aware and is able to ascertain from information published by such third parties, no facts have been omitted which would render the reproduced information inaccurate or misleading.

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• 13.7 There have been no interruptions in the business of the Company, which may have or have had in the 12 months preceding the publication of this document a significant effect on the financial position of the Company or which are likely to have a material effect on the prospects of the Company for the next 12 months.

• 13.8 The Directors are not aware of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on the Company’s prospects in the current financial year.

• 13.9 Principals and employees of Hannam own a total of 549,641 Ordinary Shares as at the date of this document.

• 13.10 The Company confirms that the Competent Person’s Report is dated within six months of the date of this document and that no material changes have occurred since the date of the Competent Person’s Report the omission of which would make the Competent Person’s Report misleading.

14. Consents

• 14.1 ERC Equipoise Limited has given and not withdrawn its written consent to the inclusion of its report in Part XVIII – Competent Person’s Report of this document and/or extracts therefrom and references thereto and to the inclusion of its name and references in the form and context in which they are included and has authorised the contents of those parts of this document which comprise its report for the purposes of Rule 5.5.3R(2)(f) of the Prospectus Rules.

• 14.2 PricewaterhouseCoopers LLP is a member firm of the Institute of Chartered Accountants in England and Wales and has given and not withdrawn its written consent to the inclusion of the report in Section B of Part IX – Unaudited Pro Forma Financial Information for the Enlarged Group of this document in the form and context in which it appears, and has authorised the contents of its report for the purpose of Rule 5.5.3R(2)(f) of the Prospectus Rules.

• 14.3 Hannam & Partners (Advisory) LLP has given and not withdrawn its written consent to the issue of this document with the inclusion of the references herein to its name in the form and context in which they appear.

• Documents available for inspection

• 15.1 Copies of the following documents may be inspected at the registered office of the Company at Cooley (UK) LLP, Dashwood, 69 Old Broad Street, London EC2M 1QS during usual business hours on any day (except Saturdays, Sundays and public holidays) for a period of 12 months following Admission:

• (a) the Memorandum and Articles of the Company;

• (b) the consent letters referred to in ‘‘Consents’’ in paragraph 14 of this Part XIV – Additional Information of this document;

• (c) the report of PricewaterhouseCoopers LLP, which is set out in Section B of Part IX – Unaudited Pro Forma Financial Information for the Enlarged Group of this document; and

• (d) this document.

• 15.2 In addition, this document will be published in electronic form and be available on the Company’s website at www.rockroseenergy.com, subject to certain access restrictions applicable to persons located or resident outside the United Kingdom.

Date: 14 February 2018

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PART XV

DEFINITIONS

DEFINITIONS	DEFINITIONS
The following defnitions apply throughout this document (unless the context requires otherwise):
‘‘ABEX’’	abandonment expenditure.
‘‘Acquisition Agreements’’	the Sojitz Acquisition Agreement, the Egerton Acquisition
	Agreement, and the Idemitsu UK Acquisition Agreement.
‘‘Admission’’	admission of the Ordinary Shares to Standard Listing and to
	trading on the Main Market of the London Stock Exchange
	becoming effective.
‘‘AIM’’	AIM, the market of that name operated by the London Stock
	Exchange.
‘‘Acquisitions’’	the Sojitz Acquisition, the Egerton Acquisition and the Idemitsu
	UK Acquisition.
‘‘Articles’’	the articles of association of the Company in force from time to
	time.
‘‘Audit Committee’’	a committee of directors of the Company, details of which appear
	inPart VIII – The Company, the Board, the Senior Managers and
	the Further Acquisition Strategy of this document.
‘‘Business Day’’	days (not being a Saturday, Sunday or public holiday) on which
	the banks are generally open for business in London, UK.
‘‘Arunvill’’	Arunvill Capital Limited.
‘‘certifcated’’ or ‘‘in certifcated	in relation to a share, warrant or other security, a share, warrant
form’’	or other security, title to which is recorded in the relevant register
	of the share, warrant or other security concerned as being held in
	certifcated form (that is, not in CREST).
‘‘change of control’’	the acquisition of Control of the Company by any person or party
	(or by any group of persons or parties who are acting in concert).
‘‘Companies Act’’	the UK Companies Act 2006.
‘‘Company’’ or ‘‘Rockrose’’	Rockrose Energy plc, a company incorporated in England and
	Wales with registered number 09665181.
‘‘Competent Person’s Report’’	the report prepared by ERC Equipoise.
‘‘Control’’	(i) the power (whether by way of ownership of shares, proxy,
	contract, agency or otherwise) to: (a) cast, or control the casting
	of, more than 50 per cent., of the maximum number of votes that
	might be cast at a general meeting of the Company; or (b) appoint
	or remove all, or the majority, of the Directors or other equivalent
	offcers of the Company; or (c) give directions with respect to the
	operating and fnancial policies of the Company with which the
	Directors or other equivalent offcers of the Company are obliged
	to comply; and/or (ii) the holding benefcially of more than 50 per
	cent., of the issued shares of the Company (excluding any issued
	shares that carry no right to participate beyond a specifed
	amount in a distribution of either profts or capital), but excluding
	in the case of each of (i) and (ii) above any such power or holding
	that arises as a result of the issue of Ordinary Shares by the
	Company in connection with further acquisitions.

• ‘‘CREST’’ the paperless settlement system operated by Euroclear enabling securities to be evidenced otherwise than by certificates and transferred otherwise than by written instruments.

‘‘CREST Regulations’’ the Uncertificated Securities Regulations 2001 (SI 2001 No. 3755).

‘‘DSA’’

decommissioning security agreement.

100

‘‘Directors’’ or ‘‘Board’’

‘‘Disclosure Guidance and Transparency Rules’’ or ‘‘DTRs’’

‘‘EEA’’ or ‘‘European Economic Area’’

‘‘EEA States’’

‘‘Egerton’’

‘‘Egerton Acquisition’’

the directors of the Company, whose names appear in Part VIII – The Company, the Board, the Senior Managers and the Further Acquisition Strategy of this document, or the board of directors from time to time of the Company, as the context requires, and ‘‘Director’’ is to be construed accordingly. the disclosure guidance and transparency rules of the FCA made in accordance with section 73A of FSMA.

the EU, Iceland, Norway and Liechtenstein.

the member states of the EU and the European Economic Area, and each, an ‘‘EEA State’’.

Egerton Energy Ventures Limited, a company incorporated in England and Wales with company number 08724360. the acquisition of the entire issued share capital of Egerton by Rockrose (UKCS1) from the Egerton Sellers pursuant to the terms of the Egerton Acquisition Agreement.

‘‘Egerton Acquisition the share purchase agreement between Rockrose (UKCS1) and Agreement’’ the Egerton Sellers dated 22 March 2017 relating to the Egerton Acquisition. ‘‘Egerton Sellers’’ Arunvill. ‘‘EHS’’ environmental and health and safety. ‘‘Enlarged Group’’ the Group following the completion of the Acquisitions. ‘‘ERC Equipoise’’ or ‘‘ERCE’’ ERC Equipoise Limited. ‘‘EU’’ the Member States of the European Union. ‘‘Euroclear’’ Euroclear UK & Ireland Limited. ‘‘FCA’’ the United Kingdom Financial Conduct Authority. ‘‘FLE’’ field life extension. ‘‘FPSO’’ floating production and storage unit. ‘‘FSMA’’ the UK Financial Services and Markets Act 2000. ‘‘Fundraise’’ the subscription by Arunvill for 2,666,666 Ordinary Shares and the subscription by certain of the Directors, certain of their spouses and certain third parties for 967,074 Ordinary Shares, and placing of 1,699,594 Ordinary Shares, which completed on 6 July 2017. ‘‘general meeting’’ a meeting of the Shareholders of the Company or a class of Shareholders of the Company (as the context requires). ‘‘Group’’ the Company and its subsidiaries, from time to time. ‘‘Hannam’’ or ‘‘Financial Adviser Hannam & Partners (Advisory) LLP. and Broker’’ ‘‘IASB’’ International Accounting Standards Board. ‘‘Idemitsu Group’’ Idemitsu Kosen Co., Limited. ‘‘Idemitsu UK’’ Idemitsu Petroleum UK Limited. ‘‘Idemitsu UK Acquisition’’ the Company’s acquisition of the entire issued share capital of Idemitsu UK from Idemitsu Group pursuant to the terms of the Idemitsu UK Acquisition Agreement.

‘‘Idemitsu UK Acquisition the sale and purchase agreement between the Company, and Agreement’’ Idemitsu Group dated 17 October 2017 relating to the Idemitsu UK Acquisition.

101

‘‘IFRS’’

‘‘Initial Admission’’

‘‘ISA’’

• ‘‘ISIN’’

International Financial Reporting Standards, as adopted in the EU.

admission of the Ordinary Shares to Standard Listing and to trading on the Main Market of the London Stock Exchange on 13 January 2016.

individual savings account.

International Securities Number.

‘‘Listing Rules’’ the listing rules made by the FCA under section 73A of FSMA. ‘‘London Stock Exchange’’ London Stock Exchange plc.

• ‘‘Maersk’’

• ‘‘Maersk Acquisition’’

• ‘‘Maersk Acquisition Agreement’’

• ‘‘Maersk Interests’’

Maersk Oil North Sea UK Ltd.

the proposed acquisition of the Scott and Telford Interests by Rockrose (UKCS1) pursuant to the terms of the Maersk Acquisition Agreement, which will now not proceed.

the sale and purchase agreement between Rockrose (UKCS1) and Maersk dated 21 December 2016 relating to the Maersk Acquisition which has now expired in accordance with its terms.

• the Scott and Telford Interests.

‘‘Main Market’’ the main market for listed securities for the London Stock Exchange. ‘‘Memorandum’’ the memorandum of association of the Company in force from time to time. ‘‘MER UK Strategy’’ the UK Government’s ‘‘Maximising Economic Strategy for the UK’’.

• ‘‘Nomination Committee’’

‘‘NPV’’

• ‘‘ List’’

a committee of directors of the Company, details of which appear in Part VIII – The Company, the Board, the Senior Managers and the Further Acquisition Strategy of this document.

net present value.

the official list maintained by the UKLA.

• ‘‘OGA’’ the UK Oil and Gas Authority.

• ‘‘Ordinary Shares’’

• ‘‘Overseas Shareholders’’

• ‘‘Premium Listing’’

• ‘‘Prospectus Directive’’

• ‘‘Prospectus Directive Regulation’’ or ‘‘PD Regulation’’

• ‘‘Prospectus Rules’’

• ‘‘Registrar’’

• ‘‘Registrar Agreement’’

• ‘‘Regulation S’’

the ordinary shares of nominal value of £0.20 each in the capital of the Company. Shareholders residing in, or subject to, any jurisdiction outside the United Kingdom.

a listing on the premium listing segment of the Official List under Chapter 6 of the Listing Rules.

Directive 2003/71/EC of the European Parliament and of the Council on the prospectus to be published when securities are offered to the public or admitted to trading.

Commission Regulation (EC) No. 809/2004.

the prospectus rules of the UKLA made in accordance with section 73A of FSMA.

Link Asset Services or any other registrar appointed by the Company from time to time.

the registrar agreement dated 8 January 2016 between the Company and the Registrar details of which are set out in Part XIV – Additional Information of this document.

Regulation S promulgated under the US Securities Act.

102

‘‘Remuneration Committee’’

• ‘‘Reverse Takeover’’

• ‘‘Risk and Disclosure Committee’’

• ‘‘Rockrose (UKCS1)’’

a committee of directors of the Company, details of which appear in Part VIII – The Company, the Board, the Senior Managers and the Further Acquisition Strategy of this document.

a reverse takeover as defined in the Listing Rules.

a committee of directors of the Company, details of which appear in Part VIII – The Company, the Board, the Senior Managers and the Further Acquisition Strategy of this document. Rockrose (UKCS1) Limited, a private limited company incorporated in England and Wales with registered number 10448997, which is dormant.

‘‘Scott and Telford Interests’’ the 5.16 per cent. interest in the Scott field and the 2.36 per cent. interest in the Telford field which it was intended that Rockrose (UKCS1) may acquire from Maersk. ‘‘Securities Act’’ the US Securities Act of 1933. ‘‘SEDOL’’ Stock Exchange Daily Official List.

• ‘‘Senior Managers’’

the senior management team of the Company, whose names appear in Part VII – The Company, the Board, the Senior Managers and the Further Acquisition Strategy of this document, and ‘‘Senior Manager’’ is to be construed accordingly.

• ‘‘Share Dealing Code’’

the Company’s policy on directors’, senior managers’ and employees’ dealings in securities.

‘‘Shareholder’’ a holder of Ordinary Shares. ‘‘Share Option Plan’’ the Company’s non-tax advantaged share option plan; ‘‘SIPP’’SIPP’’’’ Self-Invested Personal Pension. ‘‘Sojitz’’ Sojitz Energy Project Limited, a company incorporated in England and Wales with company number 04620801. ‘‘Sojitz Acquisition’’ the acquisition of the entire issued share capital of Sojitz by Rockrose (UKCS1). ‘‘Sojitz Acquisition Agreement’’ the sale and purchase agreement between the Company and Sojitz Sellers dated 3 August 2017 relating to the Sojitz Acquisition.

‘‘SIPP’’SIPP’’’’

• ‘‘Sojitz Sellers’’

Sojitz Corporation and Sojitz Europe plc.

• ‘‘Standard Listing’’ a standard listing under Chapter 14 of the Listing Rules. ‘‘Takeover Code’’ the City Code on Takeovers and Mergers.

• ‘‘Takeover Panel’’

‘‘TIDM’’

‘‘UK Corporate Governance Code’’ ‘‘UKLA’’

• ‘‘uncertificated’’ or ‘‘ form’’

• ‘‘United Kingdom’’ or ‘‘UK’’ ‘‘United States’’ or ‘‘US’’

the UK Panel on Takeovers and Mergers.

Tradeable Instrument Display Mnemonic.

the UK Corporate Governance Code issued by the UK Financial Reporting Council.

the FCA in its capacity as the competent authority for listing in the UK pursuant to Part VI of FSMA.

in relation to a share or other security, a share or other security, title to which is recorded in the relevant register of the share or other security concerned as being held in uncertificated form (that is, in CREST) and title to which may be transferred by using CREST.

the United Kingdom of Great Britain and Northern Ireland.

the United States of America.

103

References to a ‘‘company’’ in this document shall be construed so as to include any company, corporation or other body corporate, wherever and however incorporated or established.

All references to legislation in this document are to the legislation of England and Wales unless the contrary is indicated. Any reference to any provision of any legislation shall include any amendment, modification, re-enactment or extension thereof. Words importing the singular shall include the plural and vice versa, and words importing the masculine gender shall include the feminine or neutral gender.

For the purpose of this document, ‘‘subsidiary’’ and ‘‘subsidiary undertaking’’ have the meanings given by the Companies Act.

104

PART XVI

HISTORICAL FINANCIAL INFORMATION ON THE COMPANY

Rockrose	Interim	Report for the six months ended 30 June 2017	R-1
Rockrose	Annual	Report for the period ended 31 December 2016	R-11
Rockrose	Interim	Report for the six months ended 30 June 2016	R-45
Rockrose	Interim	Report for the period from incorporation on 1 July 2015 ended 31 December	R-72
2015

105

29 September 2017

RockRose Energy plc

(‘‘RockRose’’ or ‘‘the Company’’)

Interim Results

RockRose Energy PLC (‘‘RockRose’’ or the ‘‘Company’’) is pleased to announce to announce its interim results for the six months ended 30 June 2017.

Chairman’s Statement

A fundraise of £8million gross was completed on the 6th July 2017 (after the interim balance sheet date), underpinning the continued development of the company in its stated strategy of pursuing targeted acquisitions to create a scalable energy business with a capital efficiency that is able to deliver shareholder returns in a low oil price environment. Having reviewed numerous opportunities within the market to enhance the company’s position in the UKCS and northern Europe we are convinced that now is the optimum time in the exploration and production life cycle in these areas for smaller niche companies like RockRose to acquire assets from much larger companies for whom such assets are no longer material.

The company is well placed to take its strategy forward given the restatement by the government of their MER Strategy to Maximise the Economic Recovery of oil in the North Sea. We are also encouraged by the statements from the Minister and the head of the Oil and Gas Authority that the overall cost of decommissioning in the North Sea is targeted to be reduced by some 35% (OGA – UKCS Decommissioning 2017 Cost Estimate Report). This has recently been reinforced by the Chancellor Philip Hammond in his speech on the 25th September, with the stated intention ‘‘to extract every possible last commercially-viable molecule from the basin’’.

The company is working towards completing the previously reported Maersk, Sojitz and Egerton transactions, which it is looking to complete early in Q4 of 2017. It is also advancing other transactions that will enable RockRose to become a significant producer in the region.

At the end of the period and prior to the fund raise the Total Assets for the company stood at £2,524,281.

The Risks and Uncertainties are unchanged from the last reporting period and are described in detail in our annual report for 2016.

Ends

Enquiries: RockRose Energy plc +44 (0)20 3826 4800 Broker Hannam & Partners (Advisory) LLP +44 (0)20 7907 8500 Giles Fitzpatrick / Andrew Chubb Financial PR Camarco +44 (0)20 3757 4980

Billy Clegg Georgia Edmonds Ollie Head

For further information, please visit the Company’s updated website at www.rockroseenergy.com.

R-1

STATEMENT OF DIRECTORS RESPONSIBILITIES

The directors confirm, to the best of their knowledge, that these condensed interim financial statements have been prepared in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’, as adopted by the European Union and that the interim management report includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely:

• an indication of important events that have occurred during the period and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the period; and

• material related-party transactions in the period, and any material changes in the related party transactions described in the annual report.

• By order of the Board

Andrew Austin Executive Chairman

R-2

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 JUNE 2017

Notes Administrative expenses 6 Exceptional Items 7 Operating loss Finance Income Finance costs Loss before tax Tax Loss for the period and total comprehensive expense Basic and diluted loss per share 12	Six months ended 30 June 2017 £ (1,381,377) (529,375) (1,910,752) 845 — (1,909,907) — (1,909,907) (0.1910)	Six months ended 30 June 2016 £ (263,072) (42,434) (305,506) 2,163 (1) (303,344) — (303,344) (0.0303)

The notes are an integral part of these condensed interim financial statements.

R-3

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2017 (Registered number: 09665181)

Notes Assets Current Assets Trade and other receivables 8 Cash and cash equivalents 9 Total Assets Equity and Liabilities Current Liabilities Trade and other payables 10 Total liabilities Share Capital and Reserves Share Capital 11 Share Premium 11 Accumulated Losses Share Option Reserve Total Equity and Liabilities	30 June 2017 £ 31 December 2016 £ 1,085,433 244,428 1,438,848 2,387,968 2,524,281 2,632,396 2,204,386 441,042 2,204,386 441,042 2,000,000 2,000,000 2,224,816 2,224,816 (4,020,264) (2,110,357) 115,343 76,895 319,895 2,191,354 2,524,281 2,632,396

These financial statements were approved by the Board of Directors on 28th September 2017 and were signed on its behalf by:

……………………………………

A. P. Austin Director

The notes are an integral part of these condensed interim financial statements.

R-4

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2017

Balance at 1 January 2017 Cumulative loss for the period Total comprehensive loss Share option charges Total transactions with owners Balance at 30 June 2017	Share Capital £ 2,000,000 — — — — 2,000,000	Share Premium £ 2,224,816 — — — — 2,224,816	Accumulated Losses £ (2,110,357) (1,909,907) (1,909,907) — — (4,020,264)	Share Option Reserve £ 76,895 — — 38,448 38,448 115,343	Total £ 2,191,354 (1,909,907) (1,909,907) 38,448 38,448 319,895

The notes are an integral part of these financial statements.

R-5

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 JUNE 2017

Notes Cash fows from operating activities Loss for the period Share based payments Finance cost Finance income Increase in trade and other receivables Increase in other trade and payables Cash used in operating activities Cash fows from investing activities Interest paid Interest received Net cash generated from investing activities Cash fows from fnancing activities Proceeds from issue of shares net of treasury shares Net cash generated from fnancing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning period Cash and cash equivalents at the end of period 9	Six months ended 30 June 2017 £ (1,909,907) 38,448 — (845) (841,005) 1,763,344 (949,965) — 845 845 — — (949,120) 2,387,968 1,438,848	Six months ended 30 June 2016 £ (303,344) — 1 (2,163) 173,495 (1,132,385) (1,264,396) (1) 2,163 2,162 4,400,000 4,400,000 3,137,766 78 3,137,844

The notes are an integral part of these condensed interim financial statements.

R-6

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2017

1 General information

Rockrose Energy Plc (‘the company’) has been formed to make acquisitions of companies or businesses in the upstream oil and gas and power sector.

The company is a public limited company incorporated on 1 July 2015, which is listed on the London Stock Exchange and incorporated and domiciled in the UK. The address of its registered office is Dashwood House, 69 Old Broad Street, London.

These condensed interim financial statements were approved for issue on 28th September 2017.

These condensed interim financial statements do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 December 2016 were approved by the board of directors on 31 March 2017 and delivered to the Registrar of Companies. The report of the auditors on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under section 498 of the Companies Act 2006.

These condensed interim statements have not been reviewed nor audited.

2 Basis of preparation

These condensed interim financial statements for the six months ended 30 June 2017 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and with IAS 34, ‘Interim financial reporting’, as adopted by the European Union. The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2016, which have been prepared in accordance with IFRSs as adopted by the European Union.

Consolidation

The consolidated financial statements include the financial statements of the Company and its subsidiary for the six months ended 30 June 2017. Subsidiaries are all entities over which the group has control. The group controls an entity when the group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the group.

Going concern

These interim condensed consolidated financial statements have been prepared on a going concern basis. With the successful fundraise post the balance sheet date the directors are satisfied that the company has sufficient resources to continue in operation for the foreseeable future, a period of not less than twelve months from the date of this report. Accordingly they continue to adopt the going concern basis in preparing the interim condensed statements.

Segment reporting

In the opinion of the directors the operations of the company represent one segment, and are treated as such, when evaluating its performance. The chief operating decision maker is the Board of Directors. The Board of Directors reviews management accounts prepared for the company when assessing performance.

3 Accounting policies

The accounting policies applied in these condensed financial statements are consistent with those followed in the preparation of the Group’s financial statements for the year ended 31 December 2016.

A number of amendments to IFRSs became effective for the financial year beginning on 1 January 2017 however the group did not have to change its accounting policies or make material retrospective adjustments as a result of adopting these new standards.

R-7

4 Estimates

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

In preparing these condensed interim financial statements, the significant judgements made by management in applying the company’s accounting policies and the key accounting estimates are the accruals and going concern evaluation. Other than the evaluation of going concern and accruals, the company’s financial statements do not contain any significant accounting estimates.

5 Financial risk management

As at 30 June 2017 the company’s financial instruments consisted of cash and cash equivalents, trade and other receivables and trade and other payables including accrued liabilities. With respect to all of these financial instruments, the company estimates that their fair values approximate their carrying values at 30 June 2017 based on the nature of those instruments.

The company’s risk exposures and impact on the company’s financial instruments are summarised below:

Credit risk

The company’s credit risk is primarily attributable to cash, which is held in Metro Bank.

Market risk

(a) Interest rate risk

Cash balances do not generate material amounts of interest. There are no other interest bearing financial instruments therefore the company is not exposed to interest rate risk.

(b) Foreign currency risk

All the balances as of 30 June 2017 and the transactions for the six month period then ended were denominated in UK £ which is the company’s functional and presentation currency. The company is therefore not exposed to foreign currency risk.

Capital management

The capital of the company is represented by the net assets attributable to holders of ordinary shares. The company’s objective when managing capital is to safeguard the company’s ability to continue as a going concern and fund development, in order to provide returns for shareholders and benefits for other stakeholders. The company has not paid dividends, nor returned capital to the shareholder to date. The company is not subject to externally imposed capital requirements.

6 Administrative expenses

These include salaries and directors fees, periodic listing fees, printing, advertising and distribution costs and professional advisory fees, including legal fees, any other applicable expenses and office overheads.

7 Exceptional items

Exceptional items include professional fees incurred in relation to potential acquisitions.

R-8

8 Trade and other receivables

VAT receivable Prepayments	Group 30 June 2017 £ 224,676 860,757 1,085,433	Group 31 December 2016 £
		156,977 87,451
		244,428

Prepayments include an amount of £771,658 relating to transaction costs for placing of new shares which were issued, subsequent to the period end, on 6th July 2017.

9 Cash and cash equivalents

Cash at bank Short term deposit	Group 30 June 2017 £ 49,914 1,388,934 1,438,848	Group 31 December 2016 £
		529,560 1,858,408
		2,387,968

10 Trade and other payables

Trade payables Accruals Other payables Share capital and share premium Balance at 1 January 2017 & 30 June 2017	Number of shares 10,000,000	Group 30 June 2017 £ 1,207,106 463,566 533,714 2,204,386 Share capital £ 2,000,000	Group 31 December 2016 £
			18,261 396,615 26,166
			441,042
			Share premium £
			2,224,816

11 Share capital and share premium

R-9

12 Loss per share

Basic earnings per share amounts are calculated by dividing the profit for the period by the weighted average of shares outstanding during the period.

Loss for the period attributable to the shareholders Weighted average number of shares Basic and diluted loss per share	Six Months ended 30 June 2017 £ (1,909,907) 10,000,000 (0.1910)	Six Months ended 30 June 2016 £
		(303,344) 10,000,000
		(0.0303)

13 Related party transactions

During the six month period ended 30 June 2017, the company maintained a loan account with the director, A P Austin. The amounts owed from the director totalled £9,921.

Directors’ fees	Six Months ended 30 June 2017 £
	665,948

Directors’ fees include share based payment costs, accrued bonuses related to the placing and directors’ in kind.

14 Subsequent events

On 6th July 2017, 5,333,334 shares were placed and a total of £8 million (£7.2 million net of placing costs) of capital was raised.

R-10

ROCKROSE ENERGY PLC

ANNUAL REPORT

FOR THE PERIOD ENDED 31 DECEMBER 2016

R-11

COMPANY INFORMATION Directors A P Austin R A Benmore J A Morrow Company secretary Cooley Services Limited Company number 09665181 Registered office C/O Cooley (UK) LLP Dashwood House 69 Old Broad Street London EC2M 1QS Accountant Price Bailey LLP 7th Floor Dashwood House 69 Old Broad Street London EC2M 1QS Auditors PricewaterhouseCoopers LLP 1 Embankment Place London WC2N 6RH Bankers Metro Bank One Southampton Row London WC1B 5HA

R-12

CONTENTS

	Page
Strategic Report and Remuneration Report	2-8
Directors’ Report	9-11
Independent auditors’ report	12-13
Consolidated income statement and statement of comprehensive income	14
Consolidated statement of fnancial position	15
Company statement of fnancial position	16
Consolidated statement of changes in equity	17
Company statement of changes in equity	18
Consolidated statement of cash fows	19
Company statement of cash fows	20
Notes to the fnancial statements	21-34

R-13

STRATEGIC REPORT

Strategic report

A RockRose is a plant that grows in harsh environments with minimal external support. Creating an energy company that is equipped to do business in the harsh environment of sub $50 oil with a minimal cost base was the strategy behind the establishment of RockRose Energy Plc (‘the Company’) in 2015.

After listing as an acquisition vehicle on the London Stock Exchange in January 2016, the Company has evaluated more than 35 opportunities. These have ranged from onshore production assets to pipelines and electricity generating assets. The focus is on mature cash producing assets in politically stable geographies, particularly the UK.

In September 2016 the Company announced that it had agreed a heads of terms with Maersk Oil North Sea UK Ltd for a package of UK based production assets and subsequently signed a sales and purchase agreement in December 2016. Following partner pre-emption and approval RockRose is now acquiring a 5.16% interest in the Scott field and a 2.36% interest in the Telford field. Both Fields are operated by Nexen Petroleum. Following extensive due diligence and rising oil prices since the commercial terms of the deal were struck, the Company sees the potential for significant upside through improving production following recent drilling activity and extending the life.

Subsequent to 31 December 2016, RockRose has also agreed to acquire the entire share capital of Egerton Ventures Ltd, which holds a 8.33% interest in the Mordred field and a 27.8% interest in the Galahad field. Both assets are operated by Perenco and are near cessation in production. However again, the Company sees upside in the potential delay in decommissioning from enhanced production and hydrocarbon prices.

Rockrose is committed to minimising the overheads and administrative costs of running the assets, using a small executive team and purchasing other services as required.

Looking forward, RockRose continues to evaluate other complementary acquisitions, with the aim of building a material energy business that is equipped to flourish in the prevailing harsh hydrocarbon price environment. In short, Opportunities… Enhanced.

Financial Review

At 31 December 2016 the Group had net assets of £2.2 million. The main costs incurred in the 18 month period since incorporation of the Company in July 2015 have been the costs of listing. Since listing on the London Stock Exchange there have also been costs in evaluating various acquisition opportunities. The costs of operating the business have been as anticipated at the time of listing in January 2016. During the period, minimising Administrative Expenses was the key KPI for the Company.

Risks and uncertainties

During the period while the Company was sourcing acquisition opportunities risks and uncertainties were limited. Now that an acquisition has been agreed a wider range of risks and uncertainties exist. These include (but are not limited to) changes in exchange rates, commodity prices, government legislative changes, environmental regulation and operator performance. The timing of cessation of production on the assets to be acquired and the subsequent costs of decommissioning may also have a significant impact on the Company.

The board of directors is committed to monitoring and managing these risks on behalf of shareholders.

A. P. Austin On behalf of the Board 31 March 2017

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DIRECTORS’ REMUNERATION REPORT

Directors’ remuneration policy.

In 2017, the Company intends to form a Remuneration Committee to set clear objectives for each individual Director relating to Company KPIs plus individual and strategic targets taking into account where an individual has particular influence and responsibility.

The Company’s policy is to maintain levels of remuneration sufficient to attract, motivate and retain senior executives of the highest calibre who can deliver growth in shareholder value. Executive Director remuneration currently consists of basic salary and benefits. It is envisaged that an annual bonus, and long term incentives will be introduced in line with the Company’s expansion. The Company will seek to strike an appropriate balance between fixed and performance-related reward so that the total remuneration package is structured to align a significant proportion to the achievement of performance targets, reinforcing a clear link between pay and performance. The performance targets for staff, senior executives and the Executive Directors will be each aligned to the key drivers of the business strategy, thereby creating a strong alignment of interest between staff, Executive Directors and shareholders.

The Board will continue to review the Company’s remuneration policy and make amendments, as and when necessary, to ensure it remains fit for purpose and continues to drive high levels of executive performance and remains both affordable and competitive in the market.

Future Policy Table

As mentioned above it is the Company’s intention to form a Remuneration Committee. Where the term ‘‘Board’’ is mentioned in the following table the responsibility will be assumed by the Remuneration Committee once formed.

Element of reward – Base Salary

Purpose and Link to Strategy	To provide fxed remuneration to help recruit and retain key individuals; refect the individual’s experience, role and contribution within the Company.
Operation	The Board takes into account a number of factors when setting salaries, including: scope and complexity of the role the skills and experience of the individual salary levels for similar roles within the industry pay elsewhere in the Company Salaries are reviewed, but not necessarily increased, annually with any increase usually taking effect in January.
Performance conditions	None
Maximum opportunity	The current base salary of the Directors can be found in the Directors’ Remuneration section. Salary increases are normally made with reference to the average increase for the Company’s wider employee population. The Board retains discretion to make higher increases in certain circumstances, for example, following an increase in the scope and/or responsibility of the role or the development of the individual in the role or by benchmarking.

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Element of reward – Other benefts

Purpose and Link to Strategy	To provide a basic benefts package
Operation	The Company provides Executive Directors with medical insurance for themselves and their family
Performance conditions	None
Maximum opportunity	Maximum opportunity will be whatever it costs to provide the beneft.

Element of reward – Annual Bonus

Purpose and Link to Strategy	To incentivise and reward the achievement of annual fnancial, operational and individual objectives which are key to the delivery of the Company’s short-term strategy.
Operation	Executive Directors and staff are eligible to participate in a discretionary bonus plan. The Board will determine on an annual basis the level of deferral, if any, of the bonus payment into Company shares. Maximum bonus levels and the proportion payable for on target performance are considered in the light of market bonus levels for similar roles among the industry sector. Bonuses are not pensionable. Objectives are set annually to ensure that they remain targeted and focused on the delivery of the Company’s short-term goals which will usually be based on the annual budget The Board sets targets which require appropriate levels of performance, taking into account internal and external expectations of performance As soon as practicable after the year-end, the Board meets to review performance against objectives and determines payout levels. * In terms of bonus targets a balanced scorecard approach is operated which focuses on a mixture of strategic, operational, fnancial and non-fnancial metrics. Examples of fnancial measures will include net sales and net proft targets. Financial measures will typically represent the majority of the bonus with other, non-fnancial measures representing the balance.
Performance conditions	At least 50% of the award will be assessed against Company metrics including operational, fnancial and non-fnancial performance. The remainder of the award will be based on performance against individual objectives. A sliding scale of between 0% and 100% of the maximum award is paid dependent on the level of performance.
Maximum opportunity	The maximum potential bonus entitlement for Executive Directors under the plan is up to 150% of base salary.

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Element of reward – Long Term Incentive Plan (LTIP)

Purpose and Link to Strategy	To incentivise and reward the creation of long-term shareholder value. To align the interests of the Executive Directors with those of Shareholders.
Operation	Under the terms of the non-tax advantaged share option pan (the ‘‘Share Option Plan’’), the Board may issue options over shares up to 15% of the issued share capital of the Company from time to time. Directors and employees are eligible for awards. The exercise of options may be subject to the satisfaction of such performance conditions, if any, as may be specifed and subsequently varied and/or waived by the Board. The Board determines on an annual basis, and from time to time as needed (i.e., new employee or promotion), the type of awards to be granted to executives and other employees under the plan.
Performance conditions	Vesting of the awards is dependent on fnancial, operational and/or share price measures, as set by the Board, which are aligned with the long-term strategic objectives of the Company. The relevant performance conditions will be set by the Board on the award of each grant but will include a mixture of strategic, operational, fnancial and non-fnancial metrics. In respect of the option granted to Andrew Austin (details of which are set out in the Remuneration Report) the following performance conditions must also be satisfed before his option may be exercised: the Company must have completed at least one acquisition resulting in the market capitalisation of the Company increasing by at least 500 per cent from Initial Admission based on a starting price of 50p per Ordinary Share; the option may not be exercised at a time when, in the opinion of the remuneration committee there has been public criticism by any appropriate regulatory authority of the Company’s operations or those of any of its subsidiaries which results in a material negative impact on the business of the Company
Maximum opportunity	No one eligible person (individually or deemed to be acting in concert with other persons for the purposes of the City code including shares already held) can exceed 29.9% of the Company’s issued share capital.

Notes on Table

The Board may make minor amendments to the Policy set out above for regulatory, exchange control, tax or administrative purposes or to take account of a change in legislation without obtaining Shareholder approval for that amendment. Any major changes will be put to a shareholder vote at the next AGM or an EGM.

Policy on payment for loss of office

In the event that the employment of an Executive Director is terminated, any compensation payable will be determined in accordance with the terms of the service contract between the Company and the employee, as well as the rules of any incentive plans. Notice periods are set at up to a maximum of twelve months by either party.

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The Company considers a variety of factors when considering leaving arrangements for an Executive Director, including individual and business performance, the obligation for the Director to mitigate loss (for example by gaining new employment) and other relevant circumstances (e.g. ill health).

If the Executive Director’s employment is terminated by the Company, the Executive Director may receive a time pro-rated bonus to the period worked subject to performance in that period, subject to Board discretion.

The treatment of outstanding share awards is governed by the relevant share plan rules. The following table summarises the leaver provisions of share plans under which Executive Directors may currently hold awards.

Leaving Event	Time period	Conditions
Injury, disability, ill-health, redundancy	Option may be exercised within 6 months of leaving.	Exercise and time vesting provisions per the option certifcate. Board can waive if satisfed that such waiver is not rewarding failure.
Death	Option may be exercised by personal representatives within 6 months of death.	Exercise and time vesting provisions per the option certifcate. Board can waive if satisfed that such waiver is not rewarding failure.
Employing company transferred out of group.	Option may be exercised within 6 months of transfer.	Exercise and time vesting provisions per the option certifcate. Board can waive if satisfed that such waiver is not rewarding failure.
Resignation or any other reason not mentioned above.	Lapse of option unless Board exercises discretion to allow exercise of option in which case 6 months of leaving/ notice.	If allowed to exercise; Exercise and time vesting provisions per the option certifcate. Board can waive if satisfed that such waiver is not rewarding failure.

Recruitment policy

In determining remuneration for new appointments to the Board, the Board will consider all relevant factors including, but not limited to, the calibre of the individual and their existing package, the external market and the existing arrangements for the Company’s current Executive Directors, with a view that any arrangements offered are in the best interests of the Company and shareholders and without paying any more than is necessary.

Where the new appointment is replacing a previous Executive Director, salaries and total remuneration opportunity may be higher or lower than the previous incumbent. If the appointee is expected to develop into the role, the Board may decide to appoint the new Executive Director to the Board at a lower than typical salary. Larger increases (above those of the wider employee population) may be awarded over a period of time to move closer to market level as their experience develops. Benefits and other elements of remuneration will normally be limited to those outlined in the remuneration policy table above. However, additional benefits may be provided by the Company where the Board considers it reasonable and necessary to do so.

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It is expected that the structure and quantum of the variable pay elements would reflect those set out in the policy table above. However, the Board recognises that, as an independent oil and gas company, it is competing with global firms for its talent. As a result, the Board considers it important that the recruitment policy has sufficient flexibility in order to attract the calibre of individual that the Company requires to grow a successful business. The Company recognises that in many cases, an external appointee may forfeit significant cash bonuses and/or share awards from a prior employer. The Board believes that it needs the ability to compensate new hires for bonuses and/ or incentive awards lost on joining the Company. The Board will use its discretion in settling any such compensation, which will be decided on a case-by-case basis, provided that in no event shall such compensation exceed the value of compensation forfeited by the external appointee, as confirmed by the appointee in a written agreement with the Company.

Directors’ Remuneration (audited)

Andrew Austin is currently the only Executive Director and is employed under a service agreement which was initially capable of termination by either party giving three months’ notice in writing. This period automatically extends to 12 months on completion of an Acquisition.

The Non-executive Directors are employed under rolling contracts with notice periods of three months, under which they are not entitled to any pension, benefits or bonuses.

Directors’ emoluments for the period were as follows:

18 months ended 31 December 2016

	Salary	Taxable Benefts	Bonus	Pension	Total
A P Austin	£145,000	£4,926	Nil	Nil	£149,926
R A Benmore	£35,000	Nil	Nil	Nil	£35,000
J A C Morrow	£35,000	Nil	Nil	Nil	£35,000

Benefits provided to Mr. Austin are the provision of medical insurance for himself and his family.

Scheme interests awarded during the period (audited) Unapproved Share Option Plan

	Date of Grant	Granted	Face Value(1)	Exercise Price	Exercised	Waived/ Lapsed	Earliest Vesting Date	Lapse Date	Performance Criteria
A P Austin	22/12/2015	1,000,000	£500,000	50p	Nil	Nil	22/12/2018*	13/01/2022	Time based Vesting

1. The share price on date of grant was 50p based on the admission price of 50p.

The option is to acquire up to 10% of the issued share capital. As at the date of the grant this was 1,000,000 shares but it may increase to include any issue of shares after the date of grant subject to the earlier of;

• the date falling on the third anniversary of admission.

• the market capitalisation of the Company first becomes or exceeds £100 million.

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*The shares shall vest in three tranches of 33% on the third anniversary of grant, 33% on the fourth anniversary of grant and 34% on the fifth anniversary of grant, subject to a completion of at least one acquisition resulting in the market capitalisation of the Company increasing by at least 500% (the starting measure being the price at admission of 50p per share), save as to they may become 100% exercisable in the event of a takeover or liquidation (Rule 11 of the plan).

The expense to the income statement for the period was £76,895.

The Directors’ interests for disclosure purposes in the voting rights attaching to the Company’s shares at 31 December 2016 were as follows (audited):

31 December 2016, Ordinary 20p Shares

	Number	%
A P Austin	1,995,002	19.95
R A Benmore	150,000	1.5
J A C Morrow	160,000	1.6

A P Austin also holds certain options as disclosed above.

Payments to past directors (audited)

In the period there were no payments to past directors.

Payments for loss of office (audited)

No payments were made to directors for loss of office in the period.

It is envisaged that a Remuneration Committee will be formed prior to the AGM to implement the Remuneration Policy.

A. P. Austin On behalf of the Board 31 March 2017

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The directors present the audited consolidated financial statements of the Group for the period ended 31 December 2016.

Principal activity and status.

The Group’s principal area of activity is the acquisition of companies or businesses in the upstream oil and gas and power sector.

A review of the business and the future developments of the Group are presented within the Strategic Report.

Dividends

No dividends have been declared or paid.

Political donations.

The Group made no political donations during the period.

Directors.

The Directors who served during the period were as follows:

• A P Austin Executive chairman appointed 1 July 2015

• E J Lukins Non-executive appointed 1 July 2015, resigned 18 December 2015

• R A Benmore Non-executive appointed 18 December 2015

• J A C Morrow Non-executive appointed 18 December 2015

Directors’ indemnities and insurance.

Subject to the conditions set out in the Companies Act 2006, the Company has arranged appropriate Directors and Officers insurance to indemnify the Directors and officers against liability in respect of proceedings brought by third parties. Such provision remains in force at the date of this report.

The Company indemnifies the Directors against actions they undertake or fail to undertake as Directors or officers of any Group company, to the extent permissible for such indemnities to meet the test of a qualifying third party indemnity provision as provided for by the Companies Act 2006. The nature and extent of the indemnities is as described in Section 143 of the Company’s Articles of Association as adopted on 15 November 2015. These provisions remained in force throughout the period and remain in place at the date of this report.

Substantial shareholdings

As at 31 March 2017, in addition to the Directors’ interests as set out in the Remuneration Report, the Company had received notification from the following institutions of interests in excess of 3 per cent of the Company’s issued Ordinary Shares with voting rights:

	Number	%
City Financial	2,000,000	20.00
Legal & General	1,000,000	10.00

The Company is not a close company as defined in the Income and Corporation Taxes Act 1988. The Company is domiciled in the UK and incorporated and registered in England.

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Corporate governance

In order to implement its business strategy, the Company has adopted a corporate governance structure which is fit for purpose for this stage of the Company’s life cycle. This includes a threemember board, with two independent non-executive Directors.

Until a major asset acquisition is made the Company will not have nomination, remuneration, audit or risk committees. The Board as a whole reviews its size, structure and composition, the scale and structure of Directors’ fees (taking into account the interests of shareholders and the performance of the Company) takes responsibility for the appointment of auditors and payment of their audit fee, monitors and reviews the integrity of the Company’s financial statements and takes responsibility for any formal announcements on the Company’s financial performance. Following a major asset acquisition the Board intends to put in place nomination, remuneration, audit and risk committees.

The Board has established the corporate governance values of the Company and has overall responsibility for setting the Company’s strategic aims, defining the business plan and strategy and managing the financial and operational resources of the Company. Overall supervision, acquisition, divestment and other strategic decisions are considered and determined by the Board. The Board held four meetings in the period to 31 December 2016.

Mr Austin, in addition to acting as Chairman, is the Director charged with day-to-day responsibility for the implementation of the Company’s acquisition strategy. Mr Austin is supported by service providers as required.

The Board intends to comply, so far as it is practicable, with certain Main Principles of the UK Corporate Governance Code. Since incorporation compliance with the provisions of the Model Code is being undertaken on a voluntary basis, as the Company does not have a premium listing on the London Stock Exchange.

As at the date of this document, the Board has voluntarily adopted the Model Code for Directors’ dealings contained in the Listing Rules of the UK Listing Authority. The Board will be responsible for taking all proper and reasonable steps to ensure compliance with the Model Code by the Directors. The FCA will not have the authority to (and will not) monitor the Company’s voluntary compliance with the Model Code, nor to impose sanctions in respect of any failure by the Company to so comply.

Statement of directors’ responsibilities in respect of the financial statements

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulation.

Company law requires the directors to prepare financial statements for each financial period. Under that law the directors have prepared the Group financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and Company financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit or loss of the Group and Company for that period. In preparing the financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

• state whether applicable IFRSs as adopted by the European Union have been followed for the Group financial statements and IFRSs as adopted by the European Union have been followed for the company financial statements, subject to any material departures disclosed and explained in the financial statements;

• make judgements and accounting estimates that are reasonable and prudent; and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and Company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group and Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and Company and enable them to ensure that the financial statements and the Directors’ Remuneration Report comply with the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS Regulation.

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The directors are also responsible for safeguarding the assets of the Group and Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the Group and Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

The directors consider that the annual report and accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group and Company’s performance, business model and strategy.

Each of the directors, whose names and functions are listed in the Directors’ Report confirm that, to the best of their knowledge:

• the Company financial statements, which have been prepared in accordance with IFRSs as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and loss of the Company;

• the Group financial statements, which have been prepared in accordance with IFRSs as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and loss of the Group; and

• the Strategic Report includes a fair review of the development and performance of the business and the position of the Group and Company, together with a description of the principal risks and uncertainties that it faces.

In the case of each director in office at the date the Directors’ Report is approved:

• so far as the director is aware, there is no relevant audit information of which the Group and Company’s auditors are unaware; and

• they have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the Group and Company’s auditors are aware of that information.

Andrew Austin Executive Chairman 31 March 2017

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Independent auditors’ report to the members of Rockrose Energy plc

Our opinion

In our opinion:

• Rockrose Energy plc’s Group financial statements and Company financial statements (the ‘‘financial statements’’) give a true and fair view of the state of the Group’s and of the Company’s affairs as at 31 December 2016 and of the Group’s loss and the Group’s and the Company’s cash flows for the 18 month period (the ‘‘period’’) then ended;

• the Group financial statements have been properly prepared in accordance with International Financial Reporting Standards (‘‘IFRSs’’) as adopted by the European Union;

• the Company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and

• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS Regulation.

What we have audited

The financial statements, included within the Annual Report, comprise:

• the Consolidated statement of financial position and Company statement of financial position as at 31 December 2016;

• the Consolidated income statement and Consolidated statement of comprehensive income for the period then ended;

• the Consolidated statement of cash flows and Company statement of cash flows for the period then ended;

• the Consolidated statement of changes in equity and Company statement of changes in equity for the period then ended; and

• the notes to the financial statements, which include a summary of significant accounting policies and other explanatory information.

The financial reporting framework that has been applied in the preparation of the financial statements is IFRSs as adopted by the European Union and, as regards the Company financial statements, as applied in accordance with the provisions of the Companies Act 2006, and applicable law.

In applying the financial reporting framework, the directors have made a number of subjective judgements, for example in respect of significant accounting estimates. In making such estimates, they have made assumptions and considered future events.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion:

• the information given in the Strategic Report and the Directors’ Report for the financial period for which the financial statements are prepared is consistent with the financial statements.

• In our opinion:

• the part of the Directors’ Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006.

Other matters on which we are required to report by exception

Adequacy of accounting records and information and explanations received

Under the Companies Act 2006 we are required to report to you if, in our opinion:

• we have not received all the information and explanations we require for our audit; or

• adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from branches not visited by us; or

• the Company financial statements and the part of the Directors’ Remuneration Report to be audited are not in agreement with the accounting records and returns.

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We have no exceptions to report arising from this responsibility.

Directors’ remuneration

Under the Companies Act 2006 we are required to report to you if, in our opinion, certain disclosures of directors’ remuneration specified by law are not made. We have no exceptions to report arising from this responsibility.

Responsibilities for the financial statements and the audit

Our responsibilities and those of the directors

As explained more fully in the Statement of Directors’ Responsibilities set out on pages 10 and 11, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view.

Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland) (‘‘ISAs (UK & Ireland)’’). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.

This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

What an audit of statements involves

We conducted our audit in accordance with ISAs (UK & Ireland). An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of:

• whether the accounting policies are appropriate to the Group’s and the Company’s circumstances and have been consistently applied and adequately disclosed;

• the reasonableness of significant accounting estimates made by the directors; and

• the overall presentation of the financial statements.

We primarily focus our work in these areas by assessing the directors’ judgements against available evidence, forming our own judgements, and evaluating the disclosures in the financial statements.

We test and examine information, using sampling and other auditing techniques, to the extent we consider necessary to provide a reasonable basis for us to draw conclusions. We obtain audit evidence through testing the effectiveness of controls, substantive procedures or a combination of both.

In addition, we read all the financial and non-financial information in the Annual Report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

Richard Spilsbury (Senior Statutory Auditor) for and on behalf of PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors London

31 March 2017

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CONSOLIDATED INCOME STATEMENT AND CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD ENDED 31 DECEMBER 2016

Administrative expenses Exceptional items: initial public offering costs Operating loss Finance income Finance costs Loss before tax Tax Loss for the period and total comprehensive expense Basic and diluted loss per share	Notes 5 8 19	Eighteen months ended 31 December 2016 £ (1,292,584) (48,164) (1,340,748) 3,893 (2) (1,336,857) — (1,336,857) (0.2326)

The notes on pages R-34 to R-45 are an integral part of these financial statements.

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2016

(Registered number: 09665181)

Assets Current assets Trade and other receivables Cash and cash equivalents Total assets Current liabilities Trade and other payables Total liabilities Equity and liabilities Share capital and reserves Share capital Share option reserve Share premium Accumulated losses Total equity Total equity and liabilities	Notes 12 13 14 18 18	31 December 2016 £ 244,428 2,387,968 2,632,396 441,042 441,042 2,000,000 76,895 2,224,816 (2,110,357) 2,191,354 2,632,396

These financial statements were approved by the Board of Directors on 31 March 2017 and were signed on its behalf by:

............................................... A.P. Austin Director

The notes on pages R-33 to R-44 are an integral part of these financial statements.

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COMPANY STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2016

(Registered number: 09665181)

Assets Non current assets Investments in subsidiaries Total fxed assets Current assets Trade and other receivables Cash and cash equivalents Total current assets Total assets Current liabilities Trade and other payables Total liabilities Equity and liabilities Share capital and reserves Share capital Share option reserve Share premium Accumulated losses Total Equity Total equity and liabilities	Notes 10 12 13 14 18 18	31 December 2016 £ 100 100 934,854 2,387,968 3,322,822 3,322,922 441,142 441,142 2,000,000 76,895 2,224,816 (1,419,931) 2,881,780 3,322,922

These financial statements were approved by the Board of Directors on 31 March 2017 and were signed on its behalf by:

............................................... A.P. Austin Director

The notes on pages R-33 to R-44 are an integral part of these financial statements.

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 31 DECEMBER 2016

Cumulative loss for the period Total comprehensive loss Purchase of treasury shares Shares issued during the period Total transactions with owners Balance at 31 December 2016	Share capital £ — — 2,000,000 2,000,000 2,000,000	Share premium £ — — 2,224,816 2,224,816 2,224,816	Accumulated Losses £ (1,336,857) (1,336,857) (773,500) — (773,500) (2,110,357)	Share Option Reserve £ — — 76,895 76,895 76,895	Total £ (1,336,857) (1,336,857) (773,500) 4,301,711 3,528,211 2,191,354

The notes on pages R-33 to R-44 are an integral part of these financial statements.

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COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 31 DECEMBER 2016

Cumulative loss for the period Total comprehensive loss Shares issued during the period Total transactions with owners Balance at 31 December 2016	Share capital £ — — 2,000,000 2,000,000 2,000,000	Share premium £ — — 2,224,816 2,224,816 2,224,816	Accumulated Losses £ (1,419,931) (1,419,931) — — (1,419,931)	Share Option Reserve £ — — 76,895 76,895 76,895	Total £ (1,419,931) (1,419,931) 4,301,711 4,301,711 2,881,780

The notes on pages R-33 to R-44 are an integral part of these financial statements.

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CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE PERIOD ENDED 31 DECEMBER 2016

Cash fows from operating activities Loss for the period Share based payments Finance cost Finance income Increase in trade and other receivables Increase in other trade and payables Net cash used in operating activities Cash fows from investing activities Interest received Net cash generated from investing activities Cash fows from fnancing activities Proceeds from issue of shares net of treasury shares Initial public offering costs Net cash generated from fnancing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	Notes 13	Eighteen months ended 31 December 2016 £ (1,336,857) 76,895 2 (3,893) (244,428) 441,040 (1,067,241) 3,893 3,893 4,226,500 (775,184) 3,451,316 2,387,968 — 2,387,968

The notes on pages R-33 to R-44 are an integral part of these financial statements.

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COMPANY STATEMENT OF CASH FLOWS FOR THE PERIOD ENDED 31 DECEMBER 2016

Cash fows from operating activities Loss for the period Share based payments Finance cost Finance income Increase in trade and other receivables Increase in other trade and payables Net cash used in operating activities Cash fows from investing activities Interest received Acquisition of investment in subsidiary Net cash generated from investing activities Cash fows from fnancing activities Proceeds from issue of shares Initial public offering costs Net cash generated from fnancing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	Notes 13	Eighteen months ended 31 December 2016 £ (1,419,931) 76,895 2 (3,893) (934,854) 441,140 (1,840,641) 3,893 (100) 3,793 5,000,000 (775,184) 4,224,816 2,387,968 — 2,387,968

The notes on pages R-33 to R-44 are an integral part of these financial statements.

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NOTES TO FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 DECEMBER 2016

1 General information

Rockrose Energy Plc (‘the Company’ or together with its subsidiaries, ‘the Group’) has been formed to make acquisitions of companies or businesses in the upstream oil and gas and power sector.

The Company is a public limited company incorporated on 1 July 2015, which is listed on the London Stock Exchange and incorporated and domiciled in the UK. The address of its registered office is Dashwood House, 69 Old Broad Street, London.

The financial statements have been prepared for an eighteen month period from incorporation date on 1 July 2015 to 31 December 2016. The Company changed its financial year-end date to 31 December to align with industry peers. As this is the first period of account no financial statements are presented for a prior period.

The financial statements have been prepared in pound sterling (‘GBP’) and have been rounded to the nearest pound (£).

2 Accounting policies

2.1 Basis of preparation of the Financial Statements

The financial statements have been prepared in accordance with the International Financial Reporting Standards as adopted by the European Union and the Companies Act 2006. They have been prepared using the historical cost convention.

The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities at the date of the financial statements. If in the future such estimates and assumptions which are based on management’s best judgement at the date of the financial statements, deviate from the actual circumstances, the original estimates and assumptions will be modified as appropriate in the period in which the circumstances change.

2.2 Consolidation

The consolidated financial statements include the financial statements of the Company and its subsidiaries for the period ended 31 December 2016. Subsidiaries are all entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company.

Investments in subsidiaries are accounted for at cost less impairment in the Company Statement of Financial Position.

2.3 Going concern

These consolidated financial statements have been prepared on a going concern basis. The directors are satisfied that the Group and Company have sufficient resources to continue in operation for the foreseeable future, a period of not less than twelve months from the date of this report. Accordingly they continue to adopt the going concern basis in preparing the statements.

2.4 Segment reporting

In the opinion of the directors the operations of the Group represents one segment, and are treated as such, when evaluating its performance. The chief operating decision maker is the Board of Directors. The Board of Directors reviews management accounts prepared for the Group when assessing performance.

2.5 Standards and amendments effective and relevant to the Company

The financial statements have been prepared in accordance with IFRSs adopted by the European Union which are effective as at 31 December 2016.

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The following IFRSs became effective during the period:

IAS 1	Presentation of Financial Statements – Amendments resulting from the disclosure
	initiative
IAS 16	Property, Plant and Equipment – Amendments regarding the clarifcation of
	acceptable methods of depreciation and amortisation
IAS 16	Property, Plant and Equipment – Amendments bringing bearer plants into the scope
	of IAS 16
IAS 19	Employee Benefts – Amendments resulting from September 2014 Annual
	Improvements to IFRSs
IAS 27	Separate Financial Statements – Amendments reinstating the equity method as an
	accounting option for investments in in subsidiaries, joint ventures and associates in
	an entity’s separate fnancial statements
IAS 28	Investments in Associates and Joint Ventures – Amendments regarding the
	application of the consolidation exception
IAS 34	Interim Financial Reporting – Amendments resulting from September 2014 Annual
	Improvements to IFRSs
IAS 38	Intangible Assets – Amendments regarding the clarifcation of acceptable methods of
	depreciation and amortisation
IFRS 5	Non-current Assets Held for Sale and Discontinued Operations – Amendments
	resulting from September 2014 Annual Improvements to IFRSs
IFRS 7	Financial Instruments: Disclosures – Amendments resulting from September 2014
	Annual Improvements to IFRSs
IFRS 10	Consolidated Financial Statements – Amendments regarding the application of the
	consolidation exception
IFRS 11	Joint Arrangements – Amendments regarding the accounting for acquisitions of an
	interest in a joint operation
IFRS 12	Disclosure of Interests in Other Entities – Amendments regarding the application of
	the consolidation exception
IFRS 14	Regulatory Deferral Accounts

At the date of authorisation the following Standards and Interpretations, which have not yet been applied in these financial statements, were in issue but not yet effective:

• IAS 7 Statement of Cash Flows – Amendments as result of the Disclosure initiative

• IAS 12 Income Taxes – Amendments regarding the recognition of deferred tax assets for unrealised losses

• IAS 28 Investments in Associates and Joint Ventures – Amendments resulting from Annual Improvements 2014-2016 Cycle (clarifying certain fair value measurements)

• IAS 39 Financial Instruments: Recognition and Measurement – Amendments to permit an entity to elect to continue to apply the hedge accounting requirements in IAS 39 for a fair value hedge of the interest rate exposure of a portion of a portfolio of financial assets or financial liabilities when IFRS 9 is applied, and to extend the fair value option to certain contracts that meet the ‘own use’ scope exception

• IFRS 1 First-time Adoption of International Financial Reporting Standards – Amendments resulting from Annual Improvements 2014-2016 Cycle (removing short-term exemptions)

• IFRS 2 Share-based Payment – Amendments to clarify the classification and measurement of payment transactions

IFRS 4 Insurance Contracts – Amendments regarding the interaction of IFRS 4 and IFRS 9 IFRS 7 Financial Instruments: Disclosures – Additional hedge accounting disclosures (and consequential amendments) resulting from the introduction of the hedge accounting chapter in IFRS 9

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• IFRS 9 Financial Instruments – Finalised version, incorporating requirements for classification and measurement, impairment, general hedge accounting and derecognition

IFRS 12 Disclosure of Interests in Other Entities – Amendments resulting from Annual Improvements 2014-2016 Cycle (clarifying scope)

IFRS 15 Revenue from Contracts with Customers – Original issue IFRS 15 Revenue from Contracts with Customers – Clarifications to IFRS 15 IFRS 16 Leases

The adoption of these standards and Interpretations are not expected to have a significant impact on the Group’s financial statements.

2.6 Cash and cash equivalents

Cash and cash equivalents comprise cash in hand and bank balances. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash, which are subject to an insignificant risk of changes in value and have a maturity of three months or less at the date of acquisition.

2.7 Financial Instruments

Financial Instruments are classified on initial recognition as financial assets, financial liabilities or equity instruments in accordance with the substance of the contractual arrangement. Financial instruments are recognised on the Statement of Financial Position at fair value when the Company becomes party to the contractual provisions of the instrument. Financial assets are reduced by appropriate allowances for estimated irrecoverable amounts. Interest earned from financial assets and interest paid on financial liabilities is recognised in the income statement on an accruals basis over the term of the financial asset or liability using the effective rate of interest.

Trade and other receivables are stated at their nominal value, as the interest that would be recognised from discounting future cash receipts over the short credit period is not considered to be material.

Trade and other payables are stated at their original invoiced value, as the interest that would be recognised from discounting future cash payments over the short term payment period is not considered material.

2.8 Share capital

Ordinary shares are classified as equity. The Company’s share capital currently consists of ordinary shares. Any transaction costs associated with the issuing of shares are deducted from equity to the extent they are incremental costs directly attributable to the equity transaction.

2.9 Taxes

Current income tax: The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

Deferred tax: Deferred balances are recognised in respect of all timing differences that have originated but not reversed by the Statement of Financial Position date, except that:

• The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and

• Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

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2.10 Exceptional Items

Exceptional items relate to the IPO costs on issuing the share capital in the Company that did not meet the criteria for recognition directly in equity.

2.11 Employee Benefit Trust

The assets and liabilities of the Employee Benefit Trust are consolidated by the Group, as the Group exercises control over the Trust as defined in IFRS 10. Shares in the Company held by the trust are consolidated as a deduction from equity and treated as treasury shares.

2.12 Share based payments

Under the Share Option Plan, the Employee Benefit Trust subscribes for ordinary shares in the Company. The EBT owns a portion of the share equivalent to the subscription price. Any employee who received an award under the plan owns any value in the share in excess of the subscription price. Awards vest over three years to five years and are subject to performance criteria. The fair value of awards granted is recognised as an employee expense with a corresponding increase in equity.

The fair value is measured at grant date, using an appropriate pricing model taking into account the terms and conditions upon which the award was granted, and is spread over the period during which the awards vest. The amount recognised as an expense is adjusted to reflect the actual number of share awards that vest in the same period. At each balance sheet date, the Company revises its estimates of the number of options that are expected to vest. The Company recognises the impact of the revision to original estimates, if any, in the income statement, with a corresponding adjustment to equity.

3 Estimates

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

In preparing these financial statements, the significant judgements made by management in applying the Group’s accounting policies and the key accounting estimates are accruals and the non-recognition of a deferred tax asset. The deferred tax asset has not been recognised as the directors do not expect profits to be made for up to three years hence.

In the Company’s financial statements the key accounting estimate is valuation of the loan made to the EBT. The loan to the EBT has been impaired to reflect the market value of the Company’s shares at 31 December 2016, as disclosed in Note 12.

4 Financial risk management

As at 31 December 2016 the Company’s financial instruments consisted of cash and cash equivalents, trade and other receivables and trade and other payables including accrued liabilities. With respect to all of these financial instruments, the Company estimates that their fair values approximate their carrying values at 31 December 2016 based on the nature of those instruments.

The Company’s risk exposures and impact on the Company’s financial instruments are summarised below:

Credit risk

The Company’s credit risk is primarily attributable to cash, which is held in Metro Bank which is domiciled in the UK and regulated by the FCA.

Credit risk in relation to the EBT loan has been discussed in note 12.

Market risk

(a) Interest rate risk

Cash balances do not generate material amounts of interest. There are no other interest bearing financial instruments and therefore the Company is not exposed to interest rate risk.

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(b) Foreign currency risk

All the balances as of 31 December 2016 and the transactions for the eighteen month period then ended were denominated in UK sterling which is the Company’s functional and presentation currency. The Company is therefore not exposed to foreign currency risk.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company monitors the risk of cash shortfalls by means of current liquidity planning. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. The approach is used to analyse payment dates associated with financial assets and also to forecast cash flows from operating activities. The table below sets out the contractual maturities of financial liabilities present.

Group At 31 December 2016 Trade and other payables Company At 31 December 2016 Trade and other payables	Contractual Amount £ 441,042 441,042 441,142 441,142	Due in less than 1 year £
		441,042
		441,042
		441,142
		441,142

Capital management

The capital of the Company is represented by the net assets attributable to holders of ordinary shares. The Company’s objective when managing capital is to safeguard the Company’s ability to continue as a going concern and fund development, in order to provide returns for shareholders and benefits for other stakeholders. The Company has not paid dividends, nor returned capital to the shareholders to date. The Company is not subject to externally imposed capital requirements.

5 Operating Loss

Operating loss is stated after charging:

Director’s fees, salaries, share options and other benefts Fees payable to the Company’s auditors for: – Audit of the parent company and the consolidated fnancial statements – Interim review of the parent companies’ fnancial statements and; – Other non audit services: Transaction services (diligence) Accountancy, consulting, legal & other advisory fees Operating lease costs	Eighteen Months ended 31 December 2016 £
	296,821 35,000 24,000 330,000 48,000

The Company’s auditors provided £80,000 of services connected with the Company’s initial public offering of shares which has been treated as share issue costs and deducted from equity.

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6 Employee benefit expenses (including Director’s remuneration)

Salaries, allowances and benefts in kind (short term) Social security costs Share based payments	Eighteen Months ended 31 December 2016 £
	253,654 27,139 76,895
	357,688

In addition to the Directors, the monthly average number of employees during the period was 1.

The highest paid director received remuneration of £226,821.

Total key management compensation for the period was £296,821.

7 Financial income

Bank interest received	Eighteen Months ended 31 December 2016 £
	3,893
	3,893

8 Taxation and deferred tax

No UK corporation tax charge arises in the period ended 31 December 2016. A reconciliation of the expected tax benefit computed by applying the tax rate applicable in the primary jurisdiction to the loss before tax to the actual tax (credit)/expense is as follows:-

Tax on loss on ordinary activities

Loss before tax on continuing operations Corporation tax at the statutory income tax rate of 20% Effects of: Expenses not deductible for tax purposes Tax losses not utilised Total tax charge on loss before tax	2016 £
	(1,336,857 (267,371) 19,162 248,209
	—

Factors that may affect future tax charges

The Group has estimated losses of £1,241,045 available to carry forward against future profits. The Company has a potential deferred tax asset of £248,209 which has not been recognised on losses in the financial statements. This is due to uncertainty regarding when such losses will be utilised.

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9 Income statement – company

The Company has elected to take exemption under section 408 of the Companies Act 2006, to not present the parent company profit and loss account. The Company’s loss for the period was £1,419,931.

10 Fixed asset investments

Company

Investment in subsidiary companies

Cost or valuation Additions At 31 December 2016 Net book value At 31 December 2016	100
	100
	100

Subsidiary undertakings:

The following were subsidiary undertakings of the Company:

Name Rockrose (UKCS1) Ltd Rockrose Energy Employee Beneft Trust	Country of incorporation United Kingdom States of Jersey	Class of shares Ordinary N/A	Holding 100% N/A	Principal activity
				Extraction of crude petroleum Employee Beneft Trust

On 27 October 2016, Rockrose Energy Plc acquired 100% of the share capital of Rockrose (UKCS1) Limited.

Rockrose Energy Employee Benefit Trust is an employee benefit trust for the purpose of making awards under the Group’s employee share schemes. These shares have been classified as treasury shares within equity.

11 Audit exemptions for subsidiary companies

The Group has elected to take advantage of the full extent of the exemptions available under Section 479A of the Companies Act 2006. As a result, statutory financial statements will not be audited for the following UK entity: Rockrose (UKCS1) Ltd.

12 Trade and other receivables

VAT receivable Prepayments Loan to Appleby Trust (Jersey) Limited ‘‘EBT Trustee’’	Group 31 December 2016 £ 156,977 87,451 — 244,428	Company 31 December 2016 £
		156,977 87,541 690,426
		934,854

Appleby Trust (Jersey) Limited (the ‘‘EBT Trustee’’) has subscribed for 1,200,000 Ordinary Shares (1,200,000 @ £0.50 = £600,000) on behalf of the EBT. At Admission, these shares comprised 12 per cent of the issued share capital of the Company.

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The EBT Trustee funded its subscription by way of a loan from the Company amounting to £600,000. The Company has no recourse under the loan to the assets of the EBT Trustee other than the proceeds of the sales of the shares. The proceeds of sale may not be sufficient for the EBT Trustee to repay the loan in full.

If the proceeds of the sale of its beneficial interest are greater than the amount the EBT Trustee is required to repay under the loan, the EBT Trustee may apply any surplus for future employee incentivisation arrangements.

The EBT Trustee will not normally exercise the voting rights of unvested Ordinary Shares held under the EBT but may exercise such rights on vested Ordinary Shares at the request of the relevant participants. Similarly, Ordinary Shares held under the EBT will not receive any dividends paid.

In addition, on 16 August 2016, A. P. Austin transferred 347,000 of his own shares to EBT at a value of £0.50 per share, which increased this loan balance by a further £173,500.

The loan receivable has been impaired in line with the conditions of the loan agreement due to the value of the shares held by EBT being less than the loan balance owing.

13 Cash and cash equivalents

Cash at bank Short term deposit	Group 2016 £ 529,560 1,858,408 2,387,968	Company 2016 £
		529,560 1,858,408
		2,387,968

14 Trade and other payables

Trade payables Accruals Amounts due to group companies Other payables	Group 2016 £ 18,261 396,615 — 26,166 441,042	Company 2016 £
		18,261 396,615 100 26,166
		441,142

Other payables relate to amounts due to A. P. Austin, a director of the Company.

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15 Financial instruments

Financial assets: Financial assets that are debt instruments measured at amortised cost Financial liabilities: Financial liabilities that are debt instruments measured at amortised cost	Group 2016 £ — — (441,042) (441,042)	Company 2016 £
		690,426
		690,526
		(441,142
		(441,142

Financial assets that are debt instruments measured at amortised cost comprise the loan to Appleby Trust.

The loan to the EBT has been impaired to reflect the market value of the shares at the year end date.

Financial liabilities that are debt instruments measured at amortised cost comprise trade payables, accruals and amounts due to group companies.

16 Share based payments

The Company commenced the operation of a Share Option Plan (‘‘the plan’’) during December 2015. The plan is an equity incentive scheme.

The board of directors oversees the plan, approves the subscription price of awards under the plan and any criteria to be satisfied before exercise is permitted, and monitors the effectiveness of the plan as an incentive.

Under the plan, the options outstanding to Directors are as follows:

Name A Austin A Austin A Austin	Grant date 22/12/2015 22/12/2015 22/12/2015	Vesting date 22/12/2018 22/12/2019 22/12/2020	Number 330,000 330,000 340,000 1,000,000	Exercise price 0.5000 0.5000 0.5000	Expiry 13/01/2022 13/01/2022 13/01/2022	Share price at grant 0.5000 0.5000 0.5000	Fair value
							0.2896 0.2918 0.2785

There were no options vested during the year and no options were exercisable at the year end. The assessed fair value at the grant date is determined using the binomial model. The vesting conditions are that the share price is at least £0.3000; that there is continuous employment to the date of exercise; that there has been an acquisition resulting in a 500% increase in the market capitalisation of the Company; that there are no negative regulatory findings and that the options holder’ and those acting in concert with him do not own more than 29.99% of the Company’s issued capital after exercise. The binomial model valuation does not incorporate non-market based vesting conditions.

33% of the total share options are exercisable three years from the grant date (‘‘three year options’’); 33% of the total share options are exercisable four years from the grant date (‘‘four year options’’), and 34% of the total share options are exercisable five years from the grant date (‘‘five year options’’).

The cost of awards under the plan is recognised over the vesting period of the award. The expense for share options granted in 2016 was £76,895.

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17 Reserves Share premium

The share premium account represents the premium arising on the issue of shares net of issue costs.

Accumulated losses

Accumulated losses represents cumulative profits and losses net of dividends and other adjustments.

Treasury shares

Under the terms of the Company’s share option plan outlined in note 16, an Employee Benefit Trust (EBT) subscribed for ordinary shares in the Company. The Trust is administered by Appleby Trust (Jersey) Limited. The trustee can distribute shares at its discretion directly to beneficiaries upon the recommendation of the board. All administrative costs associated with the EBT are met by the Company. The EBT owns the shares to be distributed at the discretion of the trustees and the employee owns any value in the shares in excess of the subscription price.

On 22 December 2015, the Company placed 1,200,000 shares into the EBT. The market price of the shares was £0.125 each, and the market value was £150,000. The shares were placed pre-IPO.

On 16 August 2016, the EBT acquired a further 347,000 shares. The market price of the shares was £0.45 each, and the market value was £156,150.

At 31 December 2016, the EBT jointly owned 1,547,000, with a nominal value of £309,400, representing 15.47% of the allotted share capital of the Company. None of the shares held were under option or conditionally gifted.

18 Share capital and share premium

Proceeds from issue of shares Initial public offering costs Balance at 31 December 2016	Number of Shares 10,000,000 — 10,000,000	Share capital £ 2,000,000 — 2,000,000	Share premium £ 3,000,000 (775,184) 2,224,816

On incorporation, 1 July 2015, 1,200,000 ordinary shares of 5p at a price of 12.5p each were issued (equivalent to 300,000 shares at a price of 50p – £150,000). The payment for the ordinary shares of £150,000 was not made on incorporation but was made on 18 December 2015.

On 5 August 2015, a special resolution was passed to consolidate every four ordinary shares of 5p each into one ordinary share of 20p.

18 December 2015, a further 900,000 ordinary shares of 20p each were issued at a price of 50p per share.

On 22 December 2015 the Company entered into a loan agreement with Appleby Trust (Jersey) Limited pursuant to which the Company agreed to lend £600,000 to the EBT for the purpose of subscribing for the 1,200,000 Placing Shares already issued.

On 12 January 2016 the Company issued 8,800,000 new ordinary shares at a price of 50p per share amounting to gross proceeds of £4,400,000.

19 Loss per share

Basic loss per share amounts are calculated by dividing the loss for the period by the weighted average of shares outstanding during the period. Weighted average number of shares excludes those shares held as treasury shares.

The basic and diluted loss per share are the same as there are no instruments that have a dilutive effect on earnings.

R-42

There have been no transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of authorisation of these financial statements.

Loss for the period attributable to the shareholders Weighted average number of shares Basic and diluted loss per share	Eighteen months ended 31 December 2016 £
	(1,336,857) 5,746,741
	(0.2326)

20 Related party transactions

The transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation.

The balances which are receivable from, or payable to, subsidiary undertakings at 31 December 2016 are disclosed at note 12 and 14.

Key management compensation has been detailed at note 6.

The following transactions relate to related party transactions with A. P. Austin, a director of the Company:

Share issues

A. P. Austin subscribed for 2,342,002 ordinary shares of 20p each in the capital of the Company at a price of 50p per share. On 16 August 2016, A. P. Austin then transferred 347,000 of his own shares to the EBT at a price of 50p per share, see note 12 for more information. The effect of this was to take his beneficial holding from 23.42% to 19.95%.

20 Related party transactions

Period end balance

£173,500 was owed to A.P. Austin for the transfer of shares to the EBT mentioned above and as at the period end a total of £26,166 is outstanding to the director. Offset within the amount owing to A. P. Austin is unpaid share capital of £21,001 and various personal expenses paid by the Company.

Rent of £48,000 was paid to Brandon Toor, the step son of A. P. Austin who is a director of the Company, during the period.

R.A. Benmore (through his wife Judith Helen Benmore) and J. A. C. Morrow subscribed for 150,000 and 160,000 ordinary shares of 20p each in the capital of the Company at a price of 50p per share.

21 Operating Lease Commitments

Not later than 1 year Later than 1 year and not later than 5 years Later than 5 years	Group 31 December 2016 £ 48,000 — — 48,000	Company 31 December 2016 £
		48,000 — —
		48,000

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22 Post Balance Sheet/Subsequent Events

On 22nd March RockRose announced that it is progressing towards completion of the acquisition of Maersk’s interests in the Scott (5.16%) and Telford (2.36%) fields. The consideration for the interests in Scott and Telford consists of a payment from Maersk to the Company. Separately, Rockrose has signed a conditional sale and purchase agreement to acquire the entire issued and to be issued share capital of Egerton Energy Ventures Limited (‘‘Egerton’’) including non-operated interests in the Galahad (27.80%) and Mordred (8.33%) gas fields located in the Southern North Sea. Both transactions are subject to OGA approval and customary conditions precedent. The Company has also signed a non-binding heads of terms to acquire a subsidiary of a major trading company which holds small non-operated interests in gas fields located in the Southern North Sea. This proposed acquisition also includes significant tax assets. On completion of the acquisitions of the Scott and Telford assets, Egerton, and the other potential acquisition, the Company estimates current aggregate current production of around 1,400 barrels of oil equivalent per day. It is anticipated that the acquisitions/proposed acquisitions will be treated as business combinations but management are still evaluating the fair value of assets/liabilities acquired and fair value of the various considerations. The Company has also filed a draft prospectus with the UK Listing Authority and is proceeding with the documentation and application process to re-list. Concurrently, and in order to accelerate the implementation of its stated strategy, the Company is consulting with both existing shareholders and potential investors to allow the Board to consider a fundraising by way of a private placement.

23 Date of approval of financial statements

The financial statements were approved by the board of Directors on 31 March 2017.

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16 August 2016

RockRose Energy plc

(‘‘RockRose’’ or ‘‘the Company’’)

Interim Results

RockRose Energy plc announces its Interim Results for six months ended 30 June 2016.

Highlights:

• On 13 January 2016 Rockrose was admitted to the Standard Listing segment of the UK Listing Authority and to trading on the Main Market of the London Stock Exchange, raising £4.4million before expenses

• Business strategy remains focused on targeted acquisitions to deliver shareholder value

• • Strong pipeline of deal flow:

• RockRose has evaluated over 35 targets across a number of geographies

• The Company remains in a number of processes

Andrew Austin, the Company’s Executive Chairman commented:

‘‘With the price of Brent back around $45 and security of UK energy supply back in the headlines, the relevance of RockRose has never been greater. Your Company is working hard to secure value creating acquisition opportunities. Since listing we have evaluated more than 35 targets and have been (or continue to be) in processes relating to 15 different assets.

‘‘We have submitted bids for a number of assets. The market for assets continues to be illiquid. Many assets are offered for sale but there is often a lack of realism when it comes to value and few transactions are actually closing. However, we believe that the continued downturn in the market and the Brexit vote is increasing the number of reluctant but forced sellers of assets.

‘‘I look forward to updating you in the near future on specific acquisition opportunities.’’

Enquiries:

RockRose Energy plc Andrew Austin, Executive Chairman

+44 (0)20 3826 4800

Broker

Macquarie Capital (Europe) Limited Ken Fleming Nick Donovan

+44 (0)20 3037 2000

Financial PR Camarco Billy Clegg Georgia Mann

+44 (0) 20 3757 4980

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CHAIRMAN’S STATEMENT

With the price of Brent back around $45 and security of UK energy supply back in the headlines, the relevance of RockRose has never been greater. Your Company is working hard to secure value creating acquisition opportunities. Since listing we have evaluated more than 35 targets and have been (or continue to be) in processes relating to 15 different assets. We have submitted bids for a number of assets. The market for assets continues to be illiquid. Many assets are offered for sale but there is often a lack of realism when it comes to value and few transactions are actually closing. However we believe that the continued downturn in the market and the Brexit vote is increasing the number of reluctant but forced sellers of assets.

We continue to have a very low level of general and administration expenses averaging at less than £45,000 per month.

I look forward to updating you in the near future on specific acquisition opportunities.

...........................................................

A.P. Austin Executive Chairman

RESPONSIBILITY STATEMENT

The directors confirm that these condensed interim financial statements have been prepared in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’, as adopted by the European Union and that the interim management report includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely:

• an indication of important events that have occurred during the first twelve months and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the period;

and

• material related-party transactions in the first twelve months, and any material changes in the related party transactions described in the last interim report.

By order of the Board

...........................................................

Andrew Austin 15 August 2016 Executive Chairman

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INDEPENDENT AUDITORS’ REVIEW REPORT

Our conclusion

We have reviewed the condensed interim financial statements, defined below, in the interim financial report of Rockrose Energy Plc for the period ended 30 June 2016. Based on our review, nothing has come to our attention that causes us to believe that the condensed interim financial statements are not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

This conclusion is to be read in the context of what we say in the remainder of this report.

What we have reviewed

The condensed interim financial statements, which are prepared by Rockrose Energy Plc, comprise:

• The condensed interim financial position as at 30 June 2016;

• The condensed interim income statement and condensed interim statement of comprehensive income for the period then ended;

• The condensed interim statement of cash flows for the period then ended;

• The condensed interim statement of changes in equity for the period then ended; and

• The notes to the condensed interim statements.

The condensed interim financial statements included in the interim financial report have been prepared in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’, as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

What a review of condensed interim statements involves

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, ‘Review of Interim Financial Information Performed by the Independent Auditor of the Entity’ issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.

PwC Manual of accounting – Interim and preliminary reporting for the UK 2015

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

We have read the other information contained in the interim financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed interim statements.

INDEPENDENT AUDITORS’ REVIEW REPORT

Responsibilities for the condensed interim financial statements and the review Our responsibilities and those of the directors

The interim financial report, including the condensed interim financial statements, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

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Our responsibility is to express to the Company a conclusion on the condensed interim financial statements in the interim financial report based on our review. This report, including the conclusion, has been prepared for and only for the Company for the purpose of complying with the Disclosure and Transparency Rules of the Financial Conduct Authority and for no other purpose. We do not, in giving this conclusion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

PricewaterhouseCoopers LLP Chartered Accountants

London 15 August 2016

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CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD ENDED 30 JUNE 2016

Administrative expenses 6 Exceptional items: initial public offering costs Operating loss Finance income Finance costs Loss before tax Tax 7 Loss for the period Basic and diluted earnings per share 12	Six months ended 30 June 2016 £ (263,072) (42,434) (305,506) 2,163 (1) (303,344) — (303,344) (0.030)	Twelve months ended 30 June 2016 (as restated) £ (291,643) (48,164) (339,807) 2,163 (3) (337,647) — (337,647) (0.034)

The notes are an integral part of these condensed interim financial statements.

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CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION FOR THE PERIOD ENDED 30 JUNE 2016

Notes Assets Current assets Trade and other receivables 8 Cash and cash equivalents 9 Total assets Equity and liabilities Share capital and reserves Share capital 11 Share premium 11 Accumulated losses Current liabilities Trade and other payables 10 Total liabilities Total equity and liabilities	30 June 2016 £ 788,951 3,137,844 3,926,795 2,000,000 2,224,816 (337,647) 3,887,169 39,626 39,626 3,926,795	31 December 2015 (as restated) £ 962,446 78 962,524 240,000 (415,184) (34,303) (209,487) 1,172,011 1,172,011 962,524

These financial statements were approved by the Board of Directors on 15 August 2016 and were signed on its behalf by:

...........................................................

A. P. Austin Director

The notes are an integral part of these condensed interim financial statements.

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CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 30 JUNE 2016

Balance at 1 July 2015 Loss for the period Total comprehensive loss for the period (as previously stated) Issue of share capital (see note 11) Prior period adjustment: initial public offering costs Total contributions by owners of the Company, recognised directly in equity (as restated) Balance at 31 December 2015 (as restated) Balance at 1 January 2016 Loss for the period Total comprehensive loss for the period Issue of share capital (see note 11) Total contributions by owners of the Company, recognised directly in equity Balance at 30 June 2016	Share Capital £ — — — 240,000 — 240,000 240,000 240,000 — — 1,760,000 1,760,000 2,000,000	Share Premium £ — — — 360,000 (775,184) (415,184) (415,184) (415,184) — — 2,640,000 2,640,000 2,224,816	Retained earnings £ — (809,487) (809,487) — 775,184 775,184 (34,303) (34,303) (303,344) (303,344) — — (337,647)	Total £ — (809,487) (809,487) 600,000 — 600,000 (209,487) (209,487) (303,344) (303,344) 4,400,000 4,400,000 3,887,169

Prior period adjustments

The Company has reclassified the initial public offering costs to offset against the share premium. The impact of this restatement is to increase the retained earnings by £775,184 and reduce share premium by the same amount.

The notes are an integral part of these condensed interim financial statements.

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CONDENSED INTERIM STATEMENT OF CASH FLOWS FOR THE PERIOD ENDED 30 JUNE 2016

Cash fows from investing activities Loss for the period Finance cost Finance income Net cash used in investing activities Decrease/(increase) in trade and other receivable (Decrease)/increase in other trade and payables Cash used in investing activities Interest paid Interest received Net Cash used in investing activities Cash fows from fnancing activities Proceeds from issue of shares Initial public offering costs Net Cash generated from fnancing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	Six months ended 30 June 2016 £ (303,344) 1 (2,163) (305,506) 173,495 (1,132,385) (1,264,396) (1) 2,163 (1,262,234) 4,400,000 — 4,400,000 3,137,766 78 3,137,844	Twelve months ended 30 June 2016 £ (337,647) 3 (2,163) (339,807) (788,951) 39,626 (1,089,132) (3) 2,163 (1,086,972) 5,000,000 (775,184) 4,224,816 3,137,844 — 3,137,844

The notes are an integral part of these condensed interim financial statements.

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE 2016

1 General information

Rockrose Energy Plc (‘the Company’) has been formed to make acquisitions of companies or businesses in the upstream oil and gas and power sector.

The Company is a public limited Company incorporated on 1 July 2015, which is listed on the London Stock Exchange and incorporated and domiciled in the UK. The address of its registered office is Dashwood House, 69 Old Broad Street, London.

These condensed interim financial statements were approved for issue on 15 August 2016.

These condensed interim financial statements do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006.

The condensed interim financial statements have been prepared for the six months period from 1 January 2016 to 30 June 2016.

The results for the interim period to 31 December 2015 have been restated to reflect the representation of certain transaction costs directly associated with the issue of shares under the initial public offering which have been offset against share premium. Linking the equity transaction and costs of the transaction reflects the net proceeds received from the transaction in equity. Refer to note 11 for more details.

These condensed interim financial statements have been reviewed, not audited.

2 Basis of preparation

These condensed interim financial statements for the six months ended 30 June 2016 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and with IAS 34, ‘Interim financial reporting’, as adopted by the European Union. The condensed interim financial statements have been prepared in accordance with IFRSs as adopted by the European Union.

Going concern

These interim condensed consolidated financial statements have been prepared on a going concern basis.

The directors are satisfied that the Company has sufficient resources to continue in operation for the foreseeable future, a period of not less than twelve months from the date of this report. Accordingly they continue to adopt the going concern basis in preparing the interim condensed statements.

Segment reporting

In the opinion of the directors that the operations of the Company represent one segment, and are treated as such, when evaluating its performance. The chief operating decision maker is the Board of Directors. The Board of Directors reviews management accounts prepared for the Company when assessing performance.

Standards and amendments effective and relevant to the Company

The following standards and amendments became effective during the period:

IAS 1 Presentation of Financial Statements – Amendments resulting from the disclosure initiative.

3 Accounting policies

The Company has adopted all relevant standards, amendments and interpretations that are effective for accounting periods commencing 1 January 2016. A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 January 2016, and have not been applied in preparing these financial statements. None of these is expected to have a significant effect on the financial statements of the Company.

The accounting policies applied in the preparation of these financial statements are set out below.

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3.1 Cash and cash equivalents

Cash and cash equivalents in the statement of cash flows include cash in hand and deposits held with banks.

3.2 Financial assets

Financial assets within the scope of IAS 39 are classified as financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, available-for-resale financial assets, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. The Company determines the classification of its financial assets at initial recognition.

All financial assets are recognised initially at fair value plus, in the case of investments not at fair value through profit or loss, directly attributable transaction costs.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are recognised on the trade date, i.e. the date that the Company commits to purchase or sell the asset.

The Company’s financial assets include cash and trade and other receivables.

Loans and receivables: Loans and receivables are carried at amortised cost using the effective interest method if the time value of money is significant. Gains and losses are recognised in income when the loans and receivables are derecognised or impaired, as well as through the amortisation process. This category of financial assets includes trade and other receivables. Cash equivalents are short-term highly liquid investments that are readily convertible to known amounts of cash, are subject to insignificant risk of changes in value and have a maturity of three months or less from the date of acquisition.

Derecognition: Financial assets are de-recognised when the rights to receive cash flows from the asset have expired.

Impairment of financial assets: The Company assesses at each reporting date whether there is any objective evidence that a financial asset or a group of financial assets is impaired. A financial asset or a group of financial assets is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one or more events that has occurred after the initial recognition of the asset (an incurred ‘loss event’) and that loss event has an impact on the estimated future cash flows of the financial asset of the financial asset or the group of financial assets that can be reliably estimated.

Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation and where observable data indicate that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

Financial assets carried at amortised cost: For financial assets carried at amortised cost the Company assesses individually whether objective evidence of impairment exists. If there is objective evidence that an impairment loss has incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future expected credit losses that have not yet been incurred). The present value of the estimated future cash flows is discounted at the financial assets original effective interest rate.

The carrying amount of the asset is reduced through the use of an allowance account and the amount of the loss is recognised in the profit or loss. Financial assets together with the associated allowance are written off when there is no realistic prospect of future recovery. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or reduced by adjusting the allowance account. If a future write-off is later recovered, the recovery is credited to finance costs in the profit or loss.

3.3 Financial liabilities

Initial recognition and measurement: All financial liabilities are recorded initially at fair value. The Company’s financial liabilities include trade and other payables.

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Subsequent measurement: After initial recognition, interest bearing borrowings are subsequently measured at amortised cost using the EIR. Gains and Gains and losses are recognised in the profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fee or costs that are an integral part of the EIR. The EIR amortisation is included in finance cost in the profit or loss.

Derecognition: A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in the profit or loss.

Offsetting of financial instruments: Financial assets and financial liabilities are offset and the net amount reported in the statement of financial position, and only if, there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, or to realise the assets and settle the liabilities simultaneously.

3.4 Share capital

Ordinary shares are classified as equity. The Company’s share capital currently consists of ordinary shares.

3.5 Taxes

Current income tax: The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income. Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual profit or loss.

Deferred tax: Deferred balances are recognised in respect of all timing differences that have originated but not reversed by the Statement of Financial Position date, except that:

• The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and

• Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

4 Estimates

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

In preparing these condensed interim financial statements, the significant judgements made by management in applying the Company’s accounting policies and the key accounting estimates are the accruals and going concern evaluation. Other than the evaluation of going concern and accruals, the Company’s financial statements do not contain any significant accounting estimates.

5 Financial risk management

As at 30 June 2016 the Company’s financial instruments consisted of cash and cash equivalents, trade and other receivables and trade and other payables including accrued liabilities. With respect to all of these financial instruments, the Company estimates that their fair values approximate their carrying values at 30 June 2016 based on the nature of those instruments.

The Company’s risk exposures and impact on the Company’s financial instruments are summarised below:

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Credit risk

The Company’s credit risk is primarily attributable to cash, which is held in Metro bank and receivables from broker firms. Cash is deposited in a fairly new financial institution which is now becoming the trend for many businesses in the UK.

Market risk

• (a) Interest rate risk

• Cash balances do not generate material amounts of interest. There are no other interest bearing financial instruments therefore the Company is not exposed to interest rate risk.

• (b) Foreign currency risk

• All the balances as of 30 June 2016 and the transactions for the six month period then ended were denominated in UK £ which is the Company’s functional and presentation currency. The Company is therefore not exposed to foreign currency risk.

Capital management

The capital of the Company is represented by the net assets attributable to holders of ordinary shares. The Company’s objective when managing capital is to safeguard the Company’s ability to continue as a going concern and fund development, in order to provide returns for shareholders and benefits for other stakeholders. The Company has not paid dividends, nor returned capital to the shareholder to date. The Company is not subject to externally imposed capital requirements.

6 Administrative expenses

These include commission and expenses payable under the Placing Agreement, registration, listing and admission fees, printing, advertising and distribution costs and professional advisory fees, including legal fees, and any other applicable expenses.

7 Taxation and deferred tax

Income tax expense is recognised based on management’s estimate of the weighted average annual income tax rate expected for the full financial year. There is no income tax charge for the period.

Factors that may affect future tax charges

The Company has estimated losses of £337,647 available to carry forward against future profits. The Company has a potential deferred tax asset of £67,530 which has not been recognised on the above losses in the condensed interim financial statements. This is due to uncertainty when such losses will be utilised.

8 Trade and other receivables

VAT receivable Other receivables Prepayments Loan to Appleby Trust (Jersey) Limited ‘‘EBT Trustee’’	30 June 2016 £ 83,349 46,001 59,601 600,000 788,951	31 December 2015 £
		— 940,546 21,900 —
		962,446

Other receivables include cash receivables from broker’s firm client account and unpaid share capital by the director, A. P. Austin, which is disclosed as related party transactions. Appleby Trust (Jersey) Limited (the ‘‘EBT Trustee’’) subscribed for 1,200,000 Ordinary Shares (1,200,000 @ £0.50 = £600,000) on behalf of the EBT. At Admission, these shares comprise 12 per cent of the issued share capital of the Company.

The EBT Trustee funded its subscription by way of a loan from the Company amounting to £600,000. The Company has no recourse under the loan to the assets of the EBT Trustee other

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than the proceeds of the sales of the shares. The proceeds of sale may not be sufficient for the EBT Trustee to repay the loan in full.

If the proceeds of the sale of its beneficial interest are greater than the amount the EBT Trustee is required to repay under the loan, the EBT Trustee may apply any surplus for future employee incentivisation arrangements.

The EBT Trustee will not normally exercise the voting rights of unvested Ordinary Shares held under the EBT but may exercise such rights on vested Ordinary Shares at the request of the relevant participants. Similarly, Ordinary Shares held under the EBT will not receive any dividends paid.

9 Cash and cash equivalent

Cash at bank Short term deposit	30 June 2016 £ 1,281,166 1,856,678 3,137,844	31 December 2015 £
		78 —
		78

10 Trade and other payables

Trade payables Accruals Other payables	30 June 2016 £ 3,896 12,165 23,565 39,626	31 December 2015 £
		— 806,615 365,396
		1,172,011

11 Share capital and share premium

Opening balance at 1 July 2015 Proceeds from issue of shares Prior period adjustment: initial public offering costs Balance at 31 December 2015 as restated Balance at 1 January 2016 Proceeds from shares issued Balance at 30 June 2016	Number of Shares — 1,200,000 — 1,200,000 1,200,000 8,800,000 10,000,000	Share capital £ — 240,000 — 240,000 240,000 1,760,000 2,000,000	Share premium £
			— 360,000 (775,184
			(415,184
			(415,184 2,640,000
			2,224,816

On incorporation, 1 July 2015, 1,200,000 ordinary shares of 5p at a price of 12.5p each were issued (equivalent to 300,000 shares at a price of 50p – £150,000). The payment for the ordinary shares of £150,000 was not made on incorporation but was made on 18 December 2015.

On 5 August 2015, a special resolution was passed to consolidate every four ordinary shares of 5p each into one ordinary share of 20p.

18 December 2015, a further 900,000 ordinary shares of 20p each were issued at a price of 50p per share.

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On 22 December 2015 the Company entered into a loan agreement with Appleby Trust (Jersey) Limited pursuant to which the Company agreed to lend £600,000 to the EBT for the purpose of subscribing for 1,200,000 Placing Shares.

On 12 January 2016 the Company issued 8,800,000 new ordinary shares at a price of 50p per share amounting to gross proceeds of £4,400,000.

12 Earning per share

Basic earnings per share amounts are calculated by dividing the profit for the period by the weighted average of shares outstanding during the period.

The basic and diluted earnings per share are the same as there are no instruments that have a dilutive effect on earnings.

There have been no transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of authorisation of these financial statements.

Loss for the period attributable to the shareholders Weighted average number of shares Basic and diluted earnings per share	Six months ended 30 June 2016 £ (303,344) 10,000,000 (0.030)	Twelve months ended 30 June 2016 £
		(337,647 10,000,000
		(0.034

13 Related party transactions

During the twelve month period ended 30 June 2016, the director, A P Austin, subscribed for 2,342,002 ordinary shares of 20p each in the capital of the Company at a price of 50p per share. At 30 June 2016, £21,001 remained unpaid and this is included in other receivables.

Key management compensation amounted to £107,500 for the six month ended 30 June 2016 as follows:

Directors’ fees	Six months ended 30 June 2016 £ 107,500	Twelve months ended 30 June 2016 £
		107,500

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31 March 2016

RockRose Energy plc

(‘‘RockRose’’ or ‘‘the Company’’)

Interim Results

RockRose announces its Interim Results for the period from incorporation to 31 December 2015.

Highlights:

• On 13 January 2016 Rockrose was admitted to the Standard Listing segment of the UK Listing Authority and to trading on the Main Market of the London Stock Exchange, raising £4.4million before expenses.

• Targeted acquisition strategy in place to deliver shareholder value

Andrew Austin, the Company’s Executive Chairman commented:

‘‘RockRose is pursuing a targeted acquisition strategy focused on onshore and offshore production opportunities, power generation and infrastructure projects. We have a strong board in place with an excellent track record of M&A success and following our IPO in January are well funded with a minimal level of general and administrative expenses and access to deal flow. I am confident that we have the right team and advisers in place to accurately analyse opportunities and potential transactions to materially enhance the value of the Company and I look forward to reporting to you on our progress in due course.’’

Enquiries:

RockRose Energy plc +44 (0)20 3826 4800 Andrew Austin, Executive Chairman

Broker Macquarie Capital (Europe) Limited +44 (0)20 3037 2000 Ken Fleming Nick Donovan

Financial PR Camarco Billy Clegg Georgia Mann

+44 (0) 20 3757 4980

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Chairman’s Statement

Rockrose Energy plc (‘the Company’) has been formed to make acquisitions of companies or businesses in the upstream oil and gas and power sector. This is an unusual statement to be writing as the bulk of the activity the Company has undertaken has happened since the period end. On 13 January this year we were admitted to the London Stock Exchange as a standard listed company raising £4.4million before expenses. The Board has been strengthened by the appointment of Richard Benmore and John Morrow whose experience is invaluable as we continue to evaluate opportunities.

As I am sure you are aware the situation of many oil and gas companies remains very difficult and this has got significantly worse since the incorporation of Rockrose Energy last year. The difficulties encountered by companies such as Iona, First Oil and Atlantic Petroleum brings new challenges to the market and with it, new opportunities for Rockrose. We as a board are currently reviewing a number of potential acquisitions of producing and non-producing assets offshore and onshore and also of connected infrastructure. We are also working with our partners Senergy and Macquarie on innovative ways to maximise the potential of Rockrose as a clean vehicle during this complicated period for asset holders.

Post-closing the fundraising in January we are well funded with a minimal level of general and administrative expenses. We have access to deal flow and the right advisers in place to accurately analyse opportunities. We are reviewing potential transactions which could materially enhance the value of your company. I look forward to reporting to you on our progress in due course.

...........................................................

A.P. Austin Executive Chairman

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STATEMENT OF DIRECTORS’ RESPONSIBILITIES

The directors’ confirm that these condensed interim financial statements have been prepared in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’, as adopted by the European Union and that the interim management report includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely:

• an indication of important events that have occurred during the first six months and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for this period; and

• material related-party transactions in the first six months.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Rockrose Energy plc website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

• By order of the Board

...........................................................

Andrew Austin 30 March 2016

Chairman

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INDEPENDENT REVIEW REPORT TO ROCKROSE ENERGY PLC

Report on the Condensed interim financial statements

Our conclusion

We have reviewed Rockrose Energy plc’s condensed interim financial statements (the ‘‘interim financial statements’’) in the interim financial report of Rockrose Energy Plc for the 6 month period ended 31 December 2015. Based on our review, nothing has come to our attention that causes us to believe that the condensed interim financial statements are not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

What we have reviewed

The interim financial statements comprise:

• The Condensed interim balance sheet as at 31 December 2015;

• The Condensed interim statement of comprehensive income for the period then ended;

• The Condensed interim statement of changes in equity for the period then ended;

• The Condensed interim statement of cash flows for the period then ended; and

• The notes to the Condensed interim statements.

The interim financial statements included in the interim financial report have been prepared in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’, as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

As disclosed in note 2 to the interim financial statements, the financial reporting framework to be applied in the preparation of the full annual financial statements of the company is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.

Responsibilities for the interim financial statements and the review

Our responsibilities and those of the directors

The interim financial report, including the interim financial statements, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim financial report in accordance with the Disclosure Rules and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

Our responsibility is to express to the company a conclusion on the interim financial statements in the interim financial report based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of complying with the Disclosure Rules and Transparency Rules of the United Kingdom’s Financial Conduct Authority and for no other purpose. We do not, in giving this conclusion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

What a review of interim statements involves

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, ‘Review of Interim Financial Information Performed by the Independent Auditor of the Entity’ issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

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We have read the other information contained in the interim financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed interim statements.

PricewaterhouseCoopers LLP Chartered Accountants London 30 March 2016

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INDEPENDENT REVIEW REPORT TO ROCKROSE ENERGY PLC FOR THE PERIOD ENDED 31 DECEMBER 2015

Notes Administrative expenses 6 Operating loss Finance costs (2) Loss before tax Income tax 7 Loss for the period Other comprehensive income for the period, net of tax Total comprehensive loss for the period Basic and diluted loss per share	Six months period ended 31 December 2015 £ (809,485) (809,485) (809,487) — (809,487) — (809,487) (0.67)

The notes are an integral part of these condensed interim financial statements.

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INDEPENDENT REVIEW REPORT TO ROCKROSE ENERGY PLC FOR THE PERIOD ENDED 31 DECEMBER 2015

Notes Assets Current assets Cash and cash equivalents Trade and other receivables 8 Total assets Equity and liabilities Current liabilities Trade and other payables 9 Total liabilities Equity attributable to owners of the parent Share capital 10 Share premium 10 Retained earnings Total equity Total liabilities and shareholders’ equity	31 December 2015 £ 78 962,446 962,524 1,172,011 1,172,011 240,000 360,000 (809,487) (209,487) 962,524

The notes are an integral part of these condensed interim financial statements.

These financial statements were approved by the Board of Directors on 30 March 2016 and were signed on its behalf by:

...........................................................

Andrew P Austin Director

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CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 31 DECEMBER 2015

Balance at 1 July 2015 Loss for the period Total comprehensive loss Share capital (note 10) Total contributions by owners of the company, recognised directly in equity Balance at 31 December 2015	Share Capital £ — — — 240,000 240,000 240,000	Share Premium £ — — 360,000 360,000 360,000	Retained earnings £ — (809,487) (809,487) — — (809,487)	Total £ — (809,487) (809,487) 600,000 600,000 (209,487)

The notes are an integral part of these condensed interim financial statements.

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INTERIM STATEMENT OF CASH FLOWS FOR THE PERIOD ENDED 31 DECEMBER 2015

Notes Cash fows from operating activities Continuing operations: Cash from operations 11 & 12 Interest paid Net Cash fows from operating activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	31 December 2015 £ 80 (2) 78 78 — 78

The notes are an integral part of these condensed interim financial statements.

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 DECEMBER 2015

1 General information

Rockrose Energy plc (‘the company’) has been formed to make acquisitions of companies or businesses in the upstream oil and gas and power sector.

The company is a public limited company, which is listed on the London Stock Exchange and incorporated and domiciled in the UK. The address of its registered office is Dashwood House, 69 Old Broad Street, London.

These condensed interim financial statements were approved for issue on 30 March 2016.

These condensed interim financial statements do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. The company was incorporated on 1 July 2015 and the first period of accounts is to 31 December 2016.

The condensed interim financial statements have been prepared for the six months period from the date of incorporation 1 July 2015 to 31 December 2015.

These condensed interim financial statements have been reviewed, not audited

2 Basis of preparation

These condensed interim financial statements for the six months ended 31 December 2015 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and with IAS 34, ‘Interim financial reporting’, as adopted by the European Union. The financial reporting framework to be applied in the preparation of the full annual financial statements of the company is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.

Going concern basis

The company had not traded or generated any income for the period ended 31 December 2015, as a result of which the company is reporting a loss of £809,487 and net liabilities of £209,487. The loss of £809,487 was the admission costs for the Initial Public Offering. The company’s forecasts and projections, taking account of reasonably possible changes in trading performance, show that the company should be able to operate within the level of its current facilities. After making enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The directors have therefore confirmed that they considered it appropriate to adopt the going concern basis in preparing its condensed financial statements.

Segment reporting

It is the opinion of the directors that the operations of the company represent one segment, and are treated as such when evaluating its performance. The chief operating decision maker is the Board of Directors. The Board of directors reviews management accounts prepared for the company when assessing performance.

3 Accounting policies

The company has adopted all relevant standards, amendments and interpretations that are effective for accounting years commencing 1 July 2015. A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 July 2015, and have not been applied in preparing these financial statements. None of these are expected to have a significant effect on the financial statements of the company.

The accounting policies applied in the preparation of these financial statements are set out below.

3.1 Cash and cash equivalents

Cash and cash equivalents in the statement of cash flows include cash in hand, deposits held with banks and bank overdrafts.

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3.2 Financial instruments

Financial assets and liabilities are recognized when the company becomes a party to the contractual provisions of the instrument. Financial assets are derecognised when the rights to receive cash flows from the assets have expired or have been transferred and the company has transferred substantially all risks and reward of ownership. Financial liabilities are derecognised when the obligation specified in the contract is discharged, cancelled or expires. At initial recognition, the company classifies its financial instruments in the following categories:

Loans and receivables: Non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. The company’s loans and receivables comprise trade and other receivables, cash and cash equivalents, and are included in current assets due to their short term nature. Loans and receivables are initially recognised at the amount expected to be received less, when material, a discount to reduce the amount to fair value. Subsequently, loans and receivables are measured at amortised cost using the effective interest rate method less a provision for impairment.

At each reporting date, the company assesses whether there is objective evidence that a financial asset is impaired. A provision for impairment of loans and receivables is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables. The impairment loss is the difference between the carrying amount of the asset and the present value of the estimated future cash flows, discounted using the instrument’s original effective interest rate. The amount of the provision is recognised in the condensed statement of comprehensive income.

Impairment losses on financial assets carried at amortised cost are reversed in subsequent financial periods if the amount of the loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised.

Financial liabilities at amortised cost: Trade payables, accruals and other payables are classified as financial liabilities at amortised cost. Financial liabilities at amortised cost are initially recognised at the amount expected to be paid, less, when material, a discount to reduce the amount to fair value. Subsequently they are measured at amortised cost using the effective interest rate method.

3.3 Share Capital

Ordinary shares are classified as equity. The company’s share capital currently consists of ordinary shares.

3.4 Current and deferred taxation

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates income. Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual profit or loss.

Deferred balances are recognised in respect of all timing differences that have originated but not reversed by the Balance Sheet date, except that:

• The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and

• Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

• Deferred tax balances are not recognised in respect of permanent differences. Deferred income tax is determined using tax rates and laws that will be in effect when the differences are expected to reverse.

4 Estimates

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

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In preparing these condensed interim financial statements, the significant judgements made by management in applying the company’s accounting policies and the key accounting estimates are the accruals and going concern evaluation. Other than the evaluation of going concern (which is disclosed in note 2) and accruals, the company’s financial statements do not contain any significant accounting estimates.

5 Financial risk management

As at 31 December 2015 the company’s financial instruments consisted of cash and cash equivalents, trade and other receivables and trade and other payables including accrued liabilities. With respect to all of these financial instruments, the company estimates that their fair values approximate their carrying values at 31 December 2015 based on the nature of those instruments.

The company’s risk exposures and impact on the company’s financial instruments are summarised below:

Credit risk

The company’s credit risk is primarily attributable to cash, which is held in Metro bank and receivables from broker firms. Cash is deposited in a fairly new financial institution which is now becoming the trend for many businesses in the UK. Amounts receivable from brokers firms were neither past due nor impaired as of 31 December 2015 and have been received in January 2016.

Liquidity risk

At 31 December 2015, the company was in a net current liabilities position with all the liabilities due within the next 12 months.Funds were received following a further issue of shares on 8 January 2016 as disclosed in note 14. The company has therefore access to adequate funding which management considers sufficient to settle liabilities as they fall due and to fund operating activities for the foreseeable future.

Market risk

• (a) Interest rate risk

The company has minimal cash balances. Cash balances do not generate material amounts of interest. There are no other interest bearing financial instruments therefore the company is not exposed to interest rate risk

• (b) Foreign currency risk

All the balances as of 31 December 2015 and the transactions for the six month period then ended were denominated in UK £ which is the company’s functional and presentation currency. The company is therefore not exposed to foreign currency risk.

Capital management

The capital of the company is represented by the net assets attributable to holders of ordinary shares. The company’s objective when managing capital is to safeguard the company’s ability to continue as a going concern and fund development, in order to provide returns for shareholders and benefits for other stakeholders. The company has not paid dividends, nor returned capital to the shareholder to date. The company is not subject to externally imposed capital requirements.

6 Administrative expenses

These include commission and expenses payable under the Placing Agreement, registration, listing and admission fees, printing, advertising and distribution costs and professional advisory fees, including legal fees, and any other applicable expenses.

7 Taxation and deferred tax

Income tax expense is recognised based on management’s estimate of the weighted average annual income tax rate expected for the full financial year. There is no income tax charge for the period.

Factors that may affect future tax charges

The company has estimated losses of £809,487 available to carry forward against future profits. The company has a potential deferred tax asset of £161,897 which has not been recognised on

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the above losses in the condensed interim financial statements. This is due to uncertainty when such losses will be utilised.

8 Trade and other receivables

Other receivables Prepayments	31 December 2015 £
	940,546 21,900
	962,446

Other receivables represent cash receivable from broker firms client accounts, including the issued share capital and other further new issue of shares as referred to in notes 10 and 14.

9 Trade and other payables

Accruals Other payables	31 December 2015 £
	806,615 365,396
	1,172,011

Accruals represent estimated admission costs for the initial public offering. Other payables include £340,000 received prior to the further new issue of ordinary shares issued as referred to in note 10. The funds were held by the brokers firms client accounts (note 8). The funds were formally released on admission to the Stock Exchange on 13 January 2015 (note 14).

10 Share capital and share premium

Issued 1,200,000 ordinary shares of 20p nominal value each Balance carried forward	Share capital £ 240,000 240,000	Share premium £
		360,000
		360,000

On incorporation, 1 July 2015, 1,200,000 ordinary shares of 5p at a price of 12.5p each were issued (equivalent to 300,000 shares at a price of 50p).

On 5 August 2015, a special resolution was passed to consolidate every four ordinary shares of 5p each into one ordinary share of 20p.

Payment for the ordinary shares of £150,000 was not made on incorporation, but was made on 18 December 2015. Additionally on 18 December 2015, a further 900,000 ordinary shares of 20p each were issued at a price of 50p per share. A total of £600,000 was received into the broker’s client account, which is shown as other receivables and presented as unpaid share capital in the condensed interim statement of changes in equity.

On 22 December 2015 the company entered into a loan agreement with Appleby Trust (Jersey) Limited pursuant to which the company agreed to lend £600,000 to the EBT for the purpose of subscribing for 1,200,000 Placing Shares. The loan was not drawn until after the period ended 31 December 2015.

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As at 31 December 2015, a draft prospectus for the issue of 8,800,000 New Ordinary Shares at 50p per share, amounting to gross proceeds of £4.4 million had been committed to and accepted by the placees. As at 31 December 2015, £340,000 of the gross proceeds were received in advance and retained in the broker’s firm client account. The directors have been advised to make a call for at least 25% of those shares to be paid up, as at 31 December 2015.

At 31 December 2015 a significant proportion of the placees monies has been received and was held in the broker firms client accounts. The formal release of these monies took place on admission on 13 January 2016.

11 Reconciliation of net cash flow from operating activities

Loss before tax Increase in trade and other receivables (excl. share capital payment fund payment fund held in broker’s frm client account, note 10) Increase in trade and other payables Net cash infow from operating activities	31 December 2015 £
	(809,487 (362,446 1,172,011
	78

12 Reconciliation of net cash to movement in net funds

Increase in cash in the period Change in net debt resulting from cash fows Other non-cash changes Movement in net debt in the period Net funds at 1 July 2015 Net funds at 31 December 2015	31 December 2015 £
	78
	78 —
	78 —
	78

13 Related party transactions

During the six months period ended 31 December 2015, the director and the sole shareholder Andrew P Austin subscribed for 1,200,000 ordinary of 20p each in the capital of the company at a price of 50p per share.

14 Subsequent Events

The company evaluated its 31 December 2015 interim condensed financial statements for subsequent events.

On 8 January 2016 the company issued 8,800,000 new ordinary shares at a price of 50p per share amounting to gross proceeds of £4,400,000.

Included in the 8,800,000 new ordinary shares issued, 1,200,000 ordinary Shares were issued to the EBT Trustee which was funded by way of a loan from the company. The loan agreement was entered on 22 December 2015, but the loan was not granted until after the period end on 31 December 2015.

On 13 January 2016, the funds held in broker funds client accounts were formally released into company’s bank accounts.

On 13 January 2016, the company was admitted to the London Stock Exchange as a standard listed company.

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PART XVII

HISTORICAL FINANCIAL INFORMATION ON IDEMITSU UK

Idemitsu UK Interim Report
for the six months ended 30 June 2017	F-1
Idemitsu UK Annual Report and Financial Statements
for the year ended 31 December 2016	F-13
Idemitsu UK Annual Report and Financial Statements
for the year ended 31 December 2015	F-53
Idemitsu UK Annual Report and Financial Statements
for the year ended 31 December 2014	F-93

178

2 February 2018

Idemitsu Petroleum UK Ltd.

(‘‘the Company’’)

Interim Results

(Registered number: 09665181)

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 JUNE 2017

Notes Revenue 7 Other income Cost of sales Depreciation, depletion and amortisation 10 Foreign exchange (loss)/gain on decommissioning provision 10 Gross proft Administrative costs Impairment of exploration assets Operating proft/(loss) Finance income Finance costs Foreign exchange (loss)/gain Loss before income tax Income tax credit 8 Loss for the period and total comprehensive expense	Unaudited Six months ended 30 June 2017 $’000 40,500 902 (21,612) (4,343) (9,707) 5,740 (3,344) — 2,396 733 (5,188) (256) (2,315) 346 (1,969)	Unaudited Six months ended 30 June 2016 $’000 30,620 1,185 (18,685) (8,559) 11,175 15,736 (4,311) (19,402) (7,977) 378 (5,183) 811 (11,971) 2,784 (9,187)

The notes are an integral part of these condensed interim financial statements.

F-1

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2017

Notes Assets Non-Current Assets Intangible assets 9 Property, plant and equipment 10 Deferred tax 8 Total Non-Current Assets Current Assets Inventory Trade and other receivables 11 Loan to the group undertaking 12 Cash and cash equivalents 13 Total Current Assets Total Assets Equity and Liabilities Non-Current Liabilities Decommissioning provision 14 Other provision 14 Total Non-Current Liabilities Current Liabilities Trade and other payables Amount owed to fellow group undertakings Tax payable Total Current Liabilities 15 Total Liabilities Share Capital and Reserves Share capital 16 Share premium Other reserves Retained defcit Total Share Capital and Reserves Total Equity and Liabilities	Unaudited 30 June 2017 $’000 1,722 52,938 34,055 88,715 955 19,771 105,000 33,938 159,664 248,379 277,987 48 278,035 23,045 101 113 23,259 301,294 156,002 37,372 8,149 (254,438) (52,915) 248,379	Audited 31December 2016 $’000 1,722 51,074 32,131 84,927 2,962 14,582 90,000 30,500 138,044 222,971 260,592 48 260,640 12,869 270 138 13,277 273,917 156,002 37,372 8,149 (252,469) (50,946) 222,971

The notes are an integral part of these condensed interim financial statements.

F-2

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2017

Balance at 1 January 2016 Loss for the six months period ended 30 June 2016 (Unaudited) 30 June 2016 (Unaudited) 1 January 2017 Loss for the six months period ended 30 June 2017 Balance at 30 June 2017 (unaudited)	Share Capital $’000 156,002 — 156,002 156,002 — 156,002	Share Premium $’000 37,372 — 37,372 37,372 — 37,372	Other Reserves $’000 8,149 — 8,149 8,149 — 8,149	Retained Earnings / (Defcit) $’000 (256,426) (9,187) (265,613) (252,469) (1,969) (254,438)	Total $’000 (54,903) (9,187) (64,090) (50,946) (1,969) (52,915)

The notes are an integral part of these financial statements.

F-3

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 JUNE 2017

Notes Cash fows from operating activities Loss before tax Foreign exchange movement Finance income Unwinding of discount 14 Finance cost Impairment of Intangible assets Depreciation and amortisation 10 Foreign exchange movements on decommissioning Movement in provisions Movement in trade and other receivables Movement in inventory Movement in trade and other payables Net cash generated from operating activities Cash fows from investing activities Capitalized cost for property, plant and equipment Capitalized cost for exploration activities Cash used in investing activities Cash fows from fnancing activities Finance income Finance cost Loan to parent undertaking Cash used in fnancing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at start of period Effect of foreign exchange rate changes Cash and cash equivalents at end of period 13	Unaudited Six months ended 30 June 2017 $’000 (2,315) 256 (733) 5,182 6 — 4,440 9,707 (4,088) (5,189) 2,007 9,981 19,254 (1,279) — (1,279) 733 (6) (15,000) (14,273) 3,702 30,500 (264) 33,938	Unaudited Six months ended 30 June 2016 $’000 (11,971) (811) (378) 4,914 23 19,402 8,559 (11,175) 702 (15,089) (312) 6,618 482 (775) (10,931) (11,706) 378 (23) — 355 (10,869) 28,812 52 17,995

The notes are an integral part of these condensed interim financial statements.

F-4

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2017

1 General information

Idemitsu Petroleum UK Ltd. (‘the Company’) has been formed to make acquisitions of companies or businesses in the upstream oil and gas and power sector.

The Company is incorporated and domiciled in the United Kingdom under the Companies Act 2006. The address of the registered office is 5th Floor, Halton House, 20-23 Holborn, London, EC1N 2JD, United Kingdom. The Company’s objectives are to invest in North Sea oil and gas activities, holding interests in joint ventures involved in the exploration for, development of and production of oil and gas reserves. The Company is engaged in the production of oil and gas from various fields in the United Kingdom sector of the North Sea Continental shelf (‘UKCS’). The Company shares are not publicly traded. All activities of the Company are carried out in the United Kingdom Continental Shelf (UKCS). These condensed interim financial statements are presented in United States dollars (US$’s) and the values in the financial statements are rounded to thousands (US$’000). The functional and presentational currency of the Company is United States dollars (US$).

These condensed interim financial statements do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. The statutory accounts for the year ended 31 December 2016 were approved by the board of directors on 30 March 2017 and delivered to the Registrar of Companies. The report of the auditors on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under section 498 of the Companies Act 2006.

These condensed interim statements have not been reviewed or audited.

2 Basis of preparation

These condensed interim financial statements for the six months ended 30 June 2017 have been prepared in accordance with IAS 34, ‘Interim financial reporting’, as adopted by the European Union. The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2016, which have been prepared in accordance with IFRSs as adopted by the European Union.

a) Going concern

These interim condensed consolidated financial statements have been prepared on a going concern basis. The directors are satisfied that the Company has sufficient resources to continue in operation for the foreseeable future, a period of not less than twelve months from the date of this report. Accordingly they continue to adopt the going concern basis in preparing the interim condensed statements.

b) Segment reporting

In the opinion of the directors the operations of the Company represent one segment, and are treated as such, when evaluating its performance. The chief operating decision maker is the Board of Directors. The Board of Directors reviews management accounts prepared for the Company when assessing performance.

3 Accounting policies

The accounting policies applied in these condensed interim financial statements are consistent with those followed in the preparation of the Company’s audited financial statements for the year ended 31 December 2016.

A number of amendments to IFRSs became effective for the financial year beginning on 1 January 2017 however the Company did not have to change its accounting policies or make material retrospective adjustments as a result of adopting these amendments.

4 Estimates

The preparation of condensed interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

F-5

In preparing these condensed interim financial statements, the significant judgements made by management in applying the Company’s accounting policies and the key accounting estimates were the same as those that applied to the audited financial statements for the year ended 31 December 2016.

5 Financial risk management

As at 30 June 2017 the Company’s financial instruments consisted of cash and cash equivalents, trade and other receivables and trade and other payables including accrued liabilities. With respect to all of these financial instruments, the Company estimates that their fair values approximate their carrying values at 30 June 2017 based on the nature of those instruments.

The Company’s risk exposures and impact on the Company’s financial instruments are summarised below:

Credit risk

The Company’s credit risk is primarily attributable to cash, which is held in the bank account of Sumitomo Mitsui Banking Corporation Europe, and a receivable owed by the ultimate parent company.

Market risk

(a) Commodity price risk

The Company held no financial instruments at 30 June 2017 that are affected by commodity price but the Company is nonetheless exposed to movements in oil prices. Revenue from gas sales is not significant. Movement in Oil prices could have a significant impact on revenue and cash generation. A proactive assessment of oil price forecast is conducted on a monthly basis and any mitigating factors are embedded in our operational plan in conjunction with operator targets for joint ventures.

(b) Interest rate risk

The loan owed from the ultimate parent company is linked to LIBOR and volatility in LIBOR could have an impact on interest income. A regular monitoring of LIBOR volatility is part of the risk management plan and all loan arrangements with ultimate parent company are on a short term basis. There are no other interest bearing financial instruments. The loan was repaid on 8 December 2017, prior to the acquisition of the Company by Rockrose Energy plc.

(c) Foreign currency risk

The Company is exposed to foreign exchange risk arising from currency exposures, primarily with respect to GBP. The risk of foreign exchange arises when future commercial transactions or recognised assets or liabilities are denominated in a currency that is not the Company’s functional currency.

The risk of foreign exchange movement on the decommissioning liability is significant due to size of the provision. The foreign exchange movements on all other liabilities to suppliers and amounts owed to fellow subsidiary undertakings are relatively small as payment is made within 30 days.

Capital management

The capital of the Company is represented by the net assets attributable to holders of ordinary shares. The Company’s objective when managing capital is to safeguard the Company’s ability to continue as a going concern and fund development, in order to provide returns for shareholders and benefits for other stakeholders. The Company has not paid dividends, nor returned capital to the shareholder to date. The Company is not subject to externally imposed capital requirements.

6 Administrative expenses

These include salaries including director’s emoluments, stationary, printing, professional advisory fees, including legal fees, any other applicable administrative expenses and general office overheads.

F-6

7 Revenue

Oil and liquefed petroleum gas Natural gas and condensate Total revenues	Period ended 30 June 2017 $’000 39,701 799 40,500	Period ended 30 June 2016 $000
		29,652 968
		30,620

8 Taxation

Income tax expense is recognised based on management’s estimate of the weighted average annual income tax rate expected for the full financial year. The estimated average annual tax rate used for the year to 31 December 2017 is 40% (the tax rate for the six months ended 30 June 2016 was 40%). The recognition of income tax credit of $346,000 (six months period ended 30 June 2016: $2,784,000 tax credit) relates to movement in decommissioning provision on one of the producing fields.

The deferred tax asset of $34,055,000 (As at 31 December 2016: $32,131,000) relates to recognized probable economic benefits associated with future obligations.

9 Intangible assets

Cost Balance at 1 January 2016 Additions Provision for plug and abandonment Balance at 31 December 2016 Additions Balance at 30 June 2017 Impairment Balance at 1 January 2016 Impairment Balance at 31 December 2016 Impairment Balance at 30 June 2017 Net book value At 30 June 2017 At 31 December 2016	Goodwill $’000 4,099 — — 4,099 — 4,099 (4,099) — (4,099) — (4,099) — —	Oil and gas assets $’000 57,344 10,993 6,113 74,450 — 74,450 (47,213) (25,515) (72,728) — (72,728) 1,722 1,722	Total $’000
			61,443 10,993 6,113
			78,549 —
			78,549
			(51,312) (25,515)
			(76,827) —
			(76,827)
			1,722
			1,722

F-7

10 Property, plant and equipment

Cost Balance at 1 January 2016 Additions Disposal Change in estimates Foreign exchange movements on decommissioning provision Balance at 31 December 2016 Additions Foreign exchange movements on decommissioning provision Balance at 30 June 2017 Depreciation and impairment Balance at 1 January 2016 Depreciation charge for the year Disposal Balance at 31 December 2016 Depreciation charge for the period Balance at 30 June 2017 Net book value At 30 June 2017 At 31 December 2016 11 Trade and other receivables	Oil and gas assets $’000 954,565 1,272 (46,108) 12,224 (32,271) 889,682 16,001 (9,707) 895,976 (870,303) (14,235) 45,133 (839,405) (4,343) (843,748) 52,228 50,277	Administrative assets $’000 1,271 299 — — — 1,570 10 — 1,580 (596) (177) — (773) (97) (870) 710 797	Total $’000
			955,836 1,571 (46,108) 12,224 (32,271)
			891,252 16,011 (9,707)
			897,556
			(870,899) (14,412) 45,133
			(840,178) (4,440)
			(844,618)
			52,938
			51,074

Trade receivables and accrued income Crude oil under lift Amount owed by fellow group subsidiaries Deposits Tax receivables Other debtors	As at 30 June 2017 $’000 8,989 9,171 751 128 53 679 19,771	As at 31 December 2016 $000
		8,519 2,098 1,083 728 1,695 459
		14,582

F-8

12 Loan to the group undertaking

Loan to Idemitsu Kosan Co., Ltd. Total loans to the group undertaking	Currency	Nominal interest rate LIBOR +0.25%	Year of maturity Payable on demand	Fair value As at 30 June 2017 $’000 105,000 105,000	Carrying amount As at 30 June 2017 $’000 105,000 105,000	Fair value As at 31December 2016 $’000 90,000 90,000	Carrying amount As at 31December 2016 $’000
	USD						90,000
							90,000

The loan was provided to the parent entity, Idemitsu Kosan Co., Ltd. as part of the surplus cash management. The agreed terms and conditions provide for repayment of the loan to the Company on demand. The loan was repaid on 8 December 2017, prior to the acquisition of the Company by RockRose Energy plc.

13 Cash and cash equivalents

Cash at bank Short term deposit	As at 30 June 2017 $’000 3,938 30,000 33,938	As at 31 December 2016 $000
		3,500 27,000
		30,500

14 Provisions, liabilities and charges

Balance at 1 January 2016 Utilisation Foreign exchange movements Changes in estimates Unwinding of discount Disposal Additions Balance at 31 December 2016 Balance at 1 January 2017 Utilisation Foreign exchange movements Unwinding of discount Balance at 30 June 2017	Decommissioning Provisions $’000 287,643 (3,945) (49,451) 12,224 9,829 (1,821) 6,113 260,592 260,592 (2,509) 14,722 5,182 277,987	Other Provisions $’000 — — — — — — 48 48 48 — — — 48	Total Provisions $000
			287,643 (3,945) (49,451) 12,224 9,829 (1,821 6,161
			260,640
			260,640 (2,509 14,722 5,182
			278,035

F-9

15 Trade and other payables

Trade payables and accrued expenses Deferred income Crude oil over lift Amount owed to joint venture partners Amount owed to the parent or fellow group subsidiaries Tax payable 16 Share capital and share premium Ordinary shares as at 1 January Shares issued Ordinary shares as at end of period/year Deferred shares as at end of period/year Total ordinary and deferred shares as at end of period / year Authorised, allotted, called up and fully paid 156,000,368 (As at 31 December 2016:156,000,368) ordinary shares of $1 each 1,000 (As at 31 December 2016: 1,000) deferred shares of £1 each Authorised as at 31 December and 30 June	As at 30 June 2017 $’000 6,371 11,466 1,199 4,009 101 113 23,259 As at 30 June 2017 Number 156,000,368 — 156,000,368 1,000 156,001,368 As at 30 June 2017 $’000 156,000 2 156,002	As at 31 December 2016 $000
		7,248 — 939 4,682 270 138
		13,277
		As at 31 December 2016 Number
		156,000,368 —
		156,000,368 1,000
		156,001,368
		As at 31 December 2016 $’000
		156,000 2
		156,002

F-10

17 Related party transactions

Identity of related parties with which the Company has transacted Related party transactions as defined under IAS 24, which occurred during the year, are listed below:

Income Management fee from Idemitsu International (Europe) Limited Management fee from Idemitsu Petroleum Norge AS Interest income on loan owed from Idemitsu Kosan Co., Ltd. Expenses recharged to Idemitsu Kosan Co., Ltd. Total income earned from the fellow group undertakings Expenses Management fee from Idemitsu Kosan Co., Ltd. Total expenses incurred on the fellow group undertakings Receivables Idemitsu Kosan Co., Ltd. Idemitsu International (Europe) Limited Idemitsu Petroleum Norge AS Idemitsu Kosan (Vietnam) Total receivables Payables Idemitsu Kosan Co., Ltd. Total Payables Subtotal – Net current receivables Idemitsu Kosan Co., Ltd. – Loan Total net receivables from the fellow group undertakings Entities	Period ended 30 June 2017 $’000 Period ended 30 June 2016 $’000 27 36 119 258 641 641 640 1,567 1,427 2,502 29 60 29 60 As at 30 June 2017 $’000 As at 31 December 2016 $’000 614 587 15 7 123 215 — 5 752 814 (101) (269) (101) (269) 651 545 105,000 90,000 105,651 90,545 Incorporation place Japan Norway United Kingdom
Idemitsu Kosan Co., Ltd. (immediate and ultimate parent Company) Idemitsu Petroleum Norge AS (fellow group subsidiary) Idemitsu International (Europe) Limited (fellow group subsidiary)

All related parties transactions were made on terms equivalent to those that prevail in arm’s length transactions.

Transactions with key management personnel

The Directors of the Company do not have any shares in the Company (As at 31 December 2016: $nil).

F-11

Total remuneration paid to the Directors who provided qualifying services to the Company during the period, consisted of salaries of $222,325 and benefits $61,963 (Period ended 30 June 2016: Salaries $307,853 and benefits $91,040).

None of these Directors were remunerated from the ultimate parent company or any of its other subsidiaries.

18 Subsequent events

On 8 December 2017, full ownership of the Company was sold from Idemitsu Kosan Co., Ltd. to RockRose Energy plc. The name of the Company changed from Idemitsu Petroleum UK Ltd. to RockRose UKCS4 Limited with effect from 8 December 2017.

All receivables / (payables) with fellow group undertakings were cleared prior to completion of the acquisition of the Company by RockRose. At 30 June these balances were:

Loan receivables Idemitsu Kosan Co., Ltd. Trade receivables Idemitsu Kosan Co., Ltd. Trade receivables Idemitsu International (Europe) Limited Trade receivables Idemitsu Petroleum Norge AS Trade payables Idemitsu Kosan Co., Ltd.	As at 30 June 2017 $’000 105,000 614 15 123 (101) 105,651

The Company performed a review of recoverable amount of property, plant & equipment as part of full year end closing in accordance with the Company’s accounting policies. This indicates a likely reversal of impairment of $77,685,000 (unaudited) on producing oil and gas assets.

In addition, on 26 January 2018, the Company proposed paying a dividend of $45,000,000 to its parent company, Rockrose Energy plc. This dividend is subject to approval by the board of directors at a meeting to be held on 14 February 2018.

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PART XVIII

COMPETENT PERSON’S REPORT

The Idemitsu UK Acquisition constitutes a Reverse Takeover. Consequently, the Company is required to produce a prospectus in connection with Admission and by paragraphs 131 to 133 of the European Securities and Markets Authority (ESMA) update of the Committee of European Securities Regulators (CESR) recommendations in respect of the consistent implementation of Commission Regulation (EC) No 809/2004 implementing the Prospectus Directive to include an independent mineral expert report in this document on the licence interests of the Group along with a glossary of the technical terms used in the mineral expert’s report. The Company commissioned ERC Equipoise to prepare the independent expert report (referred to as the Competent Person’s Report), which is set out in full below.

ERC Equipoise report .........................................................................................................

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313

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14 February 2018

The Directors

Rockrose Energy plc c/o Cooley Services Ltd Dashwood 69 Old Broad Street London EC2M 1QS

Dear Sirs,

Re: Evaluation of Certain Assets Held by Rockrose Energy plc in the UK North Sea

In accordance with your instructions, ERC Equipoise Ltd (“ERCE”) has prepared a Competent Person’s Report (“CPR”) in accordance with European Securities and Market Authority (“ESMA”) Recommendations for Oil and Gas Companies as set out in paragraphs 131 to 133 and Appendix I and III of the ESMA Recommendations. Accordingly, ERCE reviewed the Reserves associated with oil fields in licences PL297, PL973, PL307, PL729, PL087, PL077 and PL069 offshore UK, in which Rockrose Energy plc (“Rockrose”) has a working interest. The Reserves in this report have been calculated using an effective date of 31 December 2017 and are based on data made available up until 30 September 2017. ERCE is not aware of any material change in the status of the Rockrose assets in the period between the receipt of the data and 31 December 2017. This is the first CPR that has been conducted on the licences PL297, PL973, PL307, PL729, PL087, PL077 and PL069 assets for Rockrose.

ERCE has carried out this work using the March 2007 SPE/WPC/AAPG/SPEE Petroleum Resources Management System (“PRMS”) as the standard for classification and reporting. A summary of the PRMS is found in Section 8 of the enclosed CPR. Nomenclature that may be used in this letter and the enclosed report is summarised in Section 9.

ERCE has used standard petroleum evaluation techniques in the generation of the enclosed CPR. These techniques combine geophysical and geological knowledge with assessments of porosity and permeability distributions, fluid characteristics, production performance and reservoir pressure. There is uncertainty in the measurement and interpretation of basic data. ERCE has estimated the degree of this uncertainty and determined the range of recoverable hydrocarbon volumes.

ERCE understands that this CPR has been prepared for the purposes of being included, in its entirety, in the Document prepared by Rockrose in relation to the admission of the entire issued share capital of Rockrose to the standard listing segment of the Official List of the Financial Conduct Authority and the main market for listed securities of the London Stock Exchange plc, and hereby consents to the inclusion of this CPR in that document and also to using references to the CPR in any other applicable disclosure document, provided that no portion be used out of context or in such a manner as to convey a meaning

ERC Equipoise Ltd , 6th Floor Stephenson House, 2 Cherry Orchard Road, Croydon, CR0 6BA Tel: 020 8256 1150 Fax: 020 8256 1151 Registered England No. 03587074 Registered Office Eastbourne House, 2 Saxbys Lane, Lingfield, Surrey, RH7 6DN

T-1

which differs from that set out in the whole. This CPR may not be used for any other purpose without the prior written approval of a Director of ERCE.

Reserves

ERCE has audited the Reserves for four fields in the UK North Sea in which Rockrose has working interest positions: Nelson, Howe, Ross and Blake. Figure 1 depicts the location of the fields.

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Figure 1: Rockrose UK North Sea Field Locations (Source: Rockrose)

Our forecasts of production and costs for each field at the Proved (1P), Proved plus Probable (2P) and Proved plus Probable plus Possible (3P) levels are presented in Table 9.1 through Table 9.12 of the enclosed CPR.

Table 1 below presents our estimates of remaining oil reserves attributable to Rockrose as at 31 December 2017 by field and in aggregate at the 1P, 2P and 3P levels respectively. It also contains our estimates of Net Present Value, applying a 10% discount factor (NPV10) attributable to Rockrose as at 31 December 2017.

In the calculation of remaining economic reserves, the volumes were calculated excluding abandonment charges, until the economic limit was reached. However, in the calculation of Net Present Value, abandonment charges have been included.

T-2

2P	Blake Field	30.82%	20.93	6.45	73.03	2024	1P	Blake Field	30.82%	16.45	5.07	40.29	2024	3P	Blake Field	30.82%	28.60	8.81	128.43	2024	_Note that the reserves estimates in the above table do not account for the ongoing negotiation regarding a mismeasurement of volumes exported to the_ Forties Pipeline System (FPS) from Nelson, Howe and Bardolino. ERCE notes that in the event an agreement is reached which results in a repayment then the Reserves and NPV10 presented for Nelson and Howe set out in this report will be affected. Table 1: Summary of Reserves and Net NPV for the Rockrose Portfolio, effective 31/12/2017*
	Ross Field	30.82%	0.90	0.28	-13.51	2024		Ross Field	30.82%	0.46	0.14	-16.64	2024		Ross Field	30.82%	1.40	0.43	-10.10	2024
	Howe Field	20.00%	5.28	1.06	31.50	2029		Howe Field	20.00%	2.46	0.49	18.15	2026		Howe Field	20.00%	7.77	1.55	41.09	2034
	Nelson Field	7.48%	24.99	1.87	20.43	2029		Nelson Field	7.48%	17.30	1.29	11.67	2026		Nelson Field	7.48%	33.54	2.51	30.40	2034
	TOTAL PORTFOLIO		52.10	9.65	111.45			TOTAL PORTFOLIO		36.67	7.00	53.47			TOTAL PORTFOLIO		71.31	13.31	189.82
		Rockrose Interest (%)	Gross Remaining Reserves (MMstb)	Reserves Attributable to Rockrose (MMstb)	NPV10 Attributle to Rockrose (GBP MM)	Economic Limit (Year)			Rockrose Interest (%)	Gross Remaining Reserves (MMstb)	Reserves Attributable to Rockrose (MMstb)	NPV10 Attributle to Rockrose (GBP MM)	Economic Limit (Year)			Rockrose Interest (%)	Gross Remaining Reserves (MMstb)	Reserves Attributable to Rockrose (MMstb)	NPV10 Attributle to Rockrose (GBP MM)	Economic Limit (Year)

T-3

ERCE is aware that there is an ongoing negotiation regarding a mismeasurement of volumes exported to the Forties Pipeline System (FPS) from Nelson, Howe and Bardolino. This arose from low flow rates in the export line not being sufficiently mixed to provide a representative sample over a period from May 2009 to April 2015. The Nelson Operator is currently seeking a resolution with the Forties pipeline owner but ERCE understands that the balance of crude oil to be repaid is approximately 1.2 MMstb, with the majority of this to be from Nelson. Although no firm agreement for the repayment has been struck, ERCE notes that in the event an agreement is reached which results in a repayment then the Reserves and NPV10 presented for Nelson and Howe set out in the enclosed CPR will be affected.

Confirmations and Professional Qualifications

ERCE has the relevant and appropriate qualifications, experience and technical knowledge to appraise professionally and independently the assets. The team has undertaken numerous reserves and resources assessments onshore and offshore UK.

The work has been supervised by Mr Simon McDonald, Engineering Director of ERCE, a Chartered Engineer with the UK Energy Institute and the President of The Society of Petroleum Evaluation Engineers, who has 40 years’ experience in the evaluation of oil and gas fields and acreage, preparation of development plans and assessment of reserves and resources.

Mr Simon McDonald is independent of Rockrose, its directors, senior management and its other advisers and has no economic or beneficial interest (present or contingent) in Rockrose or in any of the mineral assets evaluated and is not remunerated by way of a fee that is linked to the admission or value of Rockrose.

For the purposes of Prospectus Rule 5.5.3R (2)(f) ERCE accepts responsibility for the information contained in this section of the Prospectus and those sections of the Prospectus which include references to the information in this section. ERCE declares that to the best of its knowledge and belief, having taken all reasonable care to ensure that such is the case, the information contained in this letter and the enclose CPR is in accordance with the facts and does not omit anything likely to affect the import of such information.

Yours faithfully,

ERC Equipoise Limited

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Simon McDonald Engineering Director, ERC Equipoise Ltd.

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Rockrose: CPR of Certain UK Oil Fields

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PREPARED FOR: Rockrose Energy plc

BY: ERC Equipoise Limited Date: November 2017

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Rockrose Competent Person’s Report for Certain UK Assets

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Approved by: Simon McDonald

November 2017

1

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Rockrose Competent Person’s Report for Certain UK Assets

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Table of Contents

1.	Summary of Reserves...................................................................................................................... 5
2.	Dataset ............................................................................................................................................ 8
3.	Evaluation Basis .............................................................................................................................. 9
	3.1. Methodology for Economic Modelling ................................................................................... 9
	3.1.1. Discount Rate and Method ........................................................................................... 10
	3.1.2. Economic Assumptions ................................................................................................. 10
	3.1.3. UK Tax Considerations .................................................................................................. 10
4.	The Nelson Field ............................................................................................................................ 11
5.	The Howe Field.............................................................................................................................. 16
6.	The Blake Field .............................................................................................................................. 20
7.	The Ross Field................................................................................................................................ 25
8.	Appendix 1: SPE PRMS Guidelines ................................................................................................ 28
9.	Appendix 2: Field Production Forecasts Before Economic Limits are Applied ............................. 37
10. Appendix 3: Nomenclature ........................................................................................................... 50
	10.1. Units and their abbreviations ............................................................................................... 50
	10.2. Resources Categorisation...................................................................................................... 51
	10.3. Terms and their abbreviations .............................................................................................. 52

November 2017

2

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Rockrose Competent Person’s Report for Certain UK Assets

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List of Tables

Table 1.1: Summary of Reserves and Net NPV for the Rockrose Portfolio, effective 31/12/2017 .............. 7 Table 3.1: Economic Assumptions .............................................................................................................. 10 Table 4.1: Nelson Field Oil Reserves as at 1 January 2018 ......................................................................... 11 Table 5.1: Howe Field Oil Reserves as at 1 January 2018 ........................................................................... 16 Table 6.1: Blake Field Oil Reserves as at 1 January 2018 ............................................................................ 20 Table 7.1: Ross Field Oil Reserves as at 1 January 2018 ............................................................................. 25 Table 9.1: Economic Input for Nelson Field: Proved Case .......................................................................... 38 Table 9.2: Economic Input for Nelson Field: Proved + Probable Case ........................................................ 39 Table 9.3: Economic Input for Nelson Field: Proved + Probable + Possible Case ....................................... 40 Table 9.4: Economic Input for Howe Field: Proved Case ............................................................................ 41 Table 9.5: Economic Input for Howe Field: Proved + Probable Case .......................................................... 42 Table 9.6: Economic Input for Howe Field: Proved + Probable + Possible Case ......................................... 43 Table 9.7: Economic Input for Ross Field: Proved Case .............................................................................. 44 Table 9.8: Economic Input for Ross Field: Proved + Probable Case ............................................................ 45 Table 9.9: Economic Input for Ross Field: Proved + Probable + Possible Case ........................................... 46 Table 9.10: Economic Input for Blake Field: Proved Case ........................................................................... 47 Table 9.11: Economic Input for Blake Field: Proved + Probable Case ........................................................ 48 Table 9.12: Economic Input for Blake Field: Proved + Probable + Possible Case ....................................... 49

November 2017

3

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Rockrose Competent Person’s Report for Certain UK Assets

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List of Figures

Figure 1.1: Rockrose UK North Sea Field Locations (Source: Rockrose) ....................................................... 5 Figure 4.1: Nelson and Howe Field Locations ............................................................................................. 11 Figure 4.2: Nelson Production History ........................................................................................................ 12 Figure 4.3: Nelson Top Forties Depth Map (Source: Rockrose) .................................................................. 13 Figure 5.1: Howe Top Fulmar Depth Map (Source: Rockrose) ................................................................... 17 Figure 5.2: Howe Field Production History ................................................................................................. 18 Figure 6.1: Blake Top Captain Two Way Time Map (Source: Rockrose) ..................................................... 21 Figure 6.2: Blake Channel Area Production History .................................................................................... 22 Figure 6.3: Blake Flank Area Production History ........................................................................................ 22 Figure 6.4: Blake Water Injection History ................................................................................................... 23 Figure 7.1: Ross Top Depth Map with Well Locations (Source: Repsol Sinopec) ....................................... 26 Figure 7.2: Ross and Blake Development Schematic (Source: Repsol Sinopec) ......................................... 26 Figure 7.3: Ross Field Production History ................................................................................................... 27

November 2017

4

T-9

Rockrose Competent Person’s Report for Certain UK Assets

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1. Summary of Reserves

ERCE has audited the Reserves for four fields in the UK North Sea in which Rockrose has working interest positions: Nelson, Howe, Ross and Blake. Figure 1.1depicts the location of the fields.

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Figure 1.1: Rockrose UK North Sea Field Locations (Source: Rockrose)

Our forecasts of production and costs for each field reviewed at the Proved (1P), Proved plus Probable (2P) and Proved plus Probable plus Possible (3P) levels are presented in Table 9.1 through Table 9.12.

Table 1.1 below presents our estimates of remaining oil reserves attributable to Rockrose as at 31 December 2017 by field and in aggregate at the 1P, 2P and 3P levels respectively. It also contains our estimates of Net Present Value, applying a 10% discount factor.

Please note that in the calculation of remaining economic reserves, the volumes were calculated excluding abandonment charges, until the economic limit was reached. However, in the calculation of Net Present Value, abandonment charges have been included.

ERCE is aware that there is an ongoing negotiation regarding a mismeasurement of volumes exported to the Forties Pipeline System (FPS) from Nelson, Howe and Bardolino. This arose from low flow rates on the export line not being sufficiently mixed to provide a representative sample over a period from May 2009 to April 2015. The Nelson Operator is currently seeking a resolution with the Forties pipeline owner but ERCE understands that the balance of crude oil to be repaid is approximately 1.2 MMstb, with the majority

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of this to be from Nelson. Although no firm agreement for the repayment has been struck, ERCE notes that in the event an agreement is reached which results in a repayment then the Reserves and NPV for Nelson and Howe set out in this Competent Person’s Report (“CPR”) will be affected.

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2P	Blake Field	30.82%	20.93	6.45	73.03	2024	1P	Blake Field	30.82%	16.45	5.07	40.29	2024	3P	Blake Field	30.82%	28.60	8.81	128.43	2024
	Ross Field	30.82%	0.90	0.28	-13.51	2024		Ross Field	30.82%	0.46	0.14	-16.64	2024		Ross Field	30.82%	1.40	0.43	-10.10	2024
	Howe Field	20.00%	5.28	1.06	31.50	2029		Howe Field	20.00%	2.46	0.49	18.15	2026		Howe Field	20.00%	7.77	1.55	41.09	2034
	Nelson Field	7.48%	24.99	1.87	20.43	2029		Nelson Field	7.48%	17.30	1.29	11.67	2026		Nelson Field	7.48%	33.54	2.51	30.40	2034
	TOTAL PORTFOLIO		52.10	9.65	111.45			TOTAL PORTFOLIO		36.67	7.00	53.47			TOTAL PORTFOLIO		71.31	13.31	189.82
		Rockrose Interest (%)	Gross Remaining Reserves (MMstb)	Reserves Attributable to Rockrose (MMstb)	NPV10 Attributle to Rockrose (GBP MM)	Economic Limit (Year)			Rockrose Interest (%)	Gross Remaining Reserves (MMstb)	Reserves Attributable to Rockrose (MMstb)	NPV10 Attributle to Rockrose (GBP MM)	Economic Limit (Year)			Rockrose Interest (%)	Gross Remaining Reserves (MMstb)	Reserves Attributable to Rockrose (MMstb)	NPV10 Attributle to Rockrose (GBP MM)	Economic Limit (Year)

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2. Dataset

Data were made available up to the data cut-off date of 30 September 2017, as follows:

• Nelson field: May and September UMC 2017, May 2017 Report on Nelson, Howe and Bardolino historical mismeasurement and preliminary/draft budgets. Well by well production data was provided up until 31/07/2017.

• Howe field: May and September OCM, May and September TCM, preliminary/draft budgets and production data until 31/07/2017

• Ross field: June 2017 OCM, preliminary/draft budgets and production data until 25/09/2017

• Blake field: June and October 2017 OCM, preliminary/draft budgets and production data until 25/09/2017. The Operator’s and IPUK’s presentation on the simulation modelling. Static and dynamic models of the Blake Channel area.

In addition to the above Operator documents, Rockrose also provided ERCE with its proposed assumptions for the production forecasts and Operator profiles for Nelson.

ERCE was provided with a 2015 document entitled the “BLEO HOLM FPSO 2024 FEASIBILITY STUDY REPORT”. This document addressed the issues and the initiatives necessary to ensure continued production through field life for the Ross and Blake fields, accounting for future operations and maintenance strategies. The document is, for ERCE, the reference documentation for the expenditure necessary to maintain the FPSO operability until 2024. For the YE 2017 audit, the Operator has provided the partnership with an update cost schedule. ERCE’s original independent work has been compared to the most recent Operator’s plan of expenditure provided by Rockrose for the current audit.

Prior to the acquisition by Rockrose in 2017, ERCE had audited the four fields for the previous owner, Idemitsu Petroleum UK (Idemitsu). When new information was not available or in the absence of new data, ERCE has relied on information provided for past audits along with updated production data for 2017 in the assessment of reserves in the fields. Idemitsu has provided a release for these data.

Note that ERCE has used production forecasts to estimate produced volumes from the end of the production data through to the effective date of this report.

Note that we have relied upon Rockrose for the completeness and accuracy of these data. No site visit was undertaken as part of this process.

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3. Evaluation Basis

The data provided by Rockrose enabled ERCE to complete an audit of:

• Hydrocarbon Reserves

• An economic evaluation of hydrocarbon Reserves

For the purposes of economic modelling, ERCE audited and used an economic model, constructed by the previous owner Idemitsu, and adopted by Rockrose for the purposes of this Reserves evaluation. ERCE has used standard petroleum evaluation techniques in the preparation of this report. These techniques combine geophysical and geological knowledge with assessments of porosity and permeability distributions, fluid characteristics and reservoir pressure together with production performance analysis. There is inherent uncertainty in the measurement and interpretation of basic data. ERCE has estimated the degree of this uncertainty and determined the range of petroleum initially in place and recoverable hydrocarbons. Our methodology adheres to the guidelines of the SPE PRMS.

There is no guarantee that actual economic parameters will match the assumed values. Note that the economic values associated with the Reserves calculations contained within this report do not necessarily reflect a fair market value. The net present value (NPV) calculations presented in this report simply represent discounted future cash flow values. Though NPVs form an integral part of the fair market value estimations, without consideration for other economic criteria they are not to be construed as ERCE’s opinion of fair market value.

Values presented in this report have been calculated using the economic interest method.

The accuracy of estimates of volumes of oil and gas and production forecasts is a function of the quality and quantity of available data and of engineering interpretation and judgment. While estimates of Reserves and production forecasts presented herein are considered reasonable, these estimates should be accepted with the understanding that reservoir performance subsequent to the date of the estimate may justify revision, either upward or downward.

3.1. Methodology for Economic Modelling

Economics were run on the 1P, 2P and 3P Reserve forecasts for each field without abandonment liability estimates to determine the economic Reserves, considering the economic cut off for each field, or on aggregated basis when relevant. Once the economic cut off had been established, the project cash flows attributable to Rockrose were calculated based on the revenue stream from petroleum production, deducting related operating and capital expenses, including estimated abandonment liability, and relevant fiscal duties. The resulting cash flows were used to determine net present values attributable to the Company as of 1 January 2018.

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3.1.1. Discount Rate and Method

A discount rate of 10% has been used to calculate net present values of each field. Discounting to the midyear point has been applied to all future net cash flows with effect from 1 January 2018.

3.1.2. Economic Assumptions

Table 3.1 presents the assumptions of commodity pricing, cost inflation and exchange rates used for economic modelling. Note that the commodity prices presented below are nominal prices.

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Oil Price Gas Price NGL Price Forex
Year Cost Inflation
USD/BBL GBP/SM3 USD/Ton USD/GBP
2018 58.14 0.16 466.20 1.02 1.30
2019 61.38 0.17 485.23 1.04 1.30
2020 65.79 0.17 510.05 1.06 1.30
2021 71.44 0.17 539.75 1.08 1.30
2022 75.08 0.18 557.73 1.10 1.30
2023 76.58 0.18 564.80 1.13 1.30
2024 78.11 0.18 572.00 1.15 1.30
2025 79.67 0.19 579.07 1.17 1.30
2026 81.27 0.19 586.15 1.20 1.30
2027 82.89 0.19 593.22 1.22 1.30
2028 84.55 0.20 600.18 1.24 1.30
2029 86.24 0.20 607.14 1.27 1.30
2030 87.97 0.21 613.99 1.29 1.30
2031 89.72 0.21 620.72 1.32 1.30
2032 91.52 0.21 627.44 1.35 1.30
2033 93.35 0.22 634.06 1.37 1.30
2034 95.22 0.22 640.55 1.40 1.30
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Table 3.1: Economic Assumptions

3.1.3. UK Tax Considerations

The NPV calculations are based on the current UK fiscal terms applied to the cash flows for the produced oil and gas in the UK and on the UK Continental Shelf. The UK fiscal terms comprise UK ring fence Corporation Tax of 30% of profits plus Supplementary Charge of 10%. Capital allowances are available at 100% write down. In addition, an investment allowance of 62.5% of the investment expenditure incurred from 1[st] April 2015 was introduced in Finance Bill 2015 that replaces the existing offshore field allowances and is offset against profits subject to the Supplementary charge. The rate of PRT has been permanently set to 0%.

For post-tax evaluation, under the instruction of Rockrose, the trade losses and SFA pool provided by Rockrose were utilized against the most profitable fields. Thus, trade losses of $108.89 million were apportioned against Ross, Blake, Nelson and Howe to delay tax payments to 2020.

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4. The Nelson Field

Table 9.1 to Table 9.3 present our forecasts of production and costs for the Nelson field for the 1P, 2P and 3P levels of confidence respectively. The Nelson field is a mature field with established production trends. Reserves have been calculated from production performance assessment using decline analysis. Our estimates of remaining oil Reserves (MMstb) and net present values as at 1 January 2018 are as follows:

Nelson Field	Nelson Field	Nelson Field	Nelson Field
	1P	2P	3P
Rockrose Interest(%)	7.48%	7.48%	7.48%
Gross RemainingReserves(MMstb)	17.30	24.99	33.54
Reserves Attributable to Rockrose(MMstb)	1.29	1.87	2.51
NPV10 Attributable to Rockrose(GBP MM)	11.67	20.43	30.40
Economic Limit (Year)	2026	2029	2034

Table 4.1: Nelson Field Oil Reserves as at 1 January 2018

Please note that in this report, Ultimate Reserves and estimated production are presented in pipeline barrels. Remaining reserves are Forties blend sales barrels. From a comparison of reported pipeline vs sales volumes in 2008, Idemitsu (the previous owner of Rockrose’s interest in the field) advised that the shrinkage from pipeline to Forties blend is -1.0%. Also note that the Reserves estimates in the above table do not account for the ongoing negotiation regarding a mismeasurement of volumes exported to the Forties Pipeline System (FPS) from Nelson, Howe and Bardolino. ERCE notes that in the event an agreement is reached which results in a repayment then the Reserves and NPV10 presented for Nelson and Howe set out in this report will be affected.

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Figure 4.1: Nelson and Howe Field Locations

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Figure 4.2: Nelson Production History

The Nelson field is located SE of the Forties field in the Central North Sea (Figure 4.1). The Operator of the field is Shell. It has been on production for ca. 24 years. The Nelson structure is a low relief anticline at a depth of some 7000 ft ss. It can be grouped into six production compartments (Figure 4.3). The quality of the Palaeocene Forties sandstone is very good. Recovery has been through a combination of aquifer influx and water injection, as well as gas lift.

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Figure 4.3: Nelson Top Forties Depth Map (Source: Rockrose)

The field has been developed through several cycles of infill drilling following the initial development of the field. A total of 37 production wells and 4 water injectors have been drilled. 23 producers and zero were in use in Q4 2017. The oil production rate peaked at around 185 Mbbl/d in 1994 (Figure 4.2). The field is now at a mature stage of production, producing some 10 Mbbl/d of oil and 125 Mbbl/d of water, a water cut of some 93%. The cumulative oil production as at 31/07/2017 is 463 MMbbl pipeline barrels.

Oil from the fixed platform is transported by pipeline to the Forties field, and then to shore via the Forties pipeline system. Excess gas not used for fuel is exported via a separate pipeline to St Fergus for sale.

In 2017 a number of further well interventions have been undertaken as part of the Operator’s well services campaign. The first campaign was undertaken in Q2 2017, and a further campaign is planned for Q4 2017 which plans to undertake works on gas lift valves on four wells, (N34, N02, N29y and N15), with a target of increasing oil production by 485 bbl/d.

As part of the well services campaign for 2018, N12 and N20x are planned to undergo restoration. Well N12 has been suspended since 2015 due to a casing leak, and N20x was suspended in April 2017 due to sand production following perforation of the sand screens in 2016. These wells are due to be restored at a combined oil rate forecast by the Operator at approximately 1,700 bbl/d. ERCE has incorporated the successful restoration of these wells in its forecasts.

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Regarding the 2017 production performance, the Operator has reduced its availability forecast for the year from 78% to 73% due to a number of unplanned outages impacting production. These outages were related to, amongst others, compression issues, water handling problems, sand management in Well N20x and gas leaks. The compression and water handling problems have been addressed this year during the August 2017 TAR, which was extended by seven days. ERCE has adopted the Operator’s targets for availability in its production forecasts.

On the basis of the past drilling results, and following the Operator’s intention to put on hold any development projects, ERCE does not assign any Reserves to undeveloped locations. The lack of foreseeable drilling activity in the near future has lead the joint venture to cold stack the Nelson platform rig. Current projects still included in the future plans are the fuel gas import project and the Nelson South Umbilical replacement.

Ultimate technical oil recovery is projected at 489 MMbbl pipeline barrels at the 2P level, before economic cut-offs are applied. This equates to 466 MMstb assuming shrinkage of 0.953 stb/pipeline bbl (operator’s estimate).

Ultimate technical oil recovery at the 1P level is forecast at 484 MMbbl pipeline barrels. This equates to 461 MMstb assuming the same shrinkage as above. Ultimate technical oil recovery at the 3P level is forecast at 497 MMbbl pipeline barrels. This equates to 474 MMstb assuming the same shrinkage as above.

ERCE is aware from various TCMs and OCMs that there is an ongoing discussion regarding mismeasurement of volumes exported to the Forties Pipeline System (FPS) from Nelson, Howe and Bardolino. This arose from low flow rates in the export line not being sufficiently mixed to provide a representative sample, over a period from May 2009 to April 2015. The Operator is currently seeking a resolution with the FPS, owner but ERCE understands that the balance of crude oil to be repaid is approximately 1.2 MMstb, with the majority of this to be from Nelson. Although no firm agreement for the repayment has been struck, ERCE notes that in the event an agreement is made, the Reserves for Nelson set out in this report will be affected.

Table 9.1 through Table 9.3 include forecasts of NGL production. NGL yields have been derived from information provided by previous owners of Rockrose’s interest, based on analysis of product yields. ERCE has also reviewed the NGL yield used by Rockrose, which is based on historical data, and has found that the difference is negligible. The Nelson field is expected to be gas-deficient from 2018 onwards whilst the Nelson platform is expected to be deficient from November 2024. We do not calculate any fuel gas for Nelson.

For the purpose of cash flow modelling, ERCE includes the capital expenditure associated with fuel gas import and umbilical replacement projects. The fuel gas import project aims at an agreement between the Nelson and the Shell Esso Gas and Associated Liquids (SEGAL) pipeline operators for fuel gas supply to cover Nelson platform shortfall. This has been delayed by one year and is now estimated to occur in mid2019. The Operator’s cost for this project has been adopted from the Nelson 2017 Work Program and Budget released July 2017.

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The project for the umbilical replacement is envisaged to take place in 2018, during which, in our forecast of costs, we have considered a total cost of £7.5 MM including installation

As per the Operator’s budget assumption we also include £0.8 MM of annual expenditure, referred as “Existing field CAPEX”, for the period beyond 2019. In the technical input for economic modelling, ERCE assumes that capital expenses occur until two years before the economic limit of the field.

With guidance from Rockrose regarding the lack commitment for additional infill drilling and the 4D seismic campaign proposed by the Operator, these costs have not been included in ERCE’s forecasts.

For the OPEX forecast during the period 2018-2020, there were few material changes in the Operator’s 2018 Work Program and Budget from ERCE’s historical assumptions. Therefore, the Operator’s profile was accepted.

We have relied on Rockrose for the abandonment liabilities to be considered for the economic modelling.

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5. The Howe Field

Table 9.4 to Table 9.6 present our forecasts of production and costs for the Howe field for the 1P, 2P and 3P levels of confidence respectively. The Howe field is a mature field. Material Balance in combination with production performance analysis is used to calculate Reserves. Our estimates of remaining oil reserves (MMstb) and net present values as at 1 January 2018 are as follows:

Howe Field	Howe Field	Howe Field	Howe Field
	1P	2P	3P
Rockrose Interest(%)	20.00%	20.00%	20.00%
Gross RemainingReserves(MMstb)	2.46	5.28	7.77
Reserves Attributable to Rockrose(MMstb)	0.49	1.06	1.55
NPV10 Attributable to Rockrose(GBP MM)	18.15	31.50	41.09
Economic Limit (Year)	2026	2029	2034

Table 5.1: Howe Field Oil Reserves as at 1 January 2018

Please note that in this report, Ultimate Reserves and estimated production are presented in pipeline barrels. Remaining reserves are Forties blend sales barrels. From a comparison of reported pipeline vs sales volumes in 2008, Idemitsu (the previous owner of Rockrose’s interest in the field) advised that the shrinkage from pipeline to Forties blend is -1.0%. Also note that the Reserves estimates in the above table do not account for the ongoing negotiation regarding a mismeasurement of volumes exported to the Forties Pipeline System (FPS) from Nelson, Howe and Bardolino. ERCE notes that in the event an agreement is reached which results in a repayment then the Reserves and NPV10 presented for Nelson and Howe set out in this report will be affected.

The Howe field (also identified as the Howe Main area) lies 14 kilometres east of Nelson (Figure 4.1). It is operated by Shell and contains 41 degrees API oil in good quality Fulmar Jurassic sandstone at a depth of ca 10,300 ft TVDSS. The field was appraised by Well 22/12a-8, which encountered an oil water contact in a 160 feet thick reservoir section down dip of crestal Well 21/12a-1 (Figure 5.1). The initial reservoir pressure was a 6700 psi, some 2700 psi over-pressured.

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Figure 5.1: Howe Top Fulmar Depth Map (Source: Rockrose)

A single sub-horizontal production well was drilled in early 2004 and was brought on stream at the end of October 2004. The field production history is shown in Figure 5.2.

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Figure 5.2: Howe Field Production History

The Howe well produces through a sub-sea template tied back by pipeline to Nelson.

The field has been developed through this single sub-horizontal well following the initial appraisal of the field. The oil production rate peaked at around 11 Mstb/d in 2005 (Figure 5.2). The field is now at a mature stage of production, producing some 2.5 Mstb/d oil and 0.4 Mbbl/d water, a water cut of some 14%. The cumulative oil production as at 31/07/2017 is 15.4 MMstb.

In 2016 the Operator prepared a material balance model. The model comprises simulation of three connecting tanks which account for field geometry. Of note is the existence of a structural saddle in Howe Main , described by splitting the Howe Main tank into a near and a far tank. Basic assumptions include the presence of an aquifer and of a secondary gas cap across the saddle. A secondary gas cap forms in the crest of the far tank, and gas flow occurs only after this secondary gas cap grows to a size where it can spill across the saddle. The production forecast is controlled by a maximum gas rate. Therefore, the gas oil ratio (GOR) becomes a main driver for any production forecast. We have reviewed this material balance model, and we accept the match proposed for historical GOR and pressure behaviour. The model provides a STOIIP estimate of 48 MMstb.

ERCE used the model to generate oil and gas production profiles under the Operator’s assumptions and constraints. We used these profiles as our production forecast at the 2P level of confidence. We also used the material balance model to investigate the impact of the gas-oil contact depth across the saddle. We considered deeper and shallower GOC depths to generate our production profiles at 1P and 3P levels of confidence respectively. ERCE gas production profiles at all levels of confidence were derived using the GOR predicted by the modelled cases.

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The results obtained using the material balance model were then compared against 2017 production performance, and found to be acceptable. Our technical ultimate oil recovery forecasts (before economics) are 18.3, 21.3 and 23.6 MMstb at the 1P, 2P and 3P levels of confidence respectively.

In the input for the economic modelling, we refer to the Operator’s preliminary budget Howe 2018 Work Program and Budget : no capital expenditures are foreseen for the Howe field. Concerning the Operating costs, according to the most recent Operator’s estimate, £3.7MM will be spent in 2017 (excluding tariffs). This figure includes subsea reactive scope including the flushing of the umbilical return line, and for Howe West reassessment. The cost associated with the Howe West reassessment and feasibility (~£0.6MM) has not been included in ERCE’s forecast following guidance from Rockrose. In absence of a life of field forecast from the operator, we carry the costs at a flat £1.5MM on an annual basis for the following years.

We have relied on Rockrose for the abandonment liabilities to be considered for the economic modelling.

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6. The Blake Field

Rockrose’s working interest in the Blake field is 30.82%. Table 9.10 through Table 9.12 present our forecast of production and costs for the Blake field for the1P, 2P and 3P levels of confidence respectively. Reserves are estimated using a combination of reservoir simulation and decline curve analysis. Our estimates of remaining oil reserves (MMstb) and net present values as at 1 January 2018 are as follows:

Blake Field	Blake Field	Blake Field	Blake Field
	1P	2P	3P
Rockrose Interest(%)	30.82%	30.82%	30.82%
Gross RemainingReserves(MMstb)	16.45	20.93	28.60
Reserves Attributable to Rockrose(MMstb)	5.07	6.45	8.81
NPV10 Attributable to Rockrose(GBP MM)	40.29	73.03	128.43
Economic Limit (Year)	2024	2024	2024

Table 6.1: Blake Field Oil Reserves as at 1 January 2018

The Blake field lies some 12 km north east of the Ross field and has been on production since 2001. Repsol Sinopec is the Operator of the field. Hydrocarbons are contained in Lower Cretaceous turbiditic sands. The main reservoir is a massive channel sand sequence known as the Blake Channel which has excellent quality reservoir properties. Blake Flank comprises lower quality, thinner sands located to the north east of Blake Channel (Figure 6.1).

The two areas of the field have been developed separately. A total of six production wells and two water injectors have been drilled in the Channel, of which four and two respectively were in use in 2017. In the Flank, two production wells and one injection well have been drilled, all of which remain in use in 2017. The oil production rate in the Channel peaked at around 68 Mstb/d in 2001 (Figure 6.2) and in the Flank at around 13 Mstb/d in 2004 (Figure 6.3). The field is now at a mature stage of production, producing some 9.5 Mstb/d oil and 25 Mstb/d water in the Channel, a water cut of some 73%, and producing around 3.5Mstb/d oil and 0.02Mstb/d in the Flank, a water cut of around 1%. The cumulative oil production from the whole field as at 20/09/2017 is 98 MMstb.

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Figure 6.1: Blake Top Captain Two Way Time Map (Source: Rockrose)

The Blake Channel is at a depth of ca 5,200 ft ss and contains a 97 ft thick oil rim overlain by a gas cap. Blake Channel has been developed by six horizontal producers and two deviated water injectors. Oil production from the field commenced in June 2001, and water injection commenced at the same time as production.

The oil from the Blake field is produced via a subsea manifold and dual flowlines to the Ross FPSO. Since 2015 Ross stopped participating in the cost share for the FPSO. Instead, OPEX for Ross was limited to a tariff based on produced oil rate, plus field specific OPEX.

ERCE has been provided with well level data through September 2017. The production history for the Channel and Flank areas is presented in Figure 6.2 and Figure 6.3 respectively.

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Figure 6.2: Blake Channel Area Production History

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Figure 6.3: Blake Flank Area Production History

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In 2016 the partner group developed updated static and dynamic models for the Blake Channel area. These were provided to ERCE in 2017. We have audited the construction of the static and dynamic models, evaluated the history match and the applicability of the models for production forecasting. After our review, we have concluded that the model is suitable for 2P Reserves estimation of the Blake Channel.

Our review of the model indicated that the forecast oil production from the Blake Channel area has a strong correlation to water injection and field uptime.

During the first quarter of 2017 the field has outperformed our historical production forecasts, and further information has been provided by the operating group with respect to the forecast costs. Recent water injection rates have been above injection rates from the past few years. For example, the water injection rate in 2016 was ca 64 Mbbl/d.

Nameplate water injection capacity is now at 140,000 bbl/d, with potential for further debottlenecking. There is also excess pump capacity on the vessel, with total capacity of 210,000 bbl/d now installed on the vessel. However, peak injection rates historically have rarely exceeded 120,000 bbl/d (Figure 6.4).

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Figure 6.4: Blake Water Injection History

The key uncertainties that will impact oil production rates from the Blake Channel are field uptime and water injection volumes.

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ERCE has reviewed the production and water injection performance of the Blake Channel, and after accounting for recent changes in the Bleo Holm maintenance programme, ERCE has assumed an annual water injection rate average of 70,000 bbl/d in the Blake Channel at the 2P level of confidence. This assumption was used in the dynamic simulation, accounting for planned 30 day TAR programmes, to generate an estimate of oil production. We combined the results of this Channel simulation with our forecast of the Blake Flank area, which is made using decline analysis. The resultant 2P forecast is presented in Table 9.11.

Uncertainty in the forecast production at the 1P and 3P levels of confidence is primarily with respect to the field uptime and peak injection rates that will be achieved, as the Operator continues its maintenance works. The 1P and 3P forecasts are shown in Table 9.10 and Table 9.12 respectively. Note that the distribution is skewed due to the fact production is cut off when the vessel reaches its end of operating life in mid-2024.

The Operator is in the process of executing a Field Life Extension (FLE) project, which will maintain FPSO operability until 2024. With respect to costs, the Operator and Rockrose continue to execute the FLE work scope and refine costs. Rockrose provided ERCE with a revised forecast of cost from July 2017, which ERCE reviewed.

For the Bleo Holm CAPEX (extension) and OPEX, these costs for 2018 have been broadly accepted, with some re-phasing of certain projects. A water injection swivel project has been deferred to 2019, and the gas import/export modifications have been brought forward to 2018 from 2019. Costs from 2019 onwards are based on profiles proposed by the Operator’s 5-year plan issued in 2016 and audited by ERCE.

Blake field specific OPEX costs have been updated using 2018 forecasts from the Operator.

The Operator plan has provision for a scale squeeze programme, contingent on evidence of seawater breakthrough at wells. These costs have not been included in our profile as modelling indicates no sea water should reach the wells within the forecast field life.

We have relied on Rockrose for the abandonment liabilities to be considered for the economic modelling.

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7. The Ross Field

Table 9.7 to Table 9.9 present our forecasts of production and costs for the Ross field for the 1P, 2P and 3P levels of confidence respectively. The Ross field is a mature field with established production trends. Reserves have therefore been calculated using decline analysis. Our estimates of remaining oil Reserves (MMstb) and net present values as at 1 January 2018 are as follows:

Ross Field	Ross Field	Ross Field	Ross Field
	1P	2P	3P
Rockrose Interest(%)	30.82%	30.82%	30.82%
Gross RemainingReserves(MMstb)	0.46	0.90	1.40
Reserves Attributable to Rockrose(MMstb)	0.14	0.28	0.43
NPV10 Attributable to Rockrose(GBP MM)	-16.64	-13.51	-10.10
Economic Limit (Year)	2024	2024	2024

Table 7.1: Ross Field Oil Reserves as at 1 January 2018

Reserves have been assigned under the assumption that the Bleo Holm vessel continues to be in operation until mid-2024, at which point it will be decommissioned.

The Ross field lies approximately 110 km NE of Aberdeen. It has been on production since 1999, producing undersaturated oil from variable quality, relatively thin Ross sands of Upper Jurassic age at a depth from 2700 to 3200 m ss, and also from the underlying Parry sand. Reservoir performance is influenced by faulting, which causes compartmentalisation.

The Ross sand has been developed by six horizontal gas lifted production wells and four water injectors (Figure 7.1). The oil is produced into a leased FPSO where it is processed and then exported via shuttle tanker. Gas not used as fuel is exported by pipeline via the Frigg transportation system.

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Figure 7.1: Ross Top Depth Map with Well Locations (Source: Repsol Sinopec)

In 2001 the nearby Blake field was developed as a satellite to the Ross field (Figure 7.2, Section 6) and is now the main contributor of production over the Bleo Holm vessel.

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Figure 7.2: Ross and Blake Development Schematic (Source: Repsol Sinopec)

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The field has been developed through (several) cycles of infill drilling following the initial development of the field. A total of six horizontal gas lifted production wells and five water injectors have been drilled, of which three of the gas lifted production wells and no water injectors were in use in 2017. The oil production rate peaked briefly at around 39 Mstb/d in 1999 (Figure 7.3). The field is now at a mature stage of production, producing some 0.8 Mstb/d oil and 1.5 Mbbl/d water, a water cut of some 65%. The cumulative oil production as at 20/09/2017 is 33 MMstb.

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Figure 7.3: Ross Field Production History

The field has experienced downtime throughout 2016 and 2017 due to, amongst others, high oil in water levels, high H2S levels and gas lift problems. Wells RP2 and RP3 have both suffered from gas lift unavailability: gas lift mandrels could not be opened due to high wellbore pressure. At the time of writing this report, high wellbore pressure is still reported in Well RP3. The well is expected to progressively depressure until Q1 2018, when full potential is expected to be reinstated. Well PP2 is also currently shut in due to a leak in the hydraulic line, but is expected to be reinstated in Q2 2018. Well RP2 is currently producing.

There is no cost share with the Blake field, and instead the Ross field pays a tariff. With respect to cost allocation all Bleo-Holm upgrade and repair costs are therefore borne by the Blake field. With respect to the field specific costs (OPEX), ERCE has accepted the Operator’s forecast for 2018, and maintained our historical assumptions. These costs include subsea inspections carried out in alternating years.

We have relied on Rockrose for the abandonment liabilities to be considered for the economic modelling.

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8. Appendix 1: SPE PRMS Guidelines

SPE/WPC/AAPG/SPEE Petroleum Reserves and Resources Classification System and Definitions

The Petroleum Resources Management System

Preamble

Petroleum Resources are the estimated quantities of hydrocarbons naturally occurring on or within the Earth’s crust. Resource assessments estimate total quantities in known and yet-to-be-discovered accumulations; Resources evaluations are focused on those quantities that can potentially be recovered and marketed by commercial projects. A petroleum Resources managements system provides a consistent approach to estimating petroleum quantities, evaluating development projects and presenting results within a comprehensive classification framework.

International efforts to standardize the definitions of petroleum Resources and how they are estimated began in the 1930s. Early guidance focused on Proved Reserves. Building on work initiated by the Society of Petroleum Evaluation Engineers (SPEE), SPE published definitions for all Reserves categories in 1987. In the same year, the World Petroleum Council (WPC, then known as the World Petroleum Congress), working independently, published Reserves definitions that were strikingly similar. In 1997, the two organizations jointly released a single set of definitions for Reserves that could be used worldwide. In 2000, the American Association of Petroleum Geologists (AAPG), SPE, and WPC jointly developed a classification system for all petroleum Resources. This was followed by additional supporting documents: supplemental application evaluation guidelines (2001) and a glossary of terms utilized in Resources definitions (2005). SPE also published standards for estimating and auditing Reserves information (revised 2007).

These definitions and the related classification system are now in common use internationally within the petroleum industry. They provide a measure of comparability and reduce the subjective nature of Resources estimation. However, the technologies employed in petroleum exploration, development, production, and processing continue to evolve and improve. The SPE Oil and Gas Reserves Committee works closely with other organizations to maintain the definitions and issues periodic revisions to keep current with evolving technologies and changing commercial opportunities.

The SPE-PRMS consolidates, builds on, and replaces guidance previously contained in the 1997 Petroleum Reserves Definitions, the 2000 Petroleum Resources Classification and Definitions publications, and the 2001 “Guidelines for the Evaluation of Petroleum Reserves and Resources”; the latter document remains a valuable source of more detailed background information.

These definitions and guidelines are designed to provide a common reference for the international petroleum industry, including national reporting and regulatory disclosure agencies, and to support

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petroleum project and portfolio management requirements. They are intended to improve clarity in global communications regarding petroleum Resources. It is expected that the SPE-PRMS will be supplemented with industry education programs and application guides addressing their implementation in a wide spectrum of technical and/or commercial settings.

It is understood that these definitions and guidelines allow flexibility for users and agencies to tailor application for their particular needs; however, any modifications to the guidance contained herein should be clearly identified. The definitions and guidelines contained in this document must not be construed as modifying the interpretation or application of any existing regulatory reporting requirements.

The full text of the SPE/WPC/AAPG/SPEE Petroleum Resources Management System document, hereinafter referred to as the SPE-PRMS, can be viewed at

www.spe.org/specma/binary/files6859916Petroleum_Resources_Management_System_2007.pdf .

Overview and Summary of Definitions

The estimation of petroleum resource quantities involves the interpretation of volumes and values that have an inherent degree of uncertainty. These quantities are associated with development projects at various stages of design and implementation. Use of a consistent classification system enhances comparisons between projects, groups of projects, and total Company portfolios according to forecast production profiles and recoveries. Such a system must consider both technical and commercial factors that impact the project’s economic feasibility, its productive life, and its related cash flows.

Petroleum is defined as a naturally occurring mixture consisting of hydrocarbons in the gaseous, liquid, or solid phase. Petroleum may also contain non-hydrocarbons, common examples of which are carbon dioxide, nitrogen, hydrogen sulphide and sulphur. In rare cases, non-hydrocarbon content could be greater than 50%.

The term “Resources” as used herein is intended to encompass all quantities of petroleum naturally occurring on or within the Earth’s crust, discovered and undiscovered (recoverable and unrecoverable), plus those quantities already produced. Further, it includes all types of petroleum whether currently considered conventional” or “unconventional.”

Figure 1-1 is a graphical representation of the SPE/WPC/AAPG/SPEE Resources classification system. The system defines the major recoverable Resources classes: Production, Reserves, Contingent Resources, and Prospective Resources, as well as Unrecoverable petroleum.

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Figure 1-1: SPE/AAPG/WPC/SPEE Resources Classification System

The “Range of Uncertainty” reflects a range of estimated quantities potentially recoverable from an accumulation by a project, while the vertical axis represents the “Chance of Development”, that is, the chance that the project that will be developed and reach commercial producing status.

The following definitions apply to the major subdivisions within the Resources classification:

TOTAL PETROLEUM INITIALLY-IN-PLACE

Total Petroleum Initially in Place is that quantity of petroleum that is estimated to exist originally in naturally occurring accumulations.

It includes that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations prior to production plus those estimated quantities in accumulations yet to be discovered (equivalent to “total Resources”).

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DISCOVERED PETROLEUM INITIALLY-IN-PLACE

Discovered Petroleum Initially in Place is that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations prior to production.

PRODUCTION

Production is the cumulative quantity of petroleum that has been recovered at a given date.

Multiple development projects may be applied to each known accumulation, and each project will recover an estimated portion of the initially-in-place quantities. The projects shall be subdivided into Commercial and Sub-Commercial, with the estimated recoverable quantities being classified as Reserves and Contingent Resources respectively, as defined below.

RESERVES

Reserves are those quantities of petroleum anticipated to be commercially recoverable by application of development projects to known accumulations from a given date forward under defined conditions.

Reserves must satisfy four criteria: they must be discovered, recoverable, commercial, and remaining based on the development project(s) applied. Reserves are further subdivided in accordance with the level of certainty associated with the estimates and may be sub-classified based on project maturity and/or characterized by their development and production status. To be included in the Reserves class, a project must be sufficiently defined to establish its commercial viability. There must be a reasonable expectation that all required internal and external approvals will be forthcoming, and there is evidence of firm intention to proceed with development within a reasonable time frame. A reasonable time frame for the initiation of development depends on the specific circumstances and varies according to the scope of the project. While five years is recommended as a benchmark, a longer time frame could be applied where, for example, development of economic projects are deferred at the option of the producer for, among other things, market-related reasons, or to meet contractual or strategic objectives.

In all cases, the justification for classification as Reserves should be clearly documented. To be included in the Reserves class, there must be a high confidence in the commercial producibility of the reservoir as supported by actual production or formation tests. In certain cases, Reserves may be assigned on the basis of well logs and/or core analysis that indicate that the subject reservoir is hydrocarbon-bearing and is analogous to reservoirs in the same area that are producing or have demonstrated the ability to produce on formation tests.

Proved Reserves

Proved Reserves are those quantities of petroleum, which by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be commercially recoverable, from a given date forward, from known reservoirs and under defined economic conditions, operating methods, and government regulations.

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If deterministic methods are used, the term reasonable certainty is intended to express a high degree of confidence that the quantities will be recovered. If probabilistic methods are used, there should be at least a 90% probability that the quantities actually recovered will equal or exceed the estimate. The area of the reservoir considered as Proved includes:

the area delineated by drilling and defined by fluid contacts, if any, and

adjacent undrilled portions of the reservoir that can reasonably be judged as continuous with it and commercially productive on the basis of available geoscience and engineering data.

In the absence of data on fluid contacts, Proved quantities in a reservoir are limited by the lowest known hydrocarbon (LKH) as seen in a well penetration unless otherwise indicated by definitive geoscience, engineering, or performance data. Such definitive information may include pressure gradient analysis and seismic indicators. Seismic data alone may not be sufficient to define fluid contacts for Proved Reserves (see “2001 Supplemental Guidelines,” Chapter 8). Reserves in undeveloped locations may be classified as Proved provided that the locations are in undrilled areas of the reservoir that can be judged with reasonable certainty to be commercially productive and interpretations of available geoscience and engineering data indicate with reasonable certainty that the objective formation is laterally continuous with drilled Proved locations.

For Proved Reserves, the recovery efficiency applied to these reservoirs should be defined based on a range of possibilities supported by analogs and sound engineering judgment considering the characteristics of the Proved area and the applied development program.

Probable Reserves

Probable Reserves are those additional Reserves which analysis of geoscience and engineering data indicate are less likely to be recovered than Proved Reserves but more certain to be recovered than Possible Reserves.

It is equally likely that actual remaining quantities recovered will be greater than or less than the sum of the estimated Proved plus Probable Reserves (2P). In this context, when probabilistic methods are used, there should be at least a 50% probability that the actual quantities recovered will equal or exceed the 2P estimate.

Probable Reserves may be assigned to areas of a reservoir adjacent to Proved where data control or interpretations of available data are less certain. The interpreted reservoir continuity may not meet the reasonable certainty criteria. Probable estimates also include incremental recoveries associated with project recovery efficiencies beyond that assumed for Proved.

Possible Reserves

Possible Reserves are those additional Reserves which analysis of geoscience and engineering data indicate are less likely to be recoverable than Probable Reserves

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The total quantities ultimately recovered from the project have a low probability to exceed the sum of Proved plus Probable plus Possible (3P), which is equivalent to the high estimate scenario. When probabilistic methods are used, there should be at least a 10% probability that the actual quantities recovered will equal or exceed the 3P estimate.

Possible Reserves may be assigned to areas of a reservoir adjacent to Probable where data control and interpretations of available data are progressively less certain. Frequently, this may be in areas where geoscience and engineering data are unable to clearly define the area and vertical reservoir limits of commercial production from the reservoir by a defined project.

Possible estimates also include incremental quantities associated with project recovery efficiencies beyond that assumed for Probable.

Probable and Possible Reserves

(See above for separate criteria for Probable Reserves and Possible Reserves.)

The 2P and 3P estimates may be based on reasonable alternative technical and commercial interpretations within the reservoir and/or subject project that are clearly documented, including comparisons to results in successful similar projects.

In conventional accumulations, Probable and/or Possible Reserves may be assigned where geoscience and engineering data identify directly adjacent portions of a reservoir within the same accumulation that may be separated from Proved areas by minor faulting or other geological discontinuities and have not been penetrated by a wellbore but are interpreted to be in communication with the known (Proved) reservoir. Probable or Possible Reserves may be assigned to areas that are structurally higher than the Proved area. Possible (and in some cases, Probable) Reserves may be assigned to areas that are structurally lower than the adjacent Proved or 2P area.

Caution should be exercised in assigning Reserves to adjacent reservoirs isolated by major, potentially sealing, faults until this reservoir is penetrated and evaluated as commercially productive. Justification for assigning Reserves in such cases should be clearly documented. Reserves should not be assigned to areas that are clearly separated from a known accumulation by non-productive reservoir (i.e., absence of reservoir, structurally low reservoir, or negative test results); such areas may contain Prospective Resources.

In conventional accumulations, where drilling has defined a highest known oil (HKO) elevation and there exists the potential for an associated gas cap, Proved oil Reserves should only be assigned in the structurally higher portions of the reservoir if there is reasonable certainty that such portions are initially above bubble point pressure based on documented engineering analyses. Reservoir portions that do not meet this certainty may be assigned as Probable and Possible oil and/or gas based on reservoir fluid properties and pressure gradient interpretations.

CONTINGENT RESOURCES

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Contingent Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations by application of development projects, but which are not currently considered to be commercially recoverable due to one or more contingencies.

Contingent Resources may include, for example, projects for which there are currently no viable markets, or where commercial recovery is dependent on technology under development, or where evaluation of the accumulation is insufficient to clearly assess commerciality. Contingent Resources are further categorized in accordance with the level of certainty associated with the estimates and may be subclassified based on project maturity and/or characterized by their economic status.

UNDISCOVERED PETROLEUM INITIALLY-IN-PLACE

Undiscovered Petroleum Initially in Place is that quantity of petroleum that is estimated, as of a given date, to be contained within accumulations yet to be discovered.

PROSPECTIVE RESOURCES

Prospective Resources are those quantities of petroleum which are estimated, as of a given date, to be potentially recoverable from undiscovered accumulations.

Potential accumulations are evaluated according to their chance of discovery and, assuming a discovery, the estimated quantities that would be recoverable under defined development projects. It is recognized that the development programs will be of significantly less detail and depend more heavily on analog developments in the earlier phases of exploration.

Prospect

A project associated with a potential accumulation that is sufficiently well defined to represent a viable drilling target.

Project activities are focused on assessing the chance of discovery and, assuming discovery, the range of potential recoverable quantities under a commercial development program.

Lead

A project associated with a potential accumulation that is currently poorly defined and requires more data acquisition and/or evaluation in order to be classified as a prospect.

Project activities are focused on acquiring additional data and/or undertaking further evaluation designed to confirm whether or not the lead can be matured into a prospect. Such evaluation includes the assessment of the chance of discovery and, assuming discovery, the range of potential recovery under feasible development scenarios.

Play

A project associated with a prospective trend of potential prospects, but which requires more data acquisition and/or evaluation in order to define specific leads or prospects.

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Project activities are focused on acquiring additional data and/or undertaking further evaluation designed to define specific leads or prospects for more detailed analysis of their chance of discovery and, assuming discovery, the range of potential recovery under hypothetical development scenarios.

The range of uncertainty of the recoverable and/or potentially recoverable volumes may be represented by either deterministic scenarios or by a probability distribution. When the range of uncertainty is represented by a probability distribution, a low, best, and high estimate shall be provided such that:

• There should be at least a 90% probability (P90) that the quantities actually recovered will equal or exceed the low estimate.

• There should be at least a 50% probability (P50) that the quantities actually recovered will equal or exceed the best estimate.

• There should be at least a 10% probability (P10) that the quantities actually recovered will equal or exceed the high estimate.

When using the deterministic scenario method, typically there should also be low, best, and high estimates, where such estimates are based on qualitative assessments of relative uncertainty using consistent interpretation guidelines. Under the deterministic incremental (risk-based) approach, quantities at each level of uncertainty are estimated discretely and separately.

These same approaches to describing uncertainty may be applied to Reserves, Contingent Resources, and Prospective Resources. While there may be significant risk that sub-commercial and undiscovered accumulations will not achieve commercial production, it useful to consider the range of potentially recoverable quantities independently of such a risk or consideration of the resource class to which the quantities will be assigned.

Evaluators may assess recoverable quantities and categorize results by uncertainty using the deterministic incremental (risk-based) approach, the deterministic scenario (cumulative) approach, or probabilistic methods (see “2001 Supplemental Guidelines,” Chapter 2.5). In many cases, a combination of approaches is used.

Use of consistent terminology (Figure 1.1) promotes clarity in communication of evaluation results. For Reserves, the general cumulative terms low/best/high estimates are denoted as 1P/2P/3P, respectively. The associated incremental quantities are termed Proved, Probable and Possible. Reserves are a subset of, and must be viewed within context of, the complete Resources classification system. While the categorization criteria are proposed specifically for Reserves, in most cases, they can be equally applied to Contingent and Prospective Resources conditional upon their satisfying the criteria for discovery and/or development.

For Contingent Resources, the general cumulative terms low/best/high estimates are denoted as 1C/2C/3C respectively. For Prospective Resources, the general cumulative terms low/best/high estimates still apply. No specific terms are defined for incremental quantities within Contingent and Prospective Resources.

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Without new technical information, there should be no change in the distribution of technically recoverable volumes and their categorization boundaries when conditions are satisfied sufficiently to reclassify a project from Contingent Resources to Reserves. All evaluations require application of a consistent set of forecast conditions, including assumed future costs and prices, for both classifications of projects and categorization of estimated quantities recovered by each project.

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9. Appendix 2: Field Production Forecasts Before Economic Limits are Applied

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Abandex	(£ MM)				7.5	17.5									7.5	18.8	41.5	62.8	40.4	3.9	3.9	38.5	9.6						252.0
Other Capex	(£ MM)			15.0	8.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8															31.0
Drilling	(£ MM)
Nelson Opex	(£ MM)			56.4	48.9	57.0	56.0	56.6	56.7	57.5	57.5	58.4	58.3	59.2	58.9	59.8													741.1
Cost Share	(£ MM)
NGL	(Mbbl/d)			0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.0	0.0	0.0	0.0													0.3
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			7.5	7.0	6.3	5.6	5.1	4.6	4.2	3.7	3.4	3.1	2.8	2.5	1.0													20.7
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total (Platform)

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Abandex	(£ MM)				7.5	17.5									7.5	18.8	41.5	62.8	40.4	3.9	3.9	38.5	9.6						252.0			Table 9.2: Economic Input for Nelson Field: Proved + Probable Case _Note that the production forecast estimates in the above table do not account for the ongoing negotiation regarding a mismeasurement of_ (FPS) from Nelson, Howe and Bardolino. ERCE notes that in the event an agreement is reached which results in a repayment then the producti out in this report will be adversely affected. Notes:* 2017 production is estimated from data available through 31 July 2017 NGL yield assumed at 1.5% pipeline oil rate, based on previous-owner advice in mid-2009 No cost share included: Howe pays a tariff (included in the economic model), no Bardolino tariff benefit is considered CAPEX includes £9MM for umbilical replacement, fuel gas import project delayed to 2019 and HWU for N12 workover CAPEX: 2018-20 expenditure based on the Operator's "Nelson 2018WP&B". CAPEX after 2021 based on "Existing field" (E&M, ref: Shell) assumption of £ 0.8 MM on annual basis from YE2016 audit Capital expenditures stop 2 years before ELT OPEX: maintained costs from YE2016 audit OPEX: for the period 2018-2021 OPEX are consistent with Operator's Opex Plan (excluding Tariff and with inclusion of Corporate Overhead). ABANDEX as per Rockrose YE 2017 (unaudited by ERCE): ABEX to be phased with Howe's abandondement cost
Other Capex	(£ MM)			15.0	8.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8															31.0
Drilling	(£ MM)
Nelson Opex	(£ MM)			56.4	48.9	57.0	56.0	56.6	56.7	57.5	57.5	58.4	58.3	59.2	58.9	59.8													741.1
Cost Share	(£ MM)
NGL	(Mbbl/d)			0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.0													0.4
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			8.4	7.9	7.3	6.7	6.2	5.7	5.3	4.9	4.5	4.1	3.8	3.5	2.7													26.0
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total (Platform)

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Abandex	(£ MM)				7.5	17.5										7.5	18.8	41.5	62.8	40.4	3.9	3.9	38.5	9.6					252.0			Table 9.3: Economic Input for Nelson Field: Proved + Probable + Possible Case _Note that the production forecast estimates in the above table do not account for the ongoing negotiation regarding a mismeasurement of_ (FPS) from Nelson, Howe and Bardolino. ERCE notes that in the event an agreement is reached which results in a repayment then the producti out in this report will be adversely affected. Notes:* 2017 production is estimated from data available through 31 July 2017 NGL yield assumed at 1.5% pipeline oil rate, based on previous-owner advice in mid-2009 No cost share included: Howe pays a tariff (included in the economic model), no Bardolino tariff benefit is considered CAPEX includes £9MM for umbilical replacement, fuel gas import project delayed to 2019 and HWU for N12 workover CAPEX: 2018-20 expenditure based on the Operator's "Nelson 2018WP&B". CAPEX after 2021 based on "Existing field" (E&M, ref: Shell) assumption of £ 0.8 MM on annual basis from YE2016 audit Capital expenditures stop 2 years before ELT OPEX: maintained costs from YE2016 audit OPEX: for the period 2018-2021 OPEX are consistent with Operator's Opex Plan (excluding Tariff and with inclusion of Corporate Overhead). ABANDEX as per Rockrose YE 2017 (unaudited by ERCE): ABEX to be phased with Howe's abandondement cost
Other Capex	(£ MM)			15.0	8.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8	0.8														31.8
Drilling	(£ MM)
Nelson Opex	(£ MM)			56.4	48.9	57.0	56.0	56.6	56.7	57.5	57.5	58.4	58.3	59.2	58.9	59.8	59.6												800.8
Cost Share	(£ MM)
NGL	(Mbbl/d)			0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1												0.5
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			9.4	9.2	8.6	8.0	7.5	7.0	6.6	6.2	5.8	5.4	5.1	4.8	4.5	3.5												33.5
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total (Platform)

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Abandex	(£ MM)						5.6							1.0	1.9	3.8	12.4												24.6			Notes: 2017 production is estimated from data available through 31 July 2017 Gas rate profile updated based on a GOR value from the Operator's Mbal model NGL assumption provided by Rockrose: yield of 0.010258018 ton/bbl based on the 2010-2013 average No CAPEX foreseen for Howe No cost share with Nelson, Howe pays a tariff instead, included in the economic model OPEX profile aligned to 2017 Operator's Budget (excluding tariff). Flat profile assumed. ABANDEX as per Rockrose's proposal (unaudited by ERCE): ABANDEX to be phased with Nelson's abandondement cost
Other Capex	(£ MM)
Drilling	(£ MM)
Howe Opex	(£ MM)			3.2	1.5	1.2	1.5	1.5	1.5	1.5	1.5	1.5	1.5																16.4
Cost Share	(£ MM)
NGL	(Mbbl/d)			0.2	0.1	0.1	0.1	0.1	0.0	0.0	0.0	0.0	0.0																0.2
Gas Rate	(MMscf/d)			5.2	4.2	3.3	3.0	2.7	2.2	2.0	1.8	1.7	0.7																9.8
Oil Rate	(Mstb/d)			1.9	1.2	0.8	0.7	0.6	0.5	0.4	0.3	0.3	0.1																2.5
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total (Platform)

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Abandex	(£ MM)						5.6											1.0	1.9	3.8	12.4								24.6			Table 9.5: Economic Input for Howe Field: Proved + Probable Case Notes: 2017 production is estimated from data available through 31 July 2017 Gas rate profile updated based on a GOR value from the Operator's Mbal model NGL assumption provided by Rockrose: yield of 0.010258018 ton/bbl based on the 2010-2013 average No CAPEX foreseen for Howe No cost share with Nelson, Howe pays a tariff instead, included in the economic model OPEX profile aligned to 2017 Operator's Budget (excluding tariff). Flat profile assumed. ABANDEX as per Rockrose's proposal (unaudited by ERCE): ABANDEX to be phased with Nelson's abandondement cost
Other Capex	(£ MM)
Drilling	(£ MM)
Howe Opex	(£ MM)			3.2	1.5	1.2	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5												22.4
Cost Share	(£ MM)
NGL	(Mbbl/d)			0.2	0.2	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.0	0.0												0.5
Gas Rate	(MMscf/d)			5.3	5.3	4.9	5.1	5.1	4.9	5.1	5.1	4.9	5.1	5.1	3.8	2.1	0.6												22.9
Oil Rate	(Mstb/d)			2.4	1.7	1.3	1.3	1.2	1.1	1.1	1.0	0.9	0.9	0.9	0.7	0.4	0.1												5.5
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total (Platform)

T-47

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Abandex	(£ MM)						5.6														1.0	1.9	3.8	12.4					24.6			Table 9.6: Economic Input for Howe Field: Proved + Probable + Possible Case Notes: 2017 production is estimated from data available through 31 July 2017 Gas rate profile updated based on a GOR value from the Operator's Mbal model NGL assumption provided by Rockrose: yield of 0.010258018 ton/bbl based on the 2010-2013 average No CAPEX foreseen for Howe No cost share with Nelson, Howe pays a tariff instead, included in the economic model OPEX profile aligned to 2017 Operator's Budget (excluding tariff). Flat profile assumed. ABANDEX as per Rockrose's proposal (unaudited by ERCE): ABANDEX to be phased with Nelson's abandondement cost
Other Capex	(£ MM)
Drilling	(£ MM)
Howe Opex	(£ MM)			3.2	1.5	1.2	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5	1.5									26.9
Cost Share	(£ MM)
NGL	(Mbbl/d)			0.2	0.2	0.2	0.2	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.0	0.0	0.0									0.7
Gas Rate	(MMscf/d)			5.3	5.3	4.9	5.1	5.1	4.9	5.1	5.1	4.9	5.0	5.1	4.4	3.4	2.5	1.3	0.5	0.5									25.1
Oil Rate	(Mstb/d)			2.7	2.6	2.4	2.0	1.6	1.3	1.2	1.2	1.1	1.1	1.0	1.0	0.8	0.6	0.3	0.1	0.1									7.8
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total (Platform)

T-48

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Abandex	(£ MM)			0.1				4	9	43	125	77																	258.4			Notes: 2017 production is estimated from data available through 28 September 2017 CoP is assumed on June 30th 2024 - production rates are annualised RP2 and RP3 back on stream and included in the forecast No CAPEX foreseen
Other Capex	(£ MM)
Drilling	(£ MM)
Ross Opex	(£ MM)			4.1	1.9	3.7	1.9	3.7	1.9	1.0																			18.0
Cost Share	(£ MM)
NGL	(Mbbl/d)
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			0.36	0.31	0.22	0.15	0.09	0.09	0.04																			0.5
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total

T-49

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Abandex	(£ MM)			0.1				4	9	43	125	77																	258.4			Notes: 2017 production is estimated from data available through 28 September 2017 CoP is assumed on June 30th 2024 - production rates are annualised RP2 and RP3 back on stream and included in the forecast No CAPEX foreseen
Other Capex	(£ MM)
Drilling	(£ MM)
Ross Opex	(£ MM)			4.1	1.9	3.7	1.9	3.7	1.9	1.0																			18.0
Cost Share	(£ MM)
NGL	(Mbbl/d)
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			0.53	0.50	0.42	0.37	0.31	0.24	0.11																			0.9
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total

T-50

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Abandex	(£ MM)			0.1				4	9	43	125	77																	258.4			Notes: 2017 production is estimated from data available through 28 September 2017 CoP is assumed on June 30th 2024 - production rates are annualised RP2 and RP3 back on stream and included in the forecast No CAPEX foreseen
Other Capex	(£ MM)
Drilling	(£ MM)
Ross Opex	(£ MM)			4.1	1.9	3.7	1.9	3.7	1.9	1.0																			18.0
Cost Share	(£ MM)
NGL	(Mbbl/d)
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			0.69	0.70	0.63	0.58	0.53	0.48	0.22																			1.4
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total

T-51

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Abandex	(£ MM)							3.3	3.3	10.0	91.6	58.3																	166.6			Table 9.10: Economic Input for Blake Field: Proved Case Notes: 2017 production is estimated from data available through 30 September 2017 CoP is assumed on June 30th 2024 - production rates are annualised ERCE has maintained previous costs from 2022 onwards. Total BleoHolm extension cost consistent with ERCE previous view from which scale squeeze cost has been removed No drilling activity currently sanctioned ABANDEX as per Rockrose's proposal (unaudited by ERCE): expenditure starts 2 years before CoP CAPEX includes infill FEED costs
Bleo Holm Extension	(£ MM)			11.5	9.9	2.6	1.3	1.3	1.3	0.3																			28.3
Drilling	(£ MM)
Blake Field OPEX	(£ MM)			3.3	4.9	2.1	1.9	1.9	1.9	0.9																			16.9
Bleo Holm OPEX	(£ MM)			69.0	78.1	77.5	80.5	74.2	74.2	33.6																			483.9
NGL	(Mbbl/d)
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			8.3	7.7	7.2	6.7	6.3	5.9	3.0																			16.4
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total

T-52

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Abandex	(£ MM)							3.3	3.3	10.0	91.6	58.3																	166.6			Table 9.11: Economic Input for Blake Field: Proved + Probable Case Notes: 2017 production is estimated from data available through 30 September 2017 CoP is assumed on June 30th 2024 - production rates are annualised ERCE has maintained previous costs from 2022 onwards. Total BleoHolm extension cost consistent with ERCE previous view from which scale squeeze cost has been removed No drilling activity currently sanctioned ABANDEX as per Rockrose's proposal (unaudited by ERCE): expenditure starts 2 years before CoP CAPEX includes infill FEED costs
Bleo Holm Extension	(£ MM)			11.5	9.9	2.6	1.3	1.3	1.3	0.3																			28.3
Drilling	(£ MM)
Blake Field OPEX	(£ MM)			3.3	4.9	2.1	1.9	1.9	1.9	0.9																			16.9
Bleo Holm OPEX	(£ MM)			69.0	78.1	77.5	80.5	74.2	74.2	33.6																			483.9
NGL	(Mbbl/d)
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			9.7	9.5	9.5	8.7	8.2	7.8	3.9																			20.9
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total

T-53

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Abandex	(£ MM)							3.3	3.3	10.0	91.6	58.3																	166.6			Table 9.12: Economic Input for Blake Field: Proved + Probable + Possible Case Notes: 2017 production is estimated from data available through 30 September 2017 CoP is assumed on June 30th 2024 - production rates are annualised ERCE has maintained previous costs from 2022 onwards. Total BleoHolm extension cost consistent with ERCE previous view from which scale squeeze cost has been removed No drilling activity currently sanctioned ABANDEX as per Rockrose's proposal (unaudited by ERCE): expenditure starts 2 years before CoP CAPEX includes infill FEED costs
Bleo Holm Extension	(£ MM)			11.5	9.9	2.6	1.3	1.3	1.3	0.3																			28.3
Drilling	(£ MM)
Blake Field OPEX	(£ MM)			3.3	4.9	2.1	1.9	1.9	1.9	0.9																			16.9
Bleo Holm OPEX	(£ MM)			69.0	78.1	77.5	80.5	74.2	74.2	33.6																			483.9
NGL	(Mbbl/d)
Gas Rate	(MMscf/d)
Oil Rate	(Mstb/d)			12.3	12.8	13.3	12.2	11.5	10.9	5.5																			28.6
Year				2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036	2037	2038	2039	2040	2041		Total

T-54

Rockrose Competent Person Report for Certain UK Assets

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10. Appendix 3: Nomenclature

10.1. Units and their abbreviations

°C	degrees Celsius
°F	degrees Fahrenheit
bbl	When referenced to water = to 1 barrel.
	When referenced to oil in Nelson a bbl is a pipeline barrel in Nelson assumed at 0.953
	stb/pipeline bbl
bbl/d	When referenced to water = to 1 barrel per day
	When referenced to oil in Nelson, this is a pipeline barrel per day in Nelson assumed
	at 0.953 stb/pipeline bbl
Bscf	thousands of millions of standard cubic feet
boe	barrels of oil equivalent, where 6000 scf of gas = 1 bbl of oil
cp	centipoises
ft	feet
ftMDRKB	feet below Kelly Bushing
ftTVDSS	feet subsea
km	kilometres
m	metres
M or MM	thousands and millions respectively
md	millidarcy
mTVDSS	metres subsea
ppm	parts per million
psia	pounds per square inch absolute
psig	pounds per square inch gauge
pu	porosity unit
rcf	cubic feet at reservoir conditions
rb	reservoir barrels
scf	standard cubic feet measured at 14.7 pounds per square inch and 60 degrees
	Fahrenheit
scf/d	standard cubic feet per day
stb	a stock tank barrel which is 42 US gallons measured at 14.7 pounds per square inch
	and 60 degrees Fahrenheit
stb/d	stock tank barrels per day

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Rockrose Competent Person Report for Certain UK Assets

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10.2. Resources Categorisation

The following are SPE PRMS terms, defined in Section 8:

Proved Proved Probable Probable Possible Possible 2P or P+P Proved + Probable 3P or P+P+P Proved + Probable +Possible P10 10 per cent probability = Proved + Probable + Possible, or 3P P50 50 per cent probability = Proved + Probable, or 2P P90 90 per cent probability = Proved, or 1P 1C Low Estimate Contingent Resources 2C Best Estimate Contingent Resource 3C High Estimate Contingent Resource remaining when stating Reserves of petroleum, the total amount of petroleum that is expected to be produced from the reference date to the end of production

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Rockrose Competent Person Report for Certain UK Assets

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10.3. Terms and their abbreviations

Bg	gas formation volume factor, in scf/rcf
BHA	bottom hole assembly
Bo	oil shrinkage factor or formation volume factor, in rb/stb
CGR	condensate gas ratio
CoP	cessation of production
CO2	carbon dioxide
CPI	computer processed information log#
DCA	decline curve analysis
DST	drill stem test
Eg	gas expansion factor
FBHP	Flowing bottom hole pressure
FDP	field development plan
FMB	flowing material balance
FTHP	flowing tubing head pressure
FVF	formation volume factor
FWL	free water level
GDT	gas down to
GEF	gas expansion factor
GIIP	gas initially in place
GOC	gas oil contact
GRV	gross rock volume
GWC	gas water contact
H2S	hydrogen sulphide
HLV	Heavy Lift Vessel
kh	permeability thickness
Kr	relative permeability
LNG	liquefied natural gas
LPG	liquefied petroleum gas
LTC	long term compression
MD	measured depth
MSL	mean sea level
NBP	National Balancing Point
NTG	net to gross ratio
N2	nitrogen
NPV xx	net present value at xx discount rate

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Rockrose Competent Person Report for Certain UK Assets

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NUI	normally unmanned installation
ODT	oil down to
OWC	oil water contact
Phi	porosity
Phie	effective porosity
Phit	total porosity
PI	productivity index, in stb/d/psi for oil or MMscf/d/psi or Mscf/d/psi for gas
PSDM	post stack depth migration
PSTM	post stack time migration
PVT	pressure volume temperature experiment
RCA	routine core analysis
Rs	solution gas oil ratio
STOIIP	stock tank oil initially in place
Sw	water saturation
Swc	connate water saturation
TD	total depth
THP	tubing head pressure
TVD	true vertical depth
TWT	two way time
WGR	water gas ratio
WOR	water oil ratio
WUT	water up to

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Black&Callow — c113640