FAR LIMITED — Capital/Financing Update 2013

Apr 15, 2013

16 April 2013

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ASX ANNOUNCEMENT AND MEDIA RELEASE

Rig secured for West Africa exploration drilling

FAR Limited (ASX: FAR) has been advised by the operator of its three offshore blocks – Rufisque, Sangomar and Sangomar Deep, off the coast of Senegal, Cairn Energy PLC, that a drilling unit has been contracted for an exploration well, expected to be drilled in early 2014.

Cairn Energy PLC has secured a long term contract with Transocean for the “Cajun Express” drilling unit.

The rig, which is on an initial one-year contract, will be used on Cairn’s planned multi-well frontier exploration programme in Senegal, Morocco and potentially other areas.

Subject to obtaining the necessary approvals the rig will be mobilised to begin operations for Cairn, offshore Morocco in H2 2013 with an exploration well in Senegal planned early in 2014.

FAR recently secured Cairn Energy PLC as partner and operator for the potentially high impact well in Senegal.

The terms of the farm-in deal included:

• FAR being fully carried through first exploration well – expected early 2014

• FAR to be paid approximately US$10 million for back costs

• FAR and Cairn Energy PLC to enter into an alliance offshore Senegal

Under the terms of the farm-in agreement Cairn will acquire a 65% working interest (WI) and Operatorship by fully funding 100% of the costs of an exploration well and testing to an investment cap of US$80 million. As part of the farm-in agreement, Cairn will pay FAR US$9.8 million for past costs incurred on the block. FAR will retain a 25% Working Interest.

FAR’s three contiguous Senegalese blocks – Rufisque, Sangomar and Sangomar Deep – have significant exploration potential. The blocks cover an area of approximately 7,490km[2] within the productive Mauritania‐Senegal‐Guinea‐Bissau Basin. From 2,050km[2] of modern 3D seismic data acquired in the blocks, FAR has identified a number of play types and has mapped 11 potentially drillable prospects as well as numerous other leads, many supported by associated seismic amplitude responses. In combination, the Senegal blocks have prospective resources of 3.585 billion barrels of oil (unrisked best estimate, 100% basis).

After the carried well, exploration costs will be apportioned Cairn 72.2% (WI 65%) and FAR 27.8% (WI 25%). Petrosen (the Senegal National Oil Company) will continue to hold a carried 10% WI through the exploration phase in accordance with the Production Sharing Contract.

In addition, FAR and Cairn will enter into an Area of Mutual Interest agreement (AMI) to work together to evaluate and consider applying jointly for exploration opportunities offshore Senegal.

FAR’s Managing Director Cath Norman said:

“ Securing a drilling rig is a major step towards our ambition of making a substantial discovery in these highly prospective offshore blocks. Cairn Energy has moved quickly to begin the exploration program and we are fortunate to have such an experienced and capable operator working with us in these areas. ”

20130416 - Rig secured for West Africa exploration drilling

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The Cajun Express, is a deep-water, 5th Generation, dynamically positioned, semi-submersible drilling rig with shallow mooring capabilities and a 15,000 psi bop stack. The historic performance of the Cajun Express indicates it is a highly efficient rig with low operating downtime.

FAR has been active in Senegal since 2008. Senegal is considered one of Africa’s most politically and economically stable countries and hosts some of the best transportation, port, telecommunications and community infrastructure in West Africa. It has been a functioning democracy since independence from France in 1960 and enjoys free and fair elections.

About Cairn Energy

Cairn Energy PLC ('Cairn') is one of Europe's leading independent oil and gas exploration and development companies and is listed on the London Stock Exchange. Cairn has discovered and developed oil and gas reserves in a variety of locations around the world. The company historically focused its activities on the geographic region of South Asia where it operated for more than 20 years. During this time it discovered, developed and produced oil and gas both offshore and onshore in Bangladesh and India and made more than 40 significant discoveries. In particular, Cairn made a major oil discovery in Rajasthan in the north west of India at the beginning of 2004 where over 25 discoveries have since been made with the potential to provide more than 30% of India’s crude oil production. Today, Cairn continues to hold an approximate 10% shareholding in Cairn India Limited. Cairn’s business operations are now focused on frontier exploration acreage in Morocco, Senegal, Greenland and the Mediterranean along with exploration and pre-development interests in the North Sea. Cairn has its headquarters in Edinburgh, Scotland supported by operational offices in London, Greenland, Norway, Spain and Morocco.

About FAR

FAR Limited (ASX: FAR) is an independent oil and gas explorer with high impact assets in East and West Africa. FAR's acquisition of Flow Energy in November 2011 strengthened its African focus, giving it entry to the fast emerging oil and gas province of Kenya, East Africa.

In West Africa, FAR holds a dominant position with high impact prospects in Senegal, Guinea-Bissau and the AGC Profond.

FAR recently completed a major joint venture deal with UK listed Cairn Energy Plc over its Senegal offshore leases in which Cairn will operate and carry FAR through an exploration well expected to be drilled in early 2014.

Under the terms of the farm in agreement Cairn is to acquire a 65% working interest and operatorship by fully funding 100% of the costs of an exploration well and testing to an investment cap of US$80 million. Cairn will pay FAR US$9.8 million for past costs incurred on the block. FAR will retain a 25% Working Interest.

FAR’s three contiguous Senegalese blocks – Rufisque, Sangomar and Sangomar Deep – covering 7,490km[2] , have significant exploration potential.

FAR has identified a number of play types and has mapped 11 potentially drillable prospects as well as numerous other leads.

The Senegal blocks have combined prospective resources of 3.585 billion barrels of oil (unrisked best estimate, 100% basis).

FAR Limited will focus its near-term efforts on the highly prospective margins of West and East Africa.

Recent takeover activity and new drilling and major natural gas discoveries in areas close to FAR Limited’s East Africa offshore acreage have heightened interest in the region.

FAR also holds acreage surrounded by proven petroleum systems in Western Australia.

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For further information, please contact

Melbourne Office Cath Norman Managing Director Phone +61 3 9618 2550 www.far.com.au info@far.com.au

Media Enquiries Ian Howarth Collins Street Media Phone +61 3 9223 2465

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