FAR LIMITED — Capital/Financing Update 2015

Apr 12, 2015

13 April 2015

Shareholder update: Evaluation plan for Senegal discoveries

• First phase program to evaluate SNE-1 and FAN-1 discoveries planned to start in Q4 2015 with 3 well firm program

• Initial focus on SNE discovery

• Analysis of SNE-1 and FAN-1 well data ongoing

• SNE-1 and FAN-1 discoveries have significantly de-risked exploration potential

• Two newly mapped SNE look-alike prospects added to prospect inventory

Following the successful drilling campaign offshore Senegal in 2014, FAR Ltd (“FAR”) and its joint venture partners ConocoPhillips, Cairn Energy (“Cairn”) and Petrosen (the Government of Senegal) are planning a first phase work program to evaluate the SNE-1 and FAN-1 discoveries.

The work program includes two wells to appraise the SNE-1 discovery and one exploration well likely to assess a “shelf” prospect. The program will also include further evaluation of the FAN-1 discovery and a new 3D seismic survey over a part of the Contract area including a portion of the Sangomar and Rufisque blocks. An evaluation work program will be submitted to the Government of Senegal in May 2015.

The SNE-1 and FAN-1 wells (shown in Figure 1) were the first exploration wells to be drilled in the deep water offshore Senegal and were the first to be drilled offshore Senegal for 26 years. As a result, these two wells were highly significant not only because they discovered oil but because they have provided key data to update pre-drill geological models and have given FAR strong encouragement that further exploration drilling could result in more discoveries.

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Figure 1: Location map of the Senegal project and discovery wells SNE-1 and FAN-1

To this end, and since the Notice of Discoveries was submitted to the Government in November 2014, the joint venture has progressed detailed analysis of SNE-1 and FAN-1 well data, extensive geological studies and modern 3D seismic reprocessing. FAR has re-assessed its portfolio of exploration leads and prospects based on the current data and these are included in this report.

Based on the size of the SNE-1 oil accumulation (gross, best estimate contingent resource 330 mmbbls*), excellent reservoir properties, known oil and gas column height and confidence in the mapping of the structure on 3D seismic data, SNE is the more attractive discovery for early evaluation and will be the initial focus of the joint venture’s evaluation work program.

Cairn, the Operator, anticipates that two appraisal wells will be drilled and the reservoir will be flow

tested and cored in the first phase evaluation program. The objective of appraisal drilling is to confirm the reserves and productivity required for a commercial development ( reference Cairn Preliminary Results Announcement to the London Stock Exchange, 10 March 2015 ). The minimum economic field size for a standalone development is estimated by Cairn, the Operator, to be approximately 200 million barrels ( reference Cairn Preliminary Results Announcement to the London Stock Exchange, 10 March 2015 ).

Exploration wells are expected to focus initially on shelf prospects. Such prospects have the potential to contribute to building a larger resource base for an initial development project. The Operator estimates the minimum economic volume for a tie back development to be approximately 75 million barrels within a 25 kilometre radius ( reference Cairn Preliminary Results Announcement to the London Stock Exchange, 10 March 2015 ).

The development concept outlined by Operator for a SNE field development consists of a standalone Floating Production Storage and Offloading (FPSO) facility hub with potential to integrate nearby discoveries as shown in Figure 2. Gas re-injection and/or water flood is also contemplated ( reference Cairn Preliminary Results Announcement to the London Stock Exchange, 10 March 2015 ).

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Figure 2: Conceptual FPSO production facility

FAR has reworked the mapping of the prospects and leads on the shelf following the FAN-1 and SNE-1 discoveries. The additional prospects mapped by FAR are shown in Table 1. Following the discovery of oil in the SNE-1 well FAR assesses the probability of success of encountering hydrocarbons for the shelf prospects to range from 33% to 52%.

Cairn, the Operator, continues work on finding an appropriate rig for the evaluation program. As stated at a recent RBC Investor Lunch Series in London, the Operator said that with falling deep water rig rates and the experience gained drilling offshore Senegal in 2014, they believe wells could be drilled offshore Senegal at US$30-40 million per well (taking 30-40 days per well). Based on this information, FAR estimates that the firm drilling program will cost approximately US$150 million with FAR’s share being approximately US$25 million (approximately AUD$33 million).

SNE Discovery

The SNE discovery was the second in the two well exploration program undertaken in 2014 and the announcement of the discovery was made on 10 November 2014 ( refer ASX release 10/11/2014 ). The SNE field has both an oil column and an overlying gas column in stacked Albian clastic reservoirs as shown in Figure 3.

The size of the SNE discovery in the Albian sands (gross, Operator’s best estimate contingent resource 330 mmbbls) is twice that of FAR’s pre-drill estimate for the accumulation (gross, best estimate prospective resource 154 mmbbls). An outline of the SNE field is shown in Figure 4.

The SNE-1 well was drilled in a water depth of 1,100 metres on the geological shelf edge. The SNE trap is formed by a broad arch that dips to the east and south where the reservoir intervals are truncated by a major unconformity. The structure is sealed at the top by a regional shale overlying the unconformity and a clearly defined oil-water contact demarks the base of the accumulation (as shown in Figure 3). Following the discovery, Operator’s contingent resource estimates were P90 of 150mmbbls, P50 of 330mmbbls and a P10 of 670 mmbbls* ( refer ASX release 10/11/2014 ). Operator’s contingent resource estimates have since been audited by ERC-Equipoise. Analysis of log

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Figure 3: Cross section through the SNE-1 discovery

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and core data collected in the SNE 1 well and mapping of reprocessed 3D seismic data is ongoing.

As a part of the logging program in SNE-1, a series of pressure measurements and hydrocarbon samples was collected through the hydrocarbon column. These data demonstrated excellent mobility of hydrocarbons from all of the reservoir intervals. Further work is being carried out on the analysis of the porosity and permeability data over the reservoir but this is likely, in FAR’s opinion, to confirm the quality of the reservoir.

The discovery of oil at SNE-1 has greatly reduced key geological risks to discovering oil in other prospects on the geological shelf. In light of this, FAR has re-evaluated the prospects on the shelf and this is discussed below.

FAR estimates that on a gross unrisked best estimate basis, there is an additional prospective resource* of 765 mmbbls of oil on the shelf over and above the contingent resources in the SNE prospect. FAR believes at least one of these shelf exploration prospects could be drilled as part of a 2015/2016 drilling program.

Figure 4: SNE Discovery on the geological shelf edge

FAN Discovery

FAN-1 was the first well drilled in the Senegal drilling program and the discovery was announced on 7 October 2014 ( refer ASX release 7/10/2014 ). The FAN-1 well is situated approximately 100 km west of the Senegal coast and drilled in 1,428 metres of water to the west of the shelf break.

The FAN-1 well was drilled to test for hydrocarbons trapped in multiple, stacked structural and stratigraphic closures. The well encountered a gross 500 metre interval over which oil shows were observed and samples were collected. Preliminary analysis indicated 29 metres of net oil bearing reservoir. Distinct oil types ranging from 28[o] to 41[o] API have been indicated from a number of oil samples recovered to surface ( refer ASX release 7/10/2014 ).

Hydrocarbon shows were also encountered in the younger canyon play (North Fan or previously labelled as North Canyon Prospect) however it does not appear to have the potential to hold a meaningful amount of hydrocarbons at this location and the focus of the joint venture will be on evaluating the deeper units. The South and Central Fan Prospects remain on the FAR inventory for future exploration as they are seismically mapped as having thicker potential reservoir sequences than in the North Fan.

The deeper unit (FAR’s previously labelled Beer Prospect) is interpreted as an elongate, closure with a very large aerial extent. The FAN-1 well drilled an oil-bearing interval interpreted to be a stacked series of oil columns. There is potential for large oil columns in the area as an oil-water contact was not encountered in the well. As a result, the heights of the oil columns are unknown and therefore there is a very large range in potential volumes as, demonstrated by Operator’s large range in STOIIP estimates P90: 250 mmbbls, P50: 950 mmbbls and P10: 2500 mmbbls* ( refer Cairn Oil discovered offshore Senegal announcement to the London Stock Exchange, 7 October 2014 ). The large range in the STOIIP and the release of STOIIP rather than contingent resources point to a number of key uncertainties in

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the FAN discovery that are being evaluated at present and this evaluation will continue into the 2015/16 work program.

Critical to addressing these uncertainties is the interpretation of the reprocessed 3D seismic data which will be completed over the deep water, basinal area in late 2015. The outline of the North Fan Beer Prospect with the location of the FAN-1 well is shown in Figure 5. As seen from this amplitude display, the FAN-1 well was drilled on the edge of this amplitude anomaly (r eference transcript relating to Cairn Preliminary Results Announcement to the London Stock Exchange, 10 March 2015 ). Work is ongoing to correlate seismic responses to reservoir potential. An assessment of the porosity and permeability of the reservoir at the Albian level continues.

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Figure 5: FAN-1 well location and Beer Prospect

The FAN-1 well confirmed the presence and maturity

of multiple, very high quality source rocks within the basin as well as good quality lithologies for top and base seals within this play. These oil mature source intervals are believed to have provided charge to the FAN discovery. The presence of these source rocks and the sealing units has significantly reduced the risk for the remaining prospects in the deeper water, in particular the greater North Fan area and the Central and Southern Fan Prospects.

Exploration prospect review

In light of the FAN-1 and SNE-1 discoveries, FAR has matured its prospect inventory for offshore Senegal with a focus on the shelf. The discovery of oil at SNE-1 demonstrates excellent reservoir, seal and trap as well as prolific source intervals, and subsequent to the discovery, FAR has mapped two additional shelf edge prospects (Sirius and Soleil), analogous to SNE, which are now included in the prospect inventory. FAR estimates these prospects add an additional 305 mmbbls* (gross unrisked best estimate prospective resource) to the portfolio. A map showing FAR’s prospects as defined by the 3D database is shown in Figure 6.

In this focus area of the shelf, FAR now maps a total gross, unrisked best estimate of prospective resources of 1,500 mmbbls with 225 mmbbls net to FAR. In addition the gross best estimate contingent resource in the SNE discovery is 330

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Figure 6: FAR update prospects over 3D seismic area

mmbbls with 49.5 mmbbls net to FAR. This significant prospective and contingent resource inventory is expected to be assessed with the evaluation drilling program starting in late 2015.

FAR expects to re-assess its prospect inventory following the receipt of the first tranche of reprocessed 3D seismic data later in 2015. Further, the joint venture has recently received reprocessed 2D seismic in the Rufsique block and has identified early potential leads for follow up during the evaluation phase. FAR is encouraged by the potential on this block and it is likely that 3D seismic data will be acquired over the area as part of the evaluation work program.

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Having proven the existence of the working source rock, the prolific nature of the source rock and the oil migration pathways to filling the traps, in FAR’s view the geological chance of success for finding oil in all the prospects has been significantly upgraded.

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Table 1: Summary of FAR prospect inventory

For more information please contact

Cath Norman Managing Director Gordon Ramsay Executive General Manager, Business Development

Ian Howarth

T: +61 3 9618 2550 Level 17, 530 Collins Street F: +61 3 9620 5200 Melbourne VIC 3000 Australia E: info@far.com.au www.far.com.au T +61 3 9600 1979

Collins Street Media

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Disclaimers

Prospective Resource Estimates Cautionary Statement -* With respect to the prospective resource estimates contained within this report, it should be noted that the estimated quantities of Petroleum that may potentially be recovered by the future application of a development project may relate to undiscovered accumulations. These estimates have an associated risk of discovery and risk of development. Further exploration and appraisal is required to determine the existence of a significant quantity of potentially moveable hydrocarbons_ _.**

Prospective Resources - All prospective resource estimates presented in this report are prepared as at 27/2/2013, 11/3/2014 and 5/2/2014. (Reference: FAR ASX releases of 27/02/2013, 11/3/2014, 5/2/2014) . The estimates have been prepared by the Company in accordance with the definitions and guidelines set forth in the Petroleum Resources Management System, 2007 approved by the Society of Petroleum Engineer and have been prepared using probabilistic methods. Unless otherwise stated the estimates provided in this report are Best Estimates and represent that there is a 50% probability that the actual resource volume will be in excess of the amounts reported. The estimates are unrisked and have not been adjusted for both an associated chance of discovery and a chance of development. The 100% basis and net to FAR prospective resource estimates include Government share of production applicable under the Production Sharing Contract .

Competent Person Statement Information - In this report relating to hydrocarbon resource estimates has been compiled by Peter Nicholls, the FAR Limited exploration manager. Mr Nicholls has over 30 years of experience in petroleum geophysics and geology and is a member of the American Association of Petroleum Geology, the Society of Petroleum Engineers and the Petroleum Exploration Society of Australia. Mr Nicholls consents to the inclusion of the information in this report relating to hydrocarbon Prospective Resources in the form and context in which it appears. The Prospective Resource estimates contained in this report are in accordance with the standard definitions set out by the Society of Petroleum Engineers, Petroleum Resource Management System.

Forward looking statements - This document may include forward looking statements. Forward looking statements include, are not necessarily limited to, statements concerning FAR’s planned operation program and other statements that are not historic facts. When used in this document, the words such as “could”, “plan”, “estimate”, “expect”, “intend”, “may”, “potential”, “should” and similar expressions are forward looking statements. Although FAR Ltd believes its expectations reflected in these are reasonable, such statements involve risks and uncertainties, and no assurance can be given that actual results will be consistent with these forward looking statements. The entity confirms that it is not aware of any new information or data that materially affects the information included in this announcement and that all material assumptions and technical parameters underpinning this announcement continue to apply and have not materially changed.

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