HYDROCARBON DYNAMICS LIMITED — Share Issue/Capital Change 2015

Jun 30, 2015

1 July 2015

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Placement of 100,000,000 shares to Raya Group Limited

Pryme Energy Limited (Pryme) refers to its announcement lodged on 29 June 2015 in relation to the acquisition of the Mississippian Lime Acreage, Oklahoma, from Raya Group Limited (Raya) and the Purchase and Sale Agreement (PSA) executed with Raya.

Pryme is pleased to announce that pursuant to the terms of the PSA, it has completed the placement of 100,000,000 fully paid ordinary shares in Pryme to Raya (Placement). An Appendix 3B and a cleansing notice in relation to the Placement are attached to this announcement.

The issued share capital of Pryme, after the above issue of shares, is 1,007,380,397 fully paid ordinary shares, 458,340,516 listed options expiring 23 July 2016 and 90,738,040 unlisted performance options expiring 23 July 2016.

Yours sincerely,

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Justin Pettett Managing Director

For further information please contact:

Justin Pettett Managing Director Pryme Energy Limited Telephone: +61 7 3371 1103 Website: www.prymeenergy.com

Ryan Messer Chief Operating Officer Pryme Energy Limited Telephone: +1 713 401 9806 ASX Code: PYM

OTCQX Code: POGLY

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Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

Pryme Energy Limited

ABN

75 117 387 354

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of +securities issued or to Fully paid ordinary shares be issued 2 Number of[+] securities issued or 100,000,000 fully paid ordinary shares to be to be issued (if known) or issued to Raya Group Limited pursuant to maximum number which may the ASX announcement lodged on 29 June be issued 2015 (Raya shares) 3 Principal terms of the Fully paid ordinary shares +securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

• See chapter 19 for defined terms.

Appendix 3B Page 1

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Appendix 3B New issue announcement

4 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted+securities? If the additional+securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the+securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 6c Number of+securities issued without security holder approval under rule 7.1	Yes, the fully paid ordinary shares issued will rank equally with the existing class of fully paid ordinary shares traded under the code PYM.
	Non cash consideration. (Please refer to the announcement lodged on 29 June 2015)
	The Raya shares are issued as part of the consideration for acquisition of the acreage owned by US based wholly owned subsidiaries of Raya Group Limited in the Mississippian Lime, Oklahoma. (Please refer to the announcement lodged on 29 June 2015)
	No
	Not applicable
	Not applicable

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

6d Number of+securities issued with security holder approval under rule 7.1A 6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of+securities issued under an exception in rule 7.2 6g If+securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation. 6h If+securities were issued under rule 7.1A for non‐cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A. Cross reference: item 33 of Appendix 3B. 8 Number and +class of all +securities quoted on ASX (_including_the +securities in section 2 if applicable)	Not applicable	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	As per Annexure 1, post issue, the issue capacity is as follows: Under Listing Rule 7.1: 36,107,059 securities
	1 July 2015
	Number	+Class
	1,007,380,397 458,340,516	Fully paid ordinary shares Options expiring 23 July 2016

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

9 Number and +class of all +securities not quoted on ASX (_including_the +securities in section 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)	Number	+Class
	90,738,040	Options expiring 23 July 2016
	None

Part 2 - Pro rata issue

Items 11 to 33 are not applicable.

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

34 Type of[+] securities ( tick one ) (a) +Securities described in Part 1 (b) All other[+] securities Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

36 If the[+] securities are[+] equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories 1 ‐ 1,000 1,001 ‐ 5,000 5,001 ‐ 10,000 10,001 ‐ 100,000 100,001 and over

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

Items 38 to 42 are not applicable.

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no‐one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Sign here: ............................................................ Date: 1 July 2015 (Director)

Print name: JUSTIN PETTETT

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• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

Part 1	Part 1
Rule 7.1 – Issues exceeding 15% of capital
Step 1: Calculate “A”, the base figure from which the placement capacity is calculated
Insertnumber of fully paid+ordinary securities on issue 12 months before the +issue date or date of agreement to issue	344,453,990
Addthe following: • Number of fully paid+ordinary securities issued in that 12 month period under an exception in rule 7.2 • Number of fully paid+ordinary securities issued in that 12 month period with shareholder approval • Number of partly paid+ordinary securities that became fully paid in that 12 month period	116,680,985 (Issued on 10 September 2014 as placement of shortfall under the Rights Issue announced on 30 June 2014) 339,500,157 (Issued on 28 July 2014 to Sub-underwriters appointed by the Underwriter to the Rights Issue announced on 30 June 2014) 60,499,843 (Issued on 23 July 2014 under the Rights Issue announced on 30 June 2014) 12,659,010 (Adjusting Offer to Directors and their related parties – approved by shareholders at the Extraordinary General Meeting on 6 August 2014). 33,586,412 (Adjusting Offer to non-Director participants issued on 23 July 2014 and approved by shareholders at the Extraordinary General Meeting on 6 August 2014) -

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Appendix 3B New issue announcement
Note: • Include only ordinary securities here – other classes of equity securities cannot be added • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items
Subtractthe number of fully paid+ordinary securities cancelled during that 12 month period	Nil
“A”	907,380,397

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Step 2: Calculate 15% of “A”

Appendix 3B New issue announcement	Appendix 3B New issue announcement
Step 2: Calculate 15% of “A”
“B”	0.15 [Note: this value cannot be changed]
Multiply“A” by 0.15	136,107,059
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period_not counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	100,000,000 fully paid ordinary shares issued on 1 July 2015.
“C”	100,000,000
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	136,107,059
Subtract“C” Note: number must be same as shown in Step 3	100,000,000
Total[“A” x 0.15] – “C”	36,107,059 [Note: this is the remaining placement capacity under rule 7.1]

placement capacity under rule 7.1
“A” x 0.15	136,107,059
Note: number must be same as shown in
Step 2
Subtract“C”	100,000,000
Note: number must be same as shown in
Step 3
Total[“A” x 0.15] – “C”	36,107,059
	[Note: this is the remaining placement
	capacity under rule 7.1]

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Part 2 Not applicable

Rule 7.1A – Additional placement capacity for eligible entities Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

“A” Note: number must be same as shown in Step 1 of Part 1

Step 2: Calculate 10% of “A”

“D” 0.10 Note: this value cannot be changed Multiply “A” by 0.10

Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used

Insert number of[+] equity securities issued or agreed to be issued in that 12 month period under rule 7.1A

Notes:

• This applies to equity securities – not just ordinary securities

• Include here – if applicable – the securities the subject of the Appendix 3B to which this form is annexed

• Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained

• • It may be useful to set out issues of securities on different dates as separate line items

• “E”

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A “A” x 0.10 Note: number must be same as shown in Step 2 Subtract “E” Note: number must be same as shown in Step 3 Total [“A” x 0.10] – “E” Note: this is the remaining placement capacity under rule 7.1A

• See chapter 19 for defined terms.

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Company Announcements Office Australian Securities Exchange 20 Bridge Street Sydney NSW 2000

1 July 2015

Dear Sirs,

Section 708A(5)(e) Notice

Pryme Energy Limited ( Pryme or the Company ) advises that there is an outstanding disagreement between it and the vendors of the Capitola Oil Project, relating to the extent of the Company’s interest in that Project. The Parties will mediate the matter later this month. The Company believes the disclosures it has made to date concerning its interest in the Project remain true and correct.

Pryme refers to the Appendix 3B released on 1 July 2015 for the placement of 100,000,000 fully paid ordinary shares of the Company to Raya Group Limited (Raya) as part of the purchase price under the Purchase and Sale Agreement, details of which were announced on 29 June 2015.

.

Pryme hereby notifies ASX under section 708A(5)(e) of the Corporations Act ( the Act ) that:

• (a) Pryme issued the shares without disclosure to the investor under Part 6D.2 of the Act;

• (b) as at 1 July 2015, Pryme has complied with the provisions of Chapter 2M of the Act as they apply to Pryme, and section 674 of the Act; and

• (c) as at 1 July 2015, there is no information:

• (i) that has been excluded from a continuous disclosure notice in accordance with the ASX Listing Rules; and

• (ii) that investors and their professional advisers would reasonably require for the purpose of making an informed assessment of:

  • A. the assets and liabilities, financial position and performance, profits and losses and prospects of Pryme; or

  • B. the rights and liabilities attaching to the shares.

Yours sincerely,

Justin Pettett Managing Director

For further information please contact:

Justin Pettett Managing Director Pryme Energy Limited Telephone: +61 7 3371 1103 Website: www.prymeenergy.com

Ryan Messer Chief Operating Officer Pryme Energy Limited Telephone: +1 713 401 9806 ASX Code: PYM

OTCQX Code: POGLY

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