HYTERRA LTD — Interim / Quarterly Report 2011

Jul 24, 2011

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25 July 2011

The Manager Company Announcements Office Australian Securities Exchange Ltd 4th Floor, 20 Bridge Street SYDNEY NSW 2000

JUNE QUARTER ACTIVITIES REPORT

The Directors of Tango Petroleum Limited (“Tango” or the “Company”) are pleased to report the following activities:

LYONS POINT PROSPECT

During the quarter, the Company advised that it has signed a Participation Agreement to acquire a 17.25% working interest in the Lyons Point Prospect, operated by Clayton Williams Energy Inc (NASDAQ: CWEI) in Acadia Parish, Louisiana.

The prospect will be drilled to a total depth of 16,300 feet. The Lyons Point Prospect has a closure of circa 400 acres with a most likely resource potential is 3 MMBC (Million Barrels Condensate) and 60 BCFG (Billion Cubic Feet Gas) with upside potential of 4 MMBC and 80 BCFG. This estimate is conceptual in nature and insufficient activity has been conducted to determine a hydrocarbon reserve. The well is expected to take 45 days to drill and is planned to spud at the end of August 2011.

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The Lyons Point Prospect is a seismically defined upthrown three-way structural closure that is bounded by faults on all four sides. The objective is the prolific Oligocene Marginulina Texana (MT) 1, 2, and 3 Sands, which are projected to be 700 feet thick.

The objective MT sands are productive in several fields in the immediate surrounding area. The main field fault is the same trapping fault that sets up Leleux Field, which has cumulative historical production of 5 MMBC and 300 BCFG from the MT interval.

Office - Suite 9, 1200 Hay Street, West Perth WA 6005 Postal - PO Box 281, West Perth WA 6872 Ph: 08 6460 4960 Fax: 08 9324 3045 Web: www.tangopetroleum.com.au ACN - 116 829 675

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Production rates are estimated to be significant given adjacent analog wells are producing at rates of 750 BBLCD (Barrels Condensate Per Day) and 15,000 MMCFD (Million Cubic Feet Gas Per Day). It is likely only four wells will be required to drain the structure.

The Company’s share of the initial dry hole well costs are estimated at US$1,450,000 (includes entry costs). In a success case the Company’s share of completion and facilities costs are estimated to be a further US$520,000.

The participation terms are favorable with the Company paying 23% to earn a 17.25% working interest. The net revenue interest is 75%.

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This prospect is best classified as a “develo-cat” well (between a development well and a wildcat well) based on the proximity of producing wells and full support of the prospect by modern, high quality 3D seismic data. Clayton Williams have addressed the four principle geologic risk factors; generation and migration of hydrocarbons from source to reservoir, reservoir quality, reservoir seal, and structure in a very complete manner, again mostly with the support of the 3D seismic data.

This prospect was chosen over numerous others due to the work done and the risk mitigation.

The Board agree with the independent expert’s opinion that this prospect has a very high chance of success of somewhere in the region of 50-66%.

The Board also believes the operator to be of suitable competent experience to drill and manage this prospect in the best interest of all the partners.

CORPORATE

During the quarter, the Company undertook an Entitlement Issue of up to 86,000,000 options (exercisable at $0.06, expiring 30 June 2012) at $0.005 at raise $430,000 before costs, resulting in the issue of 49,785,400 options.

The Company is currently working with the Manager to the Offer to place the shortfall options.

Office - Suite 9, 1200 Hay Street, West Perth WA 6005 Postal - PO Box 281, West Perth WA 6872 Ph: 08 6460 4960 Fax: 08 9324 3045 Web: www.tangopetroleum.com.au ACN - 116 829 675

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The Company also announced its intent (and gained shareholder approval) to place 34,000,000 shares at $0.035 with a free attaching option (exercisable at $0.06, expiring 30 June 2012) to raise $1,190,000 before costs. This placement was finalised following the end of the quarter.

Yours faithfully,

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Mathew Walker Executive Chairman

For further information please contact:

James Robinson, Company Secretary, Tango Petroleum Limited, Tel: + 61 (8) 6460 4960

Office - Suite 9, 1200 Hay Street, West Perth WA 6005 Postal - PO Box 281, West Perth WA 6872 Ph: 08 6460 4960 Fax: 08 9324 3045 Web: www.tangopetroleum.com.au ACN - 116 829 675

Appendix 5B Mining exploration entity quarterly report

Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10

Name of entity

	Name of entity	Name of entity
	Tango Petroleum Limited
	ABN 68 116 829 675 Consolidated statement of cash flows
Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (GST Refund) Net OperatingCash Flows			Current quarter $A’000		Year to date (3 months) $A’000
			(174) 3 11		(174) 3 11
			(160)		(160)
1.8 1.9 1.10 1.11 1.12 1.13		Cash flows related to investing activities Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets Proceeds from sale of: (a) prospects (b) equity investments (c) other fixed assets Loans to other entities Loans repaid by other entities Other (provide details if material) Net investing cash flows Total operating and investing cash flows (carried forward)	(120)		(120)
			(120)		(120)
			(280)		(280)

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(280)	(280)
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) Net financingcash flows
	-	-
Net increase (decrease) in cash held 1.20 Cash at beginning of quarter/year to date 1.21 Exchange rate adjustments to item 1.20 1.22 Cash at end ofquarter *	(280) 341	(280) 341
	61	61

• Subsequent to the end of the quarter the Company undertook an Entitlement Issue and Placement to raise $1,620,000 before costs.

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities

1.23 1.24	Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to the parties included in item 1.10	Current quarter $A'000
		111
		-
1.25	Explanation necessaryfor an understandingof the transactions
	Director’s fees, rent, administration services and reimbursements.

Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

• 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

Financing facilities available

Add notes as necessary for an understanding of the position.

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	-	-
	-	-

Estimated cash outflows for next quarter

Estimated cash outflows for next quarter
4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration	$A’000
	1,350
	100
Total	1,450

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as	Current quarter	Previous quarter
shown in the consolidated statement of cash flows)	$A’000	$A’000
to the related items in the accounts is as follows.
5.1 Cash on hand and at bank	61	341
5.2 Deposits at call
5.3 Bank overdraft
5.4 Other (provide details)
Total: cash at end of quarter (item 1.22)	61*	341

• Subsequent to the end of the quarter the Company undertook an Entitlement Issue and Placement to raise $1,620,000 before costs.

Changes in interests in mining tenements

6.1 Interests in mining tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements acquired or increased	Tenement reference	Nature of interest (note (2))	Interest at beginning ofquarter	Interest at end of quarter

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

Issued and quoted securities at end of current quarter

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

7.1 Preference +securities (description)	Total number	Number quoted	Issue price per security (see note 3) (cents)	Amount paid up per security (see note 3) (cents)
7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs, redemptions
7.3 +Ordinary securities	86,000,000	86,000,000
7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs
7.5 +Convertible debt securities (description)
7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted
7.7 Options (description and conversion factor)			Exercise price	Expiry date
7.8 Issued during quarter
7.9 Exercised during quarter
7.10 Expired during quarter	86,000,000	48,500,000
7.11 Debentures (totals only)
7.12 Unsecured notes (totals only)

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 5).

• 2 This statement does give a true and fair view of the matters disclosed.

Sign here: Date: 25 July 2011 Company secretary

Print name: James Robinson

Notes

• 1 The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

• 2 The “Nature of interest” (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

• 3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.

• 4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.

• 5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

• See chapter 19 for defined terms.

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