Fastnet Awarded New Licensing Option in North Celtic Sea

Fastnet Oil & Gas Plc (“Fastnet” or the “Company”) the E&P company focused on near term exploration acreage in Africa and the Celtic Sea announces that it has been notified by the Irish Department of Communications, Energy and Natural Resources (the “Department”) that it has been awarded licensing option 13/3 over part blocks 56/6, 56/7, 56/8, 56/9, 56/11, 56/12, 56/13 and 56/14 in the Mizzen Basin (“East Mizzen”) and the western end of the North Celtic Sea Basin, offshore Ireland (“East Mizzen Licensing Option”).

The newly named East Mizzen Licensing Option is valid from 1 May 2013 until 30 September 2014. It covers an area of 1,155 sq. km., and is contiguous with and extending eastwards from the previously awarded Mizzen Licensing Option 12/3, announced on 12 June 2012. Fastnet is the designated operator and has a 100% working interest in the East Mizzen Licensing Option.

Highlights

– 18 month licensing option requiring the reprocessing of a minimum of 400 km. of existing 2D seismic data and the carrying out of various desktop studies

– Potential to extend the East Mizzen Licensing Option by a further 18 months subject to a satisfactory work programme being agreed with the Department

– Light oil shows encountered in basal Cretaceous sands, analogous to the Barryroe tested interval, in the 56/12-1 well drilled off-structure by Esso/Marathon in 1975

– Value-enhancing 3D seismic being acquired at no additional cost to Fastnet’s current programme to define updip drilling locations

– Farmout process alreadyunderway with significant industry interest in the Mizzen and East Mizzen portfolio of prospective structures

Details of the East Mizzen Licensing Option

The East Mizzen Licensing Option acreage lies in water depths of up to 130 metres in the Mizzen Basin and southwest part of the North Celtic Sea Basin. Esso/Marathon drilled the 56/12-1 well in 1975 in East Mizzen based on a sparse grid of poor quality 2D seismic data. It was located to test large structural closures at the Base Chalk, Base Kimmeridgian unconformity and within the Lower Jurassic and Triassic. The well was drilled to 8,773 feet but failed to reach the base of the Cretaceous. Analysis of dipmeter data for the well and 2D seismic acquired much later after the well was drilled indicates that the well was drilled off-structure. Two large structural culminations are mapped to the northwest and east of the well which may be prospective for the same basal Cretaceous sands that were encountered in the well. In the well light oil shows were present near the base of the Cretaceous. Geochemical analysis suggests that the oil was sourced from the same Upper Jurassic source rocks that have sourced the Barryroe oil accumulation, which was successfully flow-tested by Marathon (1990) and Providence (2012).

The area of the East Mizzen Licensing Option is also favourably located for the development of prospective Triassic reservoirs sealed by salt. A number of structural leads have been identified by Fastnet along this trend based on existing 2D seismic data. The Board is of the view that the geological setting of these structures is analogous to that for the Wytch Farm oil field in southern England.

Work program

Fastnet has committed to a work programme for the initial 18 month period of the East Mizzen Licensing Option (the “Initial Phase”) which is to reprocess a minimum of 400 km. of existing 2D seismic data and to undertake desktop studies.

Subject to the results of the work programme in the Initial Phase, Fastnet has the option to agree a further work program with the Department to acquire 3D seismic data during an 18 month extension to the Initial Phase in order to better define the size of the traps tested by the wells.

Fastnet is already in the process of acquiring 3D seismic over Deep Kinsale and acquisition is planned to commence on the Mizzen Licensing Option in the North Celtic Sea. The undershoot of the Kinsale platforms has been successfully completed under budget. Following the completion of the remaining 3D seismic programme over Deep Kinsale the seismic vessel is to transit to the Mizzen and East Mizzen Licensing Option areas to acquire a contiguous 1,200 sq. km. of 3D seismic data. Funding for that part of the programme covering East Mizzen has already been included in Fastnet’s previously announced estimate for the cost of the Celtic Sea 3D seismic program and therefore the inclusion of East Mizzen will not result in any additional cost.

The opportunity to fast-track the acquisition of 3D seismic in East Mizzen in the Initial Phase of the East Mizzen Licensing Option will allow Fastnet to de-risk and mature multiple prospects for drilling over Fastnet’s licensed Mizzen acreage covering 1,942 sq. km., approximately equivalent to tenNorth Sea blocks.

Paul Griffiths, Managing Director of Fastnet commented:

“We are delighted to have added to our inventory of material prospective structures in the Mizzen area offshore Ireland. This has allowed us to capitalise on the interest being shown by the industry in our farmout process in this particularly under-explored, yet highly prospective, basin. It has also allowed us to maximise the value of our on-going 3D seismic acquisition by creating “running room” for potential farminees that have identified the Mizzen Basin as a new emerging shallow water exploration province offshore Ireland. Fastnet is one of the largest acreage holders in this area contributing to creating the conditions necessary to develop competition for acreage in an area that previously lacked industry focus. This situation mirrors our ‘first mover’ strategy in Morocco.”

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Press Release, May 03, 2013