Dart Energy Ltd : UK Farm-Out with Total E&P UK Ltd

Singapore (Head Office)

T[phone] F[phone]

152 Beach Road, #19-03/04 The Gateway East

Singapore 189721

Brisbane (Registered Office)

T[phone] F[phone]

Level 9, Waterfront Place, 1 Eagle Street,

Brisbane Qld 4000, Australia

GPO Box 3120, Brisbane Qld 4001,

dartgas.com ASX CODE DTE ABN 21 122 588 505

13 January 2014 UK Farm-Out with Total E&P UK Ltd

Dart Energy (ASX:DTE) is pleased to announce that it has entered into a Farm-out Agreement (the "Agreement") with Total E&P UK Limited ("Total UK") in respect of UK Onshore Petroleum Exploration and Development Licences PEDL139 and PEDL140 (the "Licences"), along with the other existing Licence participants Egdon Resources UK Ltd, Island Gas Ltd and eCorp Oil & Gas UK Ltd.
The Licences contain the Bowland Shale located in the Gainsborough Trough geological basin in Lincolnshire. The Licences cover approximately 240 km2.
Total E&P UK Limited is one of the largest operators in the UK sector of the North Sea. It is a wholly owned subsidiary of Total S.A., listed on the London, Paris, Brussels and New York stock exchanges.
Under the terms of the Agreement, the existing Licence participants have agreed to restructure their arrangements and licence interests to facilitate the entrance of Total to a
40% working interest in the Licences. Total UK will pay US$1.6 million in back costs and earn a 40% interest in the Licences in return for funding a shale work programme of up to US$46.5 million.
On completion the interests in the Licences (across all horizons) will be as follows: Total E&P UK Limited (40%), Dart, through its subsidiary GP Energy Limited (17.5%), Egdon Resources UK Ltd (14.5%), Island Gas Ltd (14.5%) and eCorp Oil & Gas UK Ltd (13.5%). Island Gas Limited will act as operator on behalf of the joint venture partners and Total will operate the Licences upon completion of the carried programme.
The agreed work programme to be funded by Total UK will include the acquisition of 3D seismic; the drilling and testing of a vertical shale well and associated well pad construction; and, conditional on the success of the testing of the exploration well, the drilling and testing of a horizontal appraisal well. As noted, this represents an expenditure of up to US$46.5m. Total UK has the ability to exit after an initial period of the work programme (corresponding to a spend of $19.5m) although in this eventuality Total would forfeit all interest in the Licences.
As a consequence of the various agreements between the parties, Dart will also receive a cash payment of US$1million upon completion. The farm-out is subject to customary conditions precedent, including approval of the UK Department of Energy and Climate Change.
Commenting, John McGoldrick, Dart's Chief Executive Officer said:

"We are delighted with the introduction of Total UK into PEDL139/140 and the new farm- out arrangements which provide for a substantial carried work programme designed to

1

dartgas.com

verify the significant shale-gas potential identified in the relevant licences. Total UK's entry into onshore UK unconventional is very welcome, bringing valuable expertise at a critical time for the gas industry in this country.

This transaction continues our strategy aimed at unlocking the potential of Dart's extensive UK shale portfolio. Late last year we entered into a farm-out and strategic cooperation agreement with GDF SUEZ covering thirteen licences, and the Total UK transaction covers another two. Between these two transactions Dart has established partnerships with two leading international oil and gas companies, and will see an extensive shale gas exploration program across its portfolio over the next two to three years - up to six shale wells and total expenditure of up to US$80 million. Most will be operated by Dart, two operated by other parties, but more importantly almost all of the funding for this program will be obtained through the farm-outs. Dart still retains a large working interest position across its portfolio providing future opportunities for further farm-ins."

Commenting on the acquisition, Patrice de Viviès, Total's Senior Vice President for Northern Europe, said: "This opportunity is an important milestone for Total E&P UK and opens a new chapter for the subsidiary in a promising onshore play. The Group is already involved in shale gas projects in the US, Argentina, China, Australia and in Europe in Poland and in Denmark, and will leverage its expertise in this new venture in the UK."

ENDS

For and on behalf of the Board
Paul Marshall, Company Secretary

For further information contact:

John McGoldrick	Chief Executive Officer	Tel:	[phone]
Eytan Uliel	Chief Financial Officer	Tel:	[phone]

Media enquiries contact:
Peter Reilly Vigo Communications Tel: [phone]

2

OARTENERGY

Singapore (Head Office)

T[phone] F[phone]

152 Beach Road, #19-03/04 The Gateway East

Singapore 189721

Brisbane (Registered Office)

T[phone] F[phone]

Level 9, Waterfront Piace, 1Eagle Street,

Brisbane Qld 4000, Australia

GPO Box 3120, Brisbane Qld 4001,

dartgas.com ASXCODE DTE ABN 21122 588 505

APPENDIX A: BOWLAND BASIN SHALE MAP

Lcgend:

Licence Bol cks:

rZ'.,l PfDLI39 & PEDL140

c:J Dart Energy / GDF SUEZ Llcroces

CJ Dart Energy Ucences 100%

c:J Othet Ucence Areas

·T-o-w-n.s.&..C_ltl.e_s ...

3