Beach Energy : 2018 Notice of Annual General Meeting/Proxy Form

BEACH ENERGY LIMITED

ACN 007 617 969 (Beach)

NOTICE OF 2018 ANNUAL GENERAL MEETING

Beach will hold its 57th Annual General Meeting at the Adelaide Convention Centre, North Terrace Adelaide South Australia, 5000 on Friday 23 November 2018 at 10.30am (Adelaide time).

AGENDA

ORDINARY BUSINESS Financial Statements

To receive and consider the financial statements and the reports of the directors and auditors for the financial year ended 30 June 2018.

These statements and reports can be viewed in Beach's 2018 Annual Report which is available at beachenergy.com.au.

Note: There is no requirement for shareholders to approve the financial statements and reports and accordingly no resolution will be put to shareholders regarding this item of business.

Resolution 1 - Adoption of remuneration report

To consider and put to a non-binding vote the following resolution:

"That the remuneration report for the financial year ended 30 June 2018 be adopted."

Voting Exclusion Statement (Corporations Act):

Beach will disregard any votes cast on resolution 1:

• ● by or on behalf of a member of the key management personnel (KMP), details of whose remuneration are included in the remuneration report for the year ended 30 June 2018, or a closely related party of a member of the KMP, in any capacity, or

• ● as a proxy by a person who has become a member of the KMP by the time of the annual general meeting, or by any closely related party of a member of the KMP,

unless the vote is cast as proxy for a person who is entitled to vote on resolution 1 and:

• ● the vote is cast in accordance with directions on the proxy form specifying how the proxy is to vote; or

• ● the vote is cast by the Chairman of the meeting and the proxy form authorises him to vote as he decides on resolution 1.

Resolution 2 - Re-election of Glenn Davis as a director

To consider and, if thought fit, pass the following resolution as an ordinary resolution:

"That Glenn Davis, who retires by rotation pursuant to clause 13.3 of the constitution of Beach and ASX Listing Rule 14.4 and, being eligible, offers himself for re-election, is re-elected as a director of Beach."

Resolution 3 - Re-election of Ryan Stokes as a director

To consider and, if thought fit, pass the following resolution as an ordinary resolution:

"That Ryan Stokes, who retires by rotation pursuant to clause 13.3 of the constitution of Beach and ASX Listing Rule 14.4 and, being eligible, offers himself for re-election, is re-elected as a director of Beach."

Resolution 4 - Election of Joycelyn Morton as a director

To consider and, if thought fit, pass the following resolution as an ordinary resolution:

"That Joycelyn Morton, who was appointed as a director subsequent to the last annual general meeting of Beach and being eligible, offers herself for election, is elected as a director of Beach."

SPECIAL BUSINESS

Resolution 5 - Appointment of Auditor

To consider and, if thought fit, pass the following resolution as an ordinary resolution:

"That, for the purposes of section 327B(1)(b) of the Corporations Act 2001 (Cth) and for all other purposes, Ernst & Young, having consented in writing to act as auditor of Beach, is appointed auditor of Beach."

Resolution 7 - Reinstatement of Partial Takeover Provisions in the Constitution

To consider and, if thought fit, pass the following resolution as a special resolution:

"That Clause 6.4 of Beach's constitution is reinstated in the constitution for a further three years after the date of this annual general meeting."

Resolution 6 - Approval of Beach Energy Employee Share Plan

To consider and, if thought fit, pass the following resolution as an ordinary resolution:

"That for the purposes of Listing Rule 7.2 (exception 9(b)) and all other purposes, the establishment, operation and administration of a Beach Energy Ltd Employee Share Purchase Plan (Plan), as described in the Explanatory Statement to this Notice of Meeting, and the issue of shares under the Plan until 23 November 2021, be approved."

Voting exclusion statement

Beach will disregard any votes cast in favour of resolution 6 by or on behalf of:

• ● a director of Beach (except one who is ineligible to participate in any employee incentive scheme operated in relation to Beach); or

• ● an associate of that person (or those persons).

In addition, in accordance with the Corporations Act, Beach will disregard any votes cast on resolution 6 by Beach's KMP, details of whose remuneration are included in the remuneration report for the year ended 30 June 2018, or by any closely related party of a member of the KMP acting as a proxy.

However, Beach need not disregard a vote on resolution 6 if:

• ● it is cast by a person as proxy for a person who is entitled to vote on resolution 6, in accordance with the directions on the proxy form; or

• ● it is cast by the person chairing the meeting as proxy for a person who is entitled to vote on resolution 6, in accordance with a direction on the proxy form to vote as the proxy decides on resolution 6.

If you appoint the Chairman as your proxy on resolution 6 and the proxy is not directed, you expressly authorise the Chairman to cast your vote on this resolution.

The Chairman of the meeting intends to vote all available proxies in favour of each item of business.

By Order of the Board

Signed for and on behalf of Beach Energy Limited by:

Peter Kupniewski Company Secretary 19 October 2018

How to Vote:

• 1. Voting on all items of business will be conducted by a poll.

• 2. A shareholder entitled to attend and vote at this meeting is entitled to appoint not more than two proxies to attend and vote instead of the shareholder.

• 3. Where more than one proxy is appointed, a shareholder may specify the percentage or number of votes each proxy can exercise. If the proxy form does not specify the percentage or number of votes each proxy may exercise, each proxy may exercise half of the shareholders votes on a poll. Fractions will be disregarded.

• 4. A proxy need not be a shareholder of Beach.

• 5. A proxy form accompanies this notice of meeting and contains additional information.

• 6. If your proxy chooses to vote, he/she must vote in accordance with your directions. If you have directed your proxy to vote, and they fail to attend the meeting or they choose to not vote on a poll, then the Chairman of the meeting will vote your proxies as directed by you.

• 7. If you do not mark a box, your proxy may vote as they choose on that item. However, note that if the Chairman of the meeting is your proxy, you expressly authorise the Chairman to vote undirected proxies on resolutions 1 and 6, even though the resolutions are connected directly or indirectly with the remuneration of a member of the KMP. The Chairman of the meeting intends to vote undirected proxies in favour of resolutions 1 and 6.

8.

To be valid, duly completed proxy forms and any proxy appointment authorities under which a proxy form is signed, such as a power of attorney, must be received by Beach at an address specified on the proxy form no later than 48 hours before the time, in Adelaide, of the commencement of the meeting.

GETTING THERE

Adelaide Convention Centre West Entrance, Montefiore Road, Adelaide

South Australia, Australia

9.

For the purpose of the meeting, shares in Beach will be taken to be held by those persons who are registered holders at 7.30pm (Adelaide time) Wednesday 21 November 2018. Accordingly, transactions registered after that time will be disregarded in determining entitlements to attend and vote at the meeting.

10. The constitution of Beach provides that three shareholders present in person, by proxy, attorney or representative shall be a quorum for a general meeting of Beach.

FOYER

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EXPLANATORY STATEMENT TO NOTICE OF ANNUAL GENERAL MEETING

This explanatory statement is provided to shareholders of Beach in relation to resolutions to be proposed at the 2018 annual general meeting.

ORDINARY BUSINESS

Financial Statements

In accordance with section 317 of the Corporations Act, the business of an annual general meeting must include the receipt and consideration of the financial statements and reports required by law for the past financial year. They are found in Beach's 2018 Annual Report which is available for shareholders to access and can be downloaded from the Beach website beachenergy.com.au. If you would like to receive a hard copy of the annual report free of charge you can contact Beach's Share Registry on 1300 556 161 (inside Australia) or + 61 3 9415 4000 (outside Australia).

There is no requirement for shareholders to approve these statements or reports. During this item of business, the Chairman of the meeting will allow a reasonable opportunity to ask questions and make comments on these financial statements and reports. Ernst & Young conducted the audit of Beach for the last financial year. Ernst & Young has been invited to attend this meeting and Beach has been advised that a suitably qualified member of the audit team of Ernst & Young, who conducted the audit of Beach for the last financial year, will attend the meeting.

Shareholders as a whole will be allowed a reasonable opportunity at the meeting to ask the auditor's representative questions relevant to the conduct of the audit, the preparation and content of the auditor's report, the accounting policies adopted by Beach in the preparation of the financial statements and the independence of the auditor in relation to the conduct of the audit.

Shareholders who are entitled to vote at the meeting may submit a written question to the auditor that is relevant to the content of the auditor's report to be considered at the meeting or the conduct of the audit of the annual financial report to be considered at the meeting. Written questions may be submitted by sending them to Beach. Questions must be submitted no later than the fifth business day before the meeting is held. Shareholders can use the form accompanying this notice of meeting.

Resolution 1 - Adoption of remuneration report

At the meeting, there will be reasonable opportunity for shareholders to ask questions about, or make comments on, the remuneration report. The remuneration report of Beach is included in the Annual Report and appears on pages 60 to 74 of the report. It is also available for shareholders to access and download from Beach's websitewww.beachenergy.com.au. The remuneration report sets out Beach's remuneration arrangements for its non-executive directors and senior executives.

The law requires that a resolution, that the remuneration report be adopted, be put to the vote at Beach's annual general meeting. The vote on the resolution is advisory only and does not bind the directors or Beach. However, the board will take the outcome of the vote into consideration when reviewing the remuneration practices and policies of Beach.

Shareholders should also note that in accordance with the "two strikes rule", the result of the vote on this item may affect next year's annual general meeting - if 25% or more of the votes cast on this resolution are "against", a "spill resolution" will be included in the 2018 notice of annual general meeting as required by the Corporations Act. A "spill resolution" is a resolution proposing that an extraordinary general meeting of shareholders be called to consider the election of directors. If 25% or more of the votes cast on the remuneration resolution at the 2018 annual general meeting are against the remuneration resolution, shareholders would then be required to consider the "spill resolution". If 50% or more of the votes cast on the spill resolution are "for", a further separate "spill meeting" would need to be held within 90 days.

Beach received more than 98% of "yes" votes on its remuneration report for the 2017 financial year. The company did not receive any specific feedback at the 2017 annual general meeting on its remuneration practices.

The directors recommend that shareholders vote in favour of resolution 1.

Resolutions 2 and 3 - Re-election of Glenn Davis and Ryan Stokes as directors

Clause 13.3 of Beach's constitution states that at each annual general meeting, one-third of the directors (not taking into account the directors who have been appointed as an addition or to fill a casual vacancy since the last annual general meeting) must retire. There is a similar requirement in the ASX Listing Rules. Mr Davis and Mr Stokes have served as directors since their respective re-election and election at the annual general meeting in November 2016. Directors who retire from office in this manner are eligible for re-election. Mr Davis and Mr Stokes have offered themselves for re-election. Mr Jim McKerlie also retires under clause 13.3 of Beach's constitution but does not offer himself for re-election.

A description of Mr Davis' and Mr Stokes' experience, qualifications and competencies follows:

Glenn Davis

Independent non-executive director - LLB, BEc, FAICD

Mr Davis is a solicitor and principal of DMAW Lawyers, a firm he founded. He joined Beach in July 2007 as a non-executive director and was appointed non-executive Deputy Chairman in June 2009 and Chairman in November 2012. Mr Davis is a director of ASX listed company Monax Mining Limited (since 2004). His special responsibilities at Beach include Chairman of the board and membership of the Remuneration and Nomination Committee. The board considers that Mr Davis brings to the board his expertise in the execution of large legal and commercial transactions and his expertise and experience in corporate activity regulated by the Corporations Act and ASX Limited. He is considered by the board to be an independent director.

In accordance with the policy of the board, a review of Mr Davis' effectiveness as a director of Beach was considered by the board prior to accepting his offer to stand for re-election as a director of Beach.

Ryan Stokes

Non-executive director - B Comm FAIM

Mr Stokes was elected to the board on 20 July 2016. Mr Stokes is the Managing Director and Chief Executive Officer of Seven Group Holdings Limited (SGH). He has been an executive director of the company since February 2010 and CEO since 2015. SGH and related corporations collectively have a relevant interest in 25.60% of the shares of Beach. Mr Stokes is Chairman of the National Gallery of Australia. He is also a member of the Prime Ministerial Advisory Council on Veterans' Mental Health, a committee member of the innovationXchange (within the Department of Foreign Affairs and Trade), and a member of the International Olympic Committee Education Commission. His previous roles include Chairman of the National Library of Australia. His special responsibilities atBeach include membership of the Remuneration and Nomination Committee.

Beach entered into an agreement with SGH and associated corporations to agree protocols and other arrangements appropriate to the appointment of a director representing a large shareholder. There is also an agreement with SGH and Mr Stokes to protect the confidential information of the Beach group, and address any potential conflicts of interest that may arise. It has also been agreed that if SGH, Network Investment Holdings Pty Ltd and WesTrac Holdings Pty Ltd's interest in Beach falls below 12.5%, SGH will procure the resignation of Mr Stokes if requested by Beach.

In accordance with the policy of the board, a review of Mr Stokes' effectiveness as a director of Beach was considered by the board prior to accepting his offer to stand for re-election as a director of Beach.

The directors (other than the relevant director for his own re-election) recommend the re-election of Mr Davis and Mr Stokes as directors.

Resolution 4 - Election of Joycelyn Morton as a director

The board appointed Ms Morton after the 2017 annual general meeting. Beach's constitution and the ASX Listing Rules require a director who is newly appointed by the board to stand for election at the next annual general meeting after their appointment. Accordingly, Ms Morton offers herself for election.

A description of Ms Morton's experience, qualifications and competencies follows:

Joycelyn Morton

Independent non-executive director - BEc, FCA, FCPA, FIPA, FCIS, FAICD

Ms Morton has more than 38 years' experience in finance and taxation having begun her career with Coopers & Lybrand (now PwC), followed by senior management roles with Woolworths Limited and global leadership roles in Australia and internationally within the Shell Group of companies. Ms Morton was National President of both CPA Australia and Professions Australia, and has served on many committees in the private, government and not-for-profit sectors and held international advisory positions. Her other current ASX listed board positions are Argo Investments Limited and Argo Global Listed Infrastructure Limited. She is also a non-executive director of ASC Pty Ltd and Snowy Hydro Limited. Her special responsibilities at Beach include Chair of the Audit Committee.

In accordance with the policy of the board, a review of Ms Morton's effectiveness as a director of Beach was considered by the board prior to accepting her offer to stand for election as a director of Beach.

The directors (other than Ms Morton) recommend the election of Ms Morton as a director.