Australis Oil & Gas : Reserve and Resource Update Year End 2021

7 February 2022

Australis Oil & Gas

ABN: 34 609 262 937

ASX: ATS
Australis is an upstream oil and gas
onlyc mpany seeking to provide
shareholders	value	and	growth
through the strategic development of
its quality onshore oil and gas assets
in the United States of America.
The Company's acreage within the
core of the oil producing TMS	in the
mid case contains 3.7 million bbls of
producing reserves	providing free
usecash flow and approximately 150
million bbls of 2C recoverable
resource.
personal
The Company was formed by the
founders and key executives of
Aurora Oil & Gas Limited, a team
with a demonstrated track record of
creating and	realising shareholder
value.
Address
Gr und Floor
215 Hay Street
Subiaco WA 6008
Suite 3680
3 Allen Center
333 Clay Street
Houston, Texas U.S.A 77002
Contact
Telephone:
[phone]
Facsimile:
[phone]
For

Email:

c [e-mail]

Web:

www.australisoil.com

Reserve and Resource Update

Year end 2021

Australis Oil and Gas Limited ("Australis" or "Company") is pleased to provide its YE2021 reserve and resource update as independently assessed by Ryder Scott Company L.P. ("Ryder Scott") with an effective date of 31 December 20211.

Australis continues to take a conservative approach to estimating its oil and gas reserves and resources. Future production from existing wells has been assessed in the YE2021 report in a manner consistent with previous years. However, given the current Company strategy to introduce a partner for the purposes of advancing the development of its TMS asset, the Board has determined that it would not be appropriate to propose a development plan as part of the YE2021 reserves evaluation.

Therefore, the YE2021 reserve and resource estimate consists of a proved, probable and possible developed reserve estimate only and no reserve estimates have been generated for undeveloped acreage. A contingent resource estimate is provided and, as in previous years, the mid case 2C contingent resource is subject to a qualifying development plan to transition volumes to an appropriate reserve category of proved, probable and possible.

Net Oil Developed Reserves

Ryder Scott made the following estimates1 of developed (existing producing wells) recoverable oil volumes, net to Australis (variance vs YE20202).

Proved - 2.98 MMbbls (-18%)

Probable & Proved - 3.67 MMbbls (-11%)

Possible, Probable & Proved - 4.54 MMbbls (-4%)

The NPV(10) of the PDP reserves is US$62 million using a flat oil price of $67.27/bbl.

Contingent Resource

Ryder Scott have made the following estimates1 of low, mid and high case contingent resources (variance vs YE20202).

1C - 23.40 MMbbls (+13%)

2C - 148.99 MMbbls (0%)

3C - 269.87 MMbbls (0%)

Australis Managing Director and CEO Ian Lusted, said

"Australis continues to take a conservative approach to its reserve and resource estimates. We remain absolutely confident that we will secure a partner to contribute to the development of the large TMS asset that we hold and will update our undeveloped reserve estimates once a forward program has been adopted which we believe will be highly economic at prevailing oil prices."

(note: may not tally due to rounding errors)

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Table 1: Comparison of producing reserve estimates for YE2021 and YE2020

-4%

4,541

6,665

Proved + Probable + Possible Developed (3P)

+51%

n/a

+51%

866

1

867

1,304

0

1,304

Possible Developed Producing Possible Developed Not Producing Possible Developed Total

-11%

3,674

5,361

Proved + Probable Developed (2P)

690

1

691

1,038

1

1,039

+42%

n/a

+42%

Probable Developed Producing Probable Developed Not Producing Probable Developed Total

-18%

Proved Developed (1P)

2,983

4,322

-19%

n/a

2,954

29

4,285

37

Proved Developed Producing (PDP) Proved Developed Not Producing (PDNP)

(Mbbls)

(Mbbls)

YE20202

Net Oil

Gross Oil

vs

Reserve Category

YE2021

Australis Reserves1

Net Oil

In previous years Australis has proposed modest development plans for Ryder Scott to consider in useorder to assess proved, probable and possible undeveloped reserves. These development plans were based on an appropriate projected well schedule at that time and any recoverable volumes not assigned as an undeveloped reserve were allocated to a low, mid or high case contingent resource,

ubject only to a qualifying development plan.

A stralis has consistently advised that the Company has been seeking to introduce a partner in the TMS to help progress field development. The Australis Board therefore deemed it appropriate to wait and intends to update the undeveloped reserve assessment when there is more clarity on future

development plans.

personalThis decision does not impact the economic potential of the play. As shown in the YE2020 reserve report, which included a modest development program, the proved undeveloped reserves were

economic even at the YE2020 reserve report oil price of US$47.02/bbl. Without a development plan all recoverable oil volumes from future wells are allocated to contingent resources.

The ASX and SPE compliant methodology of taking the average 1st day of the preceding 12-monthperiod yielded an oil price of $67.27/bbl for use within the YE2021 report.

Table 1 below provides an update to the producing reserve estimates for YE2021 For

Australis 2021 year end reserve and resource estimates

At the effective date of the report, 31 December 2021, Australis held the rights to ~98,000 net acres onlywithin the TMS Core area, a reduction of about 10,000 acres during 2021. Australis also divested its interests in 5 marginal TMS wells located in Louisiana outside the TMS core area, which reduced the existing operated well count to 33, of which two were shut in awaiting workovers for the entire year and were therefore designated Proved Developed Not Producing ("PDNP"). The remaining 31 producing operated wells and interests in 15 producing non-operatedwells were assessed by Ryder Scott on a Proved Developed Producing ("PDP") basis and additional volumes attributed to the mid (probable)

and high (possible) cases.

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∙ Reserves and contingent resources estimates are based on the deterministic estimation method.

∙ The oil price used for all reserves analysis in this report is a flat realised $67.27/bbl, which is based on the average achieved price by Australis on the first day of the trailing 12 months of 2021.

∙ Operating costs for developed producing wells are based on the average of actuals incurred between December 2020 and November 2021.

∙ The existing PDP estimates are based on production from 31 operated and 15 non-operatedwells (31.31 net wells).

∙ The existing PDNP estimates are based on projected production from 2 operated and 2 non- operated wells (2.08 net wells).

∙ Contingent resources are estimated for areas outside of a producing well location. The 1C contingent resources are limited to any development unit (usually 1920 gross acres) that contains an existing TMS well which would have been considered as reserves had the development plan included such locations within the five-yeardevelopment window. The 2C and 3C considered all the remaining undeveloped net acreage within the core area but used different estimates of in-placevolumes and recovery factors.

∙ No gas sales are assumed in the reserve estimates as all gas is presently consumed on the lease, however projected gas volumes are included in the contingent resource estimates.

Table 2: Comparison of net contingent resource estimates for YE2021 and YE2020.

+13%

-% -%

10,554

83,515

184,253

Low Estimate (1C) Best Estimate (2C) High Estimate (3C)

25,161

162,904

300,575

23,402

148,985

269,866

useThere are no changes to the subsurface assumptions that are used to generate the contingent resource estimates in each resource category, the only material change is the acreage position that

personalAustralis holds and this can be quickly increased with the application of capital.

Assumptions

Key assumptions used by Ryder Scott to generate the YE2021 estimates are as follows: For

YE20202

Category

(Mboe)

(MMscf)1

(Mbbls)1

YE2021 vs

Gas

Contingent Resource

Oil

BOE

Oil

The YE2021 PDP net reserve estimate1 of 2.95 MMbbls is reconciled to the YE2020 report below in Table 3. The NPV(10) of the net PDP reserves volume is US$61.76 million, which is an increase of only30% from the YE2020 value, predominantly due to the higher oil price assumption for the YE2020

report of US$67.27/bbl (vs. YE20 assumed price of US$47.02/bbl)3.

Page 4 of 7

Table 3: Reconciliation of PDP/PDNP reserves between YE2020 and YE2021.

2,954

PDP Reserve (31/12/21)1

(9)

102

(6)

150

3

Allocation to PDNP

Higher oil price Operating cost Changes to ownership Other

(633)

2021 Net Production Technical Adjustment

(310)

3,656

PDP Reserve (31/12/20)2

(Mbbl)

Description

Net Oil

Table 3 below provides a reconciliation of net PDP reserves between 31 December 2020 and 31 onlyDecember 2021.

use

PDP reconciliation

Contributors to the adjustments shown in the above table are discussed below.

personal	∙ There were two transactions during the last 12 months. Australis divested interests in Louisiana
	and purchased additional working interests in existing wells from a partner, the net affect adding
		150,000 bbls.
	∙ Two operated wells and two non-operated wells were moved from PDP to PDNP due to
		workover economics not meeting internal hurdles, which results in the wells being left shut in.
		This decision is under constant review and recent oil price increases may influence this
		decision.
	∙ An improved oil price extends well economic limits and allows for a modest increase in
		recovered volumes.
	∙ Technical revision - the re-forecast of some wells has led to a reduction in anticipated
		recoverable volumes resulting from productivity changes and has been influenced by increased
For		down time encountered this year.
∙	Higher average calculated operating cost for non-op wells (inclusive of workovers).

Ian Lusted Managing Director Australis Oil & Gas [phone]

Graham Dowland

Finance Director

Australis Oil & Gas [phone]

-ends-

Table 4: Comparison of contingent resources for YE2020 and YE2021.

20.8

149.4

270.7

Low Contingent Resource (1C)

Most Likely Contingent Resource (2C)

High Contingent Resource (3C)

23.4

149.0

269.9

useThe following key factors contributed to the changes in contingent resource.

(MMbbl)

(MMbbl)

31 Dec 20211

31 Dec 20202

Resource

Resource

Description

Contingent

Contingent

Net

Net

onlyTable 4 below summarises the change in contingent resource estimated on 31 December 2020 and 31 December 2021.

TMS Contingent Resource reconciliation

• All subsurface assumptions on in place volumes and recovery factors remained identical for both the YE2020 and the YE2021 resource estimates.
• All undeveloped acreage was evaluated for contingent resource based on the decision not to consider a development plan.
• During 2021 Australis carried out strategically targeted leasing, to maintain control and footprint in the play, without necessarily simply maintaining an acreage position. The net resultant reduction was from 107,500 to ~98,000 net acres and this directly influences the contingent resource calculation.

personalThis ASX announcement was authorised for release by the Australis Disclosure Committee. Further Information:

For

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