Central Petroleum : Quarterly Activities Report & Appendix 5B

C E N T R A L P E T R O L E U M L I M I T E D

ABN 72 083 254 308

ASX:CTP

"The proposed Amadeus to Moomba Gas Pipeline promises to provide the single biggest paradigm shift for Central's Amadeus projects.

The gas resources of the Amadeus Basin are now part of the solution to Australia's looming gas shortfall and our focus is firmly on making reserves available to service that market demand."

Central Petroleum MD and

CEO, Leon Devaney

Investor and Media Inquiries

Greg Bourke: [phone]

Sarah Morgan: [phone] [e-mail] Level 7, 369 Ann Street Brisbane, Qld 4000, Australia

Activities Report and

ASX Appendix 5B

REVIEW OF OPERATIONS FOR THE QUARTER ENDED 30 SEPTEMBER 2020

Highlights

• Cash balance at the end of the September quarter (the quarter) was $26.3 million, up slightly from $25.9 million at 30 June 2020, with:
• • $4.3 million net cash flow from operations (before exploration and finance costs)
  • $2.6 million in net cash flow from operations (after exploration and finance costs)

• • Principal repayments under debt facilities were $1.0 million, Macquarie pre-sale gas deliveries totalled 437 TJ, and 202 TJ of previously over-lifted gas was returned.
• Net Debt was $44.6 million at 30 September, down from $46.1 million at the end of June and $62.4 million 12 months ago.
• Sales volumes were 2.62 PJE (Petajoule equivalent), up 3.6% from 2.53 PJE in the June quarter, largely due to higher spot and as-available demand.
• Sales revenues totaled $14.8 million, up 5% from $14.0 million in the June quarter, reflecting higher realised oil prices and sales volumes.
• • Unit sales price across the portfolio averaged $5.64/GJE, up from $5.55/GJE in the June quarter, reflecting higher realised oil prices which recovered most of the decline experienced in the previous quarter.
• Dukas prospect - Central reached agreement with Santos on the forward plan for the Dukas exploration well, targeting completion in 1H 2022 and a possible free carry of $3 million of Central's future drilling costs.
• Amadeus to Moomba Gas Pipeline - Central executed a Memorandum of Understanding with Australian Gas Infrastructure Group with the aim of becoming a foundation customer of a proposed new gas pipeline from Central's
  Amadeus Basin fields to the Moomba gas hub, providing a more efficient route to the larger east coast gas markets.
• New Gas Sales Agreement (GSA) - In October 2020, a new GSA was signed for the sale of 3.5 PJ of gas over CY2022 and CY2023, to be pre-paid in full in December 2020.
• Extension of loan agreement - In October 2020, Central reached agreement to extend its $69.8 million finance facility for a further 12 months to 30 September 2022.

Message from Managing Director and CEO

After the challenges of the last two quarters of FY2020, the September quarter provides cause for optimism, with key positive commercial developments since June providing momentum for our growth strategies.

The recently-announced Federal Energy Plan provides a clear emphasis on the development of gas resources as a transitional fuel and the Amadeus Basin is emerging as a credible cost-efficient solution. The Amadeus Basin has several attractive attributes when compared to unconventional basins, being largely under-explored yet having been a proven, reliable and low-cost oil and gas production source for over 30 years.

Our agreement to work with Australian Gas Infrastructure Group as a potential foundation customer for the proposed Amadeus to Moomba Gas Pipeline (AMGP) promises to provide the single biggest paradigm shift for Central's Amadeus projects. The AMGP promises a shorter, more cost-efficient route for Central's gas to the deeper, higher-priced southern markets. The gas resources of the Amadeus Basin have another opportunity to become a cost-efficient part of the solution to Australia's looming gas shortfall along the east coast.

In addition to the AMGP agreement, we have taken other key steps to progress our growth strategy.

In August we reached agreement with Santos, our JV partner in the promising Dukas prospect, on a pathway for recommencing a drilling programme in early 2022 with a potential partial carry of well costs.

In October we announced the sale of 3.5 PJ of gas, with proceeds paid up-front and used to fund drilling of two new production wells and recompletion of four other wells within the productive Mereenie Field in 2021. These new wells could make an additional 40 PJ of gas (20 PJ net to Central) available for marketing from 2022, including into markets potentially accessible from the proposed AMGP from 2024.

We also took the initiative to extend the term of our finance facility by 12 months to September 2022. With almost 2 years of term remaining, this reduces refinancing risk, and combined with our cash-generating production assets, provides a solid financial base from which to progress our growth activities.

We continue to progress and refine the Amadeus exploration programme and the associated farm-out process remains active with encouraging progress.

Our resilient production activities continue to generate positive cash flows, with slightly higher gas demand and a rebound in the oil price contributing to an improvement on the June quarter's results. Overall, we were net cash positive in the September quarter, with $26.3 million of cash on hand at quarter's end providing a solid base from which to position the Company to maximise long-term shareholder value.

Leon Devaney

Managing Director and Chief Executive Officer

CENTRAL PETROLEUM LIMITED | ACTIVITES REPORT AND ASX APPENDIX 5B FOR THE QUARTER ENDED 30 JUNE 2020

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Production Activities

SALES VOLUMES

Sales volumes were 2.62 PJE (including 0.18 PJ of overlift repayment gas), up 3.6% from

2.53 PJE in the June quarter, as demand for spot and as- available gas improved.

Weak customer nominations from the Dingo field adversely impacted sales volumes, but any contractual shortfall is expected to be fully recovered via the take-or-pay mechanism in January 2021.

Firm long-term gas supply contracts accounted for 94% of September quarter volumes.

The current portfolio of firm gas

supply contracts has various terms that extend beyond 1 January 2023. Challenging market conditions are anticipated to persist for at least the next couple of quarters, with sales during this period comprising largely of firm contracted volumes.

New firm sales contract

In October 2020, Central signed a new agreement for the sale of 3.5 PJ of gas over calendar years 2022 and 2023. The new gas sale agreement increases Central's firm contracted gas sales to 7.5 PJ in CY2022 and

5.2 PJ for 2023, demonstrating strength in the term gas market from 2022 whilst preserving Central's firm contracting capacity for deliveries through the proposed AMGP from 2024.

CENTRAL PETROLEUM LIMITED | ACTIVITES REPORT AND ASX APPENDIX 5B FOR THE QUARTER ENDED 30 SEPTEMBER 2020

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SALES REVENUE

Total sales revenue in the September quarter was $14.8 million, up 5.3% from $14.0 million in the preceding quarter, reflecting the combination of higher sales volume and oil prices over the quarter.

Sales revenue		FY20	FY21
Product	Unit	Q4	Q1
Gas	$'000	13,288	13,737
Crude and Condensate	$'000	760	1,057
Total Sales Revenue	$'000	14,048	14,794
Revenue per unit	$/GJE	$5.55	$5.64

Average unit prices were slightly higher (1.6%) during the quarter, as oil prices recovered (up 31%) from the historic lows last quarter. Average unit pricing for gas was steady, reflecting the fixed-price nature of Central's term sale contracts.

MEREENIE OIL AND GAS FIELD (OL4 AND OL5) - NORTHERN TERRITORY

CTP - 50% interest (and Operator), Macquarie Mereenie Pty Ltd - 50% interest

The production capacity of the Mereenie field was approximately 36 TJ/d (100% JV) at the end of the quarter.

Mereenie field production was 13% higher than the previous quarter, averaging 29.1 TJ/d (100% JV) (June quarter: 25.8 TJ/d) as demand for spot and as-available gas improved. The field remained market-constrained and operating below capacity, reflecting challenging market conditions.

Planning activities continued for recompletion of four existing wells and two new crestal production wells in 2021 which are expected to return the Mereenie field's gross production capacity to over 45 TJ/d.

PALM VALLEY (OL3) - NORTHERN TERRITORY

CTP - 100% interest

Palm Valley field production capacity was 9.0 TJ/d at the end of the quarter and actual production averaged 10.0 TJ/d, down 5.7% from the June quarter due to natural field decline.

DINGO GAS FIELD (L7) AND DINGO PIPELINE (PL30) - NORTHERN TERRITORY

CTP - 100% interest

The Dingo gas field supplies gas directly to the Owen Springs Power Station in Alice Springs. Average gas production was 2.9 TJ/d, 7% lower than the previous quarter's average of 3.1 TJ/day due to lower customer nominations. The daily contract volume of 4.4 TJ/d is subject to take-or-payprovisions under which Central will be paid in January 2021 for any gas nomination shortfall by the customer.

CENTRAL PETROLEUM LIMITED | ACTIVITES REPORT AND ASX APPENDIX 5B FOR THE QUARTER ENDED 30 SEPTEMBER 2020

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