G3 Exploration : Corporate Update

2 December 2019

G3 EXPLORATION LTD.

('G3 Exploration', 'G3E' or the 'Company')

Corporate Update

On 19 November, Nordic Trustees AS ('Nordic') presented a petition in the Grand Court of the Cayman Islands ('Petition') for the appointment of Alvarez and Marsal as Joint Official Liquidators ('JOLs') of the Company. The Petition is currently listed to be heard on 11 December 2019.

The Company believes that the interests of all stakeholders (debt holders and shareholders) are best served if Joint Provisional Liquidators ('JPLs'), rather than JOLs, are appointed to facilitate the re-structuring of its assets and on-going business. During the period of the provisional liquidation, the Company would also benefit from a stay of proceedings, which will give the Company adequate time to restructure its assets and liabilities.

In view of the significant asset base and investments of over US$1billon in the development of its assets, the Company is seeking to re-structure its assets and liabilities in accordance with its previously announced business plan and believes that the JPLs will facilitate such execution to the benefit of all stakeholders. As such, the JPL appointment under the supervision of the Grand Court of the Cayman Islands is, in the opinion of the Board, the preferred path forward for the proposed restructuring of the Company and its subsidiaries. Thus, the Company filed an application with the Grand Court on 25^th November, 2019 to request the appointment of JPLs. Under the JPL application, the directors will retain control of the day to day management of the Company while the JPLs can focus on identifying, facilitating and executing a comprehensive restructuring plan. The application for the appointment of the JPLs will also be heard on 11 December 2019. If its application is successful, the Company expects to continue as a going concern through this process and following the re-structuring.

Notwithstanding these legal proceedings and the appointment of Receivers on 21^st October, 2019, the Company continues as a going concern and has maintained its operations and remains committed to re-structure as follows:

1. Pay its Secured Creditors (Nordic and GIC) in full through either:

a. A Reserve Based Loan ('RBL') of c.$200m through the Green Dragon Gas producing assets. Active discussions to conclude such an arrangement with a bank is underway; or

b. Sale of sufficient equity for cash in wholly owned Green Dragon Gas so as to pay off creditors in full and have additional liquidity. Heads of Agreement with interested party is expected in the near term. A recent report, conducted for the RBL in October, valued the producing Green Dragon Gas, GCZ and GSS blocks at $485millon (1P) and $1.3 billion (2P).

2. Following above execution, dividend Green Dragon Gas to the Shareholders.

3. Continue as an Exploration and Appraisal company specializing in Coal Bed Methane.

Mr. Randeep S. Grewal, Chairman of G3 Exploration commented, 'Over the past two years, we have worked cooperatively, and constructively, with our Secured Creditors on each of our initiatives to repay the debt due and look forward to doing so with the JPL.

We strongly encourage the appointment of JPLs so as to expedite a re-structuring of the company for the benefit of all stakeholders, which would enable the company to continue to deploy its technical expertise in the development of complex CBM reservoirs globally and continue as a going concern.'

About G3 Exploration Ltd.

G3E is a leading independent gas producer with operations in China and is listed on the main market of the London Stock Exchange (LSE: G3E). The Company has 409 BCF of 2P reserves and 2,085 BCF of 3P reserves across eight production blocks covering over 7,566km² of license area in the Shanxi, Jiangxi, Anhui and Guizhou provinces. It holds six Production Sharing Agreements with strong, highly capitalised Chinese partners including CNOOC, CNPC and PetroChina, and has infrastructure in place to support multiple routes to monetise gas production.

The company is committed to an exploration and appraisal focused business plan in coal bed methane development across three geographies concurrently. It has a well-established track record and demonstrated expertise in gas monetisation through three basic principles:

· Focus on core intellectual aptitude in developing coal bed methane

· Develop assets in an environmentally and socially prudent manner

· Protect accreted shareholder value