Otto Energy Limited (ASX: OEL) (Otto or the Company) is pleased to provide a summary of estimates of reserves and resources as at 30 June 2021.

The reserves cover Otto's offshore leases at South Marsh 71 (SM 71) and Green Canyon 21, and its Lightning Field lease in Matagorda County, TX. The prospective resources cover SM 71 and Lightning.

1P Reserves

Proved reserves total approximately 4.1 MMboe and consist of six PDP wells and one PUD well at Lightning (Green #3), compared to 4.8 MMboe as of 30 June 2020. This decrease is predominantly due to production of 840 Mboe (NRI) through FY 21 at the Company's Lightning and SM 71 fields, partially offset by the reclassification of SM 71 reserves from Probable to Proved as a result of its advanced production profile. These reserves have a 9-year estimated life (through 2030) and anticipate six recompletions.

2P Reserves

Proved plus Probable reserves total approximately 6.5 MMboe as a result of an additional well at Lightning (Green #4), plus an additional 2.4 MMboe of probable reserves on existing assets. This compares to 8.1 MMboe as of 30 June 2020, a decrease attributable to the reclassification of SM 71 reserves from Probable to Proved and the write-down of MP Sand reserves at GC 21. These reserves have greater than a 14-year estimated life (beyond 2035) and also anticipate the same six recompletions.

3P Reserves

Proved plus Probable plus Possible reserves totaled approximately 8.4 MMboe as a result of an additional well at Lightning (Green #5), plus an additional 1.9 MMboe of possible reserves on existing assets. This compares to 11.7 MMboe as of 30 June 2020, a decrease attributable to revisions at Lightning, the write-down of MP Sand reserves at GC 21, and the reclassification of some SM 71 Possible reserves to Contingent and Prospective resources. These reserves have greater than a 14-year estimated life (beyond 2035) and also anticipate the same six recompletions.

Contingent and Potential Resources

Contingent and Prospective resources totaled approximately 2.1 MMboe as a result of additional resources at SM 71 and Lightning. This compares to 58.3 MMboe at 30 June 2020, a decrease attributable to excluding Beluga as this well was drilled during the fiscal year and subsequently plugged and abandoned, and also excluding Tarpon and Mallard as these prospects will no longer be drilled. Another reason for the decrease in Contingent and Prospective resources is the removal of the Talitha Unit in Alaska. In January 2021, the Company sold its subsidiary, Borealis Alaska LLC (Borealis), which holds a 10.8% interest in the 44,463-acre Talitha Unit in Alaska, to Pantheon. Under the terms of the sale, Otto received 14,272,592 shares in Pantheon Resources Plc (London Stock Exchange: PANR) in exchange for Borealis Alaska LLC. This sale considerably improves the Company's liquidity position, strengthens the Company's balance sheet, and positions the Company to be able to add additional reserves through drilling and/or acquisition. The sale has been approved by the Alaskan Department of Natural Resources. This decrease in Contingent and Prospective resources was partially offset by the reclassification of some SM 71 Possible reserves to Contingent and Prospective resources.V

Otto's Executive Chairman, Mike Utsler, commented: 'This reserve update reflects a balance between the strong underlying field performance at SM 71 and Lightning, with recognized Proved reserve additions to SM 71 as a result of its superior performance. Looking forward to FY 2022, we are targeting the recompletion of GC 21 into the DTR-10 Sand and progressing efforts to monetize our 2P resources position in our existing fields.' 'Finally, we believe the continued performance of our existing asset base will continue to underpin our strong balance sheet and enable us to pursue future growth. The depletion of our base is due to strong performance which will enable us to pursue the growth components of our strategy.'

Contact:

Mike Utsler

Tel: +61 8 6467 8800

(C) 2021 Electronic News Publishing, source ENP Newswire