Otto Energy Limited provided the following operational update. Mosquito Bay West: The Mosquito Bay West well has installed surface facilities and pipeline ahead of schedule and under budget. The well has commenced flow testing from the limited initial perforations in the deepest Disc 12-2 sand and has flowed back at a rate of 3 MMscf/d and 200 bbl/d (700 boed/d) 8/8ths on a 13/64ths choke.

Given the actual number and distancebetween potentially productive sands in the well, all partners in the well have agreed to focus on the deepest Disc 12-2 sand with future pay to be produced via future uphole recompletions from the same well bore. The Condensate Gas Ratio (CGR) from initial well testing of approximately 70 bbl/MMscf has come in significantly higher than Otto's pre flowback estimate of 26 bbl/MMscf. Otto holds a 30% WI /22.35% NRI in this field.

Achieving first production within 3 months of spud is an impressive achievement by Operator Castex Energy. Oyster Bayou South: The Oyster Bayou South well has had surface facilities and pipeline installed ahead of schedule and under budget. Perforating the well, unloading and flowing the well to sales are expected during third quarter current year 2022 ahead of previously provided timing estimates.

The well is expected to deliver 6 MMscf/d and 150 bbl/d 8/8ths. Otto will update the market when production data is available. Otto holds a 30% WI /22.65% NRI in this field.

Again, the development progress by operator Castex Energy is very impressive. GC 21: The Seadrill Sevan Louisiana drilling rig was mobilized to location at GC 21 on 8 August 2022 where it initially underwent pre-acceptance rig maintenance. The rig began actual well operations on 14 August 2022 to recomplete the well to the uphole DTR-10 sand.

This sand holds 70% of the original proven reserves attributed the well when initially drilled. The recompletion is expected to cost Otto $5.9 million, to be paid out of existing free cash flow. Otto holds a 16.67% WI /13.33% NRI in this lease.

SM 71: The lift boat and recompletion spread were mobilized to SM 71 on 9 August 2022 with recompletion operations to recomplete the F2 well in the J1 sand initiated on 14 August 2022. The recompletion is estimated to cost Otto $0.95 million, to be paid out of existing free cash flow. Otto holds a 50% WI /40.625% NRI in this lease.

Eaves: The Vick #1 well located in Lavaca County, Texas is awaiting gas sales meter connection after which the well will be flowed to sales. Otto has previously disclosed that first production should begin during Third Quarter CY2022. The tie-in of this well to gas markets has required the operator to negotiate and undertake three separate pipeline crossings which has proven time consuming.

In addition, further delays have been experienced due to a tightening of materials and services markets locally. This has led to increased lead times for equipment and crews which has further impacted work durations. Otto holds a 10.3125% WI /7.734375% NRI in this well.

Lease Sale 257: The US Inflation Reduction Act (2022) which has passed the Senate and House of Representatives provides for the reinstatement of lease sale 257. This lease sale was held during November 2021 where Otto was notified that it was the high bidder on the South Timbalier 48 lease.