Strike Energy : 4Q21 Quarterly Activities Report & 5B

21st January 2022

onlyQ4/21
Quarterly Report
use
	Comments from Managing Director & CEO Stuart Nicholls:
personal		"During the quarter, Strike continued its run of successful exploration and appraisal
	results in the Perth Basin, with the positive confirmation of a conventional gas
	accumulation at the Walyering-5 appraisal well. Upon successful flow testing, Strike
		intends to re-start production from Walyering as soon as practicable and progress
		towards first cashflows, which with an aggressive development plan could come as early
		as the end of the current calendar year.
		"During the quarter, the global urea supply shortage affecting farmers reached acute
		levels with the knock-on effects creating a scarcity of the urea derivative AdBlue, a diesel
		exhaust fluid used throughout Australian supply chains. With the planned shutdown this
		year of the Gibson Island urea production facility, the last remaining domestic urea
		facility, Strike welcomed support from both the Federal and State Governments in the
		form of a grant and elevated project development support to expedite Project Haber to
		its financial close.
		"The Company's focus now turns to the execution of the South Erregulla 1 well that
		spudded in mid-January, and has the potential to unlock the gas feedstock for Project
		Haber, Strike's fully integrated 1.4 mtpa low carbon urea manufacturing facility."
For
Highlights
North Perth Basin - Permian Gas Fairway

• West Erregulla upstream and midstream environmental approvals progressed through their processes with information requests submitted to the EPA.
• West Erregulla Project Financing preliminary due diligence activities underway.
• Strike spudded its 100% owned potentially high impact South Erregulla-1 well on the 15th of January.

Central Perth Basin - Jurassic Wet Gas Play

• Walyering-5results exceeded expectations and confirmed the presence of a high- quality, low CO2, conventional gas accumulation at the Walyering gas field. The well has been cased and suspended.

[e-mail]

ABN 59 078 012 745 www.strikeenergy.com.au 2, 66 Kings Park Rd, West Perth WA 6005

For personal use only

• Walyering presents a low capex and fast development opportunity for Strike to monetise the asset on successful production testing scheduled for Q1/22.
• Ocean Hill gas discovery and ~270km² of Jurassic wet gas leads to progress towards conventional appraisal and exploration operations given technical break through and validation from the Walyering success.

Project Haber - Mid-West 1.4mtpa Fertiliser Development

• Strike awarded a $2 million grant for Project Haber under the Federal Government's Supply Chain Resilience Initiative.
• Project Haber awarded Lead Agency service by Western Australian Government.
• Commenced FEED early works and issued tender for FEED/EPC contract.
• Establishment of Mid-West Hydrogen Hub with proposed funding from both Western Australian & Federal Governments.

Mid-West Geothermal Power

• Strike made application for a 1,750 km² Geothermal Exploration Permit (GEP), which will facilitate the commencement of dedicated geothermal operations.
• Progressed independently verified Inferred Resource that will form the basis of future commercial opportunities for partner participation in proposed testing, appraisal and development phases.

Project Haber -1.4mtpa Urea Plant

2

For personal use only

Domestic Gas Business

Permian Gas Fairway

West Erregulla Upstream Operations

Ongoing work was undertaken by Strike to prepare for re-entry of West Erregulla 5 to recomplete and retest. These activities are planned to be campaigned along with the other wells in the region that require similar services and testing such as West Erregulla 3, Walyering 5 and possibly South Erregulla 1.

The proposed West Erregulla Natta 3D seismic campaign is subject to feedback from the EPA and is pending a determination on the level of assessment.

West Erregulla - Development & Finance

Strike submitted its environmental referral documents in December addressing the EPA's request for further information. The EPA is now assessing the submission and continuing to review AGIG's respective midstream environmental permit submission. Strike currently expects the EPA to approve and issue the environmental permits during CY22, subject to satisfying all information requests, which will facilitate the commencement of construction.

During the quarter Strike continued funding its share of the long lead item security for the procurement of the gas plant long lead items required for the proposed 87 TJ/d Phase 1 gas processing plant. Strike also prepared the upstream procurement and construction tenders with a view to issuing those during the current quarter.

Project Financing due diligence packages are being progressed by various experts with preliminary reports being prepared. Once a formal bank group is selected these reports will form the basis of key pieces of the legal and commercial due diligence.

South Erregulla

South Erregulla-1 spudded on the 15th of January using the Ensign 970 rig after the successful appraisal of Walyering-5.

South Erregulla is located in the 100% Strike owned EP503, which adjoins EP469 where Strike as operator has made a large, high quality conventional gas discovery at West Erregulla. SE1 is less than 5km to the south of the nearest successful West Erregulla intersection.

South Erregulla is interpreted to have significant resource potential with a high chance of success due to the strong data control over the area (wells and seismic), consistent regional geological outcomes in the Kingia Sandstones and recent identification of updip connectivity.

SE1 expects to encounter the primary reservoir in the Kingia at a revised depth of 4,369m ss TVD, which is up to 200m shallower than the penetration of the Kingia at West Erregulla 2. The revision of

3

For personal use only

the depth is as a result of additional seismic processing and interpretation of the various Erregulla regional datasets. Several new reprocessed Maior 2D seismic lines can be seen below. Strike is planning to collect whole core and an advanced series of wireline logs across the Kingia Sandstones and, on success, will flow test the well in order to be completed as a future producer.

The primary objective of SE1 (and any subsequent appraisal wells in South Erregulla) is to delineate approximately 350 PJ of high confidence resource in order to secure the gas requirements for Project Haber, Strike's proposed Geraldton based 1.4mtpa urea fertiliser manufacturing facility. On confirmation of success at SE1, Strike will look to sanction additional detailed engineering (FEED), finalise the urea offtake process, and progress the equity/debt processes for Project Haber.

4

For personal use only

Seismic Programs

During the quarter Strike completed the environmental base line surveys for the proposed Minjiny 3D seismic campaign over the South Erregulla structure. Commencement of primary approvals with the EPA is scheduled for 1H22, with acquisition slated for the harvest period in CY23 or CY24.

The majority of the approval documents for the proposed ~140km of new 2D seismic at Eneabba Deep within Strike's 100% owned EP506 have been submitted and are currently under assessment by DMIRS. Acquisition is targeted between April and June this calendar year.

Jurassic Wet Gas Play

Walyering

Strike has successfully appraised the Walyering gas field with Walyering-5 confirming the presence of a high-quality, low CO2, conventional gas accumulation. The results have exceeded pre-drill expectations with four gas charged reservoirs confirmed with a total gross thickness of 116m and total net pay of 51m. Peak porosities of 21.5% were recorded with an average porosity of 15.4%. Reservoir pressure was measured at 4,386 psia with permeabilities of 274 mD. CO2 content of the gas has been measured in the laboratory to be less than 1%.1

Upon a successful production test in Q1/22, Strike as the operator of EP447 and the Walyering gas field will target moving the field back into production as quickly as possible. Preliminary assessments of an aggressive development program show a possible opportunity to commence first gas production prior to the end of CY 22.2

1	Refer ASX announcement dated 6 December 2021 titled "Successful appraisal of the Walyering gas field".
2	Development and development timeline is subject to, among other things, successful well test, reserve certification, JV processes, obtaining all

requisite regulatory and stakeholder permits, approvals and authorisations, access to processing infrastructure and financing.

5