This document comprises a prospectus (this “Prospectus”) relating to Ophir Energy plc (“Ophir” or the “Company”), and has beenprepared in accordance with the Prospectus Rules of the Financial Services Authority (the “FSA”) made under section 73A of theFinancial Services and Markets Act 2000 (as amended) (the “FSMA”). This Prospectus has been filed with the FSA and will be madeavailable to the public in accordance with the Prospectus Rules.

Application has been made to the FSA for all of the Ordinary Shares, issued and to be issued in connection with the Offer, to beadmitted to the premium listing segment of the Official List of the FSA and to the London Stock Exchange plc (the “London StockExchange”) for all such Ordinary Shares to be admitted to trading on the London Stock Exchange’s main market for listed securities(together, “Admission”). Admission to trading on the London Stock Exchange’s main market for listing constitutes admission totrading on a regulated market. Conditional dealings in the Ordinary Shares are expected to commence on the London Stock Exchangeon 8 July 2011. It is expected that Admission will become effective, and that unconditional dealing in the Ordinary Shares willcommence at 8.00 am (London time), on 13 July 2011. All dealings before the commencement of unconditional dealings will beof no effect if Admission does not take place and such dealings will be at the sole risk of the parties concerned. No applicationis currently intended to be made for the Ordinary Shares to be admitted to listing or dealt with on any other exchange.

The Company and its Directors and their alternates (whose names appear on page 64 of this Prospectus), accept responsibility for theinformation contained in this Prospectus. To the best of the knowledge of the Company and the Directors (who have all takenreasonable care to ensure that such is the case), the information contained in this Prospectus is in accordance with the facts andcontains no omission likely to affect the import of such information.

Prospective investors should read this entire Prospectus and, in particular, for a discussion of certain risks and other factorswhich should be considered prior to any investment in the Ordinary Shares, see Part II: “Risk Factors”.

OPHIR ENERGY PLC(incorporated under the Companies Act 1985 and registered in England and Wales with

registered number 5047425)

Offer of 93,867,334 Ordinary Shares of 0.25 pence eachat an Offer Price of 250 pence per share and admission to the premium listing segment

of the Official List and to trading on the London Stock Exchange

Sponsor, Global Co-ordinator, Joint Bookrunner and Lead ManagerCredit Suisse

Joint Bookrunner and Lead Manager Joint BookrunnerJ.P. Morgan Cazenove RBC Capital Markets

Syndicate MembersOriel Securities Standard Bank

Financial Advisor to the CompanyLexicon Partners Limited

ORDINARY SHARE CAPITAL IMMEDIATELY FOLLOWING ADMISSION

Number Issued and fully paid Nominal Value––––––––––––––––––––– –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– –––––––––––––––––––––

319,480,862(1) Ordinary Shares of 0.25 pence each £798,702

Credit Suisse has been appointed as Sponsor, Global Co-ordinator, Joint Bookrunner and Lead Manager, J.P. Morgan Cazenove hasbeen appointed as Joint Bookrunner and Lead Manager, RBC Capital Markets has been appointed as Joint Bookrunner, OrielSecurities Limited (“Oriel Securities”) and Standard Bank plc (“Standard Bank”) have been appointed as Syndicate Members andLexicon Partners Limited has been appointed as Financial Advisor, each of which are authorised and regulated by the FSA, are actingexclusively for the Company and no one else in connection with the Offer and will not regard any other person (whether or not arecipient or reader of this Prospectus) as their respective clients in relation to the Offer and will not be responsible for providing theprotections afforded to their respective clients nor for giving advice in relation to the Offer, Admission or any other matter referred toin this Prospectus.

(1) Assumes that the Over-allotment Option is not exercised.

Apart from the responsibilities and liabilities, if any, which may be imposed on Credit Suisse (including as Sponsor), J.P. MorganCazenove, RBC Capital Markets, Oriel Securities, Standard Bank and Lexicon Partners Limited by the FSMA or the regulatory regimeestablished thereunder, or under the regulatory regime of any jurisdiction where the exclusion of liability under the relevant regulatoryregime would be illegal, void or unenforceable, none of Credit Suisse, J.P. Morgan Cazenove, RBC Capital Markets, Oriel Securities,Standard Bank and Lexicon Partners Limited accepts any responsibility whatsoever for, or makes any representation or warranty,express or implied, as to the contents of this Prospectus or for any other statement made or purported to be made by it, or on its behalf,in connection with the Company, the Ordinary Shares or the Offer and nothing in this Prospectus will be relied upon as a promise orrepresentation in this respect, whether or not to the past or future. Each of Credit Suisse, J.P. Morgan Cazenove, RBC Capital Markets,Oriel Securities, Standard Bank and Lexicon Partners Limited accordingly disclaims all and any responsibility or liability whatsoever,whether arising in tort, contract or otherwise (save as referred to above), which it might otherwise have in respect of this Prospectusor any such statement.

Recipients of this Prospectus are authorised solely to use it for the purpose of considering the acquisition of the Ordinary Shares andmay not reproduce or distribute this Prospectus, in whole or in part, and may not disclose any of the contents of this Prospectus or useany information herein for any purpose other than considering an investment in the Ordinary Shares. Such recipients of this Prospectusagree to the foregoing by accepting delivery of this Prospectus.

The Ordinary Shares are subject to selling and transfer restrictions in certain jurisdictions. Prospective subscribers should read therestrictions contained in paragraph 9 of Part XIII: “Details of the Offer”. Each subscriber for the Ordinary Shares will be deemed tohave made the relevant representations made therein.

This Prospectus does not constitute an offer to sell or an invitation to subscribe for, or the solicitation of an offer to buy or to subscribefor, Ordinary Shares to any person in any jurisdiction to whom it is unlawful to make such offer or solicitation in such jurisdiction.

Notice to overseas shareholders

The distribution of this Prospectus and the offer of the Ordinary Shares in certain jurisdictions outside the United Kingdom may berestricted by law. No action has been taken or will be taken by the Company, Credit Suisse, J.P. Morgan Cazenove, RBC CapitalMarkets, Oriel Securities, Standard Bank or Lexicon Partners Limited to permit a public offering of the Ordinary Shares or to permitthe possession or distribution of this Prospectus (or any other offering or publicity materials relating to the Ordinary Shares) in theUnited Kingdom or any other jurisdiction where action for that purpose may be required. Accordingly, neither this Prospectus nor anyadvertisement or any other offering material may be distributed or published in any jurisdiction except under circumstances that willresult in compliance with any applicable laws and regulations. Any failure to comply with these restrictions may constitute a violationof the securities laws of any such jurisdiction.

The Ordinary Shares have not been and will not be registered under the applicable securities laws of Australia, Canada, the Republicof Ireland, the Republic of South Africa or Japan. Subject to certain exceptions, the Ordinary Shares may not be offered or sold inAustralia, Canada, the Republic of Ireland, the Republic of South Africa or Japan or to, or for the account or benefit of, any national,resident or citizen of Australia, Canada, the Republic of Ireland, the Republic of South Africa or Japan.

The Ordinary Shares have not been, and will not be, registered under the US Securities Act of 1933 (the “US Securities Act”). TheShares offered by this Prospectus may not be offered or sold in the United States, except to qualified institutional buyers (“QIBs”),as defined in, and in reliance on, the exemption from the registration requirements of the US Securities Act provided by Rule 144Athereunder (“Rule 144A”) or another exemption from, or in a transaction not subject to, the registration requirements of the USSecurities Act. Prospective investors are hereby notified that the sellers of the Shares may be relying on the exemption from theprovisions of Section 5 of the US Securities Act provided by Rule 144A.

THE ORDINARY SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES ANDEXCHANGE COMMISSION, ANY OTHER FEDERAL OR STATE SECURITIES COMMISSION IN THE UNITED STATES ORANY OTHER REGULATORY AUTHORITY IN THE UNITED STATES, NOR HAVE ANY SUCH AUTHORITIES PASSEDUPON OR ENDORSED THE MERITS OF THE OFFER OR CONFIRMED THE ACCURACY OR DETERMINED THEADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THEUNITED STATES.

NOTICE TO NEW HAMPSHIRE RESIDENTS ONLY

NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A LICENCE HAS BEEN FILEDUNDER CHAPTER 421-B OF THE NEW HAMPSHIRE REVISED STATUTES (“RSA 421-B”) WITH THE STATE OF NEWHAMPSHIRE NOR THE FACT THAT A SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED IN THESTATE OF NEW HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE OF NEW HAMPSHIRE THATANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND NOT MISLEADING. NEITHER ANY SUCH FACTNOR THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A SECURITY OR A TRANSACTION MEANSTHAT THE SECRETARY OF STATE HAS PASSED IN ANY WAY UPON THE MERITS OR QUALIFICATIONS OF, ORRECOMMENDED OR GIVEN APPROVAL TO, ANY PERSON, SECURITY OR TRANSACTION. IT IS UNLAWFUL TOMAKE, OR CAUSE TO BE MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT ANYREPRESENTATION INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH.

Dated 8 July 2011

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TABLE OF CONTENTS

Page

PART I SUMMARY INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

PART II RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

PART III DIRECTORS, SECRETARY, REGISTERED OFFICE AND ADVISORS . . . . . . . . . . . 25

PART IV EXPECTED TIMETABLE OF PRINCIPAL EVENTS AND OFFER STATISTICS . . . . 27

PART V PRESENTATION OF INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

PART VI INFORMATION ON THE GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

PART VII DIRECTORS, SENIOR MANAGEMENT AND CORPORATE GOVERNANCE . . . . . 64

PART VIII INDUSTRY OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

PART IX FINANCIAL INFORMATION ON THE GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

PART X UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE GROUP . . . . . . 115

PART XI OPERATING AND FINANCIAL REVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119

PART XII CAPITALISATION AND INDEBTEDNESS STATEMENT . . . . . . . . . . . . . . . . . . . . . . 136

PART XIII DETAILS OF THE OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137

PART XIV TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147

PART XV ADDITIONAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155

PART XVI MINERAL EXPERT’S REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213

PART XVII DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349

PART XVIII GLOSSARY OF TECHNICAL TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 354

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PART I

SUMMARY INFORMATION

This summary should be read as an introduction to this Prospectus only. Any decision to invest in the OrdinaryShares should be based on the consideration of this Prospectus as a whole by the investor and not just thissummary. Under the Prospectus Directive, in each member state of the European Economic Area (“EEA”) civilliability attaches to those persons who are responsible for the summary, including any translations of thesummary, but only if the summary is misleading, inaccurate or inconsistent when read together with other partsof this Prospectus. Where a claim relating to this information contained in this Prospectus is brought before acourt, the plaintiff investor might, under the national legislation of the EEA, have to bear the costs of translatingthis Prospectus before the legal proceedings are initiated.

Overview

Ophir is an independent oil and gas exploration company with a focus on Africa. Ophir is incorporated in Englandand Wales with headquarters in London, England, and operational offices in Perth (Australia), Dar es Salaam(Tanzania) and Malabo (Equatorial Guinea).

Since its foundation in 2004, the Company has acquired an extensive portfolio of oil and gas interests, and itscurrent portfolio comprises 17 assets in eight jurisdictions in Africa (including its interest in East Pande, Tanzaniawhich is subject to the satisfaction or waiver of certain conditions precedent but excluding its option to farm in tothree further assets in Senegal). The majority of these interests lie offshore in water depths greater than 250m andare thus classified as “deepwater”. The Company is currently interested in approximately 90,000km2 of netexploration acreage (excluding the interests in Senegal under option) of which approximately 65,000km2 is netdeepwater acreage. Furthermore, according to IHS, one of the leading providers of oil and gas licensing data andintelligence, as at 31 December 2010, the Company was one of the top five holders of deepwater explorationacreage in Africa in terms of net acreage (if its interests in the SADR are included).

The Company undertook two drilling campaigns in 2008 and 2010/2011 as operator, drilling eight explorationwells in Gabon, Equatorial Guinea and Tanzania, making two gas discoveries in Equatorial Guinea and three gasdiscoveries in Tanzania. Further details of these discoveries are provided below in Part VI: “Information on theGroup”.

According to RPS and as reported in Part XVI: “Mineral Expert’s Report”, as at the effective date of the MER,the Company’s interests in Blocks 1, 3 and 4 in Tanzania had 835Bscf of net (working interest) mean contingentresources and Block R in Equatorial Guinea had 297Bscf net (working interest) mean contingent resources.Furthermore, according to RPS, the Company’s interests in the following assets have the net (working interest)mean risked prospective resources set out below:

• Blocks 1, 3 and 4 in Tanzania: 1,953Bscf (326MMboe);

• Block R in Equatorial Guinea: 1,922Bscf (320MMboe);

• Mbeli, Ntsina, Manga and Gnondo, Gabon: 223MMstb;

• Profond, AGC: 44MMstb; and

• Marovoay, Madagascar: 10MMstb.

The Company’s interests in East Pande (Tanzania), Congo (Brazzaville), SADR and Somaliland have not beenreviewed by RPS and are not included within the MER. The recent acquisition of the East Pande block by Ophirremains subject to the satisfaction of conditions precedent. In relation to Congo (Brazzaville), Premier Oil is inthe process of withdrawing and any future operations by Ophir in respect of this asset are subject to negotiationswith the Government of Congo (Brazzaville). SADR and Somaliland are the subject of uncertainty over theirsovereign status.

The Directors believe that the Company has established a strong competitive position in a region that is becomingincreasingly significant to global oil and gas markets. In October 2010, the Company was named “Best Oil & GasExploration Company” in the 2010 World Finance Oil & Gas Industry Awards and, in June 2009, the Company wasone of two companies named “Operator of the Year” for 2008 in the Petroleum Africa Magazine annual awards.

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The Directors expect the Company will, in due course, participate in the development of petroleum discoveries inits assets with a view to establishing itself as a major oil and gas producer in the region. In addition, the Companyplans to continue to secure additional oil and gas assets and, at the same time, to manage actively its existingportfolio. Active management may, depending on circumstances that exist at the time, include divestments,acquisitions, farm ins, farm outs and exchanges of interests. The Company will also evaluate opportunities toacquire producing or near-producing assets to complement its portfolio and will look to expand the Group’sportfolio through investing in new ventures in Africa and beyond.

Key strengths

The Directors believe that Ophir has the following key strengths:

• Fifth largest holder of deepwater acreage in Africa with more than 900MMboe of net risked prospectiveresources and more than 4Bnboe of net unrisked prospective resources1 (69 per cent gas and 31 per centoil mix)

• Strong track record of success with five discoveries from eight wells drilled as Operator since November2008 and 189MMboe of net contingent resources (100 per cent gas)

• The Company intends to pursue an active exploration and appraisal drilling campaign over the next18 months, with 11 wells proposed to be drilled in four countries (in addition to the Kora-1 well in AGC)targeting more than 1.5Bnboe of net unrisked resources with a 61 per cent gas, 39 per cent oil mix

• Geographically and geologically diversified portfolio

• Control of oil and gas assets through operatorship and high equity interests

• Strong geoscience expertise coupled with deepwater exploration and drilling success

• Focus on securing attractive commercialisation terms for its gas discoveries

• Proven track record of active portfolio management to optimise capital efficiency, access relevant skills andgrow the portfolio

• High quality stakeholder relationships

Strategy

Ophir’s intention is to become a leading independent African exploration and production company. The keyelements of Ophir’s strategy for achieving this goal are:

• Create value through exploration and appraisal success and operational strengths

• Focus on commercialisation and monetisation of oil and gas discoveries

• Active asset portfolio management

• Position the Company as a partner of choice to maximise opportunities and value throughout the E&Plifecycle.

Summary financial information

The table below sets out summary financial information of the Group for the 18 months ended 31 December 2008,the years ended 31 December 2009 and 2010 and the three months ended 31 March 2011, in each case preparedon a basis that combines the financial results and assets and liabilities of each of the companies constituting theGroup.2

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1 See further Part V: “Presentation of Information” regarding the conversion of gas resource numbers to oil equivalent numbers.

2 This information has been extracted without material adjustment from Part IX: “Financial Information on the Group” and hasbeen prepared on the basis described in the notes thereto.

Summary income statements 18 Months 3 Months Ended 3 Months Ended Year Ended Year Ended Ended 31 March 31 March 31 December 31 December 31 December 2011 2010 2010 2009 2008 –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– (US$’000) (US$’000) (US$’000) (US$’000) (US$’000) (Unaudited)

Loss from continuing operations before taxation ................................ (3,773) (7,760) (19,278) (43,266) (127,830)Taxation .......................................... — — — — —

–––––––– –––––––– –––––––– –––––––– ––––––––Loss from continuing operations

for the period/year attributableto equity holders of the parent (3,773) (7,760) (19,278) (43,266) (127,830)

–––––––– –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– ––––––––

Summary balance sheets As at As at As at As at 31 March 31 December 31 December 31 December 2011 2010 2009 2008 –––––––––– –––––––––– –––––––––– –––––––––– (US$’000) (US$’000) (US$’000) (US$’000)

Non-current assets .......................... 294,809 272,486 240,787 236,005Current assets.................................. 203,980 144,408 147,544 119,821Total assets...................................... 498,789 416,894 388,331 355,826Net assets ........................................ 352,529 356,246 374,096 306,500Current liabilities ............................ (145,925) (60,338) (13,983) (49,174)Non-current liabilities..................... (335) (310) (252) (152)Total liabilities ................................ (146,260) (60,648) (14,235) (49,326) –––––––– –––––––– –––––––– ––––––––Total equity.................................... 352,529 356,246 374,096 306,500 –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– ––––––––

Summary cash flow statements 18 Months 3 Months Ended 3 Months Ended Year Ended Year Ended Ended 31 March 31 March 31 December 31 December 31 December 2011 2010 2010 2009 2008 –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– (US$’000) (US$’000) (US$’000) (US$’000) (US$’000) (Unaudited)

Net cash flow used in operatingactivities...................................... (2,981) (6,297) (12,754) (10,394) (27,111)

Net cash flow (used in) investingactivities...................................... (9,015) (17,074) (32,633) (40,252) (141,056)

Net cash flow from financing activities...................................... — 1 1 107,260 205,340

(Decrease)/increase in cash and cash equivalents for the year ...... (11,996) (23,370) (45,386) 56,614 37,173

–––––––– –––––––– –––––––– –––––––– ––––––––Cash and cash equivalents at the

end of the period/year ............... 77,838 111,540 89,925 135,077 77,927 –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– –––––––– ––––––––

Current trading and future prospects

As at the date of this Prospectus, the Group has no history of, nor any current, revenue generating operations. Theprospects of the Company are dependent on, amongst other things, exploration to be undertaken on its assets andthe evaluation of discoveries made in Equatorial Guinea in 2008 and in Tanzania in 2010 and 2011 and the resultsof the drilling of the Kora-1 well in AGC which are expected in July 2011. The Company intends to expand itsportfolio of assets should attractive opportunities arise and has recently farmed out interests in AGC and Gabon.

The Offer

The Offer comprises an issue of 93,867,334 New Shares by the Company. In addition, a further 9,386,733 Over-allotment Shares are being made available pursuant to the Over-allotment Option to cover short positions arisingfrom over-allotments made (if any) in connection with the Offer and sales made during the stabilisation period.All Ordinary Shares sold in connection with the Offer will be subscribed for, or purchased, at the Offer Price.

6

Pursuant to the Offer, the Company expects to raise gross primary proceeds of £234.7 million (US$375 million)(excluding the Over-allotment Option) out of which it will pay underwriting commissions and other estimated feesand expenses in connection with the Offer of approximately £14.4 million (US$23 million).

In addition to the New Shares being issued or sold pursuant to the Offer, Nicholas Cooper, Nicholas Smith, JohnLander, John Morgan, Patrick Spink, Ronald Blakely and B. Yvonne Holm are subscribing for Ordinary Shares atthe Offer Price in the amounts of £300,000, £150,000, £50,000, £30,000, £100,000, £30,000 and £10,000respectively.

The Offer is fully underwritten by the Underwriters and is subject to satisfaction of the conditions set out in theUnderwriting Agreement, including Admission occurring and becoming effective by no later than 8.00 am(London time) on 13 July 2011 or such later time and/or date as the Company and the Joint Bookrunners mayagree, and to the Underwriting Agreement not having been terminated in accordance with its terms.

The new Ordinary Shares to be made available by the Company pursuant to the Offer will, on Admission, rankpari passu in all respects with the existing Ordinary Shares in issue and will rank in full for all dividends and otherdistributions thereafter declared, made or paid on the share capital of the Company. The Ordinary Shares will,immediately following Admission, be freely transferable.

It is expected that Admission will take place and unconditional dealings in the Ordinary Shares will commenceon the London Stock Exchange at 8.00 am (London time) on 13 July 2011. Prior to Admission, it is expected thatdealings in the Ordinary Shares will commence on a conditional basis on the London Stock Exchange at 8.00 am(London time) on 8 July 2011.

Reasons for the Offer and use of proceeds

The Company’s net proceeds from the Offer are estimated to be US$352 million (excluding the Over-allotmentOption) after deduction of underwriting commissions and estimated fees and expenses in connection with the Offer.

The Company currently intends to use the net proceeds from the Offer to execute its stated strategy, in accordancewith its current business plan and together with its existing cash resources (which, as at 31 March 2011, wereapproximately US$78 million), toward the following purposes:

• the Company’s proposed drilling programme: approximately US$275 million, consisting of proposeddrilling programmes in the following countries:

• Tanzania: approximately US$184 million;

• Equatorial Guinea: approximately US$62 million; and

• AGC, Gabon and Madagascar: approximately US$29 million;

• the Company’s ongoing new venture programme to manage the Company’s asset portfolio: approximatelyUS$68 million;

• government and other in-country expenses: approximately US$19 million;

• the acquisition of geophysical data: approximately US$14 million; and

• general corporate purposes (including property, IT, personnel, professional and other corporate costs):approximately US$24 million.

The above amounts are the current best estimate of capital expenditure and funding plans and, although theGroup’s current committed capital expenditure for 2011 and 2012 will be covered by the net proceeds from theOffer, given the long-term and unpredictable nature of some of these exploration projects, the Group’sdiscretionary spending may be subject to change.

Dividend policy

The Directors intend to apply the proceeds from the Offer to implement the Company’s strategic aims and fundits capital expenditure plans and do not anticipate paying dividends in the near future. The Directors willreconsider the Company’s dividend policy as the Company advances the development of its operations. TheDirectors envisage that, at such time, the Company’s dividend policy would be determined based on, and dependon, the results of the Company’s operations, financial condition, cash requirements, future prospects, profitsavailable for distribution and other factors deemed to be relevant at the time.

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Lock-ups

Pursuant to the Underwriting Agreement and the Lock-up Deeds, the Company, the Directors and the Locked-upShareholders have each agreed to certain lock-up arrangements. Further details are set out in paragraph 11.2 ofPart XV: “Additional Information”.

Risk factors

Prior to making an investment decision in respect of Ordinary Shares, prospective investors should carefullyconsider all the information in this Prospectus, including the risk factors which are set out in Part II:“Risk Factors”. Such risks include, but are not limited to:

Business risks

• The Company does not currently produce oil or gas or have any reserves and may never produce oil or gasor have any earnings.

• The oil and gas contingent and prospective resources data and the production profiles and developmentplans for the Company’s assets contained in this Prospectus are estimates only.

• The Company is currently in an early stage of operations and has experienced operating losses in each yearsince its incorporation.

• Dry wells may lead to a downgrading of the potential value of the Company’s PSCs or require further fundsto continue exploration work.

• Any appraisal and development activities which are typically carried out following the discovery of oil andgas may require further funding or further licences and may not result in economically viable production.

• Drilling, exploration, production and related activities can be dangerous, including health, safety andenvironmental risks, particularly in the case of deepwater operations, as was seen in the Gulf of Mexico in2010.

• The Company faces strong competition for exploration licences.

• Oil and gas prices have fluctuated significantly in the past and could significantly impact the Company.

• Gas discoveries may require the Company to invest in LNG development projects which require long leadtimes and material investment in receipt, processing and transportation infrastructure and the marketing ofLNG.

• The Company’s business requires significant capital expenditure and the future expansion and developmentof the Group’s business could require future debt and equity financing. The future availability of suchfunding is uncertain.

• Interruptions or delay to exploration, appraisal, development and production could significantly impact theCompany.

• The Company relies on third party contractors and providers of capital equipment. The future availabilityand costs of services and equipment is not certain.

• The Company relies on third party operators and other joint venture partners and is typically required toconsult these partners in relation to significant matters.

• The Company may not be able to manage the expansion of its operations effectively through organicgrowth or acquisitions.

• The Company is dependent on a small team of key personnel for its success.

• The Company’s long-term success depends on attracting and retaining skilled personnel.

• The Company is subject to significant environmental, health and safety laws and regulations and may besubject to additional regulation and restrictions as a result of the Gulf of Mexico oil spill.

• The Company faces the possibility of future decommissioning charges that it cannot anticipate.

• The Company’s insurance and indemnities may not adequately cover all risks or expenses.

8

• Litigation against the Company could materially impact the Company’s business.

• The Company relies on technology systems, the failure of which could significantly impact its operationsand business.

• The Company may be adversely affected by natural disasters and climatic conditions.

Risks relating to the jurisdictions of operations

• The Company operates in jurisdictions that are subject to significant political, economic, legal, regulatoryand social uncertainties.

• Uncertainties in the interpretation and application of laws and regulations in the jurisdictions in which theCompany operates could have an adverse effect on the Company’s business.

• Tax regimes in certain jurisdictions are subject to differing interpretations and are subject to change.

• Some of the jurisdictions in which the Company operates and has assets may not be internationallyrecognised, which may impact on the Company’s title to assets or its ability to commercialise them fully.In respect of the Company’s current portfolio, the sovereignty of Somaliland and SADR over theirrespective territories are the subject of disputes and the agreement governing the establishment of AGCcould come to an end.

• There are risks and limitations in the title registration systems in certain of the regions in which theCompany operates.

• Militant activity, terrorism and piracy in certain of the regions in which the Company operates may impactits business.

• The Company does business in jurisdictions with inherent risks relating to fraud, bribery and corruption.

• Changes in government policy could have a negative impact on the Company’s business.

• The Company is subject to licensing and other regulatory requirements, which may be onerous.

• The Company may be subject to the risk of exploration and appraisal periods not being extended.

• The Company may be subject to risks relating to its workforce.

Risks relating to the Offer

• The Company has three major shareholders that will be able to exercise significant influence over mattersrequiring shareholder approval.

• The value of the Ordinary Shares may fluctuate.

• An active trading market for the Ordinary Shares may not develop, which may limit liquidity and/or causethe price of the shares to fall.

• When the lock-up arrangements to which the Directors and the Locked-up Shareholders are subject, andthe undertakings to which the Company is subject, expire, more Ordinary Shares may become available onthe market.

• US shareholders may be unable to exercise pre-emptive rights.

• There is a significant likelihood that the Company will be classified as a passive foreign investmentcompany, which could result in adverse US federal income tax consequences to US investors.

• An investment in the Company is speculative and carries a considerable degree of risk.

• The market price of the Ordinary Shares may be affected by fluctuations in exchange rates.

• The Company does not plan on making dividend payments in the near future.

Additional information

Your attention is drawn to Parts VI to XVIII of this Prospectus which provide further information in relation tothe Group and the Offer.

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PART II

RISK FACTORS

Any investment in the Ordinary Shares is speculative and subject to a high degree of risk. Prior to investing in theOrdinary Shares, prospective investors should consider carefully the factors and risks associated with anyinvestment in the Ordinary Shares, the Group’s business and the industry in which it operates, together with allother information contained in this Prospectus including, in particular, the risk factors described below. Followingthe occurrence of any such event, the value of the Ordinary Shares could decline and investors could lose all orpart of their investment.

The following is not an exhaustive list or explanation of all risks which investors may face when making aninvestment in the Company and should be used as guidance only. Additional risks and uncertainties relating to theGroup that are not currently known to the Company, or that it currently deems immaterial, may also have anadverse effect on the Company’s business, prospects, financial condition and results of operations and, if any suchrisk should occur, the price of the Ordinary Shares may decline and investors could lose all or part of theirinvestment. Investors should consider carefully whether an investment in Ordinary Shares is suitable for them inthe light of the information in this Prospectus and their personal circumstances.

BUSINESS RISKS

The Company does not currently produce oil or gas or have any reserves and may never produce oil or gas orhave any earnings

The Company does not currently produce any oil or gas and, although the Company has made some discoveries,it does not currently have any oil or gas reserves. There can be no assurance that the Company will ever produceany oil or gas.

The success of the Company depends on its ability to acquire, find, develop and commercially exploit resourcesand reserves. Exploration and development activities are capital intensive and their successful outcome cannot beassured. The Company undertakes exploration activities with no guarantee that such expenditure will result in thediscovery of commercially recoverable oil or gas.

If the Company should make no discoveries from which it is able to produce oil or gas commercially, or ifappraisal and development of discoveries should prove unsuccessful, the Company may never produce any oil orgas and never have any earnings. This would have a material and adverse impact on the business, prospects,financial condition and results of operations of the Company.

There is a long lead time between discovery and production of oil and gas, particularly for gas. During this longlead time, the Company will continue to incur significant costs at a level which may be difficult to predict, butwill not have any earnings from oil or gas production. It will also have exposure to many of the risk factorsdescribed in this Part II, and may become exposed to additional risks not currently envisaged. These risks mayindividually or collectively diminish the returns obtainable by the Company in relation to any discovery or eventhe ability to realise any value from the discovery at all, which may have a material adverse effect on the business,prospects, financial position and results of operations of the Company.

The oil and gas contingent and prospective resources data and the production profiles and development plansfor the Company’s assets contained in this Prospectus are estimates only

There are uncertainties inherent in estimating oil and gas resources and reserves for any oil and gas asset. Theseuncertainties are generally greater for areas where there has been limited historic hydrocarbon exploration whichis the case for most of the Company’s assets. In addition, the contingent and prospective resource estimatescontained in this Prospectus are derived from the interpretation of seismic and other geoscientific data and, whereappropriate, drilling results. Such interpretation and estimates of the amounts of oil and gas resources aresubjective and the results of drilling, testing and production subsequent to the date of any particular estimate mayresult in substantial revisions to the original interpretation and estimates.

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It should be noted that the contingent and prospective resources data contained in this Prospectus and in theMineral Expert’s Report (“MER”) compiled by RPS Energy Limited (“RPS”) are estimates only and should notbe construed as representing exact quantities. Unless otherwise indicated, RPS has, in compiling the MER, usedthe definitions and guidelines set out by the 2007 SPE/AAPG/WPC/SPEE Petroleum Resources ManagementSystem (“PRMS”) which defines prospective and contingent resources as undiscovered and/or undevelopedmineral resources respectively. Accordingly PRMS recognises that contingent resources are by their natureuncertain in respect of the inferred volume range and prospective resources are speculative in respect of theirinferred presence and uncertain in respect of their inferred volume range. Indeed PRMS requires that prospectiveresources should be quoted, together with an associated geological risk (or “Chance of Discovery”). In addition,they are based on assumptions which, together with the estimates, may prove to be materially incorrect.

Furthermore, there are also numerous uncertainties in estimating the timing and quantity of developmentexpenditures and the projection of production. The production profiles and development plans in this Prospectusand in the MER are based on a number of assumptions which, together with the estimates, may prove to bematerially incorrect.

As a result, potential investors should not place undue reliance on the forward-looking statements contained inthis Prospectus and in the MER concerning the Company’s resources, production profiles and development plans.In addition, nothing in this Prospectus should be interpreted as assurances of the Company’s oil and gas resources,the production profiles of the Company’s assets or the development plans of the Company. The Company does notcurrently have any oil or gas reserves.

If the estimates of the Company’s oil and gas resources, production profiles and development plans and theassumptions on which they have been based prove to be incorrect, the Company may be unable to producethe estimated levels or quality of oil and gas set out in this Prospectus (or any oil and gas at all) and the Company’sbusiness, prospects, financial condition and results of operations could be materially and adversely affected.

The Company is currently in an early stage of operations and has experienced operating losses in each yearsince its incorporation

The Company has a limited operating history on which to assess its future expected performance. To date, theCompany has experienced operating losses in each year since its incorporation and, as at 31 March 2011,the Company had accumulated losses of approximately US$65.6 million (as calculated in accordance with IFRS).The Company expects to incur further substantial operating losses in the current and medium-term future financialyears as its exploration, development and appraisal activities continue. There can be no assurance that theCompany will ever earn significant revenues or any revenues from operations at all, or achieve profitability, whichcould impact the Company’s ability to sustain operations or obtain any additional funds it may require in the futureto satisfy requirements beyond the Group’s current committed capital expenditure for 2011 and 2012.

Dry wells may lead to a downgrading of the potential value of the Company’s PSCs or require further funds tocontinue exploration work

Many of the areas being explored by the Company have a number of prospects for the discovery of oil and gas.Should the Company undertake drilling in a particular geographic area but discover no oil and gas (a “dry well”),this may lead to a downgrading of the potential value of the PSC concerned and perhaps to other PSCs within thesame geological basin and the Directors believe that the other prospects within that geographic area would be lesslikely to yield exploration success, potentially decreasing the value of the Company’s assets. If this is the case,once the minimum work obligations under the relevant PSC have been satisfied, the Company may relinquish itsinterests in that PSC, in which case it would have no further exploration rights, even though it may have identifieda number of additional prospects. Although the Company has made five gas discoveries since November 2008, theCompany also drilled dry wells in 2008 in the Ntsina PSC (Frake Noir-1) and the Manga PSC (Ngollon-1), Gabonand in Block R (Bythos-1), Equatorial Guinea (see paragraph 5 of Part VI: “Information on the Group” for furtherinformation).

Dry wells may also result in the Company requiring substantially more funds if it chooses to continue explorationwork and drill further wells beyond the Company’s existing minimum work commitments. Such funding may beunavailable or may have to be obtained on unfavourable terms, leading to a potential deterioration in theCompany’s financial position. Drilling a dry well would also mean that the Company may not be able to recoverthe costs incurred in drilling that well or make a return on its investment resulting in significant explorationexpenditure being written off.

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Any of these circumstances may have a material adverse effect on the business, prospects, financial position andresults of operations of the Company.

Any appraisal and development activities which are typically carried out following the discovery of oil and gasmay require further funding or further licences and may not result in economically viable production

The results of any appraisal of oil and gas discoveries are uncertain and may lead to the conclusion that efforts areunprofitable, either due to wells being dry or not economically viable to develop. Appraisal and developmentactivities involving the drilling of wells may be unpredictable and not result in the outcome planned, targeted orpredicted, as extensive testing is required to understand the properties of an entire asset.

In addition, appraisal and development activities of the Company (beyond the current minimum workcommitments for 2011 and 2012) may require additional funding and significant infrastructure, including storage,transportation or processing capacity which the Company does not as yet have. The Company cannot provide anyguarantee that such expenditure will result in the discovery of commercially recoverable oil or gas.

Appraisal and development activities may require the obtaining of additional licences and permits. These may besubject to delay or to additional onerous requirements by reason of governmental, regional or local consultation,approvals or other considerations or requirements.

The success of the Company’s appraisal and development operations depends on its ability to find andcommercially exploit discoveries of oil and gas, including, as appropriate, its ability to acquire land on which tolocate pipelines, LNG plants and other equipment in a timely and cost-effective manner. The failure of theCompany to succeed in these endeavours may mean that the Company may not be able to make a return oninvestment.

Any of the above may have a material adverse effect on the Company’s business, prospects, financial conditionand results of operations.

Drilling, exploration, production and related activities can be dangerous, including health, safety andenvironmental risks, particularly in the case of deepwater operations, as was seen in the Gulf of Mexico in 2010

Developing oil and gas resources and reserves into commercial production involves a high degree of risk. TheCompany’s exploration operations are subject to all the risks common in its industry. These hazards and risksinclude encountering unusual or unexpected rock formations or geological pressures, geological uncertainties,seismic shifts, blowouts, oil spills, uncontrollable flows of oil, natural gas or well fluids, explosions, fires,improper installation or operation of equipment and equipment damage or failure.

Given the nature of its offshore, deepwater operations, the Company’s exploration and drilling facilities, and inparticular its rigs, are also subject to the hazards inherent in marine operations, such as capsizing, sinking,grounding, damage from severe storms or other severe weather conditions. The offshore drilling conducted by theCompany involves drilling risks including high pressures and mechanical difficulties, which increase the risk ofdelays in drilling and of operational issues arising. Such dangers were evidenced by the blowout of the Macondowell in the Gulf of Mexico in 2010.

If any of these events were to occur, they could result in environmental damage, injury to persons and loss of lifeand a failure to produce oil or gas in commercial quantities. They could also result in significant delays to drillingprogrammes, a partial or total shutdown of operations, significant damage to the Company’s equipment andequipment owned by third parties and personal injury or wrongful death claims being brought against theCompany. These events can also put at risk some or all of the Company’s licences or PSCs which enable it toexplore, and could result in the Company incurring significant civil liability claims (as BP have done followingthe Macondo blowout), significant fines or penalties as well as criminal sanctions potentially being enforcedagainst the Company and/or its officers. The Company may also be required to curtail or cancel any operations onthe occurrence of such events.

Any of the above could materially and adversely affect the Company’s business, prospects, financial condition andresults of operations.

The Company faces strong competition for exploration licences

The oil and gas exploration industry is highly competitive (see Part VIII: “Industry Overview” for furtherinformation). There is significant competition in almost every public round of bidding for exploration licences

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throughout Africa. The Company competes with other industry participants in the search for, and acquisition of,oil and gas assets and licences. Competitors include companies with, in many cases, greater financial resources,technical resources, local contacts, staff and facilities than those of the Company. Competition for explorationlicences as well as other regional investment or acquisition opportunities may increase still further in the future.There can be no assurance that the Company will succeed in obtaining any additional oil and gas assets orprospects, or, if it does so, that it will be able to acquire such assets or prospects on economically viable terms.

This may lead to increased costs in the carrying on of the Company’s activities and reduced available growthopportunities, which could materially adversely affect its business, prospects, financial condition and results ofoperation.

Oil and gas prices have fluctuated significantly in the past and could significantly impact the Company

Historically, oil and gas prices have been subject to volatility due to a variety of factors beyond the Company’scontrol. Over the past ten years, oil and gas prices worldwide have increased significantly, but there can be noassurance that such increases, or the existing price levels, will be maintained in the future and it is possible thatoil and/or gas prices could fall significantly (see Part VIII: “Industry Overview” for further information). Loweroil and/or gas prices may reduce the economic viability of the Company’s operations and could materially andadversely affect the Company’s business, prospects, financial condition and results of operations.

Many of the Company’s existing contracts were entered into during a period when oil and gas prices were high,and the commercial terms required by national governments and contractors reflected elevated price expectations.Should oil and/or gas prices fall, returns from production would also fall and there is a risk that the Company’sexploration and production costs would not fall in line with the lower returns from production which could havea material adverse effect on the Company’s business, prospects, financial condition and results of operations.

Should oil and/or gas prices significantly increase a national government or contractor may want to change itscommercial terms with the Company. As a result of the jurisdictions in which the Company operates, this mayresult in the cancellation, or termination of, a unilateral change or a series of unilateral changes (such as a changein oil and gas pricing policy or the renegotiation or nullification of existing concession contracts) by a nationalgovernment or contractor which could materially and adversely affect the Company’s business, prospects,financial condition and results of operations. Please see further the risks identified under “Some of thejurisdictions in which the Company operates may not be internationally recognised” and “Uncertainties in theinterpretation and application of laws and regulations in the jurisdictions in which the Company operates couldhave an adverse effect on the Company’s business” below.

Gas discoveries may require the Company to invest in LNG development projects which require long lead timesand material investment in receipt, processing and transportation infrastructure and the marketing of LNG

Although the Company’s assets have prospectivity for oil, the Company has only discovered gas to-date and mayneed to monetise gas reserves through several LNG development projects which require long lead times andmaterial investment in receipt, processing and transportation infrastructure and the marketing of LNG. Delays anddifferences between estimated and actual timing of critical events and the completion of these projects mayadversely affect the Company’s development projects and the Company’s ability to participate in large-scaledevelopment projects in the future. In addition, LNG projects usually require long-term offtake contracts whichthe Company may not be able to secure.

If the Company is unable to fund any necessary LNG development projects (which are not part of the plannedcapital expenditure for 2011 and 2012) or the Company’s projects are delayed or if the Company is not able tosecure offtake agreements, this could have a material adverse effect on the Company’s business, prospects,financial condition and results of operation.

The Company’s business requires significant capital expenditure and the future expansion and development ofthe Group’s business could require future debt and equity financing. The future availability of such funding isnot certain

The Company anticipates that it will need to make substantial capital investments for its operations, exploration,appraisal, development and/or production plans. The Company has projected capital expenditures ofapproximately US$150 million for the year ending 31 December 2011 and approximately US$270 million for theyear ending 31 December 2012. In order to meet these capital expenditure requirements, the Company plans to

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use the net proceeds of the Offer (excluding the Over-allotment Option) of US$352 million together with its cashresources, which, as at 31 March 2011, were approximately US$78 million.

The Company’s business involves significant capital expenditure and it may require external debt and furtherequity financing in order to fund expenditure beyond its current committed and planned capital expenditure for2011 and 2012. Alternatively, the Company may in the future seek funds for its business by selling part of itsoperations and/or by farming down its assets. There is no certainty that counterparties may enter into suchtransactions in the future. For capital expenditure beyond the Company’s current committed capital expenditurefor 2011 and 2012, although the Company's current intention is to fund its planned expenditure during 2011 and2012 from the proceeds of the Offer and its existing cash resources, and although the Company has no currentplan to enter into such arrangements, the Company may enter into significant borrowing arrangements in additionto raising further equity financing for its operations, exploration, appraisal, development or production plans.Various forms of debt are available, ranging from equipment credits from various export agencies throughinfrastructure development agency supported debt to bank debt. However, the Company may be unable to obtainnon-equity financing or additional equity financing in the amounts required for its expenditures beyond its currentcommitted capital expenditure for 2011 and 2012 and thereafter, on favourable terms or at all. Moreover, theglobal credit environment then existing may pose additional challenges to the Company to secure needed bankloans or to secure bank loans at acceptable rates of interest.

To the extent the Company does take out bank loans, the Company will be subject to increased interest expenses,and may also be subject to covenants requiring that the Company maintain prescribed financial ratios andcovenants restricting certain aspects of its business, including, for example, restrictions on additional futureborrowings and indebtedness levels and permitted future acquisition activity, as well as security interests placedover certain of its assets. In addition, future debt financings may limit the Company’s ability to withstandcompetitive pressures, as the Company may become illiquid or less liquid in cash as a result of higher interestpayments on its debt due to increases in interest rates. This could hinder the Company’s ability to raise, renew andservice its future indebtedness, reduce the funding options available to the Company and render it more vulnerableto economic downturns. In addition, if the Company requires debt but is unable to secure sufficient bankborrowings, it is highly likely that, other than in respect of its current committed capital expenditure for 2011 and2012, this would pose challenges to the Company’s planned development and timeline for development.

If the Company fails to generate or obtain sufficient capital resources for its operations, exploration, appraisal,development or production plans (beyond the Company’s current committed capital expenditure for 2011 and2012), this could have a material adverse effect on the Company’s business, prospects, financial condition, resultsof operations and cash flows or the Company’s ability to fund the expansion or development of the business in thelonger term.

Interruptions or delay to exploration, appraisal, development and production could significantly impact theCompany

If the Company (or the operator of assets in which the Company has an interest) is unable to explore, appraise ordevelop petroleum operations or produce oil and/or gas as a result of matters such as failure to obtain equipment,equipment failure, natural disasters, political, economic, taxation, legal, regulatory and social uncertainties,terrorism or labour disputes, the Company may experience loss of income from decreased (or zero) productionand significant budget overruns.

Furthermore, the Company operates in jurisdictions that have developing transportation, telecommunications andfinancial services infrastructures which may present substantial obstacles and cause material delays to theCompany’s proposed activities. As a result of any of these or other issues, the Company may be unable to satisfythe minimum exploration work commitments under one or more of its PSCs and may as a result experiencedifficulty in extending or renewing such PSCs.

Such interruptions or delays could result in disruptions to the Company’s assets, increased costs or decreasedincomes and may therefore have a material adverse impact on the Company’s business, prospects, financialcondition and results of operations.

The Company relies on third party contractors and providers of capital equipment. The future availability andcosts of services and equipment is not certain

In common with other exploration companies, the Company (or the relevant operator of assets in which it has aninterest) contracts or leases services, capital equipment, rigs, pipelines, storage tanks and other equipment fromthird party providers on which exploration, appraisal and development and production activities are dependent.

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Such equipment and services can be scarce, may not be of the required quality and may face interruptions ordelays in availability at the times and places required. The costs of third party services and equipment haveincreased significantly over recent years and may continue to rise.

The scarcity of such equipment and services, as well as their potentially high costs, could delay, restrict or lowerthe profitability and viability of the Company’s assets and therefore could adversely affect its business, prospects,financial condition and results of operation. Conversely, should there be a sudden increase in supplies brought tothe market, and a resulting fall in prices for such services and equipment, then the Company may have contractedat prices which would not be competitive with the then prevailing rates which could materially adversely affectthe Company’s business, prospects, financial condition and results of operation.

The Company relies on third party operators and other joint venture partners and is typically required toconsult these partners in relation to significant matters

The Company operates or jointly operates most of its assets. For those assets where the Company is the operatorbut has a joint venture partner, the relevant operating agreement typically provides that the joint venture partnermust be consulted or that it must provide its consent in relation to significant matters. Accordingly, while theCompany generally has control over day-to-day management and operations of those assets, it may be unable toundertake certain activities because of opposition from a joint venture partner, or it may experience delays inundertaking activities due to time taken to obtain the consent of the relevant joint venture partner. Any suchopposition or delay could result in losses or increased costs to the Company.

Where the Company is not the operator of the asset (such as in Blocks 1, 3 and 4 in Tanzania), although it mayhave consultation rights or the right to withhold consent in relation to significant or operational matters (dependingon the Company’s interest in such asset), it has limited control over day-to-day management so thatmismanagement of an asset by the operator may result in significant delays, losses or increased costs to theCompany.

The terms of the relevant operating agreement generally impose standards and requirements in relation to theoperator’s activities. The Company transfers operatorship to a third party or acquires interests in assets operatedby third party operators only if it believes such third party is reputable. However, there can be no assurance thatsuch operators will observe such standards or requirements and this could result in a breach of the relevantoperating agreement.

There is a risk that other parties with interests in the Company’s assets may elect not to participate in, or consentto, certain activities relating to those assets which require that party’s consent (including decisions relating todrilling programmes, including the number, identity and sequencing of wells, appraisal and development decisionsand decisions relating to production). In these circumstances, it may not be possible for such activities to beundertaken by the Company alone or in conjunction with other participants at the desired time or sequence or atall.

Other participants in the Company’s assets may default on their obligations to fund capital or other fundingobligations in relation to the assets. In such circumstances, the Company may be required under the terms of therelevant operating agreement or otherwise to contribute all or part of such funding shortfall itself and, beyondcompletion of the current minimum work commitments for 2011 and 2012, the Company may not have theresources to meet these obligations.

Any disagreement, absence of consent, delay, opposition, breach of agreement, or inability to undertake activitiesor failure to provide funding of the kind identified above could adversely affect the Company’s business,prospects, financial condition and results of operation.

The Company may not be able to manage the expansion of its operations effectively through organic growthor acquisitions

There is no certainty that all, or indeed any, of the elements of the Company’s current strategy will develop asanticipated or that the Company will become profitable. In the event that the Company’s operations are successful,the Company’s current systems, procedures and controls will need to be expanded and strengthened to support theCompany’s future operations. There can be no assurance that the Company will be able to manage effectively theexpansion of its operations through organic growth or acquisitions. Any failure of the Company to manageeffectively its growth and development could have a material adverse effect on its business, prospects, financialcondition or results of operations.

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The Company is dependent on a small team of key personnel for its success

The Company is dependent on a small team of individuals with experience, knowledge and skill in explorationand development operations for its success. The departure of any of these individuals or any impediment to anyof them performing his or her duties may cause the Company serious operational difficulties, and the Companymay not be able to locate suitable replacement personnel in a timely manner, or at all.

In addition, the personal connections and relationships of the Company’s Management are important to theconduct of its business. There is no guarantee that the Company will retain key individuals, and if the Companywere to lose a member of its Management team unexpectedly, the Company’s business, prospects, financialcondition and results of operations may be adversely affected.

The Company’s long-term success depends on attracting and retaining skilled personnel

The Company’s business requires skilled personnel and professional staff in the areas of exploration anddevelopment, operations, engineering, business development, oil and gas marketing, finance and accounting.There is competition for such personnel in the African region and also in the United Kingdom and Australia wherethe Company has offices. Limitations on the Company’s ability to engage, train and retain the required number ofpersonnel would reduce its capacity to undertake further projects and may have a material adverse effect on itsbusiness, prospects, financial condition and results of operations.

The Company is subject to significant environmental, health and safety laws and regulations and may besubject to additional regulation and restrictions as a result of the Gulf of Mexico oil spill

The Company’s operations are subject to the environmental risks inherent in the oil and gas industry. TheCompany is subject to environmental laws and regulations in connection with its operations. Although theDirectors believe that the Company is in compliance in all material respects with all applicable environmental lawsand regulations, there are certain risks inherent in its activities, such as accidental spills, leakages, explosions, firesor other unforeseen circumstances that could expose the Company to significant liability.

The Company’s operations are subject to laws and regulations relating to the protection of human health and safetyas well as the environment. The Company’s health, safety, security and environment policy is to observe local legalrequirements as well as to apply recognised international industry standards in its operations (see paragraph 7 ofPart VI: “Information on the Group” for further information). Failure by the Company to comply with applicablelegal requirements or recognised international industry standards may give rise to significant liabilities.

Health, safety and environment laws may over time become more complex and stringent or the subject ofincreasingly strict interpretation and/or enforcement. The terms of future PSCs or licences may include morestringent environmental and/or health and safety requirements. The obtaining of requisite licences and permitsmay also become more difficult or be the subject of delay by reason of governmental, regional or localconsultation, approvals or other considerations or requirements.

The blowout of the Macondo well in 2010 and the resulting oil spill in the Gulf of Mexico is likely to havelong-lasting consequences for the global energy industry, in particular deepwater activities. The Company maybecome subject to further extensive laws, regulations and scrutiny on deepwater drilling or become subject tomore stringent application of existing regulations on deepwater drilling, particularly in areas that areenvironmentally sensitive and/or have not yet been open to drilling.

In the long-term, the Company’s ability to carry out deepwater exploration may be affected by such increasedregulation and the terms of licences or permissions may include more stringent environmental and/or health andsafety requirements. The obtaining of exploration, development or production licences for deepwater oil and gasexploration may become more difficult or be the subject of delay due to governmental, regional or localconsultation, approvals or other considerations or requirements.

In addition, the Company may be required to incur additional expenditure or could be required to hire or purchaseadditional equipment to comply with any new operational, environmental and/or health and safety regulations.The impact of any such regulations or requirements could be to impose a constraint on long-term oil and gasproduction of the Company and restrict the Company’s control over the nature and timing of its exploration,appraisal, development, production and other activities or its ability to undertake these activities at all may bematerially and adversely affected, including by substantial delays or material increases in costs. Such additionalcosts, interruptions or delays could have an adverse impact on the Company’s business, prospects, financialcondition and results of operations.

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The Company faces the possibility of future decommissioning charges that it cannot anticipate

Upon the expiry of PSCs, contractors are commonly required, under the terms of relevant agreements or local law,to dismantle and remove equipment, cap or seal wells and generally make good production sites. The Company’saccounts do not make provision for such decommissioning since either local laws, relevant PSCs or concessionsdo not specifically provide for decommissioning charges or the Company does not consider it appropriate at thistime to make provision for the possibility of incurring decommissioning charges. There can be no assurance thatthe Company will not in the future incur decommissioning charges since local or national governments mayrequire decommissioning to be carried out in circumstances where there currently is no express obligation to doso, particularly in the case of future licence renewals. The costs associated with decommissioning or penalties forfailure to decommission may have an adverse effect on the Company’s business, prospects, financial condition andresults of operations.

The Company’s insurance and indemnities may not adequately cover all risks or expenses

The Company may be subject to substantial liability claims due to the inherently hazardous nature of its businessor for the acts or omissions of sub-contractors, operators or joint venture partners. Any indemnities the Companymay receive from such parties may be difficult to enforce if such sub-contractors, operators or joint venturepartners lack adequate resources.

The Company’s operations are subject to the risks normally associated with exploration, appraisal anddevelopment activities and, in particular, deepwater operations. The Directors believe that its existing insuranceand indemnity coverage is reasonable to cover all general material risks associated with the Company’s operations(and that of the operators of assets in which it has an interest).

The Company can give no assurance that its existing insurance and indemnity cover is reasonable to cover all therisks to which it may be subject or that the proceeds of insurance applicable to covered risks or recovery underindemnities will be adequate to cover expenses relating to losses or liabilities. Accordingly, the Company maysuffer material losses from uninsurable or uninsured risks or insufficient insurance and indemnity coverage. TheCompany is also subject to the risk of unavailability, increased premiums or deductibles, reduced coverage andadditional or expanded exclusions in connection with its insurance policies and those of operators of assets it doesnot itself operate. In the event of any occurrence which results in losses or other adverse effects on the Companyfor which it does not have adequate insurance or indemnity cover, this may have a material adverse effect on theCompany’s business, prospects, financial condition and results of operations.

Litigation against the Company could materially impact the Company’s business

The Company currently has no material outstanding litigation or disputes (save as disclosed in paragraph 13 ofPart XV: “Additional Information” of this Prospectus). However, there can be no guarantee that the past, currentor future actions of the Company will not result in litigation. Damages claimed under such litigation may bematerial or may be indeterminate, and the outcome of such litigation may materially impact on the Company’sbusiness, prospects, financial condition and results of operations. Defence and settlement costs can be significant,even in respect of claims that have no merit. In addition, the adverse publicity surrounding such claims may havea material adverse effect of the Company’s business.

The Company relies on technology systems, the failure of which could significantly impact its operations andbusiness

The Company is reliant on its technology systems, in particular its specialist exploration applications. TheCompany’s technology systems could be exposed to, amongst other things, damage or interruption fromtelecommunications failure, unauthorised entry and malicious computer code, fire, natural disaster, power loss,industrial action, human error and acts of war or terrorism. The occurrence of any of the above may alsosignificantly disrupt the Company’s technology systems and may lead to important data (such as the geophysicaland geological data) being irretrievably lost or damaged. Such damage or interruption may adversely affect theCompany’s business, prospects, financial condition and results of operations.

The Company may be adversely affected by natural disasters and climatic conditions

The Company’s operations (particularly offshore), including the Company’s drilling programme and otherexploration activities and the transport and other logistics on which the Company is dependent, may be adverselyaffected and severely disrupted by climatic conditions. Natural disasters or adverse conditions may occur in thosegeographical areas in which the Company operates, including severe weather, cyclones, excessive rainfall, tropical

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storms or droughts. The occurrence of any of the above could cause delays in the Company’s exploration,appraisal and development activities which could adversely affect the Company’s business, prospects, financialcondition and results of operations.

RISKS RELATING TO THE COMPANY’S JURISDICTIONS OF OPERATIONS

The Company operates in jurisdictions that are subject to significant political, economic, legal, regulatory andsocial uncertainties

The Company has licence interests in the Republic of Equatorial Guinea (“Equatorial Guinea”), the Republic ofCongo (Brazzaville) (“Congo (Brazzaville)”), the United Republic of Tanzania (“Tanzania”), the Republic ofGabon (“Gabon”), the Agence de Gestion et de Coopération entre le Sénégal et la Guinée-Bissau (“AGC”), theRepublic of Somaliland (“Somaliland”), Madagascar and the Saharawi Arab Democratic Republic (“SADR”) andhas an option over licence interests in the Republic of Senegal (“Senegal”).

The Company’s operations are exposed to the significant political, economic, legal, regulatory and social risks ofthe jurisdictions in which it operates. These risks potentially include expropriation (which could, among others,take the form of the cancellation, or termination of, a unilateral change or a series of unilateral changes to, theCompany’s PSCs or other contracts, licences, permits, authorisations or approvals), nationalisation of property,the unilateral imposition of onerous obligations on the Company, instability in political, economic or financialsystems, uncertainty arising from underdeveloped legal and regulatory systems, corruption, civil strife, war,hostilities, armed conflict, guerrilla activities, terrorism, piracy, AIDS and outbreaks of other infectious diseases,prohibitions, restrictions on production, price controls, limitations or the imposition of tariffs or duties on importsof certain goods or exchange controls.

In some of the jurisdictions in which the Company operates, there is a history of civil and political conflictincluding civil war and government change by coup d’état. Madagascar, for instance, has from time to timeexperienced political instability and a coup d’état in March 2009 led to Madagascar being suspended frominternational organisations and regional bodies such as the Southern African Development Community and theAfrican Union. Furthermore, since January 2011, the Middle East and North Africa region has experiencedheightened levels of political instability, civil disturbances, labour unrest and violence which may increase thepolitical, economic, legal, regulatory and social risks in the jurisdictions in which the Company operates.

The occurrence of any of the factors listed above could have a material and adverse effect on the Company’sbusiness, prospects and results of operations.

Uncertainties in the interpretation and application of laws and regulations in the jurisdictions in which theCompany operates could have an adverse effect on the Company’s business

In several jurisdictions in which the Company has assets, decisions of the courts are not published and there areno public registers of property interests (including rights under PSCs). In some of these jurisdictions there is littlelegislation regulating oil and gas exploration, development, production or other activities which the Company mayundertake. It may accordingly not be possible to establish, protect or defend legal rights or title to assets (and, inparticular rights to explore for, develop and produce oil and gas) in the jurisdictions in which the Companyoperates and proposes to operate with any certainty.

The courts in the jurisdictions in which the Company operates may offer less certainty as to the judicial outcomeor a more protracted judicial process than is the case in more established and developed jurisdictions. Accordingly,the Company could face risks such as: (i) effective legal redress in the courts of such jurisdictions being moredifficult to obtain, whether in respect of a breach of law or regulation, or, in an ownership or contract dispute; (ii) ahigher degree of discretion on the part of governmental authorities and therefore less certainty; (iii) a lack ofjudicial or administrative guidance on interpreting applicable rules and regulations; (iv) inconsistencies orconflicts between and within various laws, regulations, decrees, orders and resolutions; or (v) relative inexperienceof the judiciary and courts in such matters.

Any contracts, PSCs, joint ventures or other legal agreements that contain governing law and/or jurisdictionclauses of a jurisdiction other than that in which the Company wishes to seek enforcement may not be enforceableunder local laws, in particular where the jurisdiction does not have bilateral enforcement treaties with thejurisdiction of such agreement or is not a party to the United Nations Convention on the Recognition andEnforcement of Foreign Arbitral Awards 1958.

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Tax regimes in certain jurisdictions are subject to differing interpretations and are subject to change

Tax regimes in certain jurisdictions can be subject to differing interpretations and are often subject to legislativechange and changes in administrative interpretation in those jurisdictions. The interpretation by the Company’srelevant subsidiaries of relevant tax law as applied to their transactions and activities (including farm ins and farmouts) may not coincide with that of the relevant tax authorities. As a result, transactions may be challenged by taxauthorities and any profits of the Company’s subsidiaries from activities in those jurisdictions may be assessed toadditional tax or additional transactional taxes (e.g. stamp duty or VAT), which, in each case, could result insignificant additional taxes, penalties and interest, any of which could have a material adverse impact on theCompany’s business, prospects, financial condition or results of operations. The Company is currently indiscussions with the Tanzanian tax authorities regarding the tax treatment of the farm out to BG in 2010. Whilstthe Company believes that all applicable taxes payable by it in respect of that transaction have been paid, therecan be no assurance that the Tanzanian tax authorities will not require the payment of further amounts.

Some of the jurisdictions in which the Company operates and has assets may not be internationally recognised,which may impact on the Company’s title to assets or its ability to commercialise th