Xstate Resources Limited · ASX:XST

Xstate Resources — Corporate Update (March 2015)

15 slides from Xstate Resources's corporate update, Mar 12, 2015

1. Slide 1: Letter to shareholders: Corporate Update

   ABN 96 009 217 154 12 March 2015 For personal use only ASX Limited Electronic lodgement ASX Code: XST Dear Shareholders Please find attached a Corporate Update. The purpose of the Update is to provide clarification on recent activities. Key points are: XST continues to have a clear strategy and futu

2. Slide 2: XST Positioned for Success in a low oil price environment

   For personal use only XST Positioned for Success in a low oil price Xstate Resources Limited environment Corporate Update Portfolio of TCF–scale Prospects 12 March 2015 Onshore California

3. Slide 3: Corporate Information

   Corporate Information For personal use only Shares on Issue ~180 million Unlisted Options 17.0 million at 6-10 cents expire 31/12/15 19.5 million at 4-8 cents expire 31/05/16 2.5 million at 5 cents expire 31/12/16 Top 10 shareholders 35% Top 20 shareholders 48% Directors >5% Directors Chris Hodge: M

4. Slide 4: The Xstate Board and Operating Philosophy

   The Xstate Board and Operating Philosophy For personal use only Xstate has a small but highly experienced Board with complementary skills • Chris Hodge (MD) is a structural geologist and petroleum geophysicist by training. Over a career spanning 35 years he has occupied senior positions at Ampolex (

5. Slide 5: Portfolio of Assets

   Portfolio of Assets ~19,000 leased acres (100%) For personal use only Gas: Sacramento XST (current) XST (with Prospective Basin WI Option) WI ** Resource (100%) Sacramento Gas #Alvares Appraisal 25% 25% >2 TCF # Gas production 10% 25% [0.6 mmcfgpd] #Dempsey 10% 25% 1 TCF # Strat Play on 3D 10% 25% >

6. Slide 6: California Strategy – prolific old basins, new ideas

   California Strategy – prolific old basins, new ideas For personal use only Why California? Strategy • Proven and prolific conventional • Innovative geological and geophysical petroleum systems and production interpretation to identify prospects history • Take up ground floor land positions over pros

7. Slide 7: Area of Mutual Interest (AMI) with AOC

   Area of Mutual Interest (AMI) with AOC For personal use only AMI with AOC • Xstate has an AMI with Australian Oil Company (AOC) in California • Shared strategy and outlook • XST is 30% & AOC is 70% and Operator • Shared Perth office and administration allows overheads to be kept to a minimum….. • …w

8. Slide 8: The Sacramento Basin

   The Sacramento Basin For personal use only • Up to 10km Jurassic to recent marine and non- marine siliclastics • Producing reservoirs Late Cretaceous, Paleocene and Eocene • Produced ~11TCF+ 15mmbo • 47 discovered accumulations • Largest field Rio Vista 3.5 TCF • Upper Cretaceous to Sacramento Plioc

9. Slide 9: Tehama Early Cretaceous Basin – our technical edge

   Tehama Early Cretaceous Basin – our technical edge For personal use only Historical Sacramento Gas Basin and Production Depth of current drilling = the Tehama sub-basin The Tehama-sub Basin contains the play types that XST is chasing – older but not deeper and under-explored.

10. Slide 10: Alvares Appraisal Project - >2 TCF 25% equity

    Alvares Appraisal Project - >2 TCF 25% equity For personal use only The AMI’s Alvares Project is on trend 50km from the geologically similar multi-Tcf Tulainyo Alvares Project which is to be (XST) Dempsey (XST) drilled by CRC (California's largest oil and gas company). Tulainyo -1 (a redrill of Jame

11. Slide 11: Alvares-1 Gas Discovery

    Alvares -1 Gas Discovery For personal use only • The Alvares -1 gas discovery was drilled within mapped closure over 30 years ago • Intersected >1,500 metres of strong gas shows below 2,500 metres and flowed pipeline quality gas to surface • Conventional clastic reservoirs • Best estimate determinis

12. Slide 12: Dempsey Prospect - TCF gas exploration well

    Dempsey Prospect - 1 TCF gas exploration well – 7 reservoir targets For personal use only XST 10% equity - option to increase to 25% Individual reservoirs 80 – 3,700 acres Mapped from 3D seismic

13. Slide 13: Santa Maria Basin

    Santa Maria Basin For personal use only • Porter Ranch Project (XST 22.5%) Porter – Covers 2 large surface anticlines Ranch – Naturally “shattered” Monterey reservoir at a depth of <1,500m – Prospective resource size (mean) ~10mmbbls recoverable - updip from recovered oil – Old oil wells in the area

14. Slide 14: 2015 Activity

    2015 Activity For personal use only – Secure farmin partner for Dempsey and Alvares prospects – CRC drilled Alvares lookalike well “Tulainyo” in late 2014. This result is confidential but XST will continue to collect scouting data – Potentially exercise option to secure additional interests over Dem

15. Slide 15: Conclusions

    Conclusions For personal use only • Targeting low risk and/or multi -TCF prospects in California • Several prospects identified - fully or partially leased • 2 high value prospects in the process of being farmed out • Building a prospect portfolio with diversity, materiality and follow-up potential

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