Interim report 31 december 2024

Botala Energy Ltd

Directors' Report

Chairman's Letter - Half-Yearly Report

Botala Energy - A Transformational Year Ahead

Dear Shareholders,

The past six months have been a period of remarkable progress and transformation for Botala Energy Ltd (ASX: BTE), as we continue our journey from exploration to development of our Serowe Coal Bed Methane (CBM) Project in Botswana. Our strategy is to deliver tangible results and your Company has certainly achieved this over the reporting period. Botala Energy is now well-positioned to become a major supplier of natural gas and renewable energy in Southern Africa, having established itself as a first mover in Botswana's emerging CBM industry.

The foundation of our success has been a 42% increase in certified CBM resources at Serowe, growing our contingent resource base to 454bcf, with the potential to expand up to 7.1tcf as announced to the ASX on the 8 July 2024. This is a large increase from our initial estimates, reinforcing the scale and significance of our Serowe CBM Project. Coupled with high-purity gas desorption results of 94% methane and enhanced flow testing, we have now mapped the "sweet spot" across our 420,000 ha prospecting leases, paving the way for wellfield development and commercial production.

Pleasingly, we have now secured all environmental approvals required for the development of the Serowe gasfield, LNG production facilities, and energy hubs at Serowe and Leupane. This means that all material regulatory hurdles have now been cleared, providing a clear pathway to first revenue.

A significant milestone was our successful capital raise of A$1.87 million in October 2024, which was well-supported by shareholders and new investors, demonstrating confidence in our vision and execution strategy.

These funds are being predominantly applied to Pilot Project Pitse, our first commercial 5-well cluster, which is now mobilising for drilling. This pilot project is a key step towards establishing commercial gas flows, validating our wellfield design and de-risking the broader field development plan.

Commercial and Financial Milestones - Positioning for Growth

Beyond our exploration and technical successes, we have made substantial commercial progress. Our binding offtake negotiations with major South African industrial gas users are now in advanced stages, underpinning the economic viability of our Serowe CBM Project. Additionally, the January 2025 agreements with Novo Energy (refer ASX announcement dated 13 January 2025) and FFS Refiners (refer ASX announcement dated 20 January 2025) mark a significant step forward in developing a regional LNG supply chain.

The recent award of our Mining Licence further supports our transition towards commercial production. As part of this strategy, discussions are underway with potential farm-in partners to acquire up to 30% equity in the CBM project, allowing us to accelerate growth while minimising capital exposure.

At the core of our development plans is the Bankable Feasibility Study (BFS), which commenced in January 2025 and is progressing well. This independent study will specify the scope, nature, risks and contingencies of commencement of commercial CBM production and is a key step in securing project financing.

Clear Roadmap to First Commercial Gas

Looking ahead, the next 12 months will be transformational as we work towards first commercial gas production at Serowe. Our pathway to development includes:

• Drilling and commissioning Project Pitse's first five-well cluster.
• Obtaining and concluding binding offtake agreements for Phase 1 production.
• Expanding commercial agreements with Offtakers.
• Securing a high-quality farm-in partner to support project financing.
• Completion of the BFS, Field Development Plan (FDP) and financial model validation.
• Obtaining and finalising full-scale project financing for Phase 1.
• Initiating full project development subject to securing funding.

2

Botala Energy Ltd

Directors' Report

Chairman's Letter - Half-Yearly Report (continued)

We appreciate the continued support of our shareholders, stakeholders and local communities, who are all integral to our success. The next phase of growth and execution is now underway and we look forward to delivering significant value as we transition to the development stage.

Kindest regards,

Dr. Wolf Martinick

Executive Chairman, Botala Energy Ltd

3

Botala Energy Ltd

Directors' Report

Review of Operations

The Directors present their report, together with the financial statements, on the consolidated entity ('Group') consisting of Botala Energy Ltd ('Botala', the 'Company' or 'parent entity') and the entities it controlled at the end of, or during, the half-year ended 31 December 2024.

Directors

The following persons were Directors of Botala Energy Ltd during the whole of the financial period and up to the date of this report, unless otherwise stated:

The Directors have been in office since the start of the financial year to the date of this report. Mr Kris Francis Martinick is the Company's CEO.

Principal activities

The principal activities of Botala during the period were focused on coal-bed methane (CBM) exploration and development of renewable energy.

No significant changes to the nature of Botala's principal activities occurred during the financial period.

Dividends

There were no dividends paid, recommended or declared during the current or previous financial period.

Review of operations

The loss for the Group after providing for income tax amounted to $1,405,320 (31 December 2023: $990,679).

A review of Botala's operations during the financial period, and the results of those operations, is as follows:

Significant Resource Expansion in Serowe CBM Project

Botala achieved a major resource milestone with a 42% increase in Contingent Resources, boosting the certified CBM volume (refer to ASX announcements dated 8 and 10 July 2024). This resource growth, independently validated by Sproule, resulted from enhanced mapping techniques and exploration drilling, demonstrating a robust potential to meet Southern Africa's energy needs as demand for natural gas grows. The additional resources support Botala's goal to transition from exploration to becoming a primary supplier of gas in Botswana, and ultimately, to the Southern African Power Pool.

Serowe Solar Project Award and Community Engagement

The Botswana Power Corporation awarded Botala's consortium a tender for a 4MW solar power project within Botala's Serowe Energy Hub, marking a significant leap in Botala's renewable energy agenda. This project will be seamlessly integrated with the 20MW hybrid gas-solar setup planned for the Serowe Hub. Additionally, the project is committed to reinvesting in the local community by directing 1% of revenues toward social programs in Serowe, promoting local employment, and advancing sustainable development.

Gas Quality Enhancements through High Purity and Efficient Desorption

Gas desorption and composition testing at the Serowe CBM Project revealed an exceptional methane purity of up to 94%, with low levels of carbon dioxide and trace impurities, such as H2S. These quality parameters not only ensure Botala's gas meets high-efficiency standards but also enhance the commercial value of the gas. Such results affirm Botala's choice to pursue a coal-bed methane (CBM) project that aligns with cost-effective, sustainable development goals.

4

Botala Energy Ltd

Directors' Report

Environmental Milestone: Approval for Leupane Energy Hub

Botala secured environmental approval for the development of the Leupane Energy Hub and Industrial Park, a central component in Botswana's evolving energy landscape. This 1,520-hectare hub near Palapye will eventually house a 500MW solar project and a 200MW gas-fired power facility, establishing it as a key regional energy supplier. Initial development will involve a 250MW solar project in collaboration with AAAS Energy BV. The approval enables Botala to move forward with infrastructure that will position Leupane as a sustainable, mixed energy solution.

Completed Feasibility and Concept Studies for Wellfield and Distribution

The feasibility study for the Serowe wellfield confirms the project's economic potential, with detailed analysis covering well design, infrastructure, and environmental factors. The study projects a viable commercial pathway, beginning with a five-well pilot cluster capable of generating up to 10MW of electricity. Downstream options include gas compression, liquefaction (LNG), and integration into hybrid power generation facilities. The commercial feasibility of these options is promising, with anticipated positive internal rates of return (IRR) even at lower flow rates, positioning Botala to meet growing regional demand for natural gas.

Environmental Impact Approval for Serowe CBM Project

On 7 October 2024, Botala announced that it had received Environmental Impact Approval for its Serowe CBM Project. This approval is a significant milestone, clearing a major regulatory hurdle and allowing the Company to proceed with its development plans. The approval underscores Botala's commitment to sustainable operations and environmental compliance.

All environmental approvals are now in place for development of the Serowe CBM Project including:

• Serowe gasfield.
• LNG production facilities.
• Energy hubs in Serowe and Leupane.
• Pipeline from the gasfield to Leupane.

The Serowe CBM Project represents a major opportunity to supply natural gas to both domestic and regional markets, particularly as South Africa faces an impending gas shortage.

The environmental approval aligns Botala with its long-term strategy of becoming a key energy supplier in Southern Africa.

Successful A$1.87 million Capital Raising

On 23 October 2024, Botala successfully completed a capital raising via a placement to raise $1.87 million. The funds will be used to advance exploration and development activities at the Serowe CBM Project and support the Company's ongoing operations.

This placement was well-supported by existing shareholders and new investors, reflecting confidence in Botala's strategy and the growing recognition of the Serowe CBM Project's potential to address regional energy needs.

Annual General Meeting and Shareholder Support

On 28 November 2024, Botala held its Annual General Meeting, where all resolutions were passed by poll. This strong shareholder endorsement demonstrates confidence in the Company's leadership and future plans.

Key resolutions included the re-election of a director, approval of the Company's remuneration report, and the ratification of prior share placements. These approvals provide the Company with the flexibility to continue its exploration and development activities, whilst pursuing strategic partnerships.

5

Botala Energy Ltd

Directors' Report

TENEMENT DIRECTORY AT 31 DECEMBER 2024

The following tenements (collectively, Serowe CBM Project) are held by Sharpay Enterprises (Pty) Ltd in which Botala has a 100% legal interest and is Operator. All tenements are in good standing.

(Total KM2 as at 31 December 2024)

The Serowe CBM Project is located in the Karoo-Kalahari Basin of Central Botswana.

Significant changes in the state of affairs

There were no significant changes in the state of affairs of the Group during the financial period.

Matters subsequent to the end of the financial period

The following matters were announced to the market subsequent to the end of the period:

• 13 January 2025 - Botala and Novo Energy to build regional LNG supply chain.
• 20 January 2025 - Botala signs strategic term sheet with FFS Refiners to address Southern Africa's gas crisis.
• 28 February 2025 - 18,707,000 founder options expired/(unexercised).
• 5 March 2025 - Serowe CBM Mining Licence Granted.

No other matter or circumstance has arisen since 31 December 2024 that has significantly affected, or may significantly affect the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.

Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this Directors' report.

This report is made in accordance with a resolution of Directors, pursuant to section 306(3)(a) of the Corporations Act 2001. On behalf of the Directors

Wolf Gerhard Martinick

Executive Chairman

12 March 2025

6

Botala Energy Ltd

Contents

31 December 2024

General information

The financial statements cover Botala Energy Ltd as a Group consisting of Botala Energy Ltd and the entities it controlled at the end of, or during, the half-year. The financial statements are presented in Australian dollars, which is Botala Energy Ltd's functional and presentation currency.

Botala Energy Ltd is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business are:

A description of the nature of the Group's operations and its principal activities are included in the Directors' report, which is not part of the financial statements.

The financial statements were authorised for issue, in accordance with a resolution of Directors, on 12 March 2025.

8

Botala Energy Ltd

Condensed consolidated statement of profit or loss and other comprehensive income

For the half-year ended 31 December 2024

The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the

accompanying notes

9

Botala Energy Ltd

Condensed consolidated statement of financial position

As at 31 December 2024

The above consolidated statement of financial position should be read in conjunction with the accompanying notes

10