Mr. Chayan Chakrabarty reports

BENGAL ENERGY ANNOUNCES OPERATIONAL UPDATE WITH RECORD PRODUCTION AND EXPANDS DRILLING PROGRAM

Four of Bengal Energy Ltd.'s 2014 phase 1 Cuisinier oil wells have been tied in and are producing, resulting in an additional preliminary gross production rate of approximately 1,100 barrels of oil per day or 334 bopd net to Bengal. Bengal's current total net production is approximately 650 bopd from Cuisinier, representing an 80-per-cent increase over the first quarter fiscal 2015 average production rate. Cuisinier is situated within petroleum lease PL 303 of Barta subblock, Cooper basin, southwest Queensland, Australia, where Bengal holds a 30.357-per-cent working interest. In light of the high-quality oil produced at Cuisinier, Bengal's production commands a premium price over the Brent benchmark and contributes to industry-leading operating netbacks.

"We are very pleased with the success of our 2014 phase 1 drilling program to date," said Chayan Chakrabarty, Bengal's president and chief executive officer. "Not only have we significantly increased our production relative to the first quarter of fiscal 2015, but we have also set a new production record for Bengal. With this higher production rate, coupled with strong netbacks, we are very well positioned to generate attractive cash flows. This cash flow stream will support our recently expanded phase 2 drilling program, which features plans to drill up to nine additional wells in Cuisinier in the coming six months. We look forward to keeping our shareholders updated as we undertake the next phase of development within this exciting, high-value asset."

Expanded Cuisinier drilling program

As a result of the successful phase 1 drilling campaign, the Barta joint venture is considering the expansion of the phase 2 Cuisinier drilling campaign, which is expected to commence in November, 2014. The expanded program would be composed of two development and three appraisal wells in the Cuisinier field, with the JV considering an additional two to three wells in and around PL 303 based on the results of the initial five-well program. The proposed expansion of the phase 2 drilling campaign is a reflection of the success realized in phase 1, which has provided valuable information that has enabled the JV to high-grade subsequent locations with a view to enhancing productivity and expanding the boundaries of the pool.

The drilling campaign will also include one exploration well (Wicho East-1) in ATP 752P -- Barta subblock. The Wicho East prospect is approximately eight kilometres northeast of PL 303, and it will target oil in sands within the basal Jurassic and Hutton sequences.

Operational update

Cuisinier operations

In late July, 2014, the operator of the JV (Santos Ltd.) upsized the pump in the Cuisinier-7 well, which has resulted in an initial 71-per-cent increase in incremental gross production of 210 bopd, calculated on a stream day basis. The Cuisinier-7 well averaged approximately 295 bopd in July and increased to 504 bopd during the month of August. In addition, the JV is currently planning a hydraulic stimulation review for certain candidate wells within the field. To date, none of the Cuisinier wells have been stimulated, which represents future optimization opportunities for the JV.

In addition, the company and JV are planning to commence remediation work in the very near term to address the previously announced unexpected production declines that have been observed from Cuisinier-6, due to an increase in water cut. The operator plans to conduct production logging in the well to determine the source of the water, followed by the implementation of an appropriate remediation strategy.

Wompi exploration well

In the Wompi subblock (ATP 752 -- working interest of 38 per cent), the JV is planning to drill one exploration well in calendar fourth quarter 2014 targeting the Birkhead, Westbourne and Adori formations, with such formations being known to produce in the offsetting Bowen field, located immediately north of the proposed location. Wompi offers Bengal moderate risk exploration in a well-established, oil-producing fairway, offering multizone potential.

Tookoonooka exploration well

In Bengal's Tookoonooka permit (ATP 732 -- working interest of 50 per cent), which is located in the emerging East Flank oil fairway of the Cooper basin, the company is partnered with Beach Energy Ltd. Beach completed the acquisition of 300 square kilometres of 3-D seismic over Tookoonooka in February, 2014, with data processing currently under way. Subject to the seismic interpretation, the second farm-out exploration well is planned for early calendar 2015.

Onshore India

As previously announced, in Bengal's onshore India block situated within the Cauvery basin (CY-ONN-2005/1 -- 30-per-cent working interest), the company continues to co-ordinate with its partners, Gas Authority of India Ltd. and Gujarat State Petroleum Corp., for the drilling of three exploration wells. The commencement of this exploration drilling program has been delayed as GAIL, the operator, continues to negotiate with various stakeholders and government bodies that provide the necessary approvals to proceed. The drilling of the first of three exploration wells is, at the earliest, expected to commence following the monsoon season in calendar second quarter 2015.

Bengal also advises that an updated presentation will be posted on the company's website on Oct. 8, 2014, containing additional information about its operations and strengthened financial position.

We seek Safe Harbor.