Mr. Philip O'Quigley reports

FALCON OIL & GAS LTD. - FARM-IN CARRY COMMITMENTS

Falcon Oil & Gas Ltd. subsidiary Falcon Oil & Gas Australia Ltd.'s joint venture partner, Tamboran (B2) Pty. Ltd., has given notice that the 2014 farm-in commitments have now been met, having reached the associated cost carry commitment of $264-million (Australian).

Falcon Australia has been carried by its partners, formerly Origin Energy and more recently Tamboran, since 2014 through the drilling and testing of five vertical wells and three horizontal wells. The wells have delivered key information of the continuous nature and productivity of the Amungee member B shale across the Beetaloo subbasin in Northern Territory, Australia. The gross carry of $264-million (Australian) was in addition to the uncapped carry for stage 1 of the three-stage work program, which amounted to approximately $85-million (Australian), with total spend in the Beetaloo subbasin to date by Falcon Australia's current and previous joint venture partners totalling $349-million (Australian).

Falcon Australia benefits from an additional carry-on future well costs of up to $30-million (Australian) ($6.75-million (Australian) net to Falcon Australia split between 2023 and 2024) under the terms of the binding letter of intent as announced on Oct. 11, 2022, when Tamboran acquired Origin Energy B2 Pty. Ltd.'s participating interest in the exploration permits.

Falcon also has optionality in respect of its exposure to future activity within the exploration permits and is able to elect to participate up to 22.5 per cent on future wells following the introduction of drilling spacing units (DSUs) (formerly referred to as proration units) on sole risk operations as part of the binding letter of intent announced on Oct. 11, 2022. Wells drilled outside of an existing DSU establish a new DSU. The size of the DSU varies depending on: (a) the type and length of the well to be drilled; and (b) whether or not the well is classified as a commitment well under the terms of the exploration permit. A non-commitment well creates a DSU to a maximum of 6,400 acres while a commitment well creates a DSU to a maximum of 25,600 acres. This flexibility ensures that Falcon Australia can tailor its participation in each proposed well to best preserve its capital while at the same time maximizing exposure to the development of the Beetaloo subbasin.

Falcon's group bank balance as of Aug. 24, 2023, was $15.3-million (U.S.) and thus it remains in a strong financial position.

About Falcon Oil & Gas Ltd.

Falcon Oil & Gas is an international oil and gas company engaged in the exploration and development of unconventional oil and gas assets, with the current portfolio focused in Australia, South Africa and Hungary. Falcon Oil & Gas is incorporated in British Columbia, Canada, and headquartered in Dublin, Ireland, with a technical team based in Budapest, Hungary.

Falcon Oil & Gas Australia is an approximately 98-per-cent subsidiary of Falcon Oil & Gas.

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