Company Information for Cove Energy Plc

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AIM; COV

Company Statement

Cove Energy is an AIM listed oil and gas company with a strategy to identify and acquire oil and gas assets in the early phase of the upstream life-cycle and mature them into marketable opportunities for the medium and larger oil and utility companies.

The Company’s initial focus is on Africa and the Mediterranean. Current operations include the Mecupa-1 well in the Onshore Rovuma Block in northern Mozambique, where Cove has a conditional farm in agreement with Artumas to acquire a 10% participating interest in the Exploration and Production Concession Contract (“EPCC”) covering the Rovuma Onshore Area.

In addition Cove, again in northern Mozambique, has a conditional farm in agreement with Artumas to acquire an 8.5% interest in the EPCC covering Area 1 Offshore of the Rovuma Block. A four well programme is planned through to end 2010 and the first prospect is planned to spud by early December 2009. The Belford Dolphin drillship is already in country and preparing to drill and set surface casing for the first two locations.

Anadarko Petroleum Corporation is the Operator of both Mozambique EPCCs.

Cove Energy has also acquired from Artumas a 16.38% interest in all operations other than exploration operations (including petroleum operations) and a 20.475% interest in the exploration operations in the Tanzanian Mnazi Bay concession, including the Mnazi Bay Production Sharing Contract which contains the Mnazi Bay and Msimbati gas fields. This transaction was completed with Maurel and Prom, with Maurel and prom taking over operatorship from Artumas.

The Company operates with a minimum level of staffing but with a larger experienced “virtual” skills-pool from where it can draw on relevant experience on a case-by-case basis. The Company intends to partner and joint venture with investors and associates who will support Cove Energy with commercial skills and influence in areas where the Company intends to grow its business.

Cove Energy has a strong management team with a wealth of experience in oil and gas operations. Michael Blaha, Non-Executive Chairman and formerly Country Chairman for Royal Dutch Shell Group in Algeria, is a Petroleum Engineer with twenty nine years industry experience, his entire career spent working at Shell. John Craven, Chief Executive Officer and formerly founder and until recently CEO of Petroceltic International plc, is a petroleum geologist with thirty five years experience in senior technical and commercial roles in upstream oil and gas exploration and production companies.

Operations and Technology

Cove Energy announced on 18 September 2009 that it was acquiring assets in Mozambique and Tanzania from Artumas Group (“Acquisitions”). The Company has entered into conditional agreements with Maurel & Prom and the Artumas Group to acquire the Mozambique Assets and Tanzania Assets, for an aggregate total consideration of US$10,980,031 of which US$3,294,009 is payable by Cove Energy and US$7,686,022 by M&P.

In order to provide sufficient working capital for the Group, following the above acquisitions, it was also announced on 18 September 2009 that the Company is raising up to £42 million (before expenses) (equivalent to approximately US$68.2 million) by the issue of up to 210,000,000 New Ordinary Shares at a price of 20 pence per Ordinary Share. This Placing was approved by shareholders on 5 October 2009 and the shares were placed with institutional and other investors.

Background to and reasons for the Acquisitions

Transaction
On Completion of the Acquisitions, Cove Energy’s interests in the Mozambique Assets and the Tanzania Assets, will be as follows:

Tanzania, Mnazi Bay/Msimbati Gas Fields

Tanzania Producing Asset (16.38 per cent. participating interest); and
Tanzania Exploration Asset (20.475 per cent. participating interest).

Mozambique, Rovuma Offshore Area 1/Rovuma Onshore

Mozambique Onshore Asset (10 per cent. participating interest); and
Mozambique Offshore Asset (8.5 per cent. participating interest).

The Directors believe the Acquisitions are attractive for the following reasons and characteristics:

Artumas has announced it has already spent approximately US$200 million on the Assets;
Mnazi Bay/Msimbati Gas Fields are proven gas resources which the Directors believe, has potential for near term development and additional reserves;
Anadarko (NYSE-listed with approximately US$31 billion market capitalisation) is the operator of the Mozambique Assets;
significant exploration potential in the Mozambique Assets with the Rovuma emerging tertiary delta basin prospects already defined by newly acquired 2D and 3D seismic;
the parties to the Mozambique JOAs and Mozambique EPCs have collectively spent over US$160 million to date on the Mozambique Assets (including acquiring 3D seismic) and the acreage is now ready to be drilled;
in the Mozambique Offshore Asset, the 1st of 4 deep water wells is currently scheduled to be drilled around the end of 2009; one additional onshore well is currently being drilled having spudded in October 2009;
the Belford Dolphin rig has moved from Cote d’Ivoire to Mozambique;
the Board intends to pursue further appraisal and development options in Tanzania with M&P (CAC-listed with approximately A1.5 billion market capitalisation); and a low purchase price from a distressed seller.

Geographical Spread

East Mediterranean and Africa

Board of Directors and Key Management

Michael Blaha, Executive Chairman

Michael is a Petroleum Engineer with twenty nine years industry experience, his entire career spent working in the Royal Dutch Shell Group (”Shell”). He is currently Country Chairman for Shell in Algeria, prior to which he held the positions of Director External Relations for EP Africa from 2003-2005, Vice President EP for Russia (Salym, Sakhalin) from 2001 to 2003 and Vice President Iran (Soroosh and Nowrooz) from 1998 to 2001. Earlier in his Shell career he worked at the Shell head offices in The Hague from where he developed business in China, Iran and Russia. He has also held senior roles in the Philippines, Syria, Thailand and the UK. Mr Blaha has an MSc in Chemistry from Universiteit van Amsterdam.

John Craven, CEO

John is a petroleum geologist with thirty five years experience in senior technical and commercial roles in upstream oil and gas exploration and production companies. Prior to joining Cove Energy, he was founder and Chief Executive of AIM and IEX quoted, African and Mediterranean focussed, exploration company, Petroceltic International plc (”Petroceltic”). Petroceltic grew under his direction and stewardship to a business with a diversified portfolio of exploration and appraisal projects in Italy, Algeria and Tunisia. Mr Craven has an MSc in Petroleum Geology from the Royal School of Mines in London and an MBA from Queens University in Belfast.

Michael Nolan, Finance Director

Michael Nolan is a Chartered Accountant and has worked with Deloitte & Touche in Dublin. He is currently executive chairman of Vancouver-based, Rathdowney Resources Limited, a private natural resource company, operating in Ireland and supported by the Hunter Dickinson Group. He acted as chief executive officer of AIM-listed, mining company, Minmet Plc from 1999 to August 2007. He also serves on the board of several resource exploration and investment companies. Mr Nolan was re-appointed to the Board on 13 September 2009.

Ivan B. Murphy, Non-Executive Director

Ivan is currently a senior executive with Gazprombankinvest, an investment bank owned by Gazprom and Quantic. Gazprom (www.gazprom.com) is the world’s largest gas company basically focused on geological exploration, production, transmission, storage, processing and marketing of gas and other hydrocarbons. Quantic is a group comprising various companies created with the intention of forming the core of an oil organization active in all levels of activities traditionally associated with companies present in this sector – production, trading, refining, distribution and financing (www.quanticoil.com). He has a degree in Economics from University College Cork, Ireland and has 15 years experience in capital markets. He started his career at Aberdeen Asset Management PLC the FTSE 250 listed global investment manager. He worked with Aberdeen in London, Miami and Singapore before returning to Ireland to become Managing Director of Aberdeen Asset Management Ireland Limited. In 2003 he left Aberdeen to work as a consultant to a number of Irish and UK plc’s assisting them in the disposal of asset management and life insurance assets. In 2005 he was one of the founders of Fairfax PLC a London based investment bank that listed more than 12 investment companies on AIM and the main market of the LSE, raising more than US$1 billion of equity from institutional clients. At Fairfax, he focussed on origination and developing the business in the Far East. After leaving Fairfax in 2008 he acted as a consultant to US and Ireland based property developer Shelbourne Developments negotiating with potential partners in China and the Middle East on the financing and construction of the Chicago Spire project.

Company Address

22 Grafton Street
London, United Kingdom W1S 4EX


Website:	http://www.cove-energy.com

Additional Address/Key Contact

DUBLIN REPRESENTATIVE OFFICE
18 FITSWILLIAM PLACE
DUBLIN 2
TEL +353 1 662 4351

Capital

Shares in Issue - 268,348,334

Annual General Meeting

April 2010

Year End

31 December

Nominated Brokers

Cenkos Securities plc
6.7.8 Tokenhouse Yard
London EC2R 7AS
Tel: 0207 397 8900
Fax: 0207 397 8901

Nominated Advisors