SENDERO PETROLEUM LIMITED

RELINQUISHMENT REPORT

LICENCE P.1795

December 1, 2014

Relinquishment Report for Licence P.1795, Block 22/6b-Fox

1. Licence Information

Licence Number: P.1795

Licence Round: 26th Round – Awarded 10 January 2011

Licence Type: Traditional

Block Numbers: 22/6b

Operator: Sendero Petroleum Limited (100%)

Licence Work Program Summary

Sendero committed to obtain 50km of 2D seismic data, and to obtain and reprocess 150km2 of 3D seismic data. Following a conversation between Sendero and DECC on the 10th of December 2010, this was amended to obtain 50km of 2D seismic data, and to obtain and reprocess 81 km2 of 3D seismic data, as the licence offered only covered 81 km2. 2. Exploration Activities

In order to conduct a full evaluation of the exploration potential of the block, Sendero acquired the following 2D data, and acquired and reprocessed the following 3D data: Sendero purchased and reprocessed the Fugro Nelson North 3D seismic survey which is 302 sq km in size, and which covered the entire 81 sq km licence. Sendero purchased all of the available TGS long offset 2D of which 12 km was in the boundaries of the block. No other 2D data was available coincident with the block. No new wells were drilled on the block. The seismic purchased was coordinated to take advantage of local well control (Figure 1). The most significant local wells included 21/05b-1, 21/05b-5, 21/06b-1z, 22/01a-3, 22/01a-4, 22/01a-11, 22/01c-7, 22/01c-9, 22/06a-14, and 22/06b-13. Seismic and well data associated with the various analog pools were also incorporated into the prospectivity assessment of block 22/6b. 3. Prospectivity Analysis The 22/6b block is adjacent to the Jurassic Bacchus oil field, and is located north of and in close proximity to the Paleocene Forties and Nelson oil fields. It is also on trend and to the east of the Cretaceous Brodgar gas-condensate field, and south of the Paleocene Callanish and Enochdu, and Eocene Alba and Chestnut oil fields (Figure 2). The productive reservoir at Bacchus is the Fulmar sandstone. The Brodgar field produces from Early Cretaceous Britannia sandstone, the Forties and Nelson fields from the Paleocene Forties sandstone, and the Alba and Chestnut fields from Eocene Alba and Caran sandstones. These horizons were the focus of the evaluation for hydrocarbon potential for 22/6b.

Source and Migration Hydrocarbons for all zones were sourced from the Upper Jurassic Kimmeridge Clay, which is locally mature for oil and liquids rich gas (Figure 3). Basement seated graben edge fault systems served as vertical migration conduits, and lateral migration was assisted by the Forties and Britannia Sandstones which are regional aquifers. Reservoirs and Associated Top Seals The associated top seals for the reservoirs reviewed for potential are:

Jurassic Fulmar Sandstone: sealed by the Kimmeridge Clay Formation marine shale Cretaceous Britannia Sandstone: sealed by the Sola Formation marine shale Paleocene Forties Sandstone: sealed by the Sele Formation marine shale Eocene Alba and Caran Sandstones: sealed by the Caran and Nauchlan marine shales

Traps The principle trapping mechanisms for the Jurassic and Paleocene fields include 4 way structural closure and depositional pinchout, for the Cretaceous fields, depositional pinchout and structural reversal, and for the Eocene fields, stratigraphic trapping related to depositional containment and updip stratigraphic pinchout. Prospective Horizons Jurassic Fulmar Sand: The 22/6b block is offsetting and to the north of the producing Bacchus field in 22/6a. Hydrocarbons are trapped at Bacchus where Jurassic Fulmar sands are coincident with a local structural trapping feature. The 9.5 meters of Fulmar reservoir present in the 22/6a-14 Bacchus producing well confirms the local potential for reservoir at this horizon. However, away from well control, the risk associated with the seismic imaging of Fulmar sands is significant. This was confirmed by the 21/6a-7 well, which was drilled to evaluate a Fulmar prospect on licence P1048 (Figure 4). A summary of the opportunity was accessed from the relinquishment report submitted by Oilexco for the P1048 licence. The 21/6a-7 well encountered mostly Heather Formation claystone and mudstone where Fulmar reservoir had been predicted. For Block 22/6b, structural features capable of capturing economic volumes of hydrocarbon were not observed on the available seismic. Early Cretaceous Britannia Sand: As displayed by the Topographic Controls on Britannia Sand Distribution (Figure 5), sands local to the licence were sourced from the Inner Moray Firth and transported downwards along the confines of the South Halibut Basin to the Outer Moray Firth. Reservoirs were deposited as a series of turbidite flows. The distal edge appears to be positioned near the 22/6 block where the system intersects with the Fisher Bank Basin. Hydrocarbons generated from the underlying Kimmeridge Clay migrated through basement rooted graben edge fault systems into the overlying Britannia sandstone regional aquifer. The regional continuity of the aquifer from the wells in block 21/5, towards the west, is supported by the well control along the South Halibut Basin. Representations of the continuity are provided by the Britannia C Net Reservoir Thickness Map (Figure 6) and the Britannia Regional Cross-Section (Figure 7). The continuity of reservoir along the basin is further supported by the presence of gas and condensate trapped in the Goldeneye field in block 14/29, a distance of 80 Km west from where the Kimmeridge source is mature for light oil and gas in 22/1. Attempts to seismically confirm the presence of Britannia sand reservoir were unsuccessful. As gas and condensate were able to migrate along the Britannia sand system, and Britannia reservoir was identified in all reviewed wells from 14/29 to the eastern edge of the licence in 21/5, it was concluded that reservoir potential for

this fairway is directly related to the accommodation provided by the South Halibut Basin. However, to the east and south of the confirmed reservoir in 21/5 where the system intersected with the Fisher Bank Basin, and in the absence of seismic support, the risk of encountering limited or no reservoir for 22/6b was considered significant. Upper Paleocene Forties Sand: Hydrocarbons in the offsetting Forties field in block 21/10 and Nelson field in block 22/6 (Figure 2) were captured as a result of the coincidence of channel reservoirs and large scale horsts. Hydrocarbons located at Callanish in block 21/4 and Enochdu in block 21/5 (Figure 2) were trapped as a result of the drape of Forties aged channel deposits over low amplitude structures. Upper Paleocene sediments were sourced from the northwest and transported towards the southeast as submarine fan complexes. Depositional environments for the Forties Member for specific wellbores were established by relating core and log signature. As presented by the Petrophysical Facies Summary and Forties Depositional Model (Figure 8), five broad facies were defined. Based primarily on gamma ray signature, a constantly high API profile is interpreted to indicate lower fan, an erratic profile for an interchannel environment, and a constantly low API value indicative of channel sedimentation. The interpreted distribution of log defined facies is provided with the Forties Member Facies Summary Map (Figure 9). Based on the prediction of geological facies trends, the log signature indicating an interchannel depositional environment for the 22/6b-13 well, and the absence of a seismically defined channel, encouragement for the presence of channel facies reservoir for block 22/6b could not be supported. Paleogene level structures having the potential for the effective trapping of hydrocarbons were not observed on review of the seismic for the block. Eocene Alba and Caran Sand: During the Middle Eocene, sediments were transported as turbidites from the northwest creating the Alba and Caran sandstone reservoirs (Figure 10) now encountered in the area of block 22/6b. Locally, these sediments appear to have been deposited within existing scour features. For the offsetting Alba field in block 16/26, hydrocarbons were trapped laterally by the confines of the scour, and by the updip depositional pinchout. The reservoir is encapsulated by impermeable hemipelagic sediments. A profile of the trapping mechanism is provided by the structurally datumed cross-section of the Alba pool (Figure 11). The hydrocarbons were sourced from the Jurassic Kimmeridge clay, migrated upwards through graben edge basement faults, were transported updip along the Paleocene Forties aquifer, and accessed the isolated Eocene reservoirs through Forties derived injectites. A summary slide of reservoir, trap and source is provided (Figure 12). The seismic expression of the analogous Alba pool scour and fill compared favourably with a Caran level feature identified on the adjacent block 21/5b (Figure 13). Local boreholes that encountered Caran aged sands are identified on the Caran Reservoir Summary map (Figure 14), with examples provided by the Caran stratigraphic cross-section (Figure 15). As can be observed from figure 13, a target area for these reservoirs is positioned parallel to the western shoreface sediment source, and locally restricted to a corridor approximately 25 km wide. The 22/6b block is located east of the target area, and seismic character indicative of scour and fill was not observed on review of the available seismic for the Tertiary section. Neither Caran nor Alba aged reservoirs were encountered in the 22/6b-13 well. Evaluation Results Based on the internal evaluation, incorporating the newly acquired data, Sendero does not consider any of the prospective horizons to have a chance of success supportive of an economically viable location on licence P.1795. The licence has reached the end of the first 4 years of its life and no application to extend it will be submitted.

Clearance Sendero gives approval to BERR to publish material contained in this report. Figure 1

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