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Northcote Energy Ltd / Index: AIM / Epic: NCT / ISIN: VGG6622A1057 / Sector:Oil & Gas 6 December 2013 Northcote Energy Ltd (`Northcote' or `the Company') Low Cost Acquisition & Farm-Out of the Producing East Blackwell Skinner Sand Unit, Oklahoma Northcote (AIM: NCT), an onshore US oil and gas exploration and productioncompany, is pleased to announce that it has acquired a 100% Working Interest(`WI') in the East Blackwell Unit (`East Blackwell') in Kay County, Oklahoma.Concurrently, the Company has agreed terms for the farm-out of a 20% interestin East Blackwell, in line with its strategy to significantly increase futureproduction and reserves while at all times actively managing development costsand risk. * Northcote's net US oil and gas acreage is now over 6,058 including 4,496 net acres in Oklahoma and over 1,562 in Texas a 1300% increase from 462 net acres at IPO * Acquired 100% working interest (75% Net Revenue Interest) in 520 gross acres for total cash consideration of US$120,000 - includes five new drilling locations * Agreed farm-out terms where a third party will earn a 20% WI (15% NRI) in East Blackwell for a total consideration of US$75,000 - effectively funding Northcote's initial share of first phase development costs * Acreage held by production giving discretion as to when work is performed * East Blackwell's strength exists in its future development upside: * + Near term - field initiatives to improve production and operating efficiency + Mid term - new well targeting the lower skinner sands + Longer term - Enhanced Oil Recovery campaigns on existing and new wells Northcote's Chief Executive Officer Randall Connally said "The East BlackwellSkinner Sand Unit acquisition is an extension of our activities in and aroundOsage County, Oklahoma and will be added to the portfolio of propertiesoperated by Northcote. The speed and terms of the agreed farm-out, in our view,provide third party confirmation of the potential of East Blackwell which isheld by production thereby allowing us to schedule development to best suit ourresources. The addition of up to five new drilling locations in a field thathas averaged about 39,000 barrels of oil per well from shallow wells that canbe drilled and completed for approximately US$500,000 each fits our objectiveof adding low cost, oily upside for Northcote shareholders." East Blackwell Northcote Energy Limited is pleased to announce the acquisition of the EastBlackwell Skinner Sand Unit in Kay County, Oklahoma for US$120,000. AfterFarm-out Northcote's interest in the East Blackwell Skinner Sand Unit includes520 gross acres with an 80% WI (60% NRI) that are held by production from twowells. The East Blackwell Skinner Sand Unit has historically produced approximately391,000 cumulative barrels from 10 productive wells to date. The fieldcurrently produces a stable 3 barrels per day from 2 wells. Northcote intends to drill and complete up to five additional wells targetingthe upper and lower Skinner Sands and the unit has excellent longer termpotential as a waterflood. The funding of these future wells is at theCompany's discretion and any investment will be subject to partnering or theavailability of non-dilutive capital. The unit is held by production and,therefore, the work programme is at Northcote's discretion. In the near termNorthcote will take steps to increase production rates from the two producingwells and improve the efficiency of the water disposal system to support longerterm development drilling. Northcote will serve as operator of the unit and theCompany looks forward to providing shareholders with an update as workcommences at East Blackwell. Northcote has concurrently agreed the terms of a farm-out of a 20% WI and 15%NRI in East Blackwell for a total consideration of US$75,000. This is comprisedof US$60,000 with regards to the lease acquisition and a further US$15,000towards Northcote's share of costs associated with the first development phase,which comprises field initiatives to improve production and operatingefficiency. Competent Persons All of the technical information, including information in relation to reservesand resources that is contained in this announcement has been reviewedinternally by the Company's Technical Director, Mr. Kevin Green. Mr. KevinGreen is a Petroleum Geologist who is a suitably qualified person with over 30years' experience in assessing hydrocarbon reserves and has reviewed therelease and consents to the inclusion of the technical information. Glossary `BOPD' means barrels of oil per day `BOE' means barrels of oil equivalent: a unit of energy based on theapproximate energy released by burning one barrel (42 US gallons or 158.9873litres) of crude oil. There are 42 gallons (approximately 159 litres) in onebarrel of oil, which will contain approximately 5.8 million British ThermalUnits (MBtus) or 1,700 kilowatt hours (kWh). The value is necessarilyapproximate as various grades of oil have slightly different heating values.BOE is used by oil and gas companies in their financial statements as a way ofcombining oil and natural gas reserves and production into a single measure. `BOEPD' means barrels of oil equivalent per day `MCF' means thousand cubic feet **ENDS** For further information visit www.northcoteenergy.com, see below or contact thefollowing: Randy Connally Northcote Energy Ltd +01 214 675 7579 Ross Warner Northcote Energy Ltd +44 7760 487 769 Dan Jorgensen Northcote Energy Ltd +44 20 7024 8391 Roland Cornish Beaumont Cornish Ltd +44 20 7628 3396 Jerry Keen Shore Capital Stockbrokers Limited +44 20 7408 4090 Bidhi Bhoma Shore Capital Stockbrokers Limited +44 20 7408 4090 Stefan Olivier Cornhill Capital Limited +44 20 7710 9618 Hugo de Salis St Brides Media and Finance Ltd +44 20 7236 1177 Elisabeth Cowell St Brides Media and Finance Ltd +44 20 7236 1177 Notes: Northcote Energy Ltd is a revenue generative US onshore oil and gas productioncompany focussed on the rapidly emerging Mississippi Lime formation inOklahoma. The Company participates with leading operators, including MidstatesPetroleum and Chesapeake Energy, in low risk development plays where advancedtechniques, such as horizontal drilling and fracing, are used to unlock knownoil accumulations and dramatically improve recovery rates. Management isfocused on increasing production through a multi-well drilling and fracingcampaign in 2013.