Cabot Energy Regulatory News (CAB)

Northern Petroleum Plc

("Northern Petroleum" or "the Company")

Subscription, Open Offer, Capital Reorganisation

and Notice of General Meeting

Northern Petroleum, the AIM quoted oil company focusing on production led growth, announces that a circular will be posted to shareholders today containing the details of the Subscription, Open Offer and Capital Reorganisation and the Notice convening a General Meeting ("the Circular"), as announced by the Company on 12 November 2015.

Capitalised terms in this announcement have the meanings given to them in the Circular, a copy of which will shortly be posted to shareholders and available from the Company's website at www.northernpetroleum.com.

Subscription

Pursuant to the Subscription Agreements, Cavendish Asset Management and City Financial have conditionally agreed to subscribe for the Subscription Shares raising £1.2 million in aggregate at a price of 3 pence per Subscription Share. Pursuant to the Cavendish Asset Management Subscription Agreement, Cavendish Asset Management will subscribe for 21,666,667 New Ordinary Shares, and pursuant to the City Financial Subscription Agreement, City Financial will subscribe for 18,333,333 New Ordinary Shares. The Subscription is conditional, inter alia, on the passing of the Resolutions and the Subscription Agreements becoming unconditional in all respects.

The Issue Price for the Subscription Shares represents a discount of approximately 14.3 per cent. to the middle market closing price per ordinary share of 3.5 pence on 11 November 2015, being the last business day prior to the publication of the Announcement.

The net proceeds of the Subscription will be used primarily to fund the Acquisition and the initial development of the assets being acquired pursuant to the Acquisition to increase production, as well as supporting the ongoing working capital requirements of the Company.

Open Offer

The Open Offer is for 40,000,000 Open Offer Shares at the Issue Price (being the same as the Issue Price for the Subscription) to raise up to £1.2 million (before expenses). Only Qualifying Shareholders on the Company's register of members as at the Record Date may participate in the Open Offer.

Subject to the fulfilment of the terms and conditions referred to in the Circular and, where relevant, set out in the Application Form, Qualifying Shareholders are being given the opportunity to apply for Open Offer Shares at a price of 3 pence per Open Offer Share, free of expenses, payable in full, in cash on application, on the basis of:

2 Open Offer Shares for every 5 Existing Ordinary Shares

registered in the name of each Qualifying Shareholder at the Record Date and so on in proportion for any other number of Ordinary Shares then held.

Qualifying Shareholders may apply for more or fewer Open Offer Shares than they are entitled to under the Open Offer and applications in excess of the Open Offer entitlements will be dealt with under the Excess Application Facility. If applications under the Excess Application Facility are received for more than the total number of Open Offer Shares available following take-up of Open Offer Entitlements, such applications will be scaled back pro rata to the number of Excess Shares applied for by Qualifying Shareholders under the Excess Application Facility.

Certain Qualifying Shareholders, who together own approximately 14.1 per cent. of the Existing Ordinary Shares and have participated in the Subscription, have undertaken not to subscribe for any Open Offer Shares in the Open Offer and their Open Offer Entitlements will be made available to Qualifying Shareholders under the Excess Application Facility. On the assumption that the Subscription is approved and the Open Offer is fully subscribed, Cavendish Asset Management, which currently owns approximately 10.9 per cent. of the Existing Issued Share Capital, will own approximately 18.3 per cent. of the Enlarged Issued Share Capital, and City Financial, which currently owns approximately 3.2 per cent. of the Existing Issued Share Capital, will own approximately 12.2 per cent. of the Enlarged Issued Share Capital.

To the extent that additional Open Offer Shares are not subscribed by existing Shareholders, Open Offer entitlements will lapse.

The Open Offer is conditional, amongst other things, upon Admission of the Subscription Shares and the Open Offer Shares becoming effective by not later than 8:00 a.m. on 10 December 2015 (or such later time and/or date as the Company may agree, being not later than 8:00 a.m. on 17 December 2015). Accordingly, if such conditions are not satisfied, or, if applicable, waived, the Open Offer will not proceed and any Open Offer Entitlements admitted to CREST will thereafter be disabled.

Capital Reorganisation

The Existing Issued Share Capital consists of 95,365,660 Existing Ordinary Shares which are currently in issue and credited as fully paid up.

The New Ordinary Shares proposed to be issued pursuant to the Subscription and the Open Offer are proposed to be issued at the Issue Price, which represents a discount of 14.3 per cent. to the closing midmarket price of an Existing Ordinary Share of 3.5 pence on 11 November 2015 (being the last practicable date prior to the publication of the Announcement).

Under the provisions of section 580 of the Companies Act, the Company may not allot shares at a price which is less than the nominal value of those shares. To enable the Company to proceed with the Subscription and the Open Offer, the Company's Existing Ordinary Shares will therefore need to be sub-divided and re-designated as described below and in the Notice of the General Meeting contained in the Circular.

Details of the Capital Reorganisation

Pursuant to the Capital Reorganisation, it is proposed that each Existing Ordinary Share with a nominal value of 5 pence be sub-divided and re-designated into one New Ordinary Share of 1 penny and one Deferred Share of 4 pence. Immediately following the Capital Reorganisation, every Shareholder will hold one New Ordinary Share and one Deferred Share for every Existing Ordinary Share currently held by them. A Shareholder's pro rata entitlement to Open Offer Shares will not be affected by such subdivision and re-designation. The Capital Reorganisation should not affect the market value of a Shareholder's aggregate holding of the Existing Ordinary Shares in the Company.

It is proposed that each New Ordinary Share will carry the same rights in all respects as each Existing Ordinary Share does at present, including the rights in respect of voting and the entitlement to receive dividends. Each Deferred Share will have very limited rights and will effectively be valueless. Such shares will have no voting rights, no rights to receive dividends and will have only very limited rights on a return of capital. The Deferred Shares will not be admitted to trading on AIM or listed on any other stock exchange and will not be freely transferable.

The Company does not propose to issue new share certificates to the existing Shareholders as a result of the Capital Reorganisation. The existing share certificates which have been issued to the Shareholders in respect of their holdings of Existing Ordinary Shares will remain valid in respect of the New Ordinary Shares.

CREST accounts of Shareholders will not be credited in respect of any entitlement to Deferred Shares.

Amendment to the Existing Articles

As part of the Capital Reorganisation, the Company proposes to make consequential amendments to its Existing Articles to include provisions in respect of the Deferred Shares.

The Capital Reorganisation is conditional on the approval of the Shareholders at the General Meeting.

The expected timetable of principal events in relation to the Subscription, Open Offer and Capital Reorganisation, as first announced by the Company on 12 November 2015 is as set out below.

The dates and timing of the events in the above timetable may be subject to change at the absolute discretion of the Company. If any of the above times or dates should change, the details of the revised times and / or dates will be notified to AIM and, where appropriate, to shareholders.

General Meeting

The General Meeting will be held at the offices of Eversheds LLP, One Wood Street, London EC2V 7WS at 12:00 p.m. on 3 December 2015 for the purpose of considering and, if thought fit, passing the resolutions, with resolutions 1 and 2 being proposed as ordinary resolutions and resolutions 3 and 4 being proposed as special resolutions of the shareholders of the Company. The resolutions to be proposed at the General Meeting are the following:

Resolution 1 - Capital Reorganisation

Resolution 1 will be proposed as an ordinary resolution of the Company and is conditional on the passing of Resolution 3, below. Pursuant to the Capital Reorganisation, it is proposed that each Existing Ordinary Share with a nominal value of 5 pence is sub-divided and re-designated into one New Ordinary Share of 1 penny and one Deferred Share of 4 pence.

Resolution 2 - Authority to allot New Ordinary Shares

Resolution 2 will also be proposed as an ordinary resolution of the Company. The Directors will be seeking authority in accordance with section 551 of the Companies Act to allot:

(a) equity securities up to a maximum aggregate nominal amount of £800,000 being 80,000,000 New Ordinary Shares (being the maximum required for the purposes of issuing the Subscription Shares and the Open Offer Shares) and representing approximately 83.9 per cent. of the Existing Issued Share Capital of the Company. This authority will expire immediately following Admission; and

(b) after allowing for the issue of up to 80,000,000 New Ordinary Shares to be issued pursuant to the Subscription and the Open Offer, a further 58,455,220 New Ordinary Shares (representing one third of the Company's Enlarged Share Capital) (assuming full take-up of the Open Offer). This authority will expire 15 months from the date of passing of the resolution or, if earlier, at the conclusion of the next annual general meeting of the Company,

such authorities to apply in substitution for all other authorities dealing with the subject matter of this resolution 2.

Resolution 3 - Amendments to Existing Articles

Resolution 3 will be proposed as a special resolution to enable the Directors to make consequential amendments to the Existing Articles in order to include provisions in respect of the Deferred Shares and is conditional on the passing of resolution 1, above. The Deferred Shares will have no voting rights, no rights as to dividends and only very limited rights on a return of capital.

Resolution 4 - Disapplication of pre-emption rights

The provisions of section 561(1) of the Companies Act to the extent that they are not disapplied, confer on shareholders rights of pre-emption in respect of the allotment of equity securities which are, or are to be paid up, wholly in cash. It is proposed that the level of the general disapplication of statutory pre-emption rights previously available to the Directors (approximately 10 per cent. of the Company's Existing Issued Share Capital) be maintained following the Subscription and the Open Offer.

Resolution 4 will therefore be proposed as a special resolution to disapply statutory pre-emption provisions in connection with:

(a) the allotment of up to 80,000,000 equity securities pursuant to the Subscription and the Open Offer;

(b) rights or other pre-emptive issues; and

(c) any other issues of equity securities for cash which do not, in aggregate, exceed a nominal value of £175,000, being 17,500,000 New Ordinary Shares,

such authorities to apply in substitution for all other authorities dealing with the subject matter of this resolution 4.

Recommendation and voting intentions

The Board considers the Subscription, Open Offer and Capital Reorganisation to be in the best interests of the Company and its Shareholders as a whole. While the completion of the Acquisition is only subject to the financing of the cash consideration of Cdn$0.25 million, and the Company had an unaudited cash balance of approximately US$1.6 million as at 30 September 2015, if the Subscription is not approved by shareholders, sufficient funding will not be available to the Company to undertake the initial work programme on the Rainbow Assets and therefore the Company will choose not to complete the Acquisition and will need to look for alternative sources of finance to support the Company during 2016.

The Directors, having consulted with the Company's Nominated Adviser, Westhouse Securities Limited, consider that the participation of Cavendish Asset Management in the Subscription is fair and reasonable insofar as the Shareholders are concerned. Accordingly, the Board unanimously recommends that Shareholders vote in favour of the Resolutions, as all of the Directors intend to do in respect of their beneficial holdings amounting, in aggregate, to 710,082 Ordinary Shares representing approximately 0.7 per cent. of the Existing Issued Share Capital as at the date of this announcement.

For further information please contact:

Northern Petroleum Plc Tel: +44 (0)20 7469 2900

Keith Bush, Chief Executive Officer

Nick Morgan, Finance Director

Westhouse Securities Limited (Nomad and Joint Broker) Tel: +44 (0)20 7601 6100

Alastair Stratton

Robert Finlay

David Coaten

This announcement is for information purposes only and is not intended to and does not constitute or form part of any offer to sell or subscribe for or any invitation to purchase or subscribe for any securities in any jurisdiction pursuant to the Open Offer or otherwise. The Open Offer will be made solely pursuant to the terms of the Circular, which will contain the full terms and conditions of the Open Offer. Any decision in respect of, or other response to, the Open Offer should be made only on the basis of the information contained in the Circular. This announcement does not constitute a prospectus or a prospectus equivalent document.

The availability of the Open Offer, and the release, publication or distribution of this announcement, in jurisdictions other than the United Kingdom may be restricted by the laws of those jurisdictions. In particular, the Open Offer will not be made directly or indirectly in any Restricted Jurisdiction. Therefore persons into whose possession this announcement comes should inform themselves about and observe any applicable restrictions. Failure to comply with any such restrictions may constitute a violation of the securities laws of any such jurisdiction. Shareholders who are in any doubt regarding such matters should consult an appropriate independent adviser in the relevant jurisdiction without delay. To the fullest extent permitted by applicable law, the Company disclaims any responsibility or liability for the violation of such restrictions by any person. The Open Offer is not being, and will not be made, directly or indirectly, in or into or from, whether by the use of mails or any means of instrumentality (including, without limitation telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, any Restricted Jurisdiction and the Open Offer should not be applied for by any such use, means, instrumentality or facility from or within any Restricted Jurisdiction. Accordingly, copies of this announcement and any documentation relating to the Open Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from whether by the use of mails or any means of instrumentality (including, without limitation telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, any Restricted Jurisdiction. Persons receiving this announcement (including without limitation custodians, nominees and trustees) must not forward, mail or otherwise distribute or send it in, into or from any Restricted Jurisdiction, as doing so may invalidate any purported application under the Open Offer. Any

person (including, without limitation, custodians, nominees and trustees) who would, or otherwise intends to, or who may have a contractual or legal obligation to, forward this announcement and/or any documentation relating to the Open Offer and/or any other related document to any jurisdiction outside the United Kingdom should inform themselves of, and observe, any applicable legal or regulatory requirements of any relevant jurisdiction.