CIP.L Regulatory News (CIP)

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5 March 2018

CIP MERCHANT CAPITAL LIMITED

("CIP Merchant Capital" or the "Company")

Further update on Investment in Saffron Energy plc

Further to the Company's announcements of 22 January 2018 and 28 February 2018, the Company is pleased to provide the following update regarding its first investment.

As per Saffron Energy plc's ("Saffron") announcement of 28 February 2018, Saffron has confirmed that it has made significant progress on a number of acquisitions in South East Asia that are consistent with its multi Tcf exploration gas strategy and that it has withdrawn, by mutual consent with Po Valley Energy Limited ("Po Valley"), from the acquisition of Po Valley Operations Limited ("PVO") (the "Po Valley Acquisition").

The Company believes that the revised transaction continues to represent an attractive investment proposition and accordingly, the Company is pleased to announce that it has re-confirmed to Saffron its second subscription of £5,438,862 as set out in its announcement of 22 January 2018 (the "Investment Announcement").

Resulting interest in Saffron

As at the date of this announcement, following completion of the initial investment of £561,138 as set out in the Investment Announcement, the Company is currently interested in approximately 7.0% of Saffron's issued share capital.

Subject to, inter alia, Saffron issuing a revised admission document, Saffron's shareholders approving the proposals at its general meeting and completion of the proposals, the Company will then be interested in 150,684,929 Saffron Shares representing approximately 21.0% of Saffron's then enlarged share capital. As a result of Saffron no longer proceeding with the Po Valley Acquisition, the 200,000,000 Saffron Shares to be issued to Po Valley as consideration for POV will now not be issued and therefore, whilst the number of Saffron Shares held by the Company on completion will not change, its resulting interest in Saffron's enlarged share capital will increase.

As set out in the Investment Announcement, on completion the Company will also be interested in 68,493,150 warrants in Saffron.

The Company also confirms that it is deemed to be acting in concert with Continental Investment Partners S.A., Metano Capital S.A. and Greenberry S.A, Marco Fumagalli and James Parsons (together the "Concert Party") for the purposes of the UK City Code on Takeovers and Mergers (the "City Code"). The Concert Party currently holds 14,092,500 Ordinary Shares, representing 7.0% of the Saffron Shares. On completion of the Saffron proposals the Concert Party will hold, in aggregate, 163,605,640 Saffron Shares, representing approximately 22.8% of the Saffron Shares and will also hold, in aggregate, a further 88,493,150 options and warrants in Saffron.

Assuming the exercise by the Concert Party of all of the options and warrants held by them and no exercise of options and/or warrants by any other party, the Concert Party would hold, in aggregate, 252,098,790 Saffron Shares, representing approximately 31.3% of Saffron's then enlarged share capital.

If the Concert Party was to increase the percentage of the aggregate voting rights it is interested in to 30.0% or more of Saffron issued share capital then they would be obliged, except with the consent of the Panel on Takeover and Mergers, to make a mandatory offer pursuant to the City Code and in order to avoid such an offer, CIP may therefore not be able to exercise all of the warrants held by it.

For further information, please contact:

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.