Jersey Oil&gas Regulatory News (JOG)

Trap Oil Group Plc

("Trapoil" or the "Company" and, together with its subsidiaries, the "Group")

Corporate Update

Trapoil (AIM: TRAP), the independent oil and gas exploration, appraisal and production company focused on the UK Continental Shelf ("UKCS") region of the North Sea, today provides a corporate update.

Trapoil's management has spent considerable time working with partners and certain shareholders to decide how best to optimise the Company's future business from its existing cash reserves and assets whilst mimimising costs and risk for shareholders. Having considered and explored a number of options at length, the board of directors of Trapoil (the "Board") has determined that the best strategy is to reduce operating costs to the minimum in order to maintain the Company's existing assets alongside seeking to maximise returns from these assets.

Cost reductions

Following the reduction in staffing levels and management pay cuts announced in April 2014 as part of the Group's full year results announcement, the Group has continued to monitor expenditure and decided to take immediate short term measures to significantly reduce the cost base of the business further. This is expected to result in a number of senior personnel leaving the business. It is anticipated that this will result in general and administrative expenses being reduced by approximately a further £1million on an annualised basis.

Directorate Changes

As part of these changes Simon Bragg is resigning his position as Chairman with immediate effect. Mark Groves Gidney, Chief Executive Officer and Paul Collins, Chief Operating Officer have also agreed to step down from the Board on completion of an orderly transition period, expected to take approximately two months, Marcus Stanton, a Non-Executive of the Company, will assume the position of Non-Executive Chairman to oversee the transition process with immediate effect. The Board will continue to review the composition of the Board in light of the cost reduction strategy stated above.

Cancellation of GE Facility

The Company has cancelled the three-year facility entered into on 29 January 2013 with GE Energy Financial Services in order to minimise the on-going financing costs. This is expected to save approximately US$880,000 on an annualised basis, with a one-off cost of approximately US$300,000 paid in 2014.

Scarinish (Alfa) Farm-in Option

In light of the further potential delays and cost uncertainties on Total E&P UK Limited's ("Total") Scarinish (Alfa) well, the Board decided not to commit to contributing to the Alfa well drilling costs, for what would be an unquantifiable and potentially significant amount of money for the Company, and therefore allowed the Company's option on Alfa with Total to expire. The Company will however continue to evaluate ways of maximising the value of its interest in the adjacent Romeo asset (Licence P.1666, Block 30/11c).

Mark Groves Gidney, Chief Executive Officer of Trapoil, commented:

"It is sad for myself and Paul Collins to be leaving the company which we both started seven years ago. However it has been a struggle for small cap explorers in the North Sea and in the circumstances we both feel that the proposed strategy is in the best interest of shareholders."

Enquiries:

Notes to editors:

· The Trapoil Group was created in 2008 by a team of experienced industry executives with a broad range of oil and gas technical, operational and financial expertise and professional skills.

· Since its listing in 2011, Trapoil's strategy has been to couple organic development of its existing portfolio with the acquisition of additional assets to create a full cycle exploration and production company focused on the UKCS. This strategy has been executed in an increasingly difficult environment. As the Company indicated at its final results on 24 April 2014, there are signs of recovery in the North Sea, but activity remains low. Larger companies and financial institutions continue to rationalise their investment in the area and this has had a negative impact, particularly on junior oil and gas companies

· Trapoil has developed long term relationships with key oil industry partners and major suppliers and consultants including CGG Services (UK) Limited ("CGG") and Applied Drilling Technology International.

· The Group utilises a research-led, knowledge-based approach to identify and deliver promising exploration and appraisal opportunities, and to this end has secured extensive long-term access to CGG's state of the art 3D seismic database over the majority of the Central North Sea area on negotiated terms. CGG is a leading pure-play geophysical services and equipment provider. Access to such 3D seismic data serves to strengthen the Group's ability to create opportunities on both open and held acreage in the UKCS.