KEA.L Regulatory News (KEA)

For Immediate Release 27 February 2015

Kea Petroleum plc

("Kea" or the "Group" or the "Company")

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 NOVEMBER 2014

Kea Petroleum plc (AIM: KEA), the oil and gas exploration company focused on New Zealand, announces its interim results for the six month period ended 30 November 2014.

Key points in the year to date

· Review of strategic options announced on 16 February 2015 to consider all opportunities to maximise shareholder value owing to the prevailing oil price environment

· Rockpoint Corporate Finance Limited appointed to advise in the strategic review

· Puka site shut-in on 28 January 2015 and further cost-cutting measures introduced to preserve working capital

· Discussions continue with potential partners for the Mercury, Mauku and Shannon prospects in a very challenging farm-out environment

· Administrative expenses in the period reduced to £881,000 (H1 2013: £1.8 million)

· Sales of £831K in the six month period (H1 2013: £1.2 million) and net loss of £8.5 million (H1 2013:net loss of £1.1 million) with the net loss reflecting the £7.5 million write-off of exploration costs relating to the Douglas and Wingrove wells

Kea Petroleum's Chairman, Ian Gowrie-Smith, said:

"Whilst Kea was making progress in the Taranaki Basin and continues to have some highly prospective opportunities, the unexpected and fundamental change in the oil price environment has created too many challenges for our business. Consequently, we launched a strategic review last month with the objective of considering all options for maximising shareholder value. We are still early in that process and we will update shareholders in due course."

For further information please contact:

Kea Petroleum plc Tel: +44 (0)20 7340 9970

David Lees, Executive Director

WH Ireland Limited Tel: +44 (0) 20 7220 1666

James Joyce

Buchanan Tel: +44 (0)20 7466 5000Mark Court

Sophie Cowles

CHAIRMAN'S STATEMENT

Dear Shareholders,

The recent collapse in the price of oil, which no one appears to have foreshadowed, has made the Puka field uneconomic and hence, as recently announced, the Puka production station was shut down. Also as a result of falling oil prices, the farm-out market has become very challenging. Against this backdrop, and without sufficient financial resources ourselves, the Company has had no option other than to offer itself for sale as a whole or for some of its parts.

Kea announced its strategic review on 16 February 2015 to consider all opportunities for maximising shareholder value. The Company is being advised during this process by Rockpoint Corporate Finance Limited. The Company has taken a number of further cost cutting measures to preserve its working capital, which remains tight.

The loss posted in the six month period includes the write-off of £7.5 million of previously capitalised costs relating to the drilling and testing of the Wingrove and Douglas wells in 2010/2011.

Kea is assisting a number of potential funding partners to complete their technical due diligence of the Shannon prospect, confirming our view that it is an exciting and potentially significant prospect. We will provide further updates for shareholders as appropriate.

Ian Gowrie-Smith

Chairman

27 February 2015

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KEA PETROLEUM PLC

Notes to the Interim financial statements

for the SIX MONTHS ended 30 november 2014

1. Basis of preparation

This interim financial information has been prepared on a going concern basis in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and on an historical cost basis, and in accordance with the Companies Act 2006 that applies to companies reporting under IFRS. The accounting policies, methods of computation and presentation used in the preparation of the interim financial information are the same as those used in the Group's audited financial statements for the year ended 31 May 2014.

The financial information in this statement does not constitute full statutory accounts within the meaning of Section 434 of the Companies Act 2006. The financial information for the six months ended 30 November 2014 is unaudited. The comparative information for the year ended 31 May 2014 was derived from the Group's audited financial statements for that period as filed with the Registrar of Companies. It does not constitute the financial statements for that period. The auditor's report on those financial statements was unqualified and did not contain a statement under sections 498(2) or (3) of the Companies Act 2006, but contained an emphasis of matter paragraph on going concern.

b. Going concern

The Group has incurred a loss of £8,525,000 for the 6 months ended 30 November 2014. In common with other junior exploration companies, the Group is reliant on raising further funds periodically through equity finance, including share options and warrants, or possibly debt facilities to achieve its long term objectives.

The directors have prepared operating cashflow forecasts and projections which assume a minimum level of expenditure to conform with the requirements of the Group's exploration licences for the 12 months from the date of signing this interim statement, which show a funding shortfall in 2015. The directors are in discussions with potential investors to secure additional funding that would cover the shortfall, but an agreement has not yet been signed. If the Group is unable to secure this funding and cannot find alternative sources of financial support, the Group may cease to be a going concern. In these circumstances adjustments may be required to reflect the position that assets may not be realised at the amounts currently disclosed in the Statement of Financial Position, and additional liabilities may be incurred.

The directors have concluded that the combination of these circumstances represents a material uncertainty that may cast significant doubt upon the Group's ability to continue as a going concern. Nevertheless after making enquiries, and considering the uncertainties described above, the directors have an expectation that the Group will have access to adequate resources to continue in operational existence for the foreseeable future and for these reasons, they continue to adopt the going concern basis in preparing the annual report and Group financial statements.

2. Loss per share

On 28 November 2014, a share consolidation was approved. On that date 939,869,567 ordinary shares of 1p were converted into 93,986,957 new ordinary shares of 1p and 93,986,957 deferred shares of 9p. The deferred shares of 9p carry no significant rights. The weighted average number of shares for comparative purposes have been adjusted to 69,744,241 (previously 697,442,407).

The diluted loss per share does not differ from the basic loss per share as the exercise of share options would have the effect of reducing the loss per share and is therefore not dilutive. The weighted average number of shares used in calculating the basic earnings per share has been adjusted to remove the shares in issue held by the Employee Benefit Trusts.

3. Share capital

4. Events after the balance sheet date

In January 2014 the Company shut in the Puka production station as a result of mechanical problems with Puka-1 and the low oil price.

In February 2014 the Company announced a strategic review including the possibility of offers within the context of a "formal sale process" in accordance with Note 2 on Rule 2.6 of the City Code on Takeovers and Mergers.