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ENEGI OIL PLC

AIM ticker: 'ENEG'

OTC ticker: 'EOLPF'

29 August 2014

Enegi Oil Plc

("Enegi" or "the Company")

Chairman's Update

I am pleased to provide the following update to shareholders on Enegi's activities over the last few months. This update is dominated by the progress being made on the continuing implementation of the Company's marginal field initiative as it is our belief that its success offers a huge opportunity for the development and growth of the Company.

On a strategic level the marginal field initiative provides a way for the Company to differentiate itself from other organisations in the oil and gas sector and build potentially very significant income streams and asset value. This is particularly important at a time when the sector appears depressed and companies that have adopted more traditional strategies are finding it difficult to get recognition for perfectly viable opportunities in a crowded marketplace.

In addition, we may look back on the adoption of the marginal field initiative being particularly prescient as the political environment is clearly aligning in recognition of the importance of maximising oil and gas from marginal fields. Of course, here I am referring to the establishment of a new UKCS regulator and the plans for a new bill to enhance the UK's energy independence and security, including the maximisation of North Sea resources, which was announced in the Queen's Speech at the State Opening of Parliament in June.

In order to ensure that the Company is positioned to maximise the benefits of the marginal field initiative the Company has been working on a number of projects which we expect to be able to announce in the coming months.

We also recognize the importance of strong communications which advocates the importance of the marginal fields initiative and the significance this could have for the Company as well as for jobs, economic impact and tax revenues. Shareholders and others may have already started to see articles in key trade press which has addressed this.

Needless to say with a venture that has the potential scope of this one, the transactions and projects that form its basis are complex and therefore time consuming, however good progress continues to be made on concluding the building blocks, advancing the projects already communicated to shareholders and in gaining further projects. Definitive agreements to conclude the establishment of the engineering solutions subsidiary are also being significantly progressed as is the work on the development of the solution for the Fyne Field ('Fyne').

The work carried out on Fyne has considerably advanced the engineering of the Self-Installing Floating Tower ("SIFT") solution, which has provided a deeper understanding of its potential applications in the UKCS and beyond. With specific reference to Fyne, the solution proposed provides a robust economic case for the development of the field and our partner, Antrim Energy (Ventures) Ltd. ("AEV"), has already been notified to that effect. In order to arrive at that conclusion significant work has been undertaken including topsides design and engineering, structural and foundation design, installation methodologies and operating philosophies. All of these not only go to show that the SIFT is a valuable solution for Fyne but confirm our belief in the solution as part of the broader marginal field initiative.

The objective for Fyne was to submit a Field Development Plan ('FDP') to the Department of Energy and Climate Change ("DECC") by 31 August 2014. Despite the considerable progress that has been made towards that goal to date the FDP will not be submitted on time. AEV is aware of our progress and there have been discussions with DECC as well who are also aware of the progress which has been made. We can also confirm that AEV are in discussions with DECC about extension of the Fyne license terms and we will update shareholders again on this matter.

Having additional evidence to the potential of marginal field developments has also made it easier for the Board to draw conclusions as to the future direction of the Company. It is clear to us that the future of Enegi should be directed towards the development of these low risk, high value, marginal fields and the Board intends to take actions to make the Company's direction easily communicable and investable. Consequently, I can announce a series of actions that the board is undertaking to achieve this:

· Firstly, it is reviewing the Company's portfolio to align it to the new direction. This includes consideration of an offer to partially divest itself of its interests in western Newfoundland, the offer being subject to due diligence and detailed contractual negotiation; and

· Secondly, it is considering whether there is merit in undertaking a restructuring to acquire the remaining shareholding in ABT Oil and Gas Ltd., with such a transaction being subject to strict corporate governance.

The Board believes that the remainder of the year is set to be very exciting for the Company as we look to continue to build on what we have already achieved and deliver further progress in the marginal field initiative.

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About Enegi Oil

Enegi Oil Plc is an independent oil and gas company whose strategy is to build a diverse portfolio of assets with a strong emphasis on acquiring interests in marginal fields. These marginal fields are low risk highly-appraised projects and consequently the Company's entry cost will be low. Enegi will look to develop these assets utilising ABTechnology's buoyant solutions, which are appropriate and change the development economics of a project. This is also expected to enable the early booking of reserves. The Company's current portfolio is made up of operations focused on opportunities around the Port au Port Peninsula in Newfoundland, Canada, the UK North Sea and Jordan. The Port au Port Peninsula is located in western Newfoundland, which, although lightly explored, is in an active petroleum system with light oil having been discovered on a number of occasions. The Company's licences in the UK North Sea have discovered hydrocarbons on them and have been selected based on buoy technology operating criteria. The Company has also entered into the highly prospective Dead Sea and Wadi Araba Block in Jordan with its partner Korea Global Energy Corporation.