Tern Regulatory News (TERN)

27 September 2011

Silvermere Energy plc

("Silvermere" or the "Company")

Interim Results for the Six Months Ended 30 June 2011

Silvermere, the independent oil and gas company focusing principally on exploration, appraisal and production opportunities in the US, today announces its interim results for the six months ended 30 June 2011.

Chairman's Review

Financial Results

The interim results of Silvermere for the six months ended 30 June 2011 reflect a period during which the Company was an investing company, as defined in the AIM Rules, with no commercial business. Its activities were confined to identifying and assessing acquisition opportunities in the natural resources sector on a worldwide basis: in particular, consideration of the acquisition of a 33.3% working interest in two oil and gas licences in shallow waters of the Gulf of Mexico offshore Kleburg County, Texas known as the Mustang Asset.

In early June 2011 Andy Morrison, now chief executive officer, and I were appointed as consultants to the Company in order to assist with the acquisition process and associated financing exercise.

For the six months ended 30 June 2011, the Company reported no turnover (2010: Nil) and made a loss before tax of £249,029 (2010: £96,402) after taking into account administrative costs of £249,029 (2010: £96,402).

Post Balance Sheet Events

On 2 August 2011, the Company announced the proposed acquisition of the Mustang Asset and a placing to raise £1.52 million before expenses. The acquisition was completed and the enlarged share capital admitted to trading on AIM on 31 August. Andy Morrison was appointed chief executive, Stewart Dalby as a non-executive director and I as chairman the same day. At the same time, John Roddison and Reinhold Heus resigned as directors of the Company.

The Mustang Asset was acquired for total consideration of approximately £2.8 million plus the future payment of certain royalties. In the admission document, RPS Energy valued the proven and probable reserves attributable to the Mustang Asset on an NPV 10 basis at £18.4 million and identified a further £59.0 million of possible reserves making a total potential valuation for the Mustang Asset of over £75 million. These possible reserves represent gas and condensate that has been identified under current and historic work programmes but which have not yet been allocated to specific sand formations in the various known reservoirs. As further technical data is obtained, the Directors are optimistic that these possible reserves will be upgraded to proven and/or probable reserves. This will not only de-risk the project but create significant value for shareholders. It is currently envisaged that this process will start in earnest during 2012 when a new drilling programme commences. This is likely to involve three new wells drilled over a period of a year or more at an estimated total cost to Silvermere of around £5 million.

The current I-1 Well, in which Silvermere has a 16.65 per cent working interest, re-entered an old drill hole in spring 2011, has tested satisfactorily and is expected to start production by the end of 2011. The production platform is currently being modified so that the facility can be installed and the tie-in process completed. This production platform has been designed with a capacity of 20 mmscfpd and should therefore be capable of supporting both the I-1 Well and the next two or three that follow.

Over the next few months, we are focused on making progress on de-risking the Mustang Asset, achieving first production and working closely with the operator, Dominion Production Company, to scope out a multiple well development programme for the rest of the Mustang Island Field.

With effect from today's date the Company's advisers are Merchant Securities as nominated adviser and joint broker, with Rivington Street Corporate Finance as joint broker.

These interim results will be available on the Company's web-site at www.silvermere-energy.com.

On behalf of the board

Frank Moxon

Chairman

Statement of comprehensive Income

for the six months ended 30 June 2011

Statement of Financial Position

As at 30 June 2011

Statement of Cash flow

for the six months ended 30 June 2011

Notes to the interim statement

for the six months ended 30 June 2011

1. General information

The Company is a public limited company quoted on AIM and is incorporated in England and Wales.

The address of its registered office is 42 Brook Street, London, W1K 5DB. Items included in the financial statements of the Company are measured in Pounds Sterling which is the currency of the primary economic environment in which the entity operates. The financial statements of the Group are also presented in Pounds Sterling which is the Company's presentational currency.

The Company was, during the six months ended 30 June 2011 an investing company. It is now an independent oil and gas company focusing principally on exploration, appraisal and production opportunities in the United States.

2. Basis of preparation

The interim financial statements of Silvermere Energy Plc have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and on the historical cost basis using the accounting policies which are consistence with those set out in the Company's Annual Report and Accounts for the 7 months ended 31 December 2010.

This interim financial information for the six months to 30 June 2011 was approved by the board on 26 September 2011.

The unaudited interim financial information for the period ended 30 June 2011 does not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. The comparative figures for the 7 months ended 31 December 2010 are extracted from the statutory financial statements which have been filed with the Registrar of Companies and which contain an unqualified audit report and did not contain statements under Section 498 to 502 of the Companies Act 2006.

3. Loss per share

Loss per share is calculated by reference to the weighted average of 5,257,091 ordinary shares in issue during the period (30 November 2010 - 642,239 (adjusted) and 31 December 2010 - 904,525).

The diluted loss per share is the same as the basic loss per share as the losses in each period have an anti-dilutive effect.

The deferred shares have negligible value, being subject to restrictions as to voting, participation and redemption according to the new Articles of Association then adopted, nor are they quoted on the Stock Exchange.

On 26 January 2011, 2,222,223 shares were issued for cash at 45p per share.

On 26 May 2011, 2,857,143 shares were issued for cash at 35p per share.

6. Post Balance Sheet Events

On 13 July 2011 the Company announced that it had raised £750,000 through the issue of £750,000 nominal of loan notes (the "Loan Notes"). Agneash Soft Commodities Plc, a Plus-quoted investment company, invested £660,000 of the £750,000. The proceeds of the loan notes were used to acquire debt due from Core Oil & Gas Inc. ("Core") to Seadrift Management LLC and Wellmaster Exploration and Company LLC as a precursor to the acquisition of the Mustang Asset (see below)

The Loan Notes were issued in two equal tranches of £375,000 ("Tranche A" and "Tranche B").

Tranche A converted automatically on the admission of Silvermere's ordinary shares to trading on AIM, at a conversion price of 22.5p per share.

Tranche B of the Loan Notes has a two year term from the date of issue. Tranche B will pay an annual coupon equivalent to 10 per cent of the revenues generated by the Company attributable to the I-1 well (located in the Mustang Island field) until such time as they are converted or, if repaid, one year after such repayment. Tranche B is convertible at any point for a period of two years following issue at a price of 35p, or is repayable at twice face value at the maturity date.

The Company held its Annual General Meeting on 14 July 2011. Included in the Resolutions was a special resolution to approve the proposed change of name of the Company from Chalkwell Investments Plc to Silvermere Energy plc which took place on 15 July 2011.

On 2 August 2011, the Company announced the proposed completion of the Mustang Asset acquisition and the raising of £1.52 million before expenses by way of a placing. The acquisition was completed and the enlarged share capital admitted to trading on AIM on 31 August. The total consideration payable for the acquisition was approximately £2.8m plus certain royalties over future production.

On 5 September 2011 the Company received confirmation from the operator, Dominion Production Company LLC ("Dominion") that a tripod platform fabrication, installation and tie-in contract with Laredo Construction Inc ("Laredo") has been entered into on behalf of the working interest partners. The total lump sum price under the contract with Laredo is US$2.9m of which Silvermere's share is one third, being $966,667 (approximately £590,000).