Tomco Energy Regulatory News (TOM)

17 August 2023

TOMCO ENERGY PLC

("TomCo" or the "Company")

TSHII Update and

Updated Independent Reserves Report for the TSHII Site

TomCo Energy plc (AIM: TOM), the US operating oil development group focused on using innovative technology to unlock unconventional hydrocarbon resources, is pleased to provide an update with respect to the Company's 100% owned subsidiary, Greenfield Energy LLC's ("Greenfield"), potential acquisition of the remaining ownership and membership rights and interests in Tar Sands Holdings II LLC ("TSHII") (the "Membership Interests"), and the findings of an updated independent reserves report for the TSHII site (the "Updated Report"). The Updated Report was commissioned from Netherland, Sewell & Associates, Inc. ("NSAI") estimating the oil reserves, associated marketable sand volumes, and future net revenue, as of 30 June 2023, in respect of a potential commercial scale project on the mining properties comprising the TSHII site.

As previously announced, Greenfield owns a 10% Membership Interest in TSHII and holds an exclusive option, exercisable at its sole discretion, to acquire the remaining 90% of the Membership Interests for additional cash consideration of US$17.25 million on or before 31 December 2023 (the "Option"), together with a matching right, as set out in the Company's announcement of 6 June 2023.

TSHII Update

The Company remains in discussions to secure a potential funding package for Greenfield, that would, inter alia, enable Greenfield to ultimately exercise the Option and pursue its previously announced wider development plans. In this regard, the principal route under active consideration remains TomCo potentially disposing of a majority stake in Greenfield to a partner(s) in return for, inter alia, certain upfront cash consideration, a continuing minority equity participation for TomCo in Greenfield (without the requirement for further capital contributions from TomCo) and the provision of a sizeable funding package to Greenfield. As previously announced, any such proposed transaction would likely constitute a fundamental disposal for TomCo pursuant to the provisions of Rule 15 of the AIM Rules for Companies and therefore be subject, inter alia, to the approval of TomCo's shareholders at a duly convened general meeting. In such eventuality, it would fall to the new majority owner(s) of Greenfield to decide whether or not to exercise the Option post completion of such proposed disposal.

Alongside these discussions, the Company continues to explore potential alternative funding routes for Greenfield including reserves based lending which will be facilitated by the Updated Report.

There can be no certainty that any funding proposal will ultimately be successfully concluded or as to the precise terms or structure of any such funding transaction or alternative financing arrangements for Greenfield. Further announcements will be made in due course as appropriate.

Updated Independent Reserves Report for the TSHII Site

The Updated Report commissioned from NSAI estimating the oil reserves, associated marketable sand volumes, and future net revenue, as of 30 June 2023, updates the findings from NSAI's previous report, as announced by the Company on 13 January 2022 (the "NSAI January 2022 Report").

Updated Report Highlights

· NSAI have estimated the proved ("1P"), proved plus probable ("2P"), and proved plus probable plus possible ("3P") oil reserves, associated marketable sand volumes, and future net revenue, as at 30 June 2023, in respect of a 100 per cent. interest in a potential commercial scale project on the mining properties comprising the TSHII site

· As anticipated, NSAI's estimates of oil reserves and volumes of marketable sand are unchanged from the NSAI January 2022 Report, as follows:

o  NSAI estimate 1P oil reserves of 22.8 million barrels of oil ("bbls"), 2P oil reserves of 33.6 million bbls and 3P oil reserves of 44.3 million bbls

o  NSAI further estimate associated volumes of marketable sand at 22.8 million tonnes (1P), 41.2 million tonnes (2P) and 59.8 million tonnes (3P)

· Total estimated undiscounted future net revenues (as described further below), in respect of a gross 100% interest in TSHII, have increased from the NSAI January 2022 Report and range from US$1.32 billion based on 1P reserves (NSAI January 2022 Report: US$942 million) to approximately US$3.2 billion based on 3P reserves (NSAI January 2022 Report: US$2.5 billion)

· Estimated discounted future net revenues (as described further below) attributable to TomCo's current 10 per cent. interest in TSHII range from approximately US$47.3 million based on 1P reserves (NSAI January 2022 Report: US$30.5 million) to approximately US$77.6 million based on 3P reserves (NSAI January 2022 Report: US$57.6 million)

· The increase in estimated undiscounted and discounted future net revenues principally reflects increased estimated future product prices for asphalt, heavy oil and diesel, particularly the assumed asphalt price which has risen by approximately 25 per cent. to US$117.39/bbl (NSAI January 2022: US$93.64/bbl)

Updated Report Details

NSAI have estimated the proved (1P), proved plus probable (2P), and proved plus probable plus possible (3P) oil reserves, associated marketable sand volumes, and future net revenue, as of 30 June 2023, in respect of a 100 per cent. interest in a commercial scale project situated on the mining properties comprising the TSHII site in the Uinta Basin, Utah, United States.

The Updated Report was prepared using certain price and cost parameters and development plans specified by TomCo. The reserves estimates in the Updated Report were prepared in accordance with the definitions and guidelines set out in the 2018 Petroleum Resources Management System ("PRMS") approved by the Society of Petroleum Engineers ("SPE"). Although marketable sand volumes are not hydrocarbons, NSAI used the 2018 PRMS as the framework for the categorisation of such volumes and their associated revenues.

In 2021, Greenfield operated Petroteq Energy Inc's existing oil sands pilot plant at Asphalt Ridge, Utah for a trial period in order to demonstrate the feasibility of mining shallow tar sands using conventional open pits and applying solvents to extract, process and sell heavy oil. Having demonstrated pilot viability, Greenfield has begun to negotiate future marketing contracts for refining and marketing asphalt, heavy oil and diesel. The planned mining operations and extraction processes at TSHII produce various types of sand as byproducts, and Greenfield has identified markets for industrial, construction, fracture stimulation ("frac") and silica sands.

NSAI estimate the net oil reserves, associated marketable sand volumes, and future net revenue in respect of the gross (100 per cent.) interest in the TSHII properties, as of 30 June 2023, in accordance with PRMS to be:

Notes:

(1) There is no expected gas production in respect of the project.

(2) Net marketable sand volumes are stated after a 5 per cent. deduction for fines and losses.

Accordingly, the net oil reserves, associated marketable sand volumes and future net revenue attributable to TomCo's current 10 per cent. interest in the TSHII properties is as follows:

In accordance with the 2018 PRMS definitions and guidelines, one of the primary requirements for oil and gas volumes to be classified as reserves is that they be commercially recoverable. For the purposes of its Updated Report, NSAI evaluated a sensitivity to the project wherein costs are incurred to dispose of 100 per cent. of the mined sand volumes rather than including revenue from selling 95 per cent. of it. In this sensitivity, based on the oil prices and costs assumed (as described further below), the project is still commercial at the 1P, 2P and 3P levels.

Reserves categorisation conveys the relative degree of certainty; reserves subcategorisation is based on development and production status. The 1P volumes are inclusive of proved undeveloped volumes only. The Updated Report indicates that as of 30 June 2023, there are no developed oil reserves or associated marketable sand volumes for the TSHII site. For the purposes of the Updated Report, the volumes and parameters associated with the proved, proved plus probable, and proved plus probable plus possible estimate scenarios of reserves are referred to as 1P, 2P and 3P, respectively. The estimates of oil reserves, associated marketable sand volumes, and future net revenue included therein have not been adjusted for risk. The Updated Report does not include any value that could be attributed to interests in undeveloped acreage beyond those tracts for which undeveloped oil reserves and associated marketable sand volumes have been estimated.

Gross revenue in the Updated Report is the gross (100 per cent.) revenue from the properties prior to any deductions whereas future net revenue is after deductions of production taxes, capital costs, abandonment costs and operating expenses, but before consideration of any income taxes. The future net revenue has then been discounted at an annual rate of 10 per cent. to determine its present worth.

The Updated Report was prepared using oil and marketable sand price parameters specified by TomCo. The future oil produced and processed through mining operations yields three distinct products namely asphalt, heavy oil and diesel. The asphalt price is based on the first quarter 2023 Argus Asphalt Index average price of US$117.39. Heavy oil and diesel prices are based on the 1 June 2023 West Texas Intermediate posted price of US$66.58 and are adjusted for quality and market differentials. Sand produced through mining operations is processed and sold as four distinct products (industrial, construction, frac and silica sands). Industrial, frac and silica sand prices are based on the 2021 United States Geological Survey ("USGS") prices for each product; construction sand prices are based on the January 2023 USGS price.

Operating costs used in the Updated Report are based on the projected costs of upscaling pilot mining operations provided by TomCo. These costs include TomCo's estimates of its administrative costs. Capital costs used in the Updated Report were also provided by TomCo and are based on the projected costs of upscaling pilot mining operations. Capital costs were included for the planned construction of a processing plant, production facilities and equipment. Based on its understanding of Greenfield's future development plans and review of the information provided by TomCo, NSAI regarded the estimated capital costs to be reasonable. Abandonment costs used in the Updated Report are TomCo's estimates of the costs to abandon the future production facilities, net of any salvage value. None of the costs were escalated for inflation.

A copy of NSAI's full updated report will shortly be made available on the Company's website.

Commenting, John Potter, CEO of TomCo, said: "Greenfield continues to progress its previously announced funding discussions, as well as exploring the potential for reserves based lending which will be facilitated by the Updated Report. The findings of NSAI's latest report serve to further confirm our view that the TSHII site contains substantial economic resources, both in terms of oil and marketable sand. These estimated economic resources have significantly increased in value over the last 18 months and we remain fully focussed on securing the requisite funding for their future exploitation. Whilst there can be no certainty that the required funding can be secured, we remain optimistic that we can ultimately secure one of the routes under consideration. We look forward to providing further updates in due course."

Enquiries:

TomCo Energy plc

Malcolm Groat (Chairman) / John Potter (CEO) +44 (0)20 3823 3635

Strand Hanson Limited (Nominated Adviser)

James Harris / Matthew Chandler +44 (0)20 7409 3494

Novum Securities Limited (Broker)

Jon Belliss / Colin Rowbury +44 (0)20 7399 9402

IFC Advisory Limited (Financial PR)

Tim Metcalfe / Florence Chandler +44 (0)20 3934 6630

For further information, please visit www.tomcoenergy.com.

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018, as amended by virtue of the Market Abuse (Amendment) (EU Exit) Regulations 2019.

Competent Persons' Statement

The information contained in this announcement that relates to Reserves in the Duchesne River and Rimrock Sandstones in certain mining properties located in the Uinta Basin, Utah, United States is based on information compiled by Mr. Benjamin W. Johnson (Petroleum Engineer) and Mr. John G. Hattner (Petroleum Geologist), both employees of Netherland, Sewell & Associates, Inc. Mr. Johnson and Mr. Hattner are both Qualified Petroleum Reserves and Resources Evaluators and are both members of the Society of Petroleum Engineers such that they are suitably qualified as Competent Persons as set out in the June 2009 AIM Note for Mining and Oil & Gas Companies. Mr. Hattner is also a member of the American Association of Petroleum Geologists. Mr. Johnson and Mr. Hattner have reviewed and have consented to the inclusion of such information in this announcement in the form and context in which it appears.

Glossary of Technical Terms