Zephyr Energy Regulatory News (ZPHR)

Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the UK Market Abuse Regulation. With the publication of this announcement, this information is now considered to be in the public domain.

9 August 2021

Zephyr Energy plc

(the "Company" or "Zephyr")

Successful conclusion of the State 16-2LN-CC drilling operations;

Wireline log data acquired and production casing set;

Lateral drilled 100% in zone in the Cane Creek reservoir;

Plans to complete well and test production in near-term

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the Rocky Mountain oil and gas company focused on responsible resource development and carbon-neutral operations, provides an update on its flagship project in the Paradox Basin, Utah, U.S.A.

The Company is pleased to report that State 16-2LN-CC drilling operations, which began on 13 July 2021, have concluded successfully and safely. The well reached Total Depth at 14,370 feet, at which point a full suite of wireline logs was run and production casing was set.

Highlights

· The State 16-2LN-CC well was drilled to a total depth ("TD") of 14,370 feet ('ft").

· The well successfully encountered the primary Cane Creek reservoir target as well as multiple secondary targets in overlying reservoirs.

· The well penetrated 4,555 ft of the Cane Creek reservoir and was drilled 100% in zone.

· The Cane Creek reservoir target indicated hydrocarbon charge across its entirety, based on wireline logs, cuttings and mud gas readings. Multiple overlying reservoirs also indicated hydrocarbon charge.

· Detailed analysis of the log data is now underway. That analysis will inform the selection of an optimal well completion method, which is expected to be determined over the course of the next week.

· Based on the multitude of positive indications gathered to date, the Company elected to set production casing in anticipation of upcoming completion and production testing activity.

Colin Harrington, Zephyr's Chief Executive, said: "I am delighted to announce the safe and successful conclusion of drilling operations. I'm even more pleased that we hit the Cane Creek reservoir target with success and stayed within that reservoir across the entire lateral portion of the well. It's also exciting to see evidence of hydrocarbon charge across the entirety of the Cane Creek lateral, as well as in multiple overlying reservoirs.

"Now that we've set production casing, we have an excellent well bore from which to complete the well and test production from the Cane Creek reservoir - and the log data gathered during drilling operations will help determine the optimal method by which to do so.

"The evaluation of the logs is underway, and we will keep our Shareholders informed in the coming days when the output from that analysis is finalised and the method for completing the well is selected."

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