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News Releases


Aug 24, 2015

OIL AND GAS RESERVES FOR PEL 91 AND PEL 106 AND BAUER FIELD UPDATE

Vancouver, British Columbia, August 24th, 2015. Newport Exploration Ltd ("Newport" or "the Company") provides an update on Oil and Gas interests in the Cooper Basin, Australia as publicly reported by Beach Energy Ltd ("Beach") on August 21st, 2015 entitled, "1P, 2P and 3P Reserves and 2C Contingent Resources as at June 30, 2015", and in Beach's "Full Year Report" released on August 24th, 2015. The Beach news release and Full Year Report make reference to Reserves and Resources on ex-PEL 91 and ex-PEL 106 that are subject to the Company's 2.5% gross overriding royalty, and to commercial productivity in the Bauer Field.

In its news release Beach provide a breakdown of 2P reserves on ex-PEL 91 and ex-PEL 106, as well as a detailed breakdown of 1P, 2P and 3P net developed reserves at the Bauer Field on ex-PEL 91.

The breakdown of net 2P reserves by permit to Beach is summarized below;

2P Reserves Oil Equivalent (MMboe) Oil Gas Liquids Gas
(Net to Beach) FY 2014(1) Production Revisions FY 2015(1) (MMbbl) (MMboe) (PJ)
ex-PEL 91 5.4 (1.6) 2.0 5.8 5.8 --- ---
ex-PEL 106 2.0 (0.3) 0.5 2.2 --- 0.6 9.1
(1) FY2014 and FY2015 relate to Beach's year end June 30.

In summary, in ex-PEL 91 Beach's 40% net 2P reserves are estimated at 5.8MMboe. In ex-PEL 106, Beach's 40% net 2P reserves are estimated at 0.6MMboe Gas Liquids and 9.1PJ Gas. The Company has a 2.5% gross overriding royalty over all commercial production from all Production Licenses (PPL's) in ex-PEL91 and ex-PEL 106.

In ex-PEL 91 (Beach 40% and operator, Drillsearch Energy Ltd ("Drillsearch") 60%) FY15 gross oil production of 4.1 MMbbl was down 11% from FY14, with average daily gross production of 11,263 bopd . Natural field decline was partly offset by additional wells being brought on line and continued strong performance of the Bauer Field.

Beach also report that on the Bauer Field a 10-well drilling campaign was completed, which included a number of oil column intersections higher than pre-drill estimates and strong flow rates recorded from short term tests. Beach report that the results from this drilling campaign have extended the aerial extent of the Bauer Field. Revised petroleum reserves were estimated by Beach using probabilistic methodology are based on interpretation and mapping of 3-D seismic data, with oil column heights defined from wireline log analysis. The range of petrophysical parameters applied was revised based on recently acquired core data.

Results from the 10 well program added 2.5 MMbbl of net 2P reserves. A Bauer facility upgrade was completed, which increased water handling capacity from 50,000 barrels of fluid per day (bfpd) to 75,000 bfpd. As reported previously by the Company, exploration discoveries were made at Balgowan-1 and Burners-1, with the former confirming a north-eastern extension of the oil fairway. The joint venture was granted Petroleum Retention Licences 151 to 172 over the former PEL 91 permit, which secures tenure over this area for up to 15 years.

Commercial productivity of the Namur Sandstone in the Bauer Field is proven, with 19 wells currently producing with operating cash costs of AUD $25-30 per barrel. Following recently completed infrastructure upgrades to cater for increased production volumes, Beach reports having a high degree of confidence in the commerciality of the 10 development wells. Based on Beach's internal assessment of commodity prices, operating cost structure and infrastructure currently in place, revised developed reserves for the Bauer Field as of June 30, 2015 are as follows;

Bauer Field      
(MMbbl, Net to Beach) 1P 2P 3P
June 30, 2014 1.3 3.0 5.7
FY 2015 Production (1.6) (1.6) (1.6)
FY 2015 Revisions 2.1 2.5 3.0
June 30, 2015 1.8 3.9 7.1

The above figures are based on SPE-PRMS definitions and guidelines and represent only Beach's 40% interest in the Bauer Field. The Company's has a 2.5% gross overriding royalty over 100% of the commercial productivity in the Bauer Field.

The capital budget of AUD $45-50 million for 2015/16 anticipates an additional 7-8 wells being drilled on ex-PEL 91. Infrastructure installations are expected to be completed at the Stunsail and Pennington fields, which comprise new facilities providing a total of 40,000 bfpd capacity, trunk line installation to connect these facilities to the Bauer to Lycium network, and connection of three completed wells. Planning is underway for a further increase in capacity at the Bauer facility, with the upgrade expected to be completed by financial year end.

In ex-PEL 106 (Beach 50% and operator, Drillsearch 50%) gross gas and gas liquids production of 0.7 MMboe was down 30% from FY14, with average daily gross production of 1,794 boepd The decline in production was mainly attributable to natural field decline. As reported in a previous news release by the Company, a five-well exploration and appraisal campaign was completed in the permit, with the Ralgnal-1 exploration well and Canunda-2 appraisal well cased and suspended as future producers. The joint venture was granted Petroleum Retention Licences 129 and 130 over the former ex-PEL 106 permit, which secures tenure over this area for up to 15 years.

Within ex-PEL 106, the work program is expected to comprise two exploration wells and completion of the compression project at the Middleton gas processing facility. In addition, four existing wells are expected to be brought online, which is expected to result in a material uplift in production by financial year end.

The Reserve classification system being used by Beach for Reserve Estimation is governed by the "Reserves and Resources Disclosure Rules for Mining and Oil and Gas Companies" as required by the Australian Securities Exchange Rules and in compliance with the Petroleum Resources Management System ("SPE-PRMS") guidelines-an internationally recognized Reserve Classification system for Oil and Gas properties.

The Company does not have access to the underlying technical data and cannot independently verify the Oil and gas Reserves and Resources in accordance with classification requirements in compliance with NI 51-101 and the Canadian Oil and Gas Evaluation Handbook ("COGEH"). Accordingly, the Reserves and Resources for ex-PEL 91 and ex-PEL 106 as reported by Beach may not satisfy the definitions of Reserves and Resources for the purposes of NI 51-101 Canadian reporting requirements. Also, the Beach release refers to Barrels of Oil Equivalent ("BOE"). In accordance with Section 5.14 (d) of NI-101 for Canadian reporting purposes this disclosure must include a cautionary statement to the effect that: "BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead".

The timing and any associated revenues to the Company resulting from the production from these Reserves and Resources as reported by Beach in ex-PEL 91 and ex-PEL 106 cannot be predicted by the Company.

The Company continues to strongly encourage shareholders and potential investors to access information released independently by Beach, Drillsearch and Santos Ltd. in order to keep current during an active period in the exploration and development of these permits.

For further information contact:

Ian Rozier, Director and Chief Executive Officer
+1 604 685 6851

info@newport-exploration.com
www.newport-exploration.com
www.beachenergy.com.au
www.drillsearch.com
www.santos.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the accuracy or adequacy of this news release.

Cautionary Statement on Forward-Looking Information

This news release, which contains certain forward-looking statements, is intended to provide readers with a reasonable basis for assessing the financial performance of the Company. All statements, other than statements of historical fact, are forward-looking statements. The words "believe", "should", "could", "expect", "anticipate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule" and similar expressions identify forward-looking statements. These forward-looking statements pertain to assumptions regarding the price of oil, fluctuations in currency markets (specifically the Australian dollar and the U.S. dollar), the future funding of the Company's projects, and the future development of the Company's projects. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, which considered reasonable by the Company, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Such factors include, but are not limited to, the risk of fluctuations in the assumed exchange rates of currencies that directly impact the Company, such as the Canadian dollar, Australian dollar and U.S. dollar, the risk of fluctuations in the assumed prices of oil, the risk of changes in government legislation, taxation, controls, regulations and political or economic developments in Canada, the United States, Australia or other countries in which the Company carries or may carry on business in the future, risks associated with developmental activities, the speculative nature of exploration and development, including the risk of obtaining necessary licences and permits, and assumed quantities or grades of reserves. Many of these uncertainties and contingencies can affect the Company's actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Company. Readers are cautioned that forward-looking statements are not guarantees of future performance. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those acknowledged in such statements.

The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except to the extent required by applicable laws.