Jersey Oil & Gas plc has entered into a conditional Sale and Purchase Agreement ("SPA") to acquire operatorship of, and an additional 70% working interest in, Licence P2170 (Blocks 20/5b and 21/1d) ("Licence P2170") from Equinor UK Limited.  The consideration for the Acquisition consists of two milestone payments and a royalty based on potential future oil volumes produced from the Verbier Upper Jurassic (J62-J64) reservoir oil discovery (the "Verbier Field"), as further detailed below.

Acquisition Highlights:

Acquisition of an additional 70% interest in, and operatorship of, Licence P2170 including the Verbier oil discovery

Contingent payments of:

• § US$3 million upon sanctioning by the UK's Oil & Gas Authority ("OGA") of a Field Development Plan ("FDP") in respect of the Verbier Field; and
• § US$5 million upon first oil from the Verbier Field

Certain royalty payments on the first 35 million barrels of oil produced from the Verbier Field calculated on the basis of a 70% working interest for on-block volumes

Increases total 2C discovered resources across the Greater Buchan Area ("GBA") by 17.5 mmboe to 142 mmboe net to JOG

• Increases ownership of multiple high-impact exploration opportunities within Licence P2170
• Acquisition simplifies licence ownership structure ahead of GBA farm-out process
• Adds an estimated US$506 million of post-tax cashflow, taking the GBA development estimate of post-tax cashflow to US$3.17 billion net to JOG and increases the estimated net NPV of the GBA development project to US$1.15 billion

Corporate Update:

Highly experienced Project Team hires made to advance the planned GBA development

Concept Select underway

• Detailed subsurface and engineering workstreams progressing to deliver a development concept
• Key project gate of concept selection due Q3 2020

Year-end 2019 cash position of approximately £12m

• Fully funded through Concept Select and into Q2 2021

Planned launch of GBA farm-out process post Concept Select

• Including the Buchan oil field, the Verbier, J2 and Glenn oil discoveries and a material portfolio of nine exploration prospects

Integration of 2018 3D seismic data into regional mapping significantly progressed

• Materially improved imaging of subsurface across the GBA
• Revised net prospective resources increased to in excess of 230 mmboe including new prospects identified within Licence P2170

In line with our strategy to provide cleaner, safer energy JOG is progressing a number of initiatives

• JOG is now a proud signatory of the United Nations Global Compact, the world's largest corporate sustainability initiative
• Progressing studies for platform electrification and for the GBA development potentially to be a regional power hub

Andrew Benitz, CEO of JOG, commented:
"Acquiring further discovered oil volumes enhances JOG's project value considerably and at the same time strengthens our plan to bring Verbier into future production through the GBA development, which is a truly exciting opportunity to showcase what is possible with new developments in the UKCS. We are working closely with the OGA and leading contractors to introduce technologies to enable the GBA development to be at the forefront of the energy transition as well as being a new area hub that encourages regional industry collaboration to maximise the economic recovery of resources in this prolific part of the Central North Sea."

"We are now well placed to progress our development plans through Concept Select, before launching a farm-out process to attract industry partners to join us in unlocking the significant value that exists within the Greater Buchan Area."