Tower Resources PLC (LON:TRP)

Tower Resources is building an African-based exploration and production group, which intends to have a balanced portfolio ranging from exploration through appraisal to production, primarily through its own origination of opportunities and their organic development.

The company aims to achieve this through:

. Originating high-potential, entry stage, exploration and appraisal licences with large equity interests (50-100%) that provide the flexibility to farm-out whilst retaining a material exposure in the event of success;

. Holding smaller equity stakes or royalty interests in production or potential production, whether developed internally or acquired;

. Maintaining the capacity to operate throughout the exploration and appraisal phase of a licence.

Cameroon

Entry: September 2015

100% of Thali PSC

Rio del Rey Basin

Operator: Tower Resources Cameroon S.A

Initial Exploration Period (3 years)

Tower Resources Cameroon S.A, a wholly-owned subsidiary of Tower Resources plc, holds a 100% interest in the shallow water Thali (formerly known as “Dissoni”) Production Sharing Contract (PSC), in the Rio del Rey basin, offshore Cameroon.

Tower was awarded the PSC on 15 September 2015.

The Thali PSC covers an area of 119.2 km², with water depths ranging from 8 to 48 metres, and lies in the prolific Rio del Rey basin, in the eastern part of the Niger Delta. The Rio del Rey basin has, to date, produced over one billion barrels of oil and has estimated remaining reserves of 1.2 billion boe, primarily within depths of less than 2,000 metres. The Rio del Rey is a sub-basin of the Niger Delta, an area in which over 34.5 billion barrels of oil has been discovered, with 2.5 billion boe attributed to the Cameroonian section. The Thali Block has the potential to hold up to four distinct play systems, including the established play in which three discovery wells, two gas (Rumpi-1, Njonji-2) and one oil (Njonji-1), have already been drilled on the Block. The current contingent Oil-In-Place estimate for the Njonji discovery is 39 million barrels (Pmean, gross) with an estimated 7 to 15 million barrels of recoverable oil. These are currently viewed as sub-commercial discoveries, but once better seismic imaging has been achieved Tower sees potential to add incremental oil reserves to achieve commerciality. There is also significant potential to develop prospects at deeper levels, in both structural and stratigraphic traps, once better imaging has been achieved.

South Africa

Algoa-Gamtoos Block (50% interest)

Operator: New Age Energy Algoa (Pty) Ltd (50% interest)

Licence Size: 9,369km²

1st Renewal Period (2 Years)

Through its wholly-owned subsidiary, Rift Petroleum Limited, Tower Resources holds a 50% interest in the Algoa-Gamtoos licence, offshore South Africa. Tower acquired its non-operated interest in the Algoa-Gamtoos licence through the all share acquisition of Rift in April 2014.

Overview

The Algoa-Gamtoos licence covers 9,369 km² and is operated by New Age Energy Algoa (Pty) Ltd (“New Age”) (50%). This acreage straddles the Algoa and Gamtoos basins on the shelf, as well as outboard slope edge of the South Outeniqua Basin.

Recent geological evaluations have shown that the true hydrocarbon prospectivity of the basins covered by the Licence area has been largely unexplored by the drill bit. All but one of the historical wells in the area were drilled over 25 years ago, and all were located using sparse 2D seismic data and either failed to intersect valid closure and/or encountered only modestly developed reservoir sands where drilled on the fringes of the Algoa and Gamtoos basins. Many of these old wells, however, either encountered shows, residual hydrocarbons and/or penetrated stacked wet gas to oil-prone shale source sequences. Basin modelling confirms three new stratigraphic and part structural-strat plays being targeted following the Operator New Age’s recent work, comprising:

.Syn-Rift Play in the Gamtoos Basin (in the west of the acreage)

.Post Rift Canyon Play in the Algoa Basin (to the east of the acreage)

.Post Rift S.Outeniqua Basin Slope Margin Play (in the south-west of the acreage in deeper water)

Western Sahara

Guelta, Imlili and Bojador (5% – 10% ORRI)

1 Onshore/2 Offshore

Operator: Hague and London Oil plc (“HALO”, 50%).

Licence size 72,698km²

Entry: 2006

As part of a portfolio review Tower Resources sold its interests in the Guelta, Imlili and Bojador blocks in the Saharawi Arab Democratic Republic (SADR) in January 2017 to Red Rio Petroleum Ltd in exchange for an over-riding royalty interest (ORRI) ranging from 5% – 10%; depending on the licence. The licences continue to be Operated by Hague and London Oil plc (“HALO”, 50%).

The SADR is the democratically elected government of the territory known as Western Sahara, which lies to the south of Morocco and is recognised by the United Nations as a non-self-governing territory. The sovereignty of the territory remains in dispute, and until this is resolved there is little that can be done to advance exploration of these blocks. If the sovereignty of the territory is resolved in due course, then these will be attractive and prospective blocks and via the ORRI Tower has retained a potential valuable, long-term interest in the event of a commercial oil or gas discovery.

In December 2014 Kosmos Energy (“Kosmos” 55%) and partners (ONHYM 25%, Cairn Energy 20%) drilled the CB-1 exploration well in the Morocco awarded offshore Cap Boujdour block in the Aaiun Basin. The well encountered 14 metres of net gas and condensate pay in clastic reservoirs over a gross hydrocarbon bearing interval of approximately 500 metres. The discovery was non-commercial and the well was plugged and abandoned, but it is nevertheless encouraging. The significance of this well result, located some 50 kms North of the Guelta Block and some 60 km west of the Imlili block, is that a working petroleum system has been established thus significantly de-risking plays along this part of the Atlantic margin.

Africa: Cameroon, South Africa & Western Sahara.

Board

Jeremy Asher BSc (Econ), MBA, MEI - Chairman and Chief Executive Officer

Jeremy Asher, aged 59, in addition to his role in Tower, is Chairman of Agile Energy Limited, a privately held energy investment company, and a director of several other energy-related companies including NYSE-listed Pacific Drilling SA, where he chairs the Remuneration Committee, Better Place BV (a private company developing infrastructure to support mass deployment of electric vehicles), and until 2010, AIM-listed Gulf Keystone Petroleum Ltd. He is also a member of the London Business School's UK regional advisory board and the Engineering Advisory Board of Imperial Innovations, the commercial arm of Imperial College. Following several years as a management consultant, he ran the global oil products trading business at Glencore AG and then acquired, developed and sold the 275,000 b/d Beta oil refinery at Wilhelmshaven in Germany. Between 1998 and 2001 he was CEO of PA Consulting Group, and since that time has been an investor and director in various public and private companies.

Graeme Thomson FCA, MA, BA, MEI, MIoD - Non-Executive Director

Graeme Thomson, aged 60, in addition to serving as CEO of Tower, is a non-executive director of Desire Petroleum plc, where he chairs the Audit Committee. He was a non-executive director of Frontier Resources International plc from 2011 to 2012. From 2009-12 he advised a range of energy and other companies on their financial and commercial affairs. From 2000 to 2009 he was a founder, Company Secretary, CFO and finally CEO of Sterling Energy plc, and from 2005 2008 a non-executive director of Forum Energy plc. He was CFO and Company Secretary of Dragon Oil plc from 1992 to 1999. In 1989 he co-led a management buy-in to AmBrit International plc, which was taken over in 1992. He was a runner-up for Finance Director of the Year at the 2007 QCA Awards.

Peter Taylor BSc (Hons), C.Eng, MIMechE - Non-Executive Director

Peter Taylor, aged 70, is Joint Chairman of TM Services Ltd, an international oil and gas consulting company. In 1991 he was a founder and director of TM Oil Productions Ltd which became Dana Petroleum Plc. and one of the leading UK oil and gas exploration companies before being taken over in 2010 by KNOC for £2bn. He was founder member of Consort Resources Ltd, a significant North Sea gas transportation and production company and was also a founder and director of Planet Oil Ltd, which reversed into Hardman Resources in 1998. Planet held various interests including Mauritania, Guyane (formerly French Guiana) and Uganda. He was a founding member and director of Star Petroleum Plc which was incorporated into Global Petroleum Ltd, and also a founding member of Neptune Petroleum Ltd which was acquired by Tower. He is a director of Global Petroleum Ltd, listed on the ASX and AIM. He was co-founder of Jupiter Petroleum Ltd, which has assets in offshore Namibia and Juan de Nova. Jupiter was sold to Global in 2011. He is Chairman of the Remuneration Committee.

David M Thomas, Independent Non-Executive Director

Mr Thomas is a geologist with over 30 years of experience in the oil and gas industry, primarily in North and West Africa. After working in Libya for Occidental Petroleum and Tunisia for Tenneco (now British Gas) in the 1970s and 1980s, Mr Thomas returned to London as International Chief Geologist for Kuwait Petroleum Corporation and later founded a consulting company offering a range of petroleum advisory services. Mr Thomas served most recently as managing director of MedOil PLC and has been a director of AIM-quoted Thalassa Holdings since 2008.

The current number of shares in issue is 377,335,427. No shares are held in treasury.

In accordance with AIM Rule 26 the following investors are identified as having a significant (3% or more) interest in the Company.

* 1,805,308 of these shares are held by Agile Energy Limited, which is owned by the Asher Family Trust of which Jeremy Asher is a lifetime beneficiary.

The current number of share options outstanding are 1,617,400 (0.4% of the fully diluted share capital).

The current number of warrants outstanding are 43,439,692 (10.3% of fully diluted share capital).

Tower Resources plc
140 Buckingham Palace Road
Westminster
London SW1W 9SA

Tel: +44 20 7157 9625

Registered Office
140 Buckingham Palace Road
Westminster
London SW1W 9SA

Nominated Adviser and Broker
SP Angel Corporate Finance LLP
35 Maddox Street
London W1S 2PP

Auditors and Reporting Accountants
UHY Hacker Young
4 Thomas More Square
London E1W 1YW

Solicitors to the Company
Watson, Farley & Williams LLP
15 Appold Street
London EC2A 2HB

Registrars
Link Market Services Limited
Bourne House
34 Beckenham Road
Beckenham
Kent BR3 4TV

Bankers
Barclays Bank Plc
Level 27
One Churchill Place
London E14 5HP