Falcon Oil & Gas Ltd. ("Falcon")

Kyalla Formation Evaluation, Beetaloo Basin, Australia

21 February 2018 - Falcon Oil & Gas Ltd. (TSXV: FO, AIM: FOG, ESM: FAC) is pleased to announce that Origin Energy Limited ("Origin") presented a technical paper on the potential of the Kyalla Formation in the Beetaloo Sub-basin at the Australia Exploration Geoscience Conference (AEGC) in Sydney earlier today. The key conclusions by Origin are summarised below:

Kyalla Formation Evaluation

• Reservoir and geomechanical analysis acquired at the Beetaloo W-1 well indicate the presence of two potential Source Rock Reservoir ("SRR") intervals; the middle Kyalla SRR and the lower Kyalla SRR.
   
• Geomechanical properties of the lower Kyalla SRR suggest it has the greater potential and could be conducive to successful hydraulic fracture stimulation.
   
• Development of the lower Kyalla SRR, if viable, could have significant cost advantages over that of the middle Velkerri SRR due to expected lower drilling costs.
   
• Mudgas and core analysis indicate the reservoir is likely to be wet gas which could also improve the economics considerably.
   
• There is also the possibility that a successful lower Kyalla SRR test could lead to a `stacked` play development with the middle Velkerri SRR. Infrastructure sharing synergies, with a greater portion of centralised infrastructure, could result in significant cost savings and an optimised surface footprint.
   
• Further appraisal work is required to determine the deliverability of the identified Kyalla SRRs.

Philip O`Quigley, CEO of Falcon, commented:
"Today`s announcement is encouraging and follows the February 2017 Discovery Evaluation Report publication on the existence of a material gas resource in the middle Velkerri formation. We look forward to the Final Report from the scientific inquiry into hydraulic fracturing due to be published in March and the Northern Territory Government`s response to the Final Report before determining the forward exploration / appraisal program."

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Advisory regarding forward looking statements
Certain information in this press release may constitute forward-looking information. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking information. Forward-looking information typically contains statements with words such as "may", "will", "should", "expect", "intend", "plan", "anticipate", "believe", "estimate", "projects", "potential", "scheduled", "forecast", "outlook", "budget", "hope", "support", "could", "suggest" or the negative of those terms or similar words suggesting future outcomes.  This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict.  Such information may include, but is not limited to, comments made with respect to the type, number, schedule, stimulating, testing and objectives of the wells to be drilled in the Beetaloo basin Australia, the prospectivity of the Middle Velkerri play and the prospect of the exploration programme being brought to commerciality,  risks associated with fluctuations in market prices for shale gas; risks related to the exploration, development and production of shale gas reserves; general economic, market and business conditions; substantial capital requirements; uncertainties inherent in estimating quantities of reserves and resources; extent of, and cost of compliance with, government laws and regulations and the effect of changes in such laws and regulations; the need to obtain regulatory approvals before development commences; environmental risks and hazards and the cost of compliance with environmental regulations; aboriginal claims; inherent risks and hazards with operations such as mechanical or pipe failure, cratering and other dangerous conditions; potential cost overruns; variations in foreign exchange rates; competition for capital, equipment, new leases, pipeline capacity and skilled personnel; the failure of the holder of licenses, leases and permits to meet requirements of such; changes in royalty regimes; failure to accurately estimate abandonment and reclamation costs; inaccurate estimates and assumptions by management and their joint venture partners; effectiveness of internal controls; the potential lack of available drilling equipment; failure to obtain or keep key personnel; title deficiencies; geo-political risks; and risk of litigation.

Readers are cautioned that the foregoing list of important factors is not exhaustive and that these factors and risks are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements.  Falcon assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to Falcon. Additional information identifying risks and uncertainties is contained in Falcon`s filings with the Canadian securities regulators, which filings are available at www.sedar.com, including under "Risk Factors" in the Annual Information Form.

Netherlands. He is a member of AAPG." data-reactid="29">This announcement has been reviewed by Dr. Gábor Bada, Falcon Oil & Gas Ltd`s Head of Technical Operations. Dr. Bada obtained his geology degree at the Eötvös L. University in Budapest, Hungary and his PhD at the Vrije Universiteit Amsterdam, the Netherlands. He is a member of AAPG.