18 December 2013

Manager of Company Announcements

ASX Limited

Level 6, 20 Bridge Street

SYDNEY NSW 2000

By E-Lodgement

OTTO ENERGY NOTES POSITIVE RESULTS FROM TANZANIAN EXPLORATION PROGRAM

Highlights:

 Otto's partner Swala Energy announces results from the 2D seismic program over the jointly owned Pangani Licence in Tanzania

Otto Energy Limited (ASX: OEL) ("Otto" or "The Company")

notes the positive exploration results from its Pangani licence in Tanzania reported in the attached ASX Announcement from joint venture partner Swala Energy Limited (ASX: SWE).

Otto holds a 50% interest in the onshore Pangani and Kilosa- Kilombero Production Sharing Agreements (PSAs) under an agreement announced in early 2012. Swala has an indirect

32.5% interest in both PSAs.

Otto Energy Chief Executive Officer Gregor McNab said: "These results reported by Swala provide further encouragement for the prospectivity in our existing East African assets. It is particularly pleasing to report these initial findings after our

recent confirmation of the Kito prospect in the Kilosa-Kilombero

PSA. This provides further support our decision to move into the exciting onshore East Africa region, which remains a core area of focus for Otto."

OTTO AT A GLANCE

• ASX-listed oil and gas company with a strategy to grow its integrated oil and gas business across exploration, development and production

• Focused on South East Asia and East

Africa

• Operator of the producing Galoc oil field in the Philippines, which provides cashflow

• Opportunity rich with substantial exploration prospects and leads COMPANY OFFICERS

Rick Crabb Chairman

Ian Macliver Director Rufino Bomasang Director John Jetter Director Ian Boserio Director Gregor McNab CEO

Matthew Allen CFO/Coy Secretary

Please find a copy of the Swala Energy Limited announcement attached.

--Ends--

Contact: Matthew Allen

Chief Financial Officer

+61 8 6467 8800

[email protected]

Media:

Dudley White

MAGNUS Investor Relations + Corporate Communication

+61 2 8999 1010

[email protected]

Head Office 32 Delhi Street, West Perth WA 6005 Australia PO Box 1414, West Perth, WA 6872 Australia T: +61 8 6467 8800 F: +61 8 6467 8801

Manila Office 32nd Floor Philamlife Tower, 8767 Paseo de Roxas, Makati City 1226, Philippines T: +63 2 773 2700 F: +63 2 773 2801 [email protected] ASX Code: OEL ABN: 56 107 555 046

SWALA ENERGY LIMITED ACN 161 989 546

ASX Release (ASX: SWE) 18th December 2013

Swala Confirms Positive Results from Pangani Seismic

Swala Energy Limited ("Swala" or "the Company") is pleased to announce the completion of the
2D seismic programme over the Pangani licence in Tanzania. Swala has an indirect 32.5% interest in the Pangani license.
The 2D seismic acquisition commenced in mid-November 2013 and is scheduled to terminate on the
20th December 2013. During this time the Company has acquired 200km of 2D seismic over the
Mvungwe and Moshi basins.
The results from the survey show that the Moshi basin, to the north of the licence area, appears to be a deep basin with sedimentary fill of probable Neogene age. Further evidence from the seismic survey suggests that the basin is fault-bounded, some 25km wide, and with basin fill to between
2,000 and 3,000m depth.
The Mvungwe basin, to the south of the licence area, is still being processed but initial results suggest that the basin is shallower, at less than 1,000m deep, and contains sediments of probable Neogene age. Shallow basins may be quite productive with the right heat flows (the Pakwach basin in Uganda's Lake Albert, where six discoveries have been made to date, has a depth of some 900m) and the Company will now continue with its planned basin modelling programme to determine whether the regional high heat flows would allow hydrocarbon generation in Mvungwe at these relatively shallow depths of burial.
Completion of the Pangani survey marks the end of Swala's 2013 seismic programme in Tanzania, during which over 500km of seismic has been shot over five basins within its two licenses. The results of the Pangani survey follow the positive results received from the survey over the Kilosa-Kilombero license as has been previously announced.
Dr. David Mestres Ridge (CEO) said, "The results from the 2D acquisition over Pangani are highly encouraging, especially in the northern Moshi basin where we appear to have defined another Neogene basin. This also marks the completion of our 2013 seismic programme in Tanzania, during which we shot over 500km of seismic over five basins. We now aim to consolidate our understanding of the two licences by completing the seismic interpretation over Pangani; the basin modelling over Mvungwe and the analysis of geochemical samples collected from our basins as part of our seismic
survey."

Swala Energy Limited

70C Kishorn Road, Mount Pleasant, WA 6153, Perth Australia

Telephone: + 61 (0)8 6270 4700 Fax: + 61 (0)8 6314 4675 www.swala-energy.com

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For further information please contact:
Swala Energy Limited
David Mestres Ridge (CEO) T: +61 8 6270 4700 [email protected] www.swala-energy.com
Walbrook Investor Relations
Ben Knowles
T: +61 8 6189 2230
M: +61 426 277 760 [email protected]
About Swala:
Swala Energy is an Australian oil and gas company with assets in Kenya and Tanzania. Swala's holdings are in the world-class East African Rift System with a total net land package in excess of
15,000km2. New discoveries have been announced in a number of licences along this trend,
including Ngamia, Twiga and Etuko, which extend the multi-billion barrel Albert Graben play successfully developed by Tullow Oil plc into the eastern arm of the rift. Swala has an active operational and business development programme to continue to grow its presence in the hydrocarbon provinces of sub-Saharan Africa. The Company is listed on the Australian Securities Exchange ("ASX") under the symbol "SWE".
In accordance with ASX Listing Rules, any geological or hydrocarbon resources or reserves information in this release has been reviewed by Swala's Exploration Director, Mr Neil Taylor who has over 30 years' experience in the sector. He consents to that information in the form and context
in which it appears.

Swala Energy Limited

70C Kishorn Road, Mount Pleasant, WA 6153, Perth Australia

Telephone: + 61 (0)8 6270 4700 Fax: + 61 (0)8 6314 4675 www.swala-energy.com

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