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2015 ANNUAL REPORT

CORPORATE DIRECTORY

NORWEST ENERGY NL REGISTERED OFFICE

ABN 65 078 301 505 Level 2, 6 Thelma Street

ACN 078 301 505 West Perth WA 6005

Tel: + 61 8 9227 3240

DIRECTORS Fax: + 61 8 9227 3211

Mr Michael John Fry

(Non-Executive Chairman) SHARE REGISTER

Computershare Investor Services Pty Ltd

Mr Henry David Kennedy GPO Box D182

(Non-Executive Director) Perth WA 6840

Level 11, 172 St Georges Terrace

Mr Peter Lawson Munachen Perth WA 6000

(Executive Director, CEO) Telephone: 1300 850 505

COMPANY SECRETARY AUDITORS

John Douglas Annand Rothsay Chartered Accountants Level 1, Lincoln House

INTERNET ADDRESS 4 Ventnor Avenue

www.norwestenergy.com.au West Perth WA 6005

EMAIL ENQUIRIES AUSTRALIAN SECURITIES EXCHANGE

[email protected] NWE

FRANKFURT STOCK EXCHANGE

NUX

CONTENTS

Chairman's Letter	3
Chief Executive Officer's Report	5
Permit Summary	7
Project Review	8
Directors' Report	17
Lead Auditor's Independence Declaration	25
Corporate Governance Statement	26
Statement of Profit and Loss and other Comprehensive Income	31
Statement of Financial Position	32
Statement of Changes in Equity	33
Statement of Cash Flows	34
Notes to the Financial Statements	35
Directors' Declaration	53
Independent Audit Report	54
Additional ASX Information	56

CHAIRMAN'S LETTER

Dear Shareholders,

It is my pleasure to present the Norwest Energy NL Annual Report for the year ended 30 June 2015.

Norwest is an active participant holding some of the most prospective acreage in the northern Perth Basin, with net acreage of approximately 3,100km2 that includes both conventional and unconventional opportunities in oil and gas.

In the year, Norwest continued to drive an active exploration and appraisal program at its numerous permits within the Basin that are being assessed for future exploration potential, including completing and progressing a number of important initiatives to add value to these projects. This included the successful completion of the EP413 Arrowsmith 3D seismic survey acquisition, the identification of the Lockyer Deep prospect in EP368, the identification of and ongoing discussions with potential farm-in partners into TP/15, and increasing our footprint in the southern part of the Basin by being awarded EP492 and by acquiring the rights over Special Prospecting Authority SPA-16 AO. Internationally, in late CY2014 Norwest was awarded P2265 in the Wessex Basin, in the southern United Kingdom.

Importantly, Norwest also continues to actively engage with industry, Government bodies and regulators, relevant stakeholders and the local communities in which we operate to ensure we foster positive relationships and drive transparent, two-way communication.

Notwithstanding depressed oil and gas prices throughout the year, your Board strongly believes in the underlying fundamentals of the energy market and the economic drivers underpinning Norwest's suite of projects, including Norwest's close position to existing natural gas transportation pipelines and the ability to supply domestic markets that have strong demand.

This is supported by increased activity and interest in the Perth Basin throughout FY2015, which has continued early in FY2016. For example, Norwest is very encouraged by the recent drilling success within the Basin, such as results achieved by AWE at Senecio-3, Waitsia-1 and 2, and Irwin-1, which are all located on acreage in close proximity to Norwest's permits. In addition, Transerv has achieved recent drilling success at their Warro gas field. Significant results from these and future drilling campaigns will continue to bring greater focus to the Basin and should see an increased interest from potential new entrants, service providers and investors.

Looking ahead to FY2016, Norwest remains focussed on delivering the strategic initiatives at our suite of projects to meet our objectives, including:

• Drilling the Arrowsmith-3 well within EP413, which is anticipated to be drilled in CY2016;

• Drilling the Lockyer Deep well within EP368, which is anticipated to be drilled in CY2016;

• Securing a farm-in partner for the drilling of Xanadu-1 within TP/15;

• Unlocking value for shareholders at our other projects in both the Perth Basin and the Wessex Basin in the UK; and

• Continuing to consult with local stakeholders and regulators as part of our ongoing stakeholder consultation program to ensure we implement best practice and are transparent.

I would like to thank my fellow directors for their contributions throughout the year as well as the dedicated management team and staff of Norwest in progressing the Company's initiatives. I would also like to thank the Company's joint venture partners.

Lastly, I would like to thank our shareholders for their ongoing support of Norwest. The Company's directors and management believe that Norwest is well placed to capitalise on the recent exploration success achieved in the Basin, and we look forward to delivering on these opportunities that will best position Norwest to generate shareholder value during FY2016 and beyond.

Michael Fry

Non-Executive Chairman

CHIEF EXECUTIVE OFFICER'S REPORT

Norwest Energy fulfilled a number of important objectives throughout the year as it moved closer to unlocking the potential of our northern Perth Basin acreage.

Norwest successfully completed the EP413 Arrowsmith 3D seismic survey acquisition, participated in the identification of the Lockyer Deep prospect in EP368, progressed discussions with potential farm-in partners into TP/15, and increased its footprint in the southern part of the Basin through the award of EP492 and the acquisition of the rights over Special Prospecting Authority SPA-16 AO. In addition, Norwest was awarded P2265, situated in the Wessex Basin in the southern United Kingdom.

At a corporate level, Norwest's operations continue to be constantly reviewed in order to drive cost efficiencies and the effective deployment of resources. These operational and corporate initiatives will best position Norwest to deliver value on the Company's objectives and provide value to shareholders.

Operations

Norwest remained focussed on our most advanced project, the Arrowsmith shale gas discovery within EP413. During Q2 CY2015, Norwest successfully completed the EP413 Arrowsmith 3D seismic acquisition survey on behalf of the EP413 Joint Venture. The survey was designed to assess the extent of the resource surrounding Arrowsmith-2, and to assist in defining the optimal location and target formation for Norwest's first horizontal well, Arrowsmith-3.

Preliminary results from the seismic data processing indicate a substantial improvement in structural definition. Preliminary planning with the co-venturers has commenced for Arrowsmith-3, planned for the 2015/16 permit year, with timing dependent upon equipment availability and the regulatory approvals process.

The final decision on surface location, target formation and lateral extent will be made once the 3D seismic survey processing and interpretation cycle is completed in Q4 CY2015, as a clear understanding of the subsurface geology is essential to this process.

Norwest remains committed to progressing the opportunities on our other projects in the Perth Basin.

The 100 per cent owned TP/15 offshore conventional oil exploration permit remains a key focus for Norwest, particularly with the 160 million barrel recoverable oil potential of prime prospect Xanadu. Norwest continues to progress discussions with interested parties to join in the exploration program for this block.

The operator of EP368, Empire Oil and Gas NL, has advised Norwest that following the successful completion of the 'Black Swan' airborne geophysical survey it has identified a high impact, near-term drilling prospect named Lockyer Deep. This prospect will be targeting the Kingia reservoir fairway identified following the recent drilling success by AWE at Senecio-3, Waitsia-1 and 2, and Irwin-1, all located in acreage immediately adjacent and to the west of EP368.

Elsewhere in the Perth Basin, Norwest increased its acreage footprint via the award of EP492 and by acquiring the rights over Special Prospecting Authority SPA-16 AO (SPA). The combined acquisition of EP492 and the SPA adds a further 1,665 km2 to the area controlled by Norwest in the Perth Basin, taking the total area net to Norwest to 3,100km2.

Internationally, Norwest was awarded P2265, situated in the Wessex Basin in the southern United Kingdom. Norwest holds 65% of the permit and since the award was granted, reprocessing of the historical 3D seismic data has commenced and is anticipated to be finalised during Q4 CY2015. Immediately to the west of P2265 and straddling this permit is the Colter Prospect (operated by InfraStrata plc) which is estimated to have 50 mmbbls

oil in place. The reprocessing of the historical 3D seismic data will further assist in determining how far this prospect extends into P2265.

Outlook

Norwest has successfully demonstrated its ability to build up a prominent acreage position in the northern Perth Basin and has continued to deliver on the initiatives required to drive value from this suite of assets. The northern Perth Basin has strong underlying economic fundamentals and we are encouraged by the renewed focus and increased activity in the region from other parties, as this interest provides further avenues for Norwest to leverage off our strong acreage position in the region.

With the recent drilling success achieved in the Basin at both the Waitsia and Warro gas fields, and with further exploration planned by both Norwest and a number of other operators, there is no doubt that further exploration success will continue to bring greater focus to the Basin.

With the potential to participate in the drilling of three wells during CY2016 (Arrowsmith-3, Lockyer Deep and Xanadu-1), Norwest will have a very active exploration program over the short to medium term. And even though Norwest only have a minor interest in the Jingemia oil field (under abandonment review), the field is in a hydrocarbon producing province and it would not take much to re-activate it given the right circumstances.

We remain cognisant that our exploration programs will require additional funding to carry forward and develop, however there are a range of options under consideration. With the increased interest in the Perth Basin from other parties there are various avenues to explore with the objective of delivering the best possible value for shareholders.

Finally, I would like to thank the Norwest team for their dedication throughout the year in delivering on the Company's strategic initiatives. I look forward to the opportunities and dynamic work program planned for the year ahead, with Norwest taking the next steps along the development pathway for each of its projects.

Peter L Munachen

Chief Executive Officer

PERMIT SUMMARY

Permit	Location	Type of Permit	Area (100%)	Norwest (%)
NORTHERN PERTH BASIN
EP368	Perth Basin, WA	Onshore	600.3 km2	20%
EP426	Perth Basin, WA	Onshore	2360.0 km2	22.22%
EP413	Perth Basin, WA	Onshore	508.3 km2	27.945%
L14	Perth Basin, WA	Onshore	39.8 km2	6.278%
TP/15	Perth Basin, WA	Offshore	645.8 km2	100%
EP492	Perth Basin, WA	Onshore	860.0 km2	100%
SPA-016 AO	Perth Basin, WA	Onshore	805.0 km2	100%
TOTAL AREA NET TO NORWEST 3,100.1 KM2 (766,261.4 ACRES)
TIMOR SEA
AC/L6 (ROYALTY)	Vulcan Sub-Basin, NT	Offshore	252.1 km2	1.25% ORRI
UNITED KINGDOM
P2265	Wessex Basin, UK	Offshore	225 km2	65%

Table 1. Norwest Permit Schedule

Figure 1. Norwest - Northern Perth Basin Acreage

Norwest Energy is a junior exploration company with interests in seven tenements in the northern Perth Basin, Western Australia, and one permit in the offshore Wessex Basin, United Kingdom.

Company Strategy

To maintain a strong focus on the northern Perth Basin, with a diverse portfolio providing significant exploration potential and exciting opportunities for development and growth.

To conduct all operations in a sustainable manner by focusing on health, safety and environmental outcomes and by maintaining positive and open communications with local communities, stakeholders and our company shareholders.

PROJECT REVIEW

AUSTRALIA - NORTHERN PERTH BASIN

Natural gas exploration is vital to Western Australia, both in unlocking new sources of energy and for providing local jobs and economic opportunities for regional communities. The northern Perth Basin is a proven hydrocarbon province, in close proximity to infrastructure servicing the domestic gas market. The industry has been operating safely in the region for over 50 years, with more than 200 wells safely drilled.

Recent northern Perth Basin gas discoveries by AWE Limited (Waitsia discovery), and Transerv Energy (Warro discovery) reinforce the potential for ongoing exploration discoveries within the basin.

Norwest's projects in the basin are all in prime locations, surrounded by commercially producing fields and recent discoveries, and with excellent access to infrastructure.

2015/16 is shaping up to be one of the most exciting periods of exploration activity in the history of the northern Perth Basin, and likewise for Norwest Energy. The past year has been a period of consolidation and planning for Norwest, in preparation for the potential drilling of three wells on Norwest-held interests within the next twelve to eighteen months (EP413, TP/15 and EP368).

EP413 (Norwest 27.945%, Operator)

EP413 is located approximately 300km north of Perth, predominantly to the western side of the Brand Highway between Eneabba and Dongara.

Figure 2. EP413 Permit Location Map

The EP413 Arrowsmith 3D seismic survey acquisition was completed in mid-2015.

The processing of the large volume of data generated from the acquisition program has been ongoing, with final results expected early in CY Q42015.

Norwest has been closely liaising with the specialist US company completing the processing, with preliminary results demonstrating a substantial improvement in structural definition.

Once this interpretation is complete, the EP413 JV will make a decision on the surface location and target formation for Arrowsmith 3, the next well to be drilled in exploring this highly prospective permit.

Figure 3. EP413 3D Seismic Survey Acquisition, Arrowsmith Location, April 2015

Environmental Baseline Studies

Since Q3 2014, Norwest has been involved with AWE Limited, Transerv Energy and the Seismology Research Centre in a baseline passive seismic recording research study. The purpose of the study is to develop a comprehensive understanding of the baseline natural background seismicity within the region. As part of this process, a seismometer was installed at the Arrowsmith location to capture any background seismic events, with results being compiled into a database for further analysis.

During 2015, Norwest also signed an agreement to participate in a CSIRO led program - 'Baseline Characterisation and Monitoring Protocols for Development of Shale and Tight Gas Resources, Perth Basin'. Along with several other operators, Norwest is sponsoring and contributing data to this research program, the aim of which is to provide better understanding of suitable methods and protocols for establishing environmental baselines associated with tight gas development.

Permit Status

The permit was renewed in August 2013 for a further five years. The five year work program for EP413 included the 3D seismic acquisition program (now complete) and the future drilling of two wells in Years 3 and 5 of the program.

Due to the protracted approvals process for the 3D acquisition program, Norwest applied for a six month suspension of the work program, and in March 2015 this suspension was granted. The Year 3 work program commitment involves the drilling of one exploration well, which is currently in the early planning stages, pending results from the 3D seismic survey data processing.

EP413 Joint Venture

Norwest Energy 27.945% (Operator)

AWE Limited 44.252% (via subsidiaries)

Bharat PetroResources Ltd 27.803%

TP/15 (Norwest 100%, Operator)

Exploration Permit TP/15 is a conventional oil play located offshore northern Perth Basin in close proximity to the Cliff Head, Jingemia and Eremia oil fields and the Dongara gas field.

The permit occupies the 3 nautical mile wide state territorial waters offshore Western Australia adjacent to the township of Port Denison and covers an area of 645.8km2.

The prime prospect is Xanadu, with a P50 un-risked prospective recoverable resource of 160mmbbls of oil, as detailed in the ASX announcement dated 29/10/2014.

The intention of Norwest is to secure a farm-in partner to provide free-carry through the drilling of Xanadu-1. Norwest continues to progress discussions in this regard with Rey Resources to agree on the terms and conditions under which Rey may earn an interest in TP/15.

Figure 4. TP/15 Prospect Location Map

The Xanadu Prospect

Structurally, the Xanadu Prospect is a prominent horst block lying parallel to the coastline in very shallow water. Xanadu-1 will target Permian sands from a depth of approximately 800 metres. Near-shore sands of the Dongara Sandstone represent the primary target, with secondary targets in the fluvio-deltaic Irwin River Coal Measures and the regressive marine sands of the High Cliff Sandstone.

Retrieval and mapping of additional 2D marine seismic data has provided a comprehensive regional interpretation of the structural setting and charge history for the Xanadu oil prospect.

The structural mapping, which is based on good quality 2D seismic data, as well as high resolution gravity data resulting from a 2009 airborne 3D Full Tensor Gradiometry Survey indicates the Xanadu Prospect is geologically similar to both the Cliff Head and

Hovea structures. Figure 5. Seismically derived structural definition at the top of the Permian reservoir sequence (Dongara/Wagina - IRCM - Kingia/High Cliff Sandstone)

In estimating the recoverable oil volumes summarised in Table 2 below, a 50 per cent recovery factor has been assumed.

Table 2. Xanadu Prospect Volumetrics

*The estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.

Xanadu-1 Drilling Program

Xanadu-1 presents a unique opportunity to drill a relatively low cost offshore play from onshore.

Since 2001 this play has resulted in four oilfield discoveries in the vicinity, namely Cliff Head, Jingemia, Hovea and Eremia.

The timing of drilling Xanadu-1 is scheduled for the 2015/16 permit year, dependent upon a range of factors including government approvals process, rig availability and securing a farm-in partner.

Figure 6. Schematic of Xanadu-1 well trajectory

Health, Safety and Environmental

Figure 7. Rehabilitation progress at RHS-1 location

Norwest has been managing the rehabilitation of the Red Hill South-1 (RHS-1) onshore well location since 2011.

A weeding and re-seeding program was implemented during the year to assist with the rehabilitation process, and excellent progress has been achieved (refer Figure 7).

Norwest has completed annual spring monitoring surveys over the past 3 years, with the next survey scheduled for October 2015.