ASX: NWE

Highlights

September 2015 Quarterly Report

30 October 2015

Norwest retains a large footprint in the northern Perth Basin, with highly attractive exploration targets optimally positioned adjacent to neighbouring discoveries, in particular to the significant AWE Waitsia and Irwin discoveries that have brought enormous focus to the basin.

Norwest continued to drive an active exploration and appraisal program in the onshore Perth Basin in Q3, with numerous permits currently being assessed for future exploration potential, including:

• EP368: The operator has identified a high impact near term drilling prospect targeting the Kingia formation, the same formation that was recently tested from AWE's Waitsia-1 well, flowing at an impressive 25.7 mmscf/d.

  
  

• EP413: Processing and interpretation of the Arrowsmith 3D seismic acquisition continued, with results indicating a substantial improvement in sub-surface structural definition.

  
  

• TP/15: Revitalised interest in the farm-in opportunity after presenting at the AAPG PESA deal day in September.

  
  

  Contact

  
  

  Norwest Energy NL Level 2, 6 Thelma Street West Perth WA 6005

  PO Box 1264 West Perth WA 6872

  
  

  Tel: +61 8 9227 3240

  Fax: +61 8 9227 3211

  
  

  Web: www.norwestenergy.com.au

  
  

  Media enquiries: [email protected]

  
  

  Shareholder enquiries: [email protected]

• P2265: Reprocessing of historic 3D seismic data continued over the permit located in the Wessex Basin, southern United Kingdom.

  
  

• Norwest continued to be active in engaging with industry, stakeholders and local communities.

Recent drilling success in the northern Perth Basin reaffirms Norwest's strategy of acquiring a large footprint in the basin and to remain focussed on progressing its optimally positioned exploration targets

Figure 1. NWE tenements

Australian Exploration Program

EP368 and EP426

During the quarter the operator of EP368, Empire Oil and Gas NL, advised Norwest that following the successful completion of the 'Black Swan' airborne geophysical survey, it has identified an exciting, high impact, near term drilling prospect named Lockyer Deep.

EP368 and EP426 lie directly to the east of AWE's recent significant Waitsia and Irwin gas discoveries. Subsequent to quarter end, AWE announced the combined flow test results of the Waitsia-1 well from the High Cliff Sandstone and Kingia Formation totalled over 50 mmscf/d.

Lockyer Deep is a medium risk well, targeting between 25 and 134 BCF, with a best case estimate of 58 BCF1.. This prospect will be targeting the Kingia reservoir fairway which has been identified following the recent drilling success by AWE at Senecio-3, Waitsia-1 and 2 and Irwin-1, all located in acreage immediately west of EP368. A new and significant gas play in the Kingia Sandstone has been confirmed in the northern part of the Perth Basin which will be further tested to the east of the play with the drilling of Lockyer Deep.

Lockyer Deep Prospective Resources - Kingia / High Cliff Sandstones

Secondary targets: Hovea Member; Dongara Sandstone; Carynginia Formation

1. Refer Empire Oil and Gas NL (ASX: EGO) Investor Presentation released to ASX on 2nd September 2015

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.

The extent of the play into EP368 remains to be confirmed but the results of the recent AWE Irwin-1 well suggests that the Kingia reservoir fairway increases in thickness to the east and thus potentially into EP368.

The proposed Lockyer Deep well will also be used to appraise an attractive secondary oil target that was identified in both the Lockyer-1 and North Erregulla-1 historic wells where oil was encountered in the Dongara/Wagina sandstone. The Kingia Sandstone was not reached in either of these wells and so the deep gas potential remains untested, presenting an exciting opportunity for the joint venture to explore in the proposed drilling of Lockyer Deep.

The reprocessing of more than 400km of historic 2D seismic data in the vicinity of Lockyer 1 and North Erregulla 1 is nearing completion, with encouraging results expected to greatly reduce structural risk. The improvement in data quality is substantial and offers the potential for providing a significant improvement in the definition of the subsurface structure, thereby greatly improving confidence in selecting future drilling locations.

The operator has a contingent rig slot secured for the drilling of Lockyer Deep in mid 2016 subject to funding and government approvals.

Should Lockyer Deep be successful, there is immediate follow up potential at the North Erregulla prospect, located to the southwest of Lockyer Deep.

Figure 2. Location of EP368 & EP426 highlighting proximity to the AWE discoveries