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CEO's Quarterly Message

“In 2017 we made significant progress in repositioning the company for the future. We increased production from the Hawler license area by 32% thanks to production from the Zey Gawra field. We also lowered per barrel operating costs which together with higher realised prices improved cash flow.

We matured our interests in the AGC Central license area. 3D seismic data acquired in late 2016 and early 2017 has been processed and interpretation is in advanced stages with final interpretation expected to be completed in the next couple of months. Based on initial interpretation, 11 prospects have been identified with best estimate unrisked gross (working interest) prospective oil resources of 3,450 million barrels.

During 2017 we completed a major recapitalisation of our balance sheet. We restructured and/or reduced all of our major liabilities and commitments and we raised equity capital from our major shareholders to fund our capital program through the end of 2018. We also made progress rationalising our license portfolio with the disposal of the OML 141 license area in Nigeria and the relinquishment of the AGC Shallow license area. In recent weeks we have accepted an offer to transfer our interest in the Haute Mer B license area in Congo (Brazzaville) for cash consideration and we expect that the disposal of our interest in the Haute Mer A license area in Congo (Brazzaville) will be completed in the coming months.
Our 2018 capital program is focused on our core license areas: the Hawler license area in the Kurdistan Region of Iraq, and the AGC Central license area offshore Senegal and Guinea Bissau. In the Hawler license area our program includes the drilling or re-entry of seven wells and has been designed to allow us to significantly increase production and better define the development potential of the three key fields in the license area. We recently finished drilling the first of the seven planned wells. The ZEG-2 well targets the Zey Gawra Cretaceous reservoir, and we expect to complete the well as a producer in the coming weeks. In the AGC Central license area, our forecasted capital expenditures include a final payment for the acquisition of 3D seismic data currently being interpreted, and preparations for exploration drilling planned in 2019.

We expect that cash on hand and cash receipts from net revenues will fund forecasted capital expenditures and operating and administrative costs through the end of 2018. 
We look forward to implementing our plans in 2018 and achieving both higher production in the Hawler license area and preparing for an exciting exploration drilling program in the AGC Central license area in 2019.”