CUE ENERGY RESOURCES LIMITED

Mahakam Hilir PSC, IndonesiaFarmin OpportunitySeapex – Singapore

13th April 2018

Bormindo rig 3 contracted for Naga Selatan-2

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Mahakam Hilir PSC Farmin Opportunity

• 50 Bcf recoverable Onshore Gas Prospect located in close proximity to the currently producing Sambutan Gas Field

• Naga-Utara-4 appraisal well planning underway; Low cost well to 3000 feet

• Close to existing infrastructure and gas market with low lead time to production

• New study revealed previously bypassed prospectivity in Naga Utara Prospect

• Integration of new data, including reprocessed 2D seismic, Gravity data, 2 key 1930s Dutch wells, and 4 recent Sambutan wells, revealed potential throughout the permit

• Cue 100% equity. Up to 40% available for the drilling of Naga Utara-4 well

• Large cost bank provides attractive economics

• Great future potential elsewhere in the Permit. Area is currently under sampled compared to neighbouring Fields such as Sanga Sanga where numerous wells have been drilled.

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Kutei Basin, East Kalimantan - A prolific petroliferous basin

• Prospect setting close to giant fields

• Adjacent to Sambutan Field which has produced >15 Bcf gas from 2007-2012

• Close to production infrastructure

• In success case, expect NU-4 to go to POD - short lead time from discovery to production

• New geologic model/ new approach to realise the > 100s Bcf potential

• Future prospecting will follow an approach with Gravity and structural modelling being central and integrating seismic data, surface mapping and well data

Exploration History

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• Four wells were drilled in the permit 2012-2016

• North: Naga Utara 1 and 2 wells drilled on poor quality seismic. Naga Utara prospect oversimplified and initially mapped as crest of simple anticline. NU-1 flared gas – non commercial.

• South: Naga Selatan 1 and 2. NS 1, drilled off structure but encountered extensive shows. In NS 2, delta top reservoir sands not present. Uplift not recognised. Intersected over pressured pro-delta deposits.

• Recent gravity survey and seismic reprocessing has transformed the subsurface model in the North. Naga Utara prospect now mapped as a graben that preserved the conventional deltaic sands.

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• Gravity/Gradiometry data acquired in late 2016 revealed a new graben structure not seen on pre existing, poor quality seismic

• Recent PSDM Seismic reprocessing strongly supports the Gravity based Graben model

• New model shows that the producing Sambutan Field and the Naga Utara Prospect are part of the same graben system

K89-52

K89-44

New approach, new structural model

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Existing Well logs show tested and untested gas reservoirs

• Sambutan – 7, <100m outside permit tested flow rates of 12.5mmcfd• Sambutan-8 within Mahalkam Hilir PSC boundary reveals potential gas pay over 100m

gross interval. Untested due to lack of interest in gas in the 1930’s

Sambutan-8 Sambutan-7PSDM 2D Line (K8944)

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Four additional wells from Sambutan Field have led to enhanced understanding of reservoir and hydrocarbon distribution

Petrophysical analysis was carried out on newly acquired well data from the Sambutan field, historic well logs of Sambutan 7 and 8 and existing Naga Utara 1 and 2 data.

Concluded SBT-8 likely logged moveable hydrocarbons.

Known production data from SambutanField shows maximum rates of 10MMFCD

50 bcf estimated resource in Naga Utara upper and lower reservoirs

0

4

8

12

16

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May

-07

Aug-0

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Nov-0

7

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-08

Aug-0

8

Nov-0

8

Feb-

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May

-09

Aug-0

9

Nov-0

9

Feb-

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-10

Aug-1

0

Nov-1

0

Feb-

11

May

-11

Aug-1

1

Nov-1

1

Feb-

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-12

Aug-1

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Nov-1

2

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-13

Aug-1

3

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14

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-14

Aug-1

4

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-15

Aug-1

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Nov-1

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Kum

.Pro

ducti

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p, BC

F

Sam

buta

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e Q, M

Msc

fd

MONTH

Sambutan Gas Production

SBT Gas Rate Tot.Kum.Production Kum.Prod.Forecast

2.19 Bcf

17.7 Bscf

SBT-06 flowedStarted SBT Compressor

Sambutan Production History Sambutan Production Forecast

15.4 Bscf

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Rapid Commercialisation through existing infrastructure

• Existing underutilised Sambutan gas processing facility and export pipeline approx. 300 m from Naga-Utara 4 well location

• Export pipeline from Sambutan to PLN power plant • Significant cost bank provides attractive economics

Sambutan Gas Plant

Mahakam Hilir PSC

Cue 100%

Sambutan Gas Plant

PLN Plant

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Upside potential >100bcf in under explored permit

• Strategy is to take Naga Utara to POD and start commercial production

• Pelarang Anticline Underexplored – only 4 wells drilled within permit compared with hundreds on adjacent fields like Sanga Sanga anticline

• New approach integrating Gravity modelling, Surface mapping, Structural Modelling and well control to reveal the remaining high potential in the Permit

Sanga Sanga PSC420 mmbbl produced> 100 wells drilled in

neighbouring structural trend

0 wells drilled in Western Permit

4 wells drilled in Eastern Mahakam Hilir permit

Putak Anticline

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Summary – Mahakam Hilir PSC Farmin Opportunity

• 50 Bcf recoverable gas Prospect next to producing Sambutan Field

• New onshore prospectivity revealed in Mahakam Delta Permit

• Naga Utara-4 Appraisal well planning underway

• Low cost well to 3,000 feet, close to infrastructure, low lead time to production

• In success case, expect to go to POD with NU-4 well

• Significant cost bank provides attractive economics

• High upside ~>100’s Bcf potential in the remaining under drilled Permit remains to be tapped

• Cue 100% equity. Up to 40% available for the drilling of Naga Utara-4 well

Level 19, 357 Collins Street, MelbourneVICTORIA – AUSTRALIA 3000

P. (61) 3 8610 4000F. (61) 3 9614 2142

E. mail@cuenrg.com.auW. www.cuenrg.com.au