maverick energy limited – acn 110 411 428...

MAVERICK ENERGY LIMITED – ACN 110 411 428 1

2 MAVERICK ENERGY LIMITED – ACN 110 411 428


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NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Annual General Meeting of the members of Maverick Energy Limited (Company) will be held in the Price Sierakowski Boardroom, Level 24, 44 St Georges Terrace, Perth, Western Australia, at 12.00 pm (Perth Time) on 19 November 2009. The Explanatory Statement that accompanies and forms part of this Notice of Annual General Meeting describes in more detail the matters to be considered. BUSINESS

1. Financial and other reports

To receive and consider the Financial Statements of the Company for the period ended 30 June 2009, together with the Directors’ Report and the Auditors’ Report as set out in the Company’s 2009 Annual Report.

2. Resolution 1 - Remuneration Report

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an advisory only resolution:

“That the Remuneration Report as detailed in the Directors’ Report for the period ended 30 June 2009 be adopted.”

3. Resolution 2 - Change in Nature and Scale of Activities of the Company

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

“That, subject to Resolutions 3 to 14 (inclusive) being passed and in accordance with Listing Rule 11.1.2 and for all other purposes, approval is given for the Company to make a significant change to the nature and scale of its activities as set out in the Explanatory Statement.”

Voting Exclusion Statement – Resolution 2

In accordance with Listing Rule 7.3.8, the Company will disregard any votes cast on Resolution 2 by:

• a person who may obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if the resolution is passed; and

• an associate of that person.

However, the Company need not disregard a vote if:

• it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or

• it is cast by a person chairing the meeting as a proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

4. Resolution 3 - Issue of Consideration Shares to Non Related Triangle Vendors To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

“That, subject to Resolutions 2 and 4 to 14 (inclusive) being passed and in accordance with Item 7 of section 611 of the Corporations Act and for all other


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purposes, approval be and is hereby given to the issue of 408,280,222 Consideration Shares to the Non Related Triangle Vendors at a deemed issue price of $0.01 each under a Prospectus (on a post consolidation basis), as part consideration for the Company acquiring 100% of the issued capital of Triangle Energy Limited, further details of which are contained in the Explanatory Statement.”


In accordance with Item 7 of section 611 of the Corporations Act, the Company will disregard any votes cast on Resolution 3 by:

• a person who may participate in the proposed issue of securities and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if the resolution is passed; and





5. Resolution 4 - Issue of Consideration Shares - Related Triangle Vendors To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

“That, subject to Resolutions 2 and 3 and 5 to 14 (inclusive) being passed and in accordance with Listing Rule 10.11 and Item 7 of section 611 and section 208 of the Corporations Act and for all other purposes, approval is given to the issue of 510,019,778 Consideration Shares to the Related Triangle Vendors at a deemed issue price of $0.01 each under a Prospectus (on a post consolidation basis), as part consideration for the Company acquiring 100% of the issued capital of Triangle Energy Limited, further details of which are contained in the Explanatory Statement.”

Voting Exclusion Statement – Resolution 4:

For the purposes of Listing Rule 10.13.6, Item 7 of section 611 and section 224 of the Corporations Act, the Company will disregard any votes cast on Resolution 4 by:




• it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or

• it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.


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6. Resolution 5 - Issue of Facilitation Shares


“That, subject to Resolutions 2 to 4 (inclusive) and 6 to 14 (inclusive) being passed and in accordance with Item 7 of section 611 of the Corporations Act and for all other purposes, approval is given to the issue of 100,000,000 Facilitation Shares to Milwal Pty Ltd ACN 008 756 296 (and/or its nominees) at a deemed issue price of $0.01 each under a Prospectus (on a post consolidation basis), further details of which are contained in the Explanatory Statement.”


For the purposes of Item 7 of section 611 of the Corporations Act, the Company will disregard any votes cast on Resolution 5 by:






7. Resolution 6 - Consolidation of Share Capital

To propose, and if thought fit, to pass the following resolution as an ordinary resolution:

“That, subject to Resolutions 2 to 5 (inclusive) and 7 to 14 (inclusive) being passed and in accordance with section 254H of the Corporations Act, Listing Rule 7.20 and 7.22.1 and the Company’s Constitution and for all other purposes, approval be and is hereby given to the consolidation of the Existing Shares and Existing Options of the Company on a 1 for 3 basis as detailed in the Explanatory Statement, with any fractional entitlements being rounded down to the nearest whole number.”

8. Resolution 7 - Issue of New Shares pursuant to the Capital Raising To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

“That, subject to Resolutions 2 to 6 (inclusive) and 8 to 14 (inclusive) being passed and in accordance with Listing Rule 7.1, and for all other purposes, approval be and is hereby given to the issue up to 141,700,000 New Shares at an issue price of $0.01 per New Share to raise $1,417,000 under a Prospectus (on a post consolidation basis), further details of which are contained in the Explanatory Statement.”


In accordance with Listing Rule 7.3.8, the Company will disregard any votes cast on Resolution 7 by:




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9. Resolution 8 - Allotment and Issue of Shares to the Proposed Directors and Adam Sierakowski Pursuant to Capital Raising


“That, subject to the passing of Resolutions 2 to 7 (inclusive) and 9 to 14 (inclusive), for the purposes Listing Rule 10.11, Item 7 of section 611 and section 208 of the Corporations Act and for all other purposes, approval is given for the Company to allot and issue to the Proposed Directors and Mr Adam Sierakowski (an existing director) up to 50,000,000 New Shares of the 141,700,000 New Shares to be issued as detailed in Resolution 7 on the terms set out in the Explanatory Statement.”








10. Resolution 9 - Election of Mr John Towner


“That, subject to the passing of Resolutions 2 to 8 (inclusive) and 10 to 14 (inclusive), Mr John Towner, being eligible and having consented to act, be elected as a director of the Company on and from the conclusion of the Meeting.”

11. Resolution 10 - Election of Mr Frank Jacobs


“That, subject to the passing of Resolutions 2 to 9 (inclusive) and 11 to 14 (inclusive), Mr Frank Jacobs, being eligible and having consented to act, be elected as a director of the Company on and from the conclusion of the Meeting.”

12. Resolution 11 - Election of Mr Steven Hamer


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“That, subject to the passing of Resolutions 2 to 10 (inclusive) and 12 to 14 (inclusive), Mr Steven Hamer, being eligible and having consented to act, be elected as a director of the Company on and from the conclusion of the Meeting”.

13. Resolution 12 - Election of Mr Lewis Johnson


“That, subject to the passing of Resolutions 2 to 11 (inclusive) and 13 to 14 (inclusive), Mr Lewis Johnson, being eligible and having consented to act, be elected as a director of the Company on and from the conclusion of the Meeting.”

14. Resolution 13 - Election of Mr Adam Sierakowski


“That, subject to the passing of Resolutions 2 to 12 (inclusive) and 14, Mr Adam Sierakowski who was appointed to the Board since the last Annual General Meeting be elected as a director of the Company in accordance with clause 11.4 of the Company’s Constitution.”

15. Resolution 14 - Change of Company Name

To consider and if thought fit, to pass, with or without amendment, the following as a special resolution:

“That subject to the passing of Resolutions 2 to 14 (inclusive) and in accordance with section 157(1) of the Corporations Act, and for all other purposes, the Company change its name from “Maverick Energy Limited” to “Triangle Energy (Global) Limited”.

16. Resolution 15 - Issue of Convertible Note to Richard Wolanski


“That, subject to the passing of Resolutions 2 to 14 (inclusive) and in accordance with Listing Rule 10.11 and for all other purposes, approval is given for the issue of a Convertible Note to Mr Richard Wolanski with a face value of $30,000 and being convertible at 3,000,000 New Shares on the terms and conditions set out in the Explanatory Statement.”


For the purposes of Listing Rule 10.13.6, the Company will disregard any votes cast on Resolution 15 by:





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9. Resolution 8 - Allotment and Issue of Shares to the Proposed Directors and Adam Sierakowski Pursuant to Capital Raising


“That, subject to the passing of Resolutions 2 to 7 (inclusive) and 9 to 14 (inclusive), for the purposes Listing Rule 10.11, Item 7 of section 611 and section 208 of the Corporations Act and for all other purposes, approval is given for the Company to allot and issue to the Proposed Directors and Mr Adam Sierakowski (an existing director) up to 50,000,000 New Shares of the 141,700,000 New Shares to be issued as detailed in Resolution 7 on the terms set out in the Explanatory Statement.”








10. Resolution 9 - Election of Mr John Towner


“That, subject to the passing of Resolutions 2 to 8 (inclusive) and 10 to 14 (inclusive), Mr John Towner, being eligible and having consented to act, be elected as a director of the Company on and from the conclusion of the Meeting.”

11. Resolution 10 - Election of Mr Frank Jacobs


“That, subject to the passing of Resolutions 2 to 9 (inclusive) and 11 to 14 (inclusive), Mr Frank Jacobs, being eligible and having consented to act, be elected as a director of the Company on and from the conclusion of the Meeting.”

12. Resolution 11 - Election of Mr Steven Hamer


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“That, subject to the passing of Resolutions 2 to 10 (inclusive) and 12 to 14 (inclusive), Mr Steven Hamer, being eligible and having consented to act, be elected as a director of the Company on and from the conclusion of the Meeting”.

13. Resolution 12 - Election of Mr Lewis Johnson


“That, subject to the passing of Resolutions 2 to 11 (inclusive) and 13 to 14 (inclusive), Mr Lewis Johnson, being eligible and having consented to act, be elected as a director of the Company on and from the conclusion of the Meeting.”

14. Resolution 13 - Election of Mr Adam Sierakowski


“That, subject to the passing of Resolutions 2 to 12 (inclusive) and 14, Mr Adam Sierakowski who was appointed to the Board since the last Annual General Meeting be elected as a director of the Company in accordance with clause 11.4 of the Company’s Constitution.”

15. Resolution 14 - Change of Company Name

To consider and if thought fit, to pass, with or without amendment, the following as a special resolution:

“That subject to the passing of Resolutions 2 to 14 (inclusive) and in accordance with section 157(1) of the Corporations Act, and for all other purposes, the Company change its name from “Maverick Energy Limited” to “Triangle Energy (Global) Limited”.

16. Resolution 15 - Issue of Convertible Note to Richard Wolanski


“That, subject to the passing of Resolutions 2 to 14 (inclusive) and in accordance with Listing Rule 10.11 and for all other purposes, approval is given for the issue of a Convertible Note to Mr Richard Wolanski with a face value of $30,000 and being convertible at 3,000,000 New Shares on the terms and conditions set out in the Explanatory Statement.”


For the purposes of Listing Rule 10.13.6, the Company will disregard any votes cast on Resolution 15 by:






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PROXIES 1. A member entitled to attend and vote at a meeting of the Company is entitled to appoint

not more than two proxies to attend and vote instead of the member. If two proxies are appointed, and a member does not specify the proportion or number of the member's votes each proxy may exercise, each proxy may exercise half the votes. A proxy need not be a member of the Company.

2. In order to vote on behalf of a company that is a Shareholder of Maverick, a valid Power

of Attorney in the name of the attendee, must be either lodged with the Company prior to the Meeting, or be presented at the Meeting before registering on the attendance register for the Meeting.

3. Forms to appoint proxies, and the Power of Attorney (if any) under which they are signed, must be lodged at the Company’s Registry at Security Transfer Registrars Pty Limited, 770 Canning Highway, Applecross, Western Australia 6153 or sent by facsimile to the Registry on +61 (08) 9315 2233, not less than 48 hours before the time of the Meeting or resumption of the adjourned Meeting at which the person named in the instrument proposes to vote.

4. An instrument appointing a proxy:

(a) shall be in writing under the hand of the appointor or of his attorney, or if the appointor is a corporation, either under seal or under the hand of a duly authorised officer or attorney;

(b) may specify the manner in which the proxy is to vote in respect of a particular

Resolution and, where an instrument of proxy so provides, the proxy is not entitled to vote on the Resolution except as specified in the instrument;

(c) shall be deemed to confer authority to demand or join in demanding a poll; and (d) shall be in such form as the Directors determine and which complies with Section

250A of the Corporations Act.

5. Proxies appointing the Chairman which do not specify the way in which the proxy is to vote on a particular resolution will be recorded as voting in favour of the Resolutions.

ATTENDANCE AND VOTING ELIGIBILITY For the purpose of regulation 7.11.37 of the Corporations Regulations 2001, the Directors have determined that Shares held at 5.00 pm (Perth Time) on 17 November 2009 will be taken, for the purposes of the Meeting, to be held by the persons who held them at that time. ENQUIRIES All enquiries in relation to the contents of the Notice of Annual General Meeting or Explanatory Statement should be directed to the Company Secretary, Mr Mark Clements. BY ORDER OF THE BOARD Mark Clements Company Secretary Dated: 8 October 2009


Maverick Energy Limited ACN 110 411 428

EXPLANATORY STATEMENT

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EXPLANATORY STATEMENT

INTRODUCTION This Explanatory Statement has been prepared for the information of Shareholders of Maverick Energy Limited in connection with Resolutions 1 to 15 to be considered at the Annual General Meeting of members to be held in the Price Sierakowski Boardroom, Level 24, 44 St Georges Terrace, Perth, Western Australia, at 12.00 pm (Perth Time) on 19 November 2009. This Explanatory Statement should be read in conjunction with the accompanying Notice of Annual General Meeting. Please refer to Section 9 of this Explanatory Statement for a glossary of terms. This Explanatory Statement includes information and statements that are both historical and forward-looking. To the extent that any statements relate to future matters, Shareholders should consider that they are subject to risks and uncertainties. Those risks and uncertainties include factors and risks sp0ecific to the oil and gas industries as well as matters such a general economic conditions. actual events and results may differ materially. None of the Company, the Directors, Proposed Directors or their advisors can assure Shareholders that forecast or implied results will be achieved. 1. ITEM 1: Financial and Other Reports

The Corporations Act requires the Directors of the Company to lay before the Annual General Meeting the Financial Statements, the Directors’ Report and the Auditor’s Report for the last financial year that ended 30 June 2009. These reports are contained in the Company’s Annual Report for the period ended 30 June 2009 which has been provided to all Shareholders and is also available on the Company’s website at www.maverickenergy.com.au. As required under section 250PA of the Corporations Act, at the Annual General Meeting, the Company will make available those questions directed to the auditor and received by the Company by 5.00 pm (Perth Time) on 12 November 2009, being questions which he auditor considers relevant to the content of the Independent Auditor’s Report or the conduct of the audit of the Financial Report. Every endeavour will be made during the Annual General Meeting to answer questions submitted by Shareholders. However, depending on the number and types of questions received, it may not be possible to respond to every submitted question, either at or after the Meeting. To enable Shareholders who cannot attend the Annual General Meeting to raise issues and to assist the Board and the auditor of the Company in responding to questions, please submit any questions you may have on the Questions From Shareholders Form (following the Proxy Form attached to this Explanatory Statement) and return the form in person or by mail to Level 24, 44 St Georges Terrace, Perth, Western Australia, 6000 or by fax on +61 8 9218 8875 so that it is received by no later than 5.00 pm (Perth Time) on 12 November 2009.


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2. RESOLUTION 1: Remuneration Report

The Remuneration Report is set out in the Directors’ Report (under the heading Remuneration Report) in the Company’s Annual Report for the period ended 30 June 2009. this report sets out the Company’s remuneration policy and reports on the remuneration arrangements in place for Directors and key executives of the Company. Section 249L(2) of the Corporations Act requires the Company to inform Shareholders that a Resolution on the Remuneration Report will be put at the Annual General Meeting. Section 250R(2) of the Corporations Act requires a Resolution that the Remuneration Report be adopted must be put to a vote. Resolution 1 seeks this approval. However, in accordance with section 250R(3) of the Corporations Act, Shareholders should note that Resolution 1 is an “advisory only” Resolution which does not bind the Directors of the Company. Following consideration of the Remuneration report, the Chairman, in accordance with section 250SA of the Corporations Act, must give Shareholders a reasonable opportunity to ask questions about, or make comments on, the Remuneration report.

3. RESOLUTION 2: Change in Nature and Scale of Activities of the Company 3.1 Background to Resolution 2

Subject to the passing of Resolutions 3 to 14 (inclusive), Resolution 2 is an ordinary resolution which seeks approval for the change of the Company’s nature and scale of activities, as a result of the proposed 100% acquisition of Triangle Energy Limited (TEL) pursuant to the Share Sale Agreement. As announced on 3 July 2009 and 11 August 2009, the Company entered into a conditional Heads of Agreement to acquire 100% of the issued capital of TEL (Heads of Agreement). Under the terms of the Heads of Agreement, the Company proposed acquiring of 100% of the issued capital of TEL. As announced on 15 September 2009, the Company and the TEL Shareholders (Vendors) entered into a share sale agreement for the acquisition of 100% of the issued capital of TEL (Share Sale Agreement). In accordance with the terms of the Share Sale Agreement, the Company will issue 918,300,000 Consideration Shares to the Vendors and 100,000,000 Facilitation Shares to Milwal Pty Ltd (and/or its nominees) as consideration for the facilitation of the acquisition. The Share Sale Agreement replaces the above Heads of Agreement and is subject to and conditional upon the following:

(a) TEL obtaining any necessary regulatory approvals as may be required by TEL’s

constitution or the Corporations Act for the transfer of 100% of TEL’s issued capital to the Company.

(b) The Vendors executing or causing TEL to execute any other document or do any

other matter reasonably required by the Company to give effect to the acquisition of TEL.

(c) Each of the Vendors entering into restriction agreements as required by the ASX. (d) The Company obtaining such Shareholder approvals or other regulatory approvals

for the transaction contemplated as may be required by its Constitution, the ASX, the Listing Rules, the Corporations Act, ASIC or any other regulatory body, including but not limited to:

• the approval for the issue and allotment of the Consideration Shares;

• the approval for the issue and allotment of the Facilitation Shares;


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• approval of the shareholders of the Company under section 611 Item 7 of the Corporations Act 2001 to the issue and allotment of the Consideration Shares or the Facilitation Shares and the acquisition of TEL;

• any approvals under the related party provisions of the Corporations Act or the Listing Rules for the issue and allotment of the Facilitation Shares or the Consideration Shares; and

• the approval of Shareholders to a change in the nature and scale of the Company under the Listing Rules.

(e) The Company taking all necessary corporate action to ensure that the existing Directors of the Company retire on and from the conclusion of the Shareholders approving the acquisition.

(f) 100% acceptance by the Vendors and each Vendor signing the Share Sale

Agreement.

3.2 Overview on TEL

TEL is an unlisted public energy company focused on the production of oil and gas in Indonesia. On 29 May 2009 TEL acquired all of the issued capital of Mobil Pase Inc. (MPI) from Mobil Petroleum Company Inc. and subsequently MPI’s name was changed to Triangle Pase Inc. (TPI). TPI became a wholly owned subsidiary of TEL on 1 June 2009. TPI owns and operates a 100% working interest in the Production Sharing Contract in respect of the Pase Block located in the Aceh Province, North Sumatra, Indonesia (Pase PSC).

3.3 Overview of Pase PSC The Pase PSC was awarded to MPI, a wholly owned subsidiary of Mobil Petroleum Company Inc. (now Exxon Mobil Corporation) (ExxonMobil) in 1981 for a period of 30 years and presently encompasses 922km2. The Pase PSC relates to the Pase Field discovered in 1983 and it consists of a fractured carbonate reservoir. Production commenced in 1998 and in 2003 ExxonMobil estimated that the field contained 498 BCF gas in place with 54% of the gas contained in fractures and 46% in the reservoir matrix. Cumulative production to date is 183 BCF. The Pase PSC is an arrangement between TPI and the government of Indonesia. Under the Pase PSC, TPI is responsible for operating and funding all exploration and production operations. The PSC prescribes the formula for calculating the share of oil and of gas attributable to TPI and to the government of Indonesia. Under the Pase PSC the government of Indonesia’s share of gas production is 32.5%. The Pase PCS expires on 11 February 2011. TEL is preparing an application for a 10 year extension to the Pase PSC term. The production wells in the Pase field now have a high water cut which suggests that much of the fracture gas has been produced. Accordingly, ongoing production is likely to be matrix and/or attic gas. The acreage has only been explored once, for gas, to feed the Arun LNG facility. TEL has identified significant remaining potential in the Pase PSC through the improvement of current gas production through workovers, water handling and attic drilling. TEL has also identified shallower bypassed gas as well as oil potential which has been neglected by ExxonMobil. Gas produced from the Pase PSC is sold through the Arun LNG plant at a premium price tied to a basket of crude oil markers.


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Figure 1 Pase Block PSC

Production The current production is from one well (Pase A5) at a rate of about 1.8 MMCF/D. The production is interrupted from time to time due to simple power supply problems. The Pase A6 well has been shut in since 2006 due to excess water production and insufficient disposal capacity. Due to the remote location, the intermittent production and the small contribution to the overall Arun gas supply the Pase PSC was a low priority for ExxonMobil and divested to TEL. During August 2009, TEL’s first month of operation of the Pase PCS, production was 57.3 MMCF at an average daily rate of 1.85 MMCF/D. Figure 2 Pase Production Performance


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Gas Sales TPI has a Continuation Agreement with ExxonMobil for the sale of gas via a consortium that delivers gas to the Arun liquefaction facility. LNG is predominantly sold to Korea and receives a crude oil equivalent price (Oil:$100/70/50/BBL Gas: $14/10/7.50/MCF). The Continuation Agreement continues to the end of the current term of the Pase PSC and can be extended by mutual agreement. Since TEL took over operations the downtime of the plant has been significantly reduced. Production from the Pase A5 well has been increased to 1.85 MMCF/D and this is expected to double when the Pase A6 well is restored to production by the end of September. The gas production is from a fractured carbonate reservoir and with the gas a considerable volume of water is produced. TEL proposes to effectively dispose of produced water. With improvements in water handling capacity it is expected that rates of up to 5 MMCF/D can be produced. Capital investment for these programs is low and under the Pase PSC-terms cost recovery of all investment results in priority payback of any investment. Development Drilling The Pase Field has produced to date 183 BCF of gas from a total of four producing wells that flowed as high as 80 MMCF/D per well. There are two attic (updip) drilling locations that TEL expects to be able to produce water-free gas for some time to come (Figure 3 and 4). Given the prolific historical production rates, a premium gas price and the cost recovery terms, payout of the investment is anticipated within a few months of successful completion. Figure 3: Base Baong depth structure map – Pase Gas Field

Infill Drilling


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Figure 4: Pase Field and SLS-B Structural Section

Upside Potential TEL’s corporate effort is currently focused on renewal of the Pase PSC. Initial discussions with BPMIGAS have indicated that a firm three year program (2011-2014) of seismic in the first year followed by two wells may be deemed appropriate to secure extension for ten years. Three distinctly different exploration targets have been identified. In the Northern block an anticlinal Pliocene oil play has been identified on trend with the Julu Rayeu oil field at an expected depth of between 600m and 1,000m. Drilling costs are expected to be low. A low risk undrilled fault block on the Pase Field West flank has been identified but size and well location could be improved with some more seismic. A carbonate prospect south of Arun, directly on trend with Arun has been identified and requires specialized seismic reprocessing. Due to the higher risk nature, this would likely be a candidate for farmout. Further information The above is a brief overview and summary of TEL’s assets and the Pase PSC, further and more detailed information relating to: (a) the Pase PSC; (b) the revenue sharing entitlements of TEL (via TPI); (c) the gas sales arrangements of TPI; and (d) further information on the Pase Field and its geology, are set out in the Independent Geologist’s Report by Roger Whyte dated 22 September 2009 and attached to the Independent Expert’s Report accompanying this Explanatory Statement. The Directors recommend Shareholders read the Independent Expert’s Report and attached Independent Geologist’s Report accompanying this Explanatory Statement in full.


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3.4 Independent Expert’s Report

For the purposes of Item 7 of section 611 of the Corporations Act and to assist Shareholders in considering the Resolutions in the Notice of Meeting, the Company has commissioned an Independent Expert on the fairness and reasonableness of the proposed 100% acquisition of TEL. The report of the Expert concludes that the proposed 100% acquisition of TEL is FAIR AND REASONABLE to non-associated Shareholders. You should consider the Expert’s Report (together with the Independent Geologists’ Reports attached to the Expert’s Report) in detail.

3.5 Advantages of transaction

The Directors are of the view that the following non-exhaustive list of advantages may be relevant to a Shareholder’s decision on how to vote on the proposed Resolutions: The Directors of the Company believe that an investment in TEL will add significant value to the Company’s Shares;

• By approving the change in nature and scale, the Company will acquire a producing asset with a potential significant revenue stream.

• Revenue generated from the acquisition of TEL may be used to further develop

and enhance the revenue generation potential of the TEL assets, provide funds to enable to the Company to further explore and develop existing assets and provide the Company with funds for the acquisition and development of additional opportunities in the oil and gas industry, as may be identified by the Company.

3.6 Disadvantages of transaction

The Directors are of the view that the following non-exhaustive list of disadvantages may be relevant to a Shareholder’s decision on how to vote on the proposed Resolutions: • The Company will be changing the scale its activities and the Company may be

more acutely affected by risk factors associated with the oil and gas industry (these are set out further below in this Notice of Annual General Meeting);

• The 100% acquisition of TEL under the Share Sale Agreement will result in the

issue of securities to the TEL Vendors which together with the other Resolutions in the Notice of Annual General Meeting will have a dilutionary effect on the current holdings of Existing Shareholders;

• TEL may not successfully obtain an extension/renewal of the Pase PSC beyond

11 February 2011;

• There is no guarantee that the Company’s Shares will increase in value.

3.7 Risks – Change of Scale of Activities

Shareholders should be aware that if the Resolutions are approved, the Company will be changing the scale of its activities which will because of its nature be subject to various risk factors. These risks are both specific to the oil and gas industry and also relate to the general business and economic environment in which the Company will operate. Based on the information available, the principal risks facing the Company are as follows: Changes in Regulatory Environment Changes to laws, regulations and accounting standards which apply to the Company from time to time could materially and adversely impact upon the operating and financial


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performance and cash flows of the Company and therefore the operations and performance of the Company.

Economic and Government Risk

There is a risk that the price of Shares and returns to Shareholders may be affected by changes in:

• local and world economic conditions;

• interest rates;

• levels of tax, taxation law and accounting practice;

• government legislation or intervention;

• inflation or inflationary expectations; and

• natural disasters, social upheaval or war in Australia or overseas,

as well as other factors beyond the control of the Company. Commodity Prices The Company plans that any future revenue of its business will be derived mainly from the sale of gas products. Consequently, the Company’s financial position, operating results and future growth will closely depend on the market price of these commodities. Market prices of gas are subject to large fluctuations in response to changes in global and domestic demand and/or supply of natural gas and various other factors. These changes can be the result of uncertainty or several industry and macroeconomic factors beyond the control of the Company, including actions taken by political instability, governmental regulation, forward selling by producers, climate, inflation, interest rates and currency exchange rates. If market prices of the commodities sold by the Company were to fall below production costs for these products and remain at that level for a sustained period of time, the Company would be likely to experience losses, having a material adverse effect on the Company. Political Risks War, terrorist attacks or hostilities anywhere in the world can result in a decline in economic conditions worldwide or in a particular region, which could produce an adverse effect on the business, financial position and financial performance of the Company. Renewal of PSC The Pase PSC is due to expire on 11 February 2011. The Company (through TEL) is developing an application for the extension of the Pase PSC for a further 10 years, however, there is a risk the application to extend the Pase PSC fails and the rights to the Pase PSC come to an end. Exchange Rates The Company may be exposed to rapid and material movements in exchange rates, in particular the A$/US$/IDR exchange rate. Adverse movements in exchange rates relating to either equity investments or commodities or project operating costs, or increased price competitiveness in response to movements in exchange rates may materially adversely impact the operational and financial performance and cash flows.

Volatility of Prices of Petroleum

The demand for, and price of, petroleum is highly dependent on a variety of factors, including international supply and demand, the level of consumer product demand, actions taken by governments and major petroleum corporations and global economic


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and political developments. International petroleum prices fluctuate and at times the fluctuations can be quite wide.

Environmental Regulations

The Company’s operations are subject to the environmental risks inherent in the oil and gas industry. The Company is subject to environmental laws and regulations in connection with all its operations. Although the Company believes that it is in compliance in all material respects with all applicable environmental laws and regulations, there are certain risks inherent to its activities that could subject the Company to extensive liability.

Further, the Company may require approval from the relevant authorities before it can undertake activities which are likely to impact the environment. Failure to obtain such approvals will prevent the Company from undertaking the desired activities. The Company is unable to predict the effect of additional environmental laws and regulations which may be adopted in the future, including whether any such laws or regulations would materially increase the Company’s cost of doing business or affect its operations in any area.

The Company believes that it is in material compliance with all applicable environmental laws and regulations. However, there can be no assurance that any new environmental laws or regulations or stricter enforcement policies (that may in the future be implemented) will not oblige the Company to incur significant expenses or undertake significant investments which could have a material adverse effect on the Company’ business, financial condition or results of operations.

Sovereign Risk

The Company operates in jurisdictions outside of Australia where there may be a number of associated risks over which it will have no or limited control. These may include economic, social, or and political instability and change, hyperinflation, currency instability and changes to laws affecting foreign ownership, government participation, taxation, working conditions foreign nationals work permits, exchange rate and control, exploration licensing, petroleum export licensing, export duties and government control over oil and gas pricing.

Indonesia has specific reported risks for personal safety and security in various locales which may adversely affect the Company’s operations.

Competition

The Company competes with other companies, including major petroleum exploration and producing companies. Some of these companies may have greater financial and other resources and as a result may be in a better position to compete for future business opportunities. There can be no assurance that the Company can effectively compete with these companies.

Future Capital Needs

While Directors are satisfied that upon completion of the TEL acquisition the Company will have sufficient capital to meet its stated objectives, further funding of projects may be required to support ongoing activities and operations. There can be no assurance that alternative funding will be available on satisfactory terms or at all. Any inability to obtain funding will adversely affect the business and financial condition of the Company and, consequently, its performance. A failure to meet expenditure obligations may, if not remedied, result in forfeiture of the Company’s tenements.

Exploration, Development and Producing Risks

Petroleum operations may be hampered by a variety of circumstances, which may or may not be within the control of the Company. The business of gas exploration and production by its nature contains elements of significant risk. Ultimate and continuous success of these activities is dependent on many factors such as: • the timing of revenues;


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• the discovery and/or acquisition of economically recoverable reserves and resources;

• access to adequate capital for project development;

• obtaining consents and approvals necessary for the conduct of the Company’s mining and exploration activities;

• access to competent operational management and prudent financial administration, including the availability and reliability of appropriately skilled and experienced operators, employees, contractors and consultants; and

• adverse weather conditions over a prolonged period can adversely affect exploration and mining operations.

Factors including costs, actual revenues, consistency and reliability of revenue quality and commodity prices (including petroleum prices) affect successful project development and operations. The oil and gas industry has become subject to increasing environmental and occupational health and safety responsibility and this potential liability is a constant risk. Regulatory Licenses, Approvals and Applicable Laws The Company will from time to time require various government regulatory approvals for its operations and must comply with those approvals and applicable laws, regulations and policies. In particular, the Company may require licenses and approvals in relation to petroleum activities and environmental matters. There is a risk that the Company may not obtain or there may be delay in obtaining the necessary licenses and approvals or that stringent conditions may be imposed on such licenses and approvals. This may affect the timing and scope of work that can be undertaken. Further a failure to comply with a license, approval or applicable law may affect the timing and scope of work that can be undertaken. Reliance on Key Management

The responsibility of overseeing the day to day operations and the strategic management of the Company is substantially dependent upon its management and its key personnel. There can be no assurance given that there will be no detrimental impact on the Company if one, or a number of these employees cease their employment. The future success of the Company also depends upon its continuing ability to attract and retain highly qualified personnel. The ability to attract and retain the necessary personnel could have a material effect upon the Company’s business, results of operations and financial condition. Operational and Technical Risks The successful implementation of the Company’s business plan and objectives could be adversely affected by the following factors: • insufficient gas reserves:

• inconsistent gas quality;

• variable gas quantity;

• interruption in gas supply due to underground processing problems; and

• breach of a supply contract due to inconsistent product production. Industry operating risks include fire, explosions, and breakdowns of plant machinery and equipment. The occurrence of any of these risks could result in legal proceedings being instituted against the Company and substantial losses due to injury or loss of life, damage to or destruction of property, natural resources, regulatory investigation, and penalties or


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suspension of operations. Damage occurring to third parties may give rise to claims by third parties.

Share Market Conditions

The price of Shares quoted on ASX will be influenced by international and domestic factors affecting conditions in equity, financial and commodity markets. These factors may affect the general level of prices for listed securities of mining and exploration companies quoted on ASX. Settlement Risks

The Share Sale Agreement for the 100% acquisition of TEL is conditional upon a number of conditions being satisfied as set out in section 3.1 of this Explanatory Statement. There is a risk that these conditions may not be met.

The Company is not aware of any circumstances that have occurred to affect the satisfaction of the above conditions and it is the expectation of the Directors that following the passing of all Resolutions contained in the Notice of Annual General Meeting, the Share Sale Agreement will become unconditional.

3.8 Listing Rule 11.1

Listing Rule 11.1 provides that if an entity proposes to make a significant change, either directly or indirectly, to the nature and scale of its activities, it must obtain the approval of its shareholders and it must set out in detail the terms of the proposed transaction.

3.9 Pro-forma statement of financial position

Set out in Annexure A to this Explanatory Statement is an audited statement of financial position of the Company as at 30 June 2009, together with the unaudited pro-forma statement of financial position assuming Resolutions 1 to 14 (inclusive) are passed and implemented.

3.10 Pro-forma Capital Structure

The proforma capital structure of the Company, assuming Resolutions 1 to 14 (inclusive) are passed and implemented, is as follows:

Description Resolution Number of Shares

% interest Number of Options

% interest fully

diluted

(Note 1)

Existing shares and options

- 494,893,620 - 65,000,000 -

Post TEL Acquisition

1:3 Capital Consolidation

Resolution 6 164,964,540 12.08% 21,666,666 13.46%

Issue of Consideration Shares

Resolutions 3 and 4

918,300,000 67.28% - 66.22%

Issue of Facilitation Shares

Resolution 5 100,000,000 7.33% - 7.22%


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Fundraising – issue of New Shares

Resolutions 7 and 8

141,700,000 10.38% - 10.22%

Conversion of existing Convertible Notes

- 40,000,000 2.93% - 2.88%

TOTALS 1,364,964,540 100 21,666,666 100

Notes

1. Calculated on a fully diluted basis assuming all Existing Options and all existing Convertible Notes are exercised (post consolidation) resulting in the total number of issued shares being 1,386,631,206.

3.11 Other Maverick Projects

Since the announcement of the first phase drilling results on the Loopleegte project on 18 March 2009 and in light of the global financial crisis, the Company announced that it has implemented a strategic review of its expenditure commitments, its existing projects and their future potential whilst maintaining its ability to assess further opportunities in the energy sector to create value for Shareholders. Accordingly, subject to this ongoing review, the availability of funds and the proposed further review to be conducted by the Proposed Directors in respect of the Company’s existing two projects, the Company currently intends to: (a) Loopleegte Project

Examine the available options relating to the Loopleegte project and the prospects and requirements of establishing a JORC compliant coal resource.

(b) Reid’s Dome

Continue its participation in the joint venture for the exploration and development of the Reid’s Dome gas project.

3.12 Expenditure Plans and Use of Funds

The Company’s review and development plans are the best estimates available to the Company at this time. The capital raising of $1,417,000 contemplated by Resolution 7 will be made to enable the Company to meet its initial objectives and expenditure plans until the Company is cash flow positive, anticipated to occur from January 2010. Accordingly, the Company will review the exploration potential of all existing assets, determine exploration priorities and it is anticipated that exploration and further development of the Company’s projects will be funded from cash flows generated from the production revenues from the Pase PSC. The Company intends to use the funds raised from the prospectus issue contemplated by Resolution 7 as follows:

Use of Funds $

Prospectus capital raising (net of costs) will be utilised as follows:

1,271,980


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Review of existing exploration assets 80,000

Corporate advisory and transaction costs 49,000

Operational expenditure - Pase PSC 287,887

Capital expenditure - Pase PSC: A6 reconnect, facilities upgrade and power supply upgrade

250,000

Working capital 605,093

Total Funds utilised 1,271,980

3.13 Directors Recommendation

Mr Sierakowski has an interest in the outcome of Resolution 2 by virtue of Resolution 2 being contingent upon Resolution 8 (a resolution in which Mr Sierakowski has a direct interest) being passed. Accordingly, Mr Sierakowski declines to make a recommendation in respect of Resolution 2.

Each of the other Directors have no interest in the outcome of Resolution 2 other than as Existing Shareholders and will resign at the conclusion of the Meeting. In this context each of them recommend that Shareholders vote in favour of Resolution 2.

4. RESOLUTIONS 3, 4, 5 and 8: ISSUE OF CONSIDERATION SHARES TO NON RELATED TRIANGLE VENDORS AND RELATED TRIANGLE VENDORS, ISSUE OF FACILITATION SHARES TO RELATED PARTY AND ALLOTMENT AND ISSUE OF SHARES TO PROPOSED DIRECTORS PURSUANT TO THE CAPITAL RAISING

4.1 Background to Resolutions 3, 4, 5 and 8

Subject to the passing of Resolution 2, 6 and 7 and Resolutions 9 to 14 (inclusive): (a) Resolution 3 is an ordinary resolution which seeks approval for the issue of

408,280,222 Consideration Shares to the Non Related Triangle Vendors as part consideration for the acquisition of 100% of the issued capital of TEL as summarised in section 3 of the Explanatory Statement.

(b) Resolution 4 is an ordinary resolution which seeks approval for the issue of

510,019,778 Consideration Shares to the Related Triangle Vendors as part consideration for the acquisition of 100% of the issued capital of TEL as summarised in section 3 of the Explanatory Statement.

(c) Resolution 5 is an ordinary resolution which seeks approval for the issue of

100,000,000 Facilitation Shares to Milwal Pty Ltd (and/or its nominees) as consideration for the facilitation of the acquisition of 100% of the issued capital of TEL as summarised in section 3 of the Explanatory Statement.

(d) Resolution 8 is an ordinary resolution which seeks approval for the issue of up to

50,000,000 New Shares to the Proposed Directors of the 141,700,000 New Shares to be issued under the capital raising contemplated by Resolution 7.

4.2 Regulatory Requirements


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Approval for Resolutions 3, 4, 5, and 8 is being sought in accordance with the following provisions of the Listing Rules and Corporations Act.

(a) Listing Rule 10.11 Chapter 10 of the Listing Rules contains certain provisions in relation to transactions between a company and “persons in a position of influence”. Listing Rule 10.11 provides that a company must not issue equity securities to a “related party” without the approval of holders of ordinary securities by ordinary resolution. The terms “related party” is defined in for these purposes to include a related party within the meaning of section 228 of the Corporations Act and a person whose relationship with the entity or a related party is, in ASX’s opinion, such that approval should be obtained. (i) Resolution 4

The Proposed Directors are considered to be “related parties” of the Company within the terms of the Listing Rules. Additionally, as the Related Triangle Vendors are either entities controlled by or relatives of various of the Proposed Directors, the Related Triangle Vendors are considered to be “relate parties” of the Company within the terms of the Listing Rules. Accordingly, the Company is seeking the approval of Shareholders under Listing Rule 10.11 in respect of the 510,019,778 Consideration Shares to be issued to the Related Triangle Vendors pursuant to Resolution 4. For the purposes of Listing Rule 10.13, the following information is provided in relation to Resolution 4: (A) The related parties to whom and the maximum number to whom the

510,019,778 Consideration Shares will be issued under Resolution 4 are:

Related Party Number of Shares

Jarrad Street Corporate Pty Ltd 349,002,647

Jacobs Oil and Gas Ltd 15,863,757

PT Prestige Global Petroleum <nominee account>

79,318,783

Jarrad Street Corporate Pty Ltd <nominee account> (and/or its nominees)

61,075,463

Supergom Holdings Pty Ltd as trustee for the Lewis Johnson Super Fund Account

2,379,564

Philip Jacobs 2,379,564

Total 510,019,778

(B) The 510,019,778 Consideration Shares to be issued to the Related

Triangle Vendors will be issued as part consideration for the Company’s 100% acquisition of TEL and no funds will be raised from the issue of those Consideration Shares.

(C) The 510,019,778 Consideration Shares shall be issued no later than 1

month after the date of the Meeting and when issued will rank equally in all respects with the existing fully paid shares on issue.


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(D) All of the 510,019,778 Consideration Shares referred to in Resolution 4

shall be offered and issued to the Related Triangle Vendors (or their nominees) under the Prospectus contemplated by Resolution 7.

(ii) Resolution 8

The right to apply for New Shares, under the Prospectus capital raising contemplated by Resolution 7, by the Proposed Directors and Mr Sierakowski (an existing Director) under Resolution 8 also requires approval in accordance with Listing Rule 10.11. For the purposes of Listing Rule 10.13, the following information is provided in relation to Resolution 8: (A) The related parties to whom New Shares will be issued and the maximum

number of New Shares to be issued are as follows:

Related Party Number of Shares

Mr John Towner 10,000,000

Mr Frank Jacobs 10,000,000

Mr Steve Hamer 10,000,000

Mr Lewis Johnson 10,000,000

Mr Adam Sierakowski 10,000,000

Total 50,000,000

(B) The New Shares to the Proposed Directors and Mr Sierakowski will be

issued under the same terms and conditions as those offered to the public under the Prospectus contemplated by Resolution 7.

(C) The New Shares will be issued under the prospectus contemplated by

Resolution 7, no later than 1 month after the date of the Meeting and when issued will rank equally in all respects with the existing fully paid shares on issue.

Pursuant to Listing Rule 7.2, if Listing Rule 10.11 shareholder approval is being sought, approval under Listing Rule 7.1 is not required.

(b) Section 208 of the Corporations Act

Section 208(1)(a) of the Corporations Act prohibits a company from giving a financial benefit (including an issues of shares) to a related party of the company without the approval of shareholders by a resolution passed at a general meeting at which no votes are cast in relation to the resolution in respect of any shares held by the related party or by an associate of the related party. On the basis set out in section 4.2(a) of this Explanatory Statement, the Shares proposed to be issued under Resolutions 4 and 8 constitutes the giving of a financial benefit to a related party of the Company. Accordingly, the Company is seeking the approval of Shareholders under section 208(1)(a) of the Corporations Act. It is necessary pursuant to section 219 of the Corporations Act to provide the following information relating to the related parties referred to in Resolutions 4 and 8:


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(i) The related parties to whom the proposed Resolution would permit financial

benefits to be given are the Related Triangle Vendors (Resolution 4) and the Proposed Directors and Mr Sierakowski, an existing Director (Resolution 8). The details of the nature and terms of the financial benefits to be given under these Resolutions is set out in section 4.2(a) of this Explanatory Statement.

(ii) The financial benefits to be given are the:

(A) 510,019,778 Consideration Shares to be issued to the Related Triangle Vendors (Resolution 4); and

(B) New Shares to the Proposed Directors and Mr Sierakowski (Resolution 8). The details of the nature and terms of the financial benefits to be given under these Resolutions is set out in section 4.2(a) of this Explanatory Statement.

(iii) The issue of the Shares under Resolutions 4 and 8 will occur no later than 1 month after the date of the Meeting.

(iv) Appropriate voting exclusion statements are included in the attached Notice of

Annual General Meeting. (v) Shareholders should read in full the Expert’s Report attached to this Explanatory

Statement for further information on the Shares to be issued under Resolutions 4 and 8.

(vi) Other than as set out in this Explanatory Statement, there is no further information

which the Existing Shareholders would reasonably require in order to decide whether or not it is in the Company’s interests to pass Resolutions 4 and 8.

(vii) Mr Sierakowski has an interest in the outcome of Resolution 8 being passed. Accordingly, Mr Sierakowski declines to make a recommendation in respect of Resolution 2.

Each of the other Directors have no interest in the outcome of Resolutions 4 and 8 other than as Existing Shareholders and will resign at the conclusion of the Meeting. In this context each of them recommend that Shareholders vote in favour of Resolutions 4 and 8.

(c) Section 611 of the Corporations Act

Resolutions 3, 4, 5 and 8 seek Shareholder approval under Item 7 of section 611 of the Corporations Act to:

(a) the acquisition by the Non Related Triangle Vendors of a relevant interest in the

specified number of Consideration Shares upon the issue of those Consideration Shares;

(b) the acquisition by the Related Triangle Vendors of a relevant interest in the

specified number of Consideration Shares upon the issue of those Consideration Shares;

(c) the acquisition by the Proposed Directors and Mr Sierakowski of a relevant

interest in additional New Shares on the issue of the New Shares under the capital raising contemplated by Resolution 7; and

(d) the acquisition by Milwal Pty Ltd (and/or its nominees) of a relevant interest in the

Facilitation Shares upon the issue of those Facilitation Shares.


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Except as provided by Chapter 6 of the Corporations Act, section 606(1) of the Corporations Act prohibits a person from acquiring shares in a company if, after the acquisition, that person or any other person would have a relevant interest or voting power in excess of 20% of the voting shares in that company. Item 7 of section 611 of the Corporations Act provides that section 606(1) of the Corporations Act does not apply to an acquisition of a relevant interest in the voting shares in a company if the company has agreed to the acquisition by resolution passed at a general meeting at which no votes are cast in relation to the resolution by the person to whom the shares are to be issued or by an associate of that person. Under section 610 of the Corporations Act, a person’s voting power is defined as the percentage of the total voting shares in the Company held by the person and the person’s associates.

The Company considers that the TEL Shareholders or their nominees, any persons nominated by the TEL Shareholders, the Proposed Directors and Mr Sierakowski (who apply for New Shares under the Prospectus) or their Associates and Milwal Pty Ltd (and/or its nominees) are not associated with each other (pursuant to the definition of Associates in the Corporations Act) for the purposes of the prohibition in Chapter 6 of the Corporations Act. However, out of an abundance of caution and to avoid any possibility that the TEL Shareholders (or their nominees), the Proposed Directors or their Associates, Mr Sierakowski or his Associates and Milwal Pty Ltd (and/or its nominees) are considered to be associated for the purposes of Chapter 6 of the Corporations Act, the Company is seeking the approval of Shareholders under Item 7 of section 611 of the Corporations Act, as if they were associated for the purposes of Chapter 6 of the Corporations Act because these issues of securities will result in the TEL Shareholders, Proposed Directors, Mr Sierakowski or his Associates and Milwal Pty Ltd (and/or its nominees) having a relevant interest in an aggregate of more than 20% of the voting shares in the Company. At the date of the Notice of Meeting, other than Mr Sierakowski and his Associates who owns 9,862,500 Existing Shares, no party comprising the TEL Shareholders, the Proposed Directors or Milwal Pty Ltd (and/or its nominees) held any Existing Shares in the Company. If Resolutions 3, 4, 5 and 8 are passed, the issue of the Consideration Shares to the TEL Shareholders or their nominees and the New Shares to the Proposed Directors or Mr Sierkowski or their Associates and the issue of the Facilitation Shares to Milwal Pty Ltd (and/or its nominees), pursuant to those Resolutions will give the TEL Shareholders, the Proposed Directors or Mr Sierakowski or their Associates and Milwal Pty Ltd (and/or its nominees) a relevant interest in an aggregate of more than 20% of the voting shares in the Company. As set out in the Voting Exclusion Statements in the Notice of Annual General Meeting and in accordance with the Listing Rules, the TEL Shareholders or their nominees, the Proposed Directors or Mr Sierakowski and their respective Associates and Milwal Pty Ltd (and/or its nominees) are precluded from voting on Resolutions 3, 4, 5 and 8 (respectively).

ASIC Regulatory Guide 74

The following information is included in accordance with the requirements of Item 7 of section 611 of the Corporations Act and ASIC Regulatory Guide 74 to the extent it applies pursuant to ASIC Regulatory Guide 159.

1. Identity of Persons who will hold a relevant interest in the securities to be issued

If Resolutions 3, 4, 5 and 8 are passed, the following New Shares are proposed to be issued to the following persons:

Shares


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Total of Post Consolidation New Shares

TEL Shareholders (excluding any TEL Shareholder Associated with the Proposed Directors)

410,659,786

John Towner and his Associates 420,078,110

Frank Jacobs and his Associates 25,863,757

Steven Hamer and his Associates 89,318,783

Lewis Johnson and his Associates 12,379,564

Adam Sierakowski and his Associates 10,000,000

Milwal Pty Ltd (and/or its nominees) 100,000,000

TOTAL 1,068,300,000

2. Impact of the Transactions on the Voting Power in the Company’s Shares

(a) The Company’s capital structure

Once the reorganisation of the Company’s capital structure proposed in Resolution 6 has been completed, the capital structure of the Company will consist of approximately 164,964,540 Shares and 21,666,666 Existing Options. Once the securities issue proposed in Resolutions 3, 4, 5, 7 and 8 have been completed and New Shares are issued on the exercise of all existing convertible notes, the capital structure of the Company will consist of: • approximately 1,364,964,540 Shares; and • 21,666,666 Existing Options (post consolidation). The number of Shares is approximate because of the rounding to whole numbers of Shares which will occur in the consolidation process.

(b) Current voting power of TEL Shareholders, Proposed Directors, Mr Sierakowski or their Associates and Milwal Pty Ltd (and/or its nominees)

As at the date of the Notice of Meeting, other than Mr Sierakowski and his Associates who owns 9,862,500 Existing Shares, no party comprising the TEL Shareholders, the Proposed Directors, Mr Sierakowski or their Associates or Milwal Pty Ltd (and/or its nominees) has a relevant interest in any Existing Shares. Accordingly, their combined voting power is 1.99%.

(c) Voting power of TEL Shareholders, Proposed Directors, Mr Sierakowski or their

Associates and Milwal Pty Ltd (and/or its nominees) after the issue of New Shares

The voting power of the TEL Shareholders, the Proposed Directors, Mr Sierakowski and their respective Associates and Milwal Pty Ltd (and/or its nominees) includes those New Shares in which the TEL Shareholders, the Proposed Directors, Mr Sierakowski and their respective Associates and Milwal Pty Ltd (and/or its nominees)


26

has a relevant interest, expressed as a percentage of the total number of votes attached to all the issued voting shares in the capital of the Company. Once all of the New Shares referred to in Resolutions 3, 4, 5, 7 and 8 have been issued or granted and New Shares issued on the exercise of all existing convertible notes, the number of shares in the Company in which the TEL Shareholders the Proposed Directors, Mr Sierakowski and their respective Associates and Milwal Pty Ltd (and/or its nominees) will have a relevant interest and their relevant voting power will be as follows:

Number of Shares

in which have a relevant interest

% voting power

TEL Shareholders (excluding any TEL Shareholder Associated with the Proposed Directors)

410,659,786

30.09%

John Towner and his Associates 420,078,110 30.78%

Frank Jacobs and his Associates 25,863,757 1.89%

Steve Hamer and his Associates 89,318,783 6.54%

Lewis Johnson and his Associates 12,379,564 0.91%

Adam Sierakowski and his Associates 13,287,500 0.97%

Milwal Pty Ltd (and/or its nominees) 100,000,000 7.33

TOTAL 1,071,587,500 78.51%

These numbers and percentages assume that the Company does not issue any other Shares to any person.

Proposed Directors

It is proposed that each of Messrs John Towner, Frank Jacobs, Steven Hamer and Lewis Johnson will be appointed as new directors of the Company on and from the conclusion of the Meeting. A short profile of each of them is set out in Section 7 of this Explanatory Statement. Each of the existing Directors (other than Mr Sierakowski) will resign on and from the conclusion of the Meeting.

Intentions as to the Future of the Company

The present intentions of the TEL Shareholders and the Proposed Directors and their Associates regarding the future of the Company, if the Resolutions in the Notice of Annual General Meeting are approved by Shareholders:

(a) Maintain the Company’s ongoing business and operations. (b) To inject capital of at least $1,271,980 (net of capital raising costs) into the

Company. This amount represents the prospectus which will enable the Company to carry out its proposed expenditure budget for the review and evaluation of the Company’s existing assets, provide funds to enable the Company to further explore and develop existing assets and acquisitions of additional opportunities in the oil and gas industry. This capital injection will provide the Company with working capital which the Proposed Directors consider is sufficient for the Company’s activities.


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(c) To appoint the Proposed Directors on and from the conclusion of the Meeting. (d) Except as set out in the previous paragraphs, the Proposed Directors have no

present intentions to change the business of the Company, or to otherwise redeploy the fixed assets of the Company. Upon appointment, the Proposed Directors will review the Company’s operations and existing assets .

(e) There are no proposals whereby any property will be transferred between the

Company and the TEL Shareholders, the Proposed Directors and their respective Associates.

Financial and Dividend Policies of the Company

There is no immediate intention of the Proposed Directors to change the financial or dividend policies of the Company.

Proposal is fair and reasonable The report of the Expert concludes that the issue of the Consideration Shares and the Facilitation Shares and the acquisition of Triangle set out in this Explanatory Statement is FAIR AND REASONABLE to non associated Shareholders. You should consider the Expert’s Report in detail.

5. RESOLUTION 6: CONSOLIDATION OF CAPITAL

Resolution 6 is an ordinary resolution. It is proposed that the issued capital of the Company be altered by consolidating the existing securities on a 1 for 3 basis. The date for determining the consolidation of capital will be 5 Business Days after the date of the Meeting at which the Resolution is passed. Any fractional entitlements as a result of holdings not being evenly divisible by 3 will be rounded down to the nearest whole number.

Section 254H of the Corporations Act enables a company to convert all or any of its shares into a smaller number of shares by a resolution passed at a general meeting. The conversion proposed by Resolution 6 is permitted under section 254H of the Corporations Act.

The consolidation will not result in any change to the substantive rights and obligations of Existing Shareholders of the Company. The purpose of the consolidation of the existing issued capital of the Company is to reduce the number of existing securities on issue. For example, a Shareholder currently holding 20,000 Existing Shares, will as a result of the consolidation, hold 6,666 New Shares.

Existing Options will also be consolidated on a 1 for 3 basis and the exercise price will be increased accordingly to 3 (3) times the current exercise price for the Existing Options. Accordingly, for example an optionholder holding 20,000 Existing Options exercisable at $0.01 each, will as a result of the consolidation, hold 6,666 Options exercisable at $0.03 each.

The Company’s net assets and tax position will remain unaltered as a result of the consolidation.

Existing Shares and Options on Issue

As at the date of this Explanatory Statement, the Shares on issue in the Company are as shown in the following table:

Shares on Issue Number

Fully paid ordinary shares 494,893,620

As at the date of this Explanatory Statement, the Options on issue in the Company are as shown in the following table:


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Options on Issue Number

$0.01 Unlisted Options Exp. 31/12/2010 65,000,000

Revised Capital after Resolutions 3, 4, 5, 6, 7 and 8 - Post Consolidation

If Resolutions 3, 4, 5, 6, 7 and 8 are approved, then the Shares on issue in the Company (post consolidation) will be as shown in the following table:

Shares on Issue Number

Existing Shares on Issue

164,964,540

Issue of Consideration Shares to Non Related Triangle Vendors

408,280,222

Issue of Consideration Shares to Related Triangle Vendors

510,019,778

Issue of Facilitation Shares to Milwal Pty Ltd (and/or its nominees)

100,000,000

Issue of Capital Raising Shares 141,700,000

TOTAL 1,324,964,540

If Resolutions 3, 4, 5, 6, 7 and 8 are approved, then the Options on issue in the Company (post consolidation) will be as shown in the following table:

Options on Issue Number

Existing Options on issue with an exercise price of $0.03 21,666,666

It is anticipated that the consolidation will occur in accordance with the following timetable:

Date Action

19 November 2009 Annual General Meeting

23 November 2009 Deferred Trading Commences

27 November 2009 Record Date for Shares to be consolidated

4 December 2009 Last day for despatch of new holding statements to Existing Shareholders and Existing Optionholders

Recommendation

Mr Sierakowski has an interest in the outcome of Resolution 6 by virtue of Resolution 6 being contingent upon Resolution 8 (a resolution in which Mr Sierakowski has a direct interest) being passed. Accordingly, Mr Sierakowski declines to make a recommendation in respect of Resolution 6



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6. RESOLUTION 7: ISSUE OF SHARES PURSUANT TO THE CAPITAL RAISING

6.1 Background on Resolution 7 Resolution 7 is an ordinary resolution which seeks approval for the issue of up to 141,700,000 New Shares under the proposed capital raising of up to $1,417,000 million under the Prospectus.

6.2 Shareholder Approval – ASX Listing Rule 7.1 Shareholder approval is being sought pursuant to Resolution 7 for the issue of up to 141,700,000 New Shares for the purposes of ASX Listing Rule 7.1. The New Shares proposed to be issued pursuant to Resolution 7 will not be included in the Company’s 15% calculation for the purposes of ASX Listing Rule 7.1. Listing Rule 7.1 provides that (subject to certain exceptions, none of which are relevant here) prior approval of shareholders is required for an issue of securities by a company if the securities will, when aggregated with securities issued by the company during the previous 12 months, exceed 15% of the number of shares on issue at the commencement of that 12 month period. Shareholder approval is being sought pursuant to Resolution7 for the issue of 141,700,000 New Shares for the purposes of Listing Rule 7.1. The New Shares proposed to be issued pursuant to Resolution 7 will not be included in the Company’s 15% calculation for the purposes of Listing Rule 7.1. For the purposes of ASX Listing Rule 7.3, the following information is provided in relation to Resolution 5: (a) the maximum number of securities to be issued by the Company under Resolution

7 is 141,700,000 New Shares; (b) the New Shares will be issued no later than three months after the date of the

Meeting (or such later date to the extent permitted by any ASX waiver or modification of the ASX Listing Rules);

(c) it is intended that allotment of the New Shares will occur on one date; (d) the New Shares will be issued at a price of $0.01 per New Share; (e) the New Shares rank equally in all respects with the existing fully paid ordinary

Shares on issue; and (f) the Company intends to use the funds raised from the issue of the New Shares

for the purposes set out in section 3.12 of this Explanatory Statement and the costs of the capital raising.

7. RESOLUTIONS 9 – 13: ELECTION OF DIRECTORS

The Share Sale Agreement provides that with effect on and from the conclusion of the Meeting the current Board of the Company will replaced by the Proposed Directors and Mr Sierakowski will remain a Director. In accordance with the Constitution and the Corporations Act, the appointment of Directors must be made by resolution passed in a general meeting. Resolutions 9 to 12 (inclusive) seek the election of the Proposed Directors. Set out below is a summary of the backgrounds of each the Proposed Directors that will be appointed to the Board following the conclusion of the Meeting. Mr John Towner


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John Towner brings a wealth of experience in the resources industry combined with knowledge and expertise in public company capital raising and finance. Renowned for taking oil and gas industry assets from start to public listing, John's level of expertise is exemplified by the success of companies such as Sydney Gas Ltd, Sunshine Gas Limited, and New Guinea Energy Ltd, all successfully listed on the ASX. Through his private company he acquired all the oil and gas assets of Amoco Australia, a wholly owned subsidiary of Amoco Inc. Through his family company he founded Sydney Gas Ltd on the strength of this, the first company to produce and retail gas in New South Wales from coal seams, despite both Amoco and the Australian Gas Light Company previously investing many hundreds of millions of dollars trying to achieve this goal. John was also instrumental in the restructure of Anzon Investments to Anzon Energy Limited, a company that has successfully carried out oil exploration and production in South-East Asia. He was also involved in taking BioMD Limited, a safety injection needle development company, from a private research and development entity to public listing in March 2004. In 2005. John formed New Guinea Energy Ltd, focusing on oil and gas exploration and production in Papua New Guinea. New Guinea Energy listed on the ASX in December 2007. Mr Frank Jacobs Frank Jacobs has more than 30 years of Oil and Gas industry experience spanning several continents. He commenced his career with AMOCO in Canada and since that time has worked for numerous oil and gas companies, implementing “growth through acquisition” strategies. Between 1986 and 2001 Frank worked in Australia and was instrumental in building several companies, Including Peko Oil Ltd., Cultus Petroleum NL and Cue Energy Resources NL (all public companies listed on the Australian Securities Exchange) into significant oil and gas production companies through the acquisition of oil and gas production properties. Properties were acquired from Esso Australia, Saga Petroleum, CMS Nomeco amongst other major international firms, projects ranging in size from $9 to $35 million. Frank was instrumental in the restructure of Anzoil NL from a “one-project” company. Under Frank’s leadership Anzoil diversified its oil and gas portfolio and pursued new ventures, in particular, the Lembak LPG project in Indonesia. Through a privately owned company Frank led the acquisition of a large offshore exploration block in Thailand from DEVON Energy Corporation. During the two years waiting for Thai government approval for the transfer, Frank worked as President and Chief Operating Officer of PetroReal, a Vancouver based company, and oversaw the acquisition and exploration of two Louisiana projects. Prior to the destruction of the platform by hurricane Ivan in September 2004 Frank was instrumental in securing a $100 million financing facility through Macquarie Bank. Frank then became the Executive Chairman of Texhoma Energy Inc, an OTCBB-listed US-incorporated company and in April 2007 he relinquished executive duties and successfully transitioned the Company to a new management team. In 2008 Frank founded Offset Energy Corporation, a company that holds the exploration rights to a number of oil and gas properties in the Gulf of Mexico. Mr Steven Hamer Steven Hamer has forty years of business experience working in both Australia and Indonesia. After completing a Bachelor of Science at Sydney University Steve spent ten


31

years with the Commonwealth Bank of Australia’s lending departments including head office lending and Bill and overseas department. After leaving the Commonwealth Bank, Steve pursued hotel ownership, home unit-townhouse development and mining activities. His activities in the mining industry and commodity trading continue today with particular involvement in energy and mining in Indonesia. Steve’s work with a fast ferry concept highlighted to him the need for an affordable fuel for gas turbine engines. This led to two years spent on the demonstration of a clean coal process for use in gas turbines and extended to clean graphite and clean steel process. Steve was Involved in each step of this process from the chemical laboratory work to overseeing the design and construction of the cleaning technology pilot plant. Steve is a foundation shareholder in Lloyd Energy Storage Systems Ltd, a public unlisted entity, co-inventor on patent for graphite based thermal energy storage system currently being commercialised by the company. Steve has served as Executive Director – Marketing, responsible for delineating markets for the product in both the grid connected regular power generation and the intermittent renewable energy generation markets. Steve is Chairman and CEO of PT Dinamika Cipta Sentosa and PT Prestige Global Petroleum in Indonesia and Director of Nickmere Pty Ltd, owner of Dianne copper mine in Queensland Australia. Mr Lewis Johnson Lewis Johnson has almost 40 years experience in all Australian and International investment sectors, involving institutional investment / funds management, development banking (corporate / project finance, private equity / venture capital), property, and stockbroking. He has been a member of numerous investment committees, advisory and corporate boards, and a director of several non-profit organisations. He is a graduated of the University of Melbourne (B.Comm) and a Graduate of the Australian Institute of Company Directors (GAICD) For more than 20 years he had direct investment management responsibility for a large successful balanced retirement fund and remains actively involved in stockbroking. He is currently an Advisor with Bell Potter Securities Limited - a Member Firm of the ASX - and a Director and Investment Manager of Bell Asset Management Ltd - members of the Bell Potter group. He is also active as a non executive director in the Property Industry Lewis has been active and well known for many years in the resources market, with strong personal and professional connections particularly in the exploration and emerging producer sectors in both minerals and energy. Mr Sierakowski was appointed a Director on 9 October 2009 and pursuant to clause 11.4 of the Constitution any Director (except a Managing Director) appointed by the Board, either to fill a casual vacancy or as an addition to the Board, must retire at the next Annual General Meeting following his or her appointment, but is eligible for re-election at that Annual General Meeting. Accordingly, Mr Sierakowski seeks to be re-elected pursuant to clause 11.4 of the Constitution. Set out below is a summary of Mr Sierakowski’s details. Mr Adam Sierakowski Mr Sierakowski is a lawyer and partner of the legal firm Price Sierakowski. He has over 15 years’ experience in legal practice, much of which he has spent as a corporate lawyer consulting and advising on a range of transactions to a variety of large private and listed public entities. He is the co-founder and director of Perth based corporate advisory


32

business, Trident Capital. Mr Sierakowski held a number of board positions with ASX listed companies. He is a member of the Australian Institute of Company Directors and the Association of Mining and Exploration Companies.

During the past three years he has also served as a director of listed companies Sterling Biofuels International Limited, Carnavale Resources Limited and International Resource Holdings Limited.

8. RESOLUTION 14: CHANGE OF COMPANY NAME

Resolution 14 is a special resolution which seeks approval for the Company to change its name.

Consistent with the new focus and direction of the Company, the Company proposes to change its name from “Maverick Energy Limited” to “Triangle Energy (Global) Limited” This change will not, in itself, affect the legal status of the Company or any of its assets or liabilities.

Shareholder approval is required for Resolution 14 under section 157 of the Corporations Act by special resolution.

The Company will make an application to the ASIC for the change of name to “Triangle Energy (Global) Limited”. The new name will take effect upon a new certificate of registration being issued.

8.1 Recommendation

Mr Sierakowski has an interest in the outcome of Resolution 14 by virtue of Resolution 14 being contingent upon Resolution 8 (a resolution in which Mr Sierakowski has a direct interest) being passed. Accordingly, Mr Sierakowski declines to make a recommendation in respect of Resolution 14.


9. RESOLUTION 15: ISSUE OF CONVERTIBLE NOTE TO RICHARD WOLANSKI

9.1 Background to Resolution 15

Resolution 15 seeks approval for Mr Richard Wolanski (a Director of the Company), to subscribe for a Convertible Note with a face Value of $30,000 and being convertible to 3,000,000 New Shares.

Shareholder approval is not being sought under Part 2E of the Corporations Act because the other Directors consider that the proposed issue of the Convertible Note is on arms length and reasonable terms in the circumstances as it will be issued at the same issue price as the capital raising.

9.2 Listing Rule 10.11

Listing Rule 10.11 sets out a number of regulatory requirements which must be satisfied in connection with the proposed issue of securities to Mr Wolanski (a Director of the Company). These are summarise in section 4.2(a) of the Explanatory Statement.

Listing Rule 10.13 sets out a number of matters which must be included in a notice of meeting proposing an approval of an issue of securities under Listing Rule 10.11. for the purposes of Listing Rule 10.13, the following information is provided in relation to Resolution 15:

(a) the maximum number of securities which may be issued to Mr Wolanski on conversion of the Convertible Note is 3,000,000 New Shares;

(b) the Convertible Note was issued with a face value of $30,000;

(c) the Convertible Note will be allotted and issued no later than 1 month after the date of the Meeting;


33

(d) the material terms of the Convertible Note are set out in section 9.3 of the Explanatory Statement; and

(e) the funds raised from the issue of the Convertible Note will be used for general working capital.

As approval of Shareholders is being sought in respect of Resolution 15 pursuant to Listing Rule 10.11, under exception 14 to Listing Rule 7.2, Shareholder approval under Listing Rule 7.1 is not required.

9.3 Terms of the Convertible Note

The material terms of the Convertible Note referred to in Resolution 15 are as follows:

(a) Issue Price - the issue price of the Convertible Note is $30,000.

(b) Conversion Price - the Convertible Note converts into 3,000,000 New Shares at an issue price $0.01 each.

(c) Interest - There is not interest payable on the Convertible Note.

(d) Term and Conversion - the Convertible Note is to be converted within 6 months of Shareholders approving the Resolution. Notes not converted within this time will result in their immediate redemption and the original subscription monies repaid within 180 days without further interest.

(e) Ranking on Conversion - each New Share issued on conversion will rank equally with all existing Shares then on issue.

(f) Security - the Convertible Note is unsecured.


34

10 GLOSSARY OF TERMS In this Explanatory Statement the following terms have the meaning set out below: Annexure Means an Annexure to this Explanatory Statement.

Associate Has the meaning set out in section 11 to 17 of the Corporations Act.

ASIC Means the Australian Securities and Investments Commission.

ASX ASX Limited (ACN 008 624 691) trading as the Australian Securities Exchange.

BBL Barrel (oil or condensate).

BCF Billion cubic feet (of gas).

Company Maverick Energy Limited (ACN 110 411 428).

Capital Raising The proposed raising of up to $1,417,000 under the Prospectus.

Consideration Shares A New Share issued (post consolidation) as consideration for the acquisition of TEL.

Constitution The Company’s constitution.

Convertible Note Means the convertible note to be issued as contemplated by Resolution 15 and on the terms set out in section 9 of the Explanatory Statement.

Corporations Act The Corporations Act 2001 (Commonwealth).

Director An existing director of the Company.

Existing Option Means an option to acquire a Share at an exercise price of $0.01 each on or before 31 December 2010.

Existing Share A fully paid ordinary share in the capital of the Company existing as at the date of this Notice of Annual General Meeting.

Existing Shareholders The Shareholders set out on the Company’s register of Shareholders as at 5.00 pm (Perth Time) on 17 November 2009.

Expert Means BDO Kendalls Corporate Finance (WA) Pty Ltd.

Expert’s Report Means the report of the Expert attached as Schedule 1 to and forming part of the Explanatory Statement.

Explanatory Statement Means the this explanatory statement accompanying the Notice of Annual General Meeting.

Facilitation Shares A New Share issued (post consolidation) as consideration for the facilitation of the acquisition of TEL.

JORC Means the Australasian Code for Reporting Exploration Results, Mineral Resources and Ore Reserves 2004.


35

Listing Rules The Official Listing Rules of ASX as amended from time to time.

Meeting The Annual General Meeting of the Company to be held on 19 November 2009 at 12.00 pm (Perth time).

MCF or MMCF Million cubic feet (of gas).

MMCF/D Million cubic feet per day (of gas).

New Shares A Share issued after the consolidation contemplated by Resolution 6.

Non Related Triangle Vendors

The Vendors who are not related parties of the Company and as set out in Annexure C (or their nominees).

Notice of Annual General Meeting

The notice convening the Meeting, which accompanies this Explanatory Statement.

Option An option to acquire a Share.

Proposed Directors Means collectively Messrs John Towner, Frank Jacobs, Steven Hamer and Lewis Johnson.

Prospectus The prospectus to be issued by the Company for the purposes of the capital raising (contemplated by Resolution 7) and issuing the Consideration Shares (contemplated by Resolutions 3 and 4) and the Facilitation Shares (contemplated by Resolution 5).

Related Triangle Vendors The Vendors who are related parties of the Company and as set out in Annexure B (or their nominees).

Resolutions The resolutions set out in the Notice of Annual General Meeting.

Share A fully paid ordinary share in the capital of the Company.

Share Sale Agreement The share sale agreement entered into between the Company and the Vendors dated 15 September 2009.

Shareholder The registered holder of a Share.

TEL Shareholders Means the Vendors.

Triangle or TEL Triangle Energy Limited (ACN 114 968 580).

Vendors The Related Triangle Vendors and the Non Related Triangle Vendors.


36

ANNEXURE A

Proforma Balance Sheet

Proforma Balance Sheet Set out below is the audited balance sheet of the consolidated entity (Maverick Energy Limited) as at 30 June 2009 together with the Proforma balance sheet on the basis of the assumptions set out below.

Balance Sheet as at

30 June 2009 $

Pro-forma Balance Sheet after transaction

$

CURRENT ASSETS

Cash and cash equivalents

Other Financial Assets

249,703

-

2,322,339

285,978

Trade and other receivables 10,962 30,648

Total current assets 260,665 2,638,965

NON-CURRENT ASSETS

Exploration and evaluation 1,538,444 1,538,444

Other Financial Assets - 124,146

Property, plant and equipment - 19,881

Investment - 127,551

Total non current assets 1,538,444 1,810,022

TOTAL ASSETS

1,799,109 4,448,987

CURRENT LIABILITIES

Trade and other payables 29,354 208,136

Total current liabilities 29,354 208,136

NON-CURRENT LIABILITIES

Provisions

Deferred tax liability

-

-

976

-

Other 16 16

Total non current liabilities 16 992

TOTAL LIABILITIES 29,370 209,128

NET /ASSETS 1,769,739 4,239,859

EQUITY

Contributed equity 2,333,067 4,614,651

Reserves 207,941 66,362

Accumulated losses (771,269) (441,154)

TOTAL / EQUITY 1,769,739 4,239,859


37

NOTES: The Company’s audited Balance Sheet as at 30 June 2009 has been consolidated with Triangle’s unaudited Balance Sheet as at 30 June 2009. Assumptions include:

• Capital raising of $400,000 through convertible notes at a conversion price of $0.01 per note and converting into 40,000,000 ordinary shares.

• Acquisition of Triangle by the issue of 1,018,300,000 shares at a deemed issue price of $0.01 per share

• Capital raising of $1,417,000 by the issue of 147,000,000 shares at an issue price of $0.01 per share.


38

ANNEXURE B

NON RELATED TRIANGLE VENDORS

NON RELATED TRIANGLE VENDORS Consideration Shares

Capersia Pte Ltd 63,455,027

Kenneth John Bull 79,318,783

Kenneth John Bull <nominee account> 79,318,783

Jeanette Radici or her nominees 23,795,635

Raewyn Clark or her nominees 23,795,633

PBL Investments Pty Ltd 2,379,564

Tempio Group of Companies Ltd 951,825

Ucan Nominees Pty Ltd 121,622,140

Australian Trade Access Pty Ltd 1,586,376

Whitehill Limited 1,586,376

Torwood Resources Limited 5,235,040

AMC Limited 2,617,520

Carter Capital Limited 2,617,520

TOTAL 408,280,222

39

ANNEXURE C

RELATED TRIANGLE VENDORS

RELATED TRIANGLE VENDORS Consideration Shares

Jarrad Street Corporate Pty Ltd 349,002,647

Jacobs Oil and Gas Ltd 15,863,757

PT Prestige Global Petroleum <nominee account> 79,318,783

Jarrad Street Corporate Pty Ltd <nominee account> 61,075,463

Supergom Holdings Pty Ltd as trustee for the Lewis Johnson Super Fund Account

2,379,564

Philip Jacobs 2,379,564

TOTAL 510,019,778


SECTION B: Voting Directions to your Proxy

SECTION A: Appointment of Proxy

SECTION C: Please Sign Below

REGISTERED OFFICE: LEVEL 24 44 ST GEORGES TERRACE PERTH WA 6000

SHARE REGISTRY:Security Transfer Registrars Pty Ltd

All Correspondence to:PO BOX 535,

APPLECROSS WA 6953 AUSTRALIA770 Canning Highway,

APPLECROSS WA 6153 AUSTRALIAT: +61 8 9315 2333 F: +61 8 9315 2233

E: [email protected]: www.securitytransfer.com.au

MAVERICK ENERGY LIMITEDACN 110 411 428

PROXY FORMTHIS DOCUMENT IS IMPORTANT. IF YOU ARE IN DOUBT AS TO HOW TO DEAL WITH IT, PLEASE CONTACT YOUR STOCK BROKER OR LICENSED PROFESSIONAL ADVISOR.

Holder Number:

1

I/We, the above named, being registered holders of the Company and entitled to attend and vote hereby appoint:

Please mark "X" in the box to indicate your voting directions to your Proxy.

RESOLUTIONS

Code: MRK

If no directions are given my proxy may vote as the proxy thinks fit or may abstain.* If you mark the Abstain box for a particular item, you are directing your Proxy not to vote on your behalf on a show of hands or on a poll and your votes will not be counted in computing the required majority on a poll.

This section must be signed in accordance with the instructions overleaf to enable your directions to be implemented.

Reference Number: MRK 1

The meeting Chairperson (mark with an "X")

The name of the person you are appointing(if this person is someone other than the Chairperson of the meeting).

or failing the person named, or if no person is named, the Chairperson of the Meeting, as my/our Proxy to act generally at the meeting on my/our behalf and to vote in accordance with thefollowing directions (or if no directions have been given, as the Proxy sees fit) at the Annual General Meeting of the Company to be held at 12.00 pm (Perth Time) on 19 November 2009 inthe Price Sierakowski Boardroom, Level 24, 44 St Georges Terrace, Perth, Western Australia and at any adjournment of that meeting.

OR

For Against Abstain* For Against Abstain*

1. Remuneration Report

2. Change of Nature and Scale of Activities of

Company

3. Issue of Consideration Shares Non Related

Triangle Vendors

4. Issue of Consideration Shares Related Triangle Vendors

5. Issue of Facilitation Shares Related Party

6. Consolidation of Share Capital

7. Issue of New Shares pursuant to the Capital

Raising

8. Proposed Directors participation in Capital

Raising

9. Election of John Towner

10. Election of Frank Jacobs

11. Election of Steven Hamer

12. Election of Lewis Johnson

13. Election of Adam Sierakowski

14. Change of Company Name

15. Issue of Convertible Note to Richard Wolanski

If you wish to appoint the Chairperson as your proxy and you do not wish to direct the Chairperson how to vote, please mark "X" in the box.By marking this box, you acknowledge that the Chairperson may exercise your proxy even if he has an interest in the outcome of the resolution and votes cast by him/her other than as a proxy holder will bedisregarded because of that interest. If you do not mark this box, and you have not directed your proxy how to vote, the Chair will not cast your votes on the resolution and your votes will not be counted incalculating the required majority if a poll is called on the resolution. The Chairperson of the Meeting intends to vote undirected proxies in favour of the resolution.

Individual or Security Holder

Sole Director and Sole Company Secretary

Security Holder 2

Director

Security Holder 3

Director / Company Secretary

9999000000003333111188882222111155559999


PRIVACY STATEMENTPersonal information is collected on this form by Security Transfer Registrars Pty Ltd as the registrar for securities issuers for the purpose of maintaining registers of securityholders,facilitating distribution payments and other corporate actions and communications. Your personal details may be disclosed to related bodies corporate, to external service providerssuch as mail and print providers, or as otherwise required or permitted by law. If you would like details of your personal information held by Security Transfer Registrars Pty Ltd or youwould like to correct information that is inaccurate please contact them on the address on this form.

TELEPHONE NUMBER

( )

NAME

My/Our contact details in case of enquiries are:

5. Signing InstructionsIndividual: where the holding is in one name, the Shareholder must sign.

Joint Holding: where the holding is in more than one name, all of the

Shareholders must sign.

Power of Attorney: to sign under Power of Attorney you must have already

lodged this document with the Company's share registry. If you have notpreviously lodged this document for notation, please attach a certified

photocopy of the Power of Attorney to this form when you return it.

Companies: where the Company has a Sole Director who is also the Sole

Company Secretary, this form must be signed by that person. If the Company(pursuant to section 204A of the Corporations Act 2001) does not have a

Company Secretary, a Sole Director may sign alone. Otherwise this form mustbe signed by a Director jointly with either another Director or Company

Secretary. Please indicate the office held in the appropriate place.

If a representative of the corporation is to attend the meeting the appropriate"Certificate of Appointment of Corporate Representative" should be lodged

with the Company before the meeting or at the registration desk on the day ofthe meeting. A form of the certificate may be obtained from the Company'sshare registry.

6. Lodgement of ProxyProxy forms (and any Power of Attorney under which it is signed) must be

received by Security Transfer Registrars Pty Ltd no later than 12.00 pm (PerthTime) on Tuesday 17 November 2009, being 48 hours before the time for

holding the meeting. Any Proxy form received after that time will not be validfor the scheduled meeting.

Security Transfer Registrars Pty LtdPO BOX 535Applecross, Western Australia 6953

Street Address:Alexandrea House, Suite 1770 Canning HighwayApplecross, Western Australia 6153

Telephone +61 8 9315 2333

Facsimile +61 8 9315 2233

Email [email protected]

NOTES 1. Name and Address

This is the name and address on the Share Register of Maverick Energy

Limited. If this information is incorrect, please make corrections on this form.Shareholders sponsored by a broker should advise their broker of any

changes. Please note that you cannot change ownership of your shares usingthis form.

2. Appointment of a ProxyIf you wish to appoint the Chairperson of the Meeting as your Proxy pleasemark "X" in the box in Section A. Please also refer to Section B of this proxy

form and ensure you mark the box in that section if you wish to appoint theChairperson as your Proxy.

If the person you wish to appoint as your Proxy is someone other than the

Chairperson of the Meeting please write the name of that person in Section A.If you leave this section blank, or your named Proxy does not attend themeeting, the Chairperson of the Meeting will be your Proxy. A Proxy need not

be a Shareholder of Maverick Energy Limited.

3. Directing your Proxy how to voteTo direct the Proxy how to vote place an "X" in the appropriate box againsteach item in Section B. Where more than one Proxy is to be appointed and

the proxies are to vote differently, then two separate forms must be used toindicate voting intentions.

4. Appointment of a Second ProxyYou are entitled to appoint up to two (2) persons as proxies to attend the meeting and vote on a poll. If you wish to appoint a second Proxy, an

additional Proxy form may be obtained by telephoning the Company's share registry +61 8 9315 2333 or you may photocopy this form.

To appoint a second Proxy you must:

(a) On each of the Proxy forms, state the percentage of your voting rights ornumber of securities applicable to that form. If the appointments do not

specify the percentage or number of votes that each Proxy may exercise,each Proxy may exercise half of your votes; and

(b) Return both forms in the same envelope.

4444999900001111111188882222111155551111


43

Please complete and return by 5.00 pm (Perth time) on 12 November 2009

!"#$%&'($)*+',)-./+#.'01#+$)*'+,)

Please complete the following details and return to Level 24, 44 St Georges Terrace, PERTH, WA

6000 or by fax +61 8 9218 8875 or by email to [email protected]

Name: ___________________________________________________________________

Address:__________________________________________________________________

Suburb:___________________________________________________________________

Telephone: ________________________________________________________________

Shareholder Questions (including audit related)

__________________________________________________________________________

__________________________________________________________________________

__________________________________________________________________________

__________________________________________________________________________

__________________________________________________________________________

_______________________________________________________________________

Signature:_____________________________ Date: ___________________

!

"#$%&'()!%*%&+,!-'"'.%/!

ACN 110 411 428


44

Schedule 1

Independent Expert’s Report


FINANCIAL SERVICES GUIDE

AND

INDEPENDENT EXPERT’S REPORT

MAVERICK ENERGY LIMITED

8 October 2009


BDO KENDALLS CORPORATE FINANCE (WA) PTY LTD

BDO Kendalls Corporate Finance (WA) Pty Ltd Level 8, 256 St Georges Terrace Perth WA 6000 PO Box 7426 Cloisters Square Perth WA 6850 Phone 61 9360 4200 Fax 61 9481 2524 [email protected] www.bdo.com.au

ABN 27 124 031 045 AFS Licence No. 316158

Financial Services Guide

8 October 2009

BDO Kendalls Corporate Finance (WA) Pty Ltd ABN 27 124 031 045 (“BDO Kendalls” or “we” or “us” or “ours” as appropriate) has been engaged by Maverick Energy Limited (“Maverick”) to provide an independent expert’s report on the proposal for Triangle Energy Limited (“Triangle”) to vend an asset into Maverick in exchange for the issue of Maverick shares. You will be provided with a copy of our report as a retail client because you are a shareholder of Maverick.


In the above circumstances we are required to issue to you, as a retail client, a Financial Services Guide (“FSG”). This FSG is designed to help retail clients make a decision as to their use of the general financial product advice and to ensure that we comply with our obligations as financial services licensees.

This FSG includes information about:

Who we are and how we can be contacted; The services we are authorised to provide under our Australian Financial Services Licence, Licence

No. 316158; Remuneration that we and/or our staff and any associates receive in connection with the general

financial product advice; Any relevant associations or relationships we have; and Our internal and external complaints handling procedures and how you may access them.

Information about us

BDO Kendalls Corporate Finance (WA) Pty Ltd is a member firm of the BDO Kendalls network in Australia, a national association of separate partnerships and entities. The financial product advice in our report is provided by BDO Kendalls Corporate Finance (WA) Pty Ltd and not by BDO Kendalls or its related entities. BDO Kendalls and its related entities provide services primarily in the areas of audit, tax, consulting and financial advisory services.

We do not have any formal associations or relationships with any entities that are issuers of financial products. However, you should note that we and BDO Kendalls (and its related entities) might from time to time provide professional services to financial product issuers in the ordinary course of business.

Financial services we are licensed to provide

We hold an Australian Financial Services Licence that authorises us to provide general financial product advice for securities to retail and wholesale clients.

When we provide the authorised financial services we are engaged to provide expert reports in connection with the financial product of another person. Our reports indicate who has engaged us and the nature of the report we have been engaged to provide. When we provide the authorised services we are not acting for you.

General Financial Product Advice

We only provide general financial product advice, not personal financial product advice. Our report does not take into account your personal objectives, financial situation or needs.

You should consider the appropriateness of this general advice having regard to your own objectives, financial situation and needs before you act on the advice







8 October 2009

BDO Kendalls Corporate Finance (WA) Pty Ltd ABN 27 124 031 045 (“BDO Kendalls” or “we” or “us” or “ours” as appropriate) has been engaged by Maverick Energy Limited (“Maverick”) to provide an independent expert’s report on the proposal for Triangle Energy Limited (“Triangle”) to vend an asset into Maverick in exchange for the issue of Maverick shares. You will be provided with a copy of our report as a retail client because you are a shareholder of Maverick.


In the above circumstances we are required to issue to you, as a retail client, a Financial Services Guide (“FSG”). This FSG is designed to help retail clients make a decision as to their use of the general financial product advice and to ensure that we comply with our obligations as financial services licensees.

This FSG includes information about:

Who we are and how we can be contacted; The services we are authorised to provide under our Australian Financial Services Licence, Licence

No. 316158; Remuneration that we and/or our staff and any associates receive in connection with the general

financial product advice; Any relevant associations or relationships we have; and Our internal and external complaints handling procedures and how you may access them.

Information about us

BDO Kendalls Corporate Finance (WA) Pty Ltd is a member firm of the BDO Kendalls network in Australia, a national association of separate partnerships and entities. The financial product advice in our report is provided by BDO Kendalls Corporate Finance (WA) Pty Ltd and not by BDO Kendalls or its related entities. BDO Kendalls and its related entities provide services primarily in the areas of audit, tax, consulting and financial advisory services.

We do not have any formal associations or relationships with any entities that are issuers of financial products. However, you should note that we and BDO Kendalls (and its related entities) might from time to time provide professional services to financial product issuers in the ordinary course of business.

Financial services we are licensed to provide

We hold an Australian Financial Services Licence that authorises us to provide general financial product advice for securities to retail and wholesale clients.

When we provide the authorised financial services we are engaged to provide expert reports in connection with the financial product of another person. Our reports indicate who has engaged us and the nature of the report we have been engaged to provide. When we provide the authorised services we are not acting for you.

General Financial Product Advice

We only provide general financial product advice, not personal financial product advice. Our report does not take into account your personal objectives, financial situation or needs.

You should consider the appropriateness of this general advice having regard to your own objectives, financial situation and needs before you act on the advice

Financial Services Guide Page 2

Fees, Commissions and Other Benefits that we may receive

We charge fees for providing reports, including this report. These fees are negotiated and agreed with the person who engages us to provide the report. Fees are agreed on an hourly basis or as a fixed amount depending on the terms of the agreement. The fee for this engagement is approximately $24,000.

Except for the fees referred to above, neither BDO Kendalls, nor any of its directors, employees or related entities, receive any pecuniary benefit or other benefit, directly or indirectly, for or in connection with the provision of the report.

Remuneration or other benefits received by our employees

All our employees receive a salary. Our employees are eligible for bonuses based on overall productivity but not directly in connection with any engagement for the provision of a report.

We have received a fee from Maverick for our professional services in providing this report. That fee is not linked in any way with our opinion as expressed in this report.

Referrals

We do not pay commissions or provide any other benefits to any person for referring customers to us in connection with the reports that we are licensed to provide.

Complaints resolution

Internal complaints resolution process

As the holder of an Australian Financial Services Licence, we are required to have a system for handling complaints from persons to whom we provide financial product advice. All complaints must be in writing addressed to The Complaints Officer, BDO Kendalls Corporate Finance (WA) Pty Ltd, PO Box 7426 Cloisters Square, Perth WA 6850.

When we receive a written complaint we will record the complaint, acknowledge receipt of the complaint within 15 days and investigate the issues raised. As soon as practical, and not more than 45 days after receiving the written complaint, we will advise the complainant in writing of our determination.

Referral to External Dispute Resolution Scheme

A complainant not satisfied with the outcome of the above process, or our determination, has the right to refer the matter to the Financial Ombudsman Service (“FOS”). FOS is an independent organisation that has been established to provide free advice and assistance to consumers to help in resolving complaints relating to the financial service industry. FOS will be able to advise you as to whether or not they can be of assistance in this matter. Our FOS Membership Number is 12561.

Further details about FOS are available at the FOS website www.fos.org.au or by contacting them directly via the details set out below.

Financial Ombudsman Service GPO Box 3 Melbourne VIC 3001 Toll free: 1300 78 08 08 Facsimile: (03) 9613 6399 Email: [email protected]

Contact details

You may contact us using the details set out at the top of our letterhead on page 1 of this FSG.






TABLE OF CONTENTS

1 . I N TR O D U C TI O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2. S UM M AR Y AN D O P I N I O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

3. S C O PE O F TH E R EP O R T . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

4. O U TL I N E O F O F FE R . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

5. P R O F IL E O F M AV E R I C K E N E R G Y L I M I TE D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

6. P R O F IL E O F TR I AN G L E E N E R G Y L I M I TE D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

7. E C O N OM I C AN AL YS I S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

8. V AL U AT I O N AP P R O AC H AD O P TE D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

9. V AL U AT I O N O F C O N S I DE R AT I O N P AY AB L E B Y M AV E R I C K . . . . . . . . . . . . . . . . . . . 23

10. V AL U AT I O N O F I N TE R ES T I N TR I AN G L E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

11. I S TH E TR AN S AC TI O N F AI R? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

12. I S TH E TR AN S AC TI O N R E AS O N AB L E ? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

13. C O N C L U S I O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

14. S O U R C E S O F I N F O RM AT I O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

15. I N D E PE N D E N C E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

16. Q U AL I F I C ATI O N S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

17. D I S C L AI M E RS AN D C O N S E N TS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

AP P E N D I X 1 – G L OS S AR Y

AP P E N D I X 2 – V AL U ATI O N M E TH O D O L O GI ES

AP P E N D I X 3 – I N DE PE N D E N T V AL U ATI O N R E P OR T – L O O P LE E G TE C O AL P R O J E C T

AP P E N D I X 4 – I N DE PE N D E N T V AL U ATI O N R E P OR T – R E I D ’S D OM E P R OJ E C T

AP P E N D I X 5 – I N DE PE N D E N T V AL U ATI O N R E P OR T – P AS E P S C






TABLE OF CONTENTS

1 . I N TR O D U C TI O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2. S UM M AR Y AN D O P I N I O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

3. S C O PE O F TH E R EP O R T . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

4. O U TL I N E O F O F FE R . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

5. P R O F IL E O F M AV E R I C K E N E R G Y L I M I TE D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

6. P R O F IL E O F TR I AN G L E E N E R G Y L I M I TE D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

7. E C O N OM I C AN AL YS I S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

8. V AL U AT I O N AP P R O AC H AD O P TE D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

9. V AL U AT I O N O F C O N S I DE R AT I O N P AY AB L E B Y M AV E R I C K . . . . . . . . . . . . . . . . . . . 23

10. V AL U AT I O N O F I N TE R ES T I N TR I AN G L E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

11. I S TH E TR AN S AC TI O N F AI R? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

12. I S TH E TR AN S AC TI O N R E AS O N AB L E ? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

13. C O N C L U S I O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

14. S O U R C E S O F I N F O RM AT I O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

15. I N D E PE N D E N C E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

16. Q U AL I F I C ATI O N S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

17. D I S C L AI M E RS AN D C O N S E N TS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

AP P E N D I X 1 – G L OS S AR Y

AP P E N D I X 2 – V AL U ATI O N M E TH O D O L O GI ES

AP P E N D I X 3 – I N DE PE N D E N T V AL U ATI O N R E P OR T – L O O P LE E G TE C O AL P R O J E C T

AP P E N D I X 4 – I N DE PE N D E N T V AL U ATI O N R E P OR T – R E I D ’S D OM E P R OJ E C T

AP P E N D I X 5 – I N DE PE N D E N T V AL U ATI O N R E P OR T – P AS E P S C

BDO KENDALLS CORPORATE FINANCE (WA) PTY LTD 1



8 October 2009 The Directors Maverick Energy Limited Level 24, St Martins Tower 44 St George’s Terrace PERTH WA 6000

Dear Sirs

INDEPENDENT EXPERT'S REPORT

1. I N TR O D U C TI O N

On 3 July 2009, Maverick Energy Limited (“Maverick” or “the Company”) announced that it had entered into a conditional Heads of Agreement for the acquisition of a gas production asset from Triangle Energy Limited (“Triangle”). The Company announced on 15 September 2009 that the formal agreement for the acquisition had been executed. Under the formal agreement, Maverick will acquire 100% of the issued shares of Triangle in exchange for consideration of 1,018,300,000 post consolidation ordinary fully paid shares in the Company (“the Transaction”). The Transaction is subject to approval of non-associated shareholders of Maverick.

2. S UM M AR Y AN D O P I N I O N

2.1 Purpose of the report

The Directors of Maverick have requested that BDO Kendalls Corporate Finance (WA) Pty Ltd (“BDO Kendalls”) prepare an independent expert’s report (“our Report”) to express an opinion as to whether or not the (“the Transaction”) is fair and reasonable to the non associated shareholders of Maverick (“Shareholders”).

Our Report is prepared pursuant to section 611 of the Corporations Act in order to assist the Shareholders in their decision whether to approve the Transaction.

Our Report is to be included in the Explanatory Memorandum for Maverick to be sent to all Shareholders.

2.2 Approach

Our Report has been prepared having regard to Australian Securities and Investments Commission (“ASIC”) Regulatory Guide 111 (“RG 111”), ‘Content of Expert’s Reports’ and Regulatory Guide 112 (“RG 112”) ‘Independence of Experts’.

In arriving at our opinion, we have assessed the terms of the Transaction as outlined in the body of this report. We have considered:

How the value of the consideration paid by Maverick under the Transaction compares to the value of Triangle;

The likelihood of a superior alternative strategy being available to Maverick;

Advantages and disadvantages of the Transaction;




The Directors Maverick Limited 8 October 2009

The position of Shareholders should the Transaction not proceed;

Alternatives available to Shareholders; and

Other factors which we consider to be relevant to the Shareholder in their assessment of the Transaction.

2.3 Opinion

We have considered the terms of the Transaction as outlined in the body of this report and have concluded that the Transaction is fair and reasonable to Shareholders.

We believe that the Directors would be justified in recommending that Shareholders vote in favour of the Transaction.

2.4 Fairness

In Section 11 we determined that the value of the consideration compares to the value of a 100% interest in Triangle, as detailed hereunder:

The Transaction Ref Low $

Preferred $

High $

Value of Consideration 9 713,000 1,120,000 1,731,000 Value of Interest in Triangle 10 9,360,000 9,360,000 9,360,000

The above valuation is graphically presented as follows:

The graph above indicates that the Transaction is fair to Shareholders.

2.5 Reasonableness

We have considered the analysis in Section 12 of this report, in terms of both

advantages and disadvantages of the Transaction; and

alternatives, including the position of Shareholders if the Transaction does not proceed.

In our opinion, the position of Shareholders if the Transaction is approved is more advantageous than the position if the Transaction is not approved. Accordingly, in the absence of any other relevant information and/or a superior Transaction we believe that the Transaction is reasonable for Shareholders.

0.00 2.00 4.00 6.00 8.00 10.00

Value of Consideration

Value of Interest in Triangle

$ Million

Valuation Summary





The position of Shareholders should the Transaction not proceed;

Alternatives available to Shareholders; and

Other factors which we consider to be relevant to the Shareholder in their assessment of the Transaction.

2.3 Opinion

We have considered the terms of the Transaction as outlined in the body of this report and have concluded that the Transaction is fair and reasonable to Shareholders.

We believe that the Directors would be justified in recommending that Shareholders vote in favour of the Transaction.

2.4 Fairness

In Section 11 we determined that the value of the consideration compares to the value of a 100% interest in Triangle, as detailed hereunder:


Preferred $

High $


The above valuation is graphically presented as follows:

The graph above indicates that the Transaction is fair to Shareholders.

2.5 Reasonableness

We have considered the analysis in Section 12 of this report, in terms of both

advantages and disadvantages of the Transaction; and

alternatives, including the position of Shareholders if the Transaction does not proceed.

In our opinion, the position of Shareholders if the Transaction is approved is more advantageous than the position if the Transaction is not approved. Accordingly, in the absence of any other relevant information and/or a superior Transaction we believe that the Transaction is reasonable for Shareholders.

0.00 2.00 4.00 6.00 8.00 10.00

Value of Consideration

Value of Interest in Triangle

$ Million

Valuation Summary



The respective advantages and disadvantages considered in section 12 are summarised below:

ADVANTAGES AND DISADVANTAGES

Section Advantages Section Disadvantages

12.1.1 The Transaction is fair 12.2.1 Country and political risk

12.1.2 Exposure to Triangle assets generating cash flows.

12.2.2 Dilution of Shareholders

12.1.3 Maverick will gain exposure to further assets

12.2.3 The vendors of Triangle will gain control of Maverick

12.1.4 Possible improvement in liquidity because of assets

12.1.5 Increased market capitalisation

12.1.6 Diversification

12.1.7 Renewal of Pase PSC

3 . S C O PE O F TH E R EP O R T

3.1 Purpose of the Report

The current shareholders of Maverick (and their associates) do not own any of the shares in Triangle. Section 606 of the Corporations Act Regulations (“the Act”) expressly prohibits the acquisition of shares by a party if that acquisition will result in that person (or someone else) holding an interest in 20% or more of the issued shares of a public company, unless a full takeover offer is made to all shareholders.

Section 611 permits such an acquisition if the shareholders of that entity have agreed to the issue of such shares. This agreement must be by resolution passed at a general meeting at which no votes are cast in favour of the resolution by any party who is associated with the party acquiring the shares, or by the party acquiring the shares. Section 611 states that shareholders of the company must be given all information that is material to the decision on how to vote at the meeting.

Regulatory Guide 74 issued by ASIC deals with "Acquisitions Agreed to by Shareholders". It states that the obligation to supply shareholders with all information that is material can be satisfied by the non-associated directors of Maverick, by either:

undertaking a detailed examination of the Transaction themselves, if they consider that they have sufficient expertise; or

by commissioning an Independent Expert's Report.

The directors of Maverick have commissioned this Independent Expert's Report to satisfy this obligation.

3.2 Regulatory guidance

The Act does not define the meaning of “fair and reasonable”. In determining whether the Transaction is fair and reasonable, we have had regard to the views expressed by ASIC in RG 111. This regulatory guide provides guidance as to what matters an independent expert should consider to assist security holders to make informed decisions about transactions.





This regulatory guide suggests that where the transaction is a control transaction the expert should focus on the substance of the control transaction rather than the legal mechanism to affect it. RG 111 suggests that where a transaction is a control transaction it should be analysed on a basis consistent with a takeover bid.

In our opinion the Transaction is a control transaction as defined by RG 111 and we have therefore assessed the Transaction to consider whether in our opinion it is fair and reasonable to Shareholders.

In determining whether the advantages of the Transaction outweigh the disadvantages, we have had regard to the views expressed by ASIC in RG 111. This Regulatory Guide suggests that an opinion as to whether the advantages of a transaction outweigh the disadvantages should focus on the purpose and outcome of the transaction, that is, the substance of the transaction rather than the legal mechanism to affect it.

RG 111 sets out that the expert should inquire whether further transactions are planned between the entity, the vendor or their associates and if any are contemplated determine if these are at arm’s length. RG 111 also suggests that an expert should consider whether the transaction will deter the making of a takeover bid.

3.3 Adopted basis of evaluation

We have completed our analysis in two parts:

A comparison between the value of Triangle and the value of the consideration to be paid by Maverick (fairness – see Section 11 “Is the Transaction Fair?”); and

An investigation into other significant factors to which Shareholders might give consideration, prior to approving the resolution, after reference to the value derived above (reasonableness – see Section 12 “Is the Transaction Reasonable?”).

RG 111 states that an offer is reasonable if it is fair. It might also be reasonable if despite being ‘not fair’ the expert believes that there are sufficient reasons for security holders to accept the offer in the absence of any higher bid.





This regulatory guide suggests that where the transaction is a control transaction the expert should focus on the substance of the control transaction rather than the legal mechanism to affect it. RG 111 suggests that where a transaction is a control transaction it should be analysed on a basis consistent with a takeover bid.

In our opinion the Transaction is a control transaction as defined by RG 111 and we have therefore assessed the Transaction to consider whether in our opinion it is fair and reasonable to Shareholders.

In determining whether the advantages of the Transaction outweigh the disadvantages, we have had regard to the views expressed by ASIC in RG 111. This Regulatory Guide suggests that an opinion as to whether the advantages of a transaction outweigh the disadvantages should focus on the purpose and outcome of the transaction, that is, the substance of the transaction rather than the legal mechanism to affect it.

RG 111 sets out that the expert should inquire whether further transactions are planned between the entity, the vendor or their associates and if any are contemplated determine if these are at arm’s length. RG 111 also suggests that an expert should consider whether the transaction will deter the making of a takeover bid.

3.3 Adopted basis of evaluation

We have completed our analysis in two parts:

A comparison between the value of Triangle and the value of the consideration to be paid by Maverick (fairness – see Section 11 “Is the Transaction Fair?”); and

An investigation into other significant factors to which Shareholders might give consideration, prior to approving the resolution, after reference to the value derived above (reasonableness – see Section 12 “Is the Transaction Reasonable?”).

RG 111 states that an offer is reasonable if it is fair. It might also be reasonable if despite being ‘not fair’ the expert believes that there are sufficient reasons for security holders to accept the offer in the absence of any higher bid.



4. O U TL I N E O F O F FE R

On 3 July 2009, Maverick announced that it had entered into a conditional Heads of Agreement for the acquisition of an asset in North Sumatra, Indonesia. On 11 August 2009, Maverick announced that it and Triangle, had completed their respective due diligence and were continuing to formalise an agreement. The Company announced on 15 September 2009 that the formal agreement for the acquisition had been executed.

As part of the proposed Transaction:

Maverick will acquire 100% of the issued shares of Triangle;

Consideration for the acquisition will be 1,018,300,000 post consolidation ordinary fully paid shares in Maverick;

Existing Maverick shares will be consolidated on a 3:1 basis;

Maverick will raise $1,417,000 under a prospectus by issuing 141,700,000 shares; and

Triangle directors John Towner, Frank Jacobs, Steven Hamer and Lewis Johnson will be appointed to the Maverick Board along with Adam Sierakowski, The existing directors of Maverick will retire.

The new share structure of Maverick as a result of the Transaction is set out below:

Share Structure Pre Transaction Share

Structure Post Transaction Share

Structure Number % Number %

Shareholders 494,893,620 100.0% 164,964,540 12.1%

Shares issued for all of Triangle’s Shares - - 1,018,300,000 74.6% 1Conversion of Convertible Notes - - 40,000,000 2.9%

Shares issued under the Prospectus - - 141,700,000 10.4%

Total 494,893,620 100.0% 1,364,964,540 100.0%

1. We note that Maverick is expecting to raise $400,000 via a convertible note issue from key and sophisticated investors by the first week of October 2009. The notes do not have a coupon and may be converted into 40,000,000 ordinary shares at a deemed issue price of $0.01 per share. The convertible notes are independent of the Transaction, however, for the purposes of our analysis of Maverick’s share structure in the table above, we have assumed the notes will be converted into ordinary shares. The funds will be used partly for the purpose of advancing funds to Triangle pursuant to a loan agreement as announced by Maverick on 11 August 2009.





5. P R O F IL E O F M AV E R I C K E N E R G Y L IM I TE D

5.1 History

Maverick is an Australian based exploration company focused on providing natural resources required for the energy sector. Maverick’s operations are centred on the development of its gas and coal assets.

The Company was registered on 9 August 2004 under the name White Sands Petroleum Pty Ltd. The Company changed from a proprietary company to an unlisted public company on 25 November 2005 and then listed on the ASX on 3 January 2006. On 20 December 2006, White Sands Petroleum Ltd appointed Gerry Collins of Jefferson Collins Joiner as administrator of the Company, and during that period, the Company changed its name to Maverick Drilling International Ltd. The suspension of trading in Maverick Drilling International Ltd was lifted on 7 July 2008 and on 23 October 2008; the Company changed its name to Maverick Energy Ltd.

The current Directors of Maverick are:

Richard Wolanski;

Peter Christie; and

Christian Cordier.

5.2 Maverick’s Projects

5.2.1 Loopleegte Coal Project

Loopleegte is situated on the southern edge of the Waterberg Karoo Basin. It is located 15 km west of the only operational mine (Grootegeluk) in the coal basin. This coal basin contains at least 50% of South Africa’s remaining coal resources. The Waterberg resource base is estimated to be in excess of 50 billion tonnes. Exxaro at Grootegeluk and neighbouring farms have new order rights granted on over 6 billion tonnes of coal resources.

The Loopleegte 302 LQ prospecting right covers an area of approximately 1,281 hectares and is situated on the Southern edge of the Waterberg Coalfield near the South African / Botswana border and about 25km west of Lephale. The project area is covered by Karoo sediments and should be underlain by coal. A number of old government boreholes drilled to the north and east of the farm showed positive intersections of the Upper Ecca zones of coal which contain a soft coking coal fraction, and with the majority of the drilling identifying Lower Ecca seams but often at depths exceeding 100 metres.

However Maverick has undertaken a total of eight percussion boreholes as part of the first phase drilling program commencing during the last quarter of 2008 and completed during the first quarter of 2009. Of these eight, six did not intersect coal and two intersected coal. The two positive boreholes on the eastern boundary of the farm intersected 43 and 10 metres of coal at depths of 10 and 27 metres respectively. These intersections confirmed the presence of coal on the eastern half of the farm. A north south trending fault has displaced the coal on the western half of the farm. The intersections were proven with percussion drilling and geophysical logging.

Although limited drilling data is available on Loopleegte 302, boreholes drilled on neighbouring properties to the east of Loopleegte show an average width of Upper Ecca coal zone intersections of 34 metres with 14 out of 28 boreholes intersecting Upper





5. P R O F IL E O F M AV E R I C K E N E R G Y L IM I TE D

5.1 History

Maverick is an Australian based exploration company focused on providing natural resources required for the energy sector. Maverick’s operations are centred on the development of its gas and coal assets.

The Company was registered on 9 August 2004 under the name White Sands Petroleum Pty Ltd. The Company changed from a proprietary company to an unlisted public company on 25 November 2005 and then listed on the ASX on 3 January 2006. On 20 December 2006, White Sands Petroleum Ltd appointed Gerry Collins of Jefferson Collins Joiner as administrator of the Company, and during that period, the Company changed its name to Maverick Drilling International Ltd. The suspension of trading in Maverick Drilling International Ltd was lifted on 7 July 2008 and on 23 October 2008; the Company changed its name to Maverick Energy Ltd.

The current Directors of Maverick are:

Richard Wolanski;

Peter Christie; and

Christian Cordier.

5.2 Maverick’s Projects

5.2.1 Loopleegte Coal Project

Loopleegte is situated on the southern edge of the Waterberg Karoo Basin. It is located 15 km west of the only operational mine (Grootegeluk) in the coal basin. This coal basin contains at least 50% of South Africa’s remaining coal resources. The Waterberg resource base is estimated to be in excess of 50 billion tonnes. Exxaro at Grootegeluk and neighbouring farms have new order rights granted on over 6 billion tonnes of coal resources.

The Loopleegte 302 LQ prospecting right covers an area of approximately 1,281 hectares and is situated on the Southern edge of the Waterberg Coalfield near the South African / Botswana border and about 25km west of Lephale. The project area is covered by Karoo sediments and should be underlain by coal. A number of old government boreholes drilled to the north and east of the farm showed positive intersections of the Upper Ecca zones of coal which contain a soft coking coal fraction, and with the majority of the drilling identifying Lower Ecca seams but often at depths exceeding 100 metres.

However Maverick has undertaken a total of eight percussion boreholes as part of the first phase drilling program commencing during the last quarter of 2008 and completed during the first quarter of 2009. Of these eight, six did not intersect coal and two intersected coal. The two positive boreholes on the eastern boundary of the farm intersected 43 and 10 metres of coal at depths of 10 and 27 metres respectively. These intersections confirmed the presence of coal on the eastern half of the farm. A north south trending fault has displaced the coal on the western half of the farm. The intersections were proven with percussion drilling and geophysical logging.

Although limited drilling data is available on Loopleegte 302, boreholes drilled on neighbouring properties to the east of Loopleegte show an average width of Upper Ecca coal zone intersections of 34 metres with 14 out of 28 boreholes intersecting Upper



Ecca coal zones and 13 of the 28 boreholes intersecting Middle Ecca coal zones. Based on these results Maverick is continuing with their review of the Project’s potential.

5.2.2 Reid’s Dome Project

The Reid’s Dome Tenement covers an area of 181 square kilometres on the western flank of the Bowen Basin in Queensland. The Reid’s Dome Gas Field is situated within Reid’s Dome Tenement and based on initial reservoir studies; a reserve of up to 1 billion cubic feet of gas is indicated for the three wells drilled on the Reid’s Dome Gas Field prior to November 1994.

The 1993 appraisal well in the Reids Dome Gas Field, drilled by Victoria Petroleum N.L, Aldinga North-1, flowed gas at a rate of 1.2 million cubic feet per day.

Drilling of the Primero -1 well to 1,565 metres in the northern part of the Reid’s Dome Tenement twinning the original shallow gas discovery well, AOE-1 commenced in late June 2006. Early success was encountered in July 2006 with Primero-1 testing a gas flow of 2.8 million cubic feet per day from the field’s shallow gas sand at 150 metres. Drilling of the deeper target which encountered numerous oil and gas shows in the original heavily mud invaded AOE-1 was carried out. Additional gas zones have been intersected in the Reids Dome Beds around 1,500 metres.

Following the completion of drilling at Primero -1, an extensive testing program was commenced to determine the reserves of the Reid’s Dome Gas Field at the shallow horizon with a view to the potential commercialisation of the gas field, subject to sufficient gas reserves being proved.

The Reid’s Dome Tenement is 40% owned by Wharf Resources PLC, 40% owned by Dome Petroleum Resources PLC and 20% owned by Maverick Energy Limited.





5.3 Historical Balance Sheet

Maverick Energy Limited

Audited Audited Audited As at As at As at

30-Jun-09 31-Dec-08 2-Jul-08 $ $ $

CURRENT ASSETS

Cash assets 249,703 402,786 1,684,881

Other 10,962 68,212 47,360

TOTAL CURRENT ASSETS 260,665 470,998 1,732,241

NON CURRENT ASSETS

Exploration and Evaluation Expenditure 1,538,444 1,509,023 -

TOTAL NON CURRENT ASSETS 1,538,444 1,509,023 -

TOTAL ASSETS 1,799,109 1,980,021 1,732,241

CURRENT LIABILITIES

Payables 29,354 9,287 544,990

TOTAL CURRENT LIABILITIES 29,354 9,287 544,990

NON CURRENT LIABILITIES

Other 16 - -

TOTAL NON CURRENT LIABILITIES 16 - -

TOTAL LIABILITIES 29,370 9,287 544,990

NET ASSETS 1,769,739 1,970,734 1,187,251

EQUITY

Issued Capital 2,333,067 2,333,067 1,151,067

Reserves 207,941 203,186 203,186

Foreign Currency Translation Reserve - 25,643 -

Accumulated losses (771,269) (591,162) (167,002)

TOTAL EQUITY 1,769,739 1,970,734 1,187,251

Source: Maverick Annual report for the year ended 30 June 2009, Interim Financial Report for the period

ended 31 December 2008, and Annual report for the period ended 2 July 2008.

The Company was audited as at 2 July 2008, the date that the Deed of Company Arrangement was executed.

Exploration and Evaluation Expenditure relates to the acquisition of Torbanite One Pty Ltd (“Torbanite”) on 14 October 2008. Torbanite is the 100% owner of New Order Investments 141 Pty Ltd (“New Order”), which is entitled to earn 30% in the Loopleegte Coal project upon the expenditure of $550,000.






Maverick Energy Limited

Audited Audited Audited As at As at As at

30-Jun-09 31-Dec-08 2-Jul-08 $ $ $

CURRENT ASSETS

Cash assets 249,703 402,786 1,684,881

Other 10,962 68,212 47,360

TOTAL CURRENT ASSETS 260,665 470,998 1,732,241

NON CURRENT ASSETS

Exploration and Evaluation Expenditure 1,538,444 1,509,023 -

TOTAL NON CURRENT ASSETS 1,538,444 1,509,023 -

TOTAL ASSETS 1,799,109 1,980,021 1,732,241

CURRENT LIABILITIES

Payables 29,354 9,287 544,990

TOTAL CURRENT LIABILITIES 29,354 9,287 544,990

NON CURRENT LIABILITIES

Other 16 - -

TOTAL NON CURRENT LIABILITIES 16 - -

TOTAL LIABILITIES 29,370 9,287 544,990

NET ASSETS 1,769,739 1,970,734 1,187,251

EQUITY

Issued Capital 2,333,067 2,333,067 1,151,067

Reserves 207,941 203,186 203,186

Foreign Currency Translation Reserve - 25,643 -

Accumulated losses (771,269) (591,162) (167,002)

TOTAL EQUITY 1,769,739 1,970,734 1,187,251

Source: Maverick Annual report for the year ended 30 June 2009, Interim Financial Report for the period

ended 31 December 2008, and Annual report for the period ended 2 July 2008.

The Company was audited as at 2 July 2008, the date that the Deed of Company Arrangement was executed.

Exploration and Evaluation Expenditure relates to the acquisition of Torbanite One Pty Ltd (“Torbanite”) on 14 October 2008. Torbanite is the 100% owner of New Order Investments 141 Pty Ltd (“New Order”), which is entitled to earn 30% in the Loopleegte Coal project upon the expenditure of $550,000.



5.4 Historical Income Statements

Audited Audited Unaudited Maverick Energy Limited Full Year Ended Period Ended Full Year Ended 30-Jun-09 2-Jul-08 30-Jun-07 $ $ $

Revenue from interest 28,775 10,283 -

Administration expenses (297,630) (22,640) -

Director’s remuneration (194,130) - -

Consultancy costs (91,465) - -

Rent (49,817) - -

Impairment of non-current assets - - -

Loss before income tax expense (604,267) (12,357) -

Income tax expense - - -

Loss from continuing operations (604,267) (12,357) -

Loss from discontinued operations (DOCA) - (154,645) (5,603,985)

Loss for the year (604,267) (167,002) (5,603,985)

Loss attributable to members of the parent entity (604,267) (167,002) (5,603,985)

Source: Maverick Annual report for the periods ended 30 June 2009 and 2 July 2008, and unaudited

financial statements for the year ended 30 June 2007.

At a meeting of creditors held on 8 June 2007, the creditors agreed with the terms of the DOCA and the DOCA was executed on 27 June 2007. The Company entered into the varied DOCA on 19 December 2007.

5.5 Capital Structure

The share structure of Maverick as at 22 September 2009 is outlined below:

Number

Total Ordinary Shares on Issue 494,893,620

Top 20 Shareholders 317,880,405

Top 20 Shareholders - % of shares on issue 64.23 Source: Maverick annual report 2009





The range of shares held in Maverick as at 22 September 2009 is as follows:

Range of Shares Held No. of Ordinary

Shareholders % Issued Capital

1-1,000 112 0.01

1,001-5,000 371 0.20

5,001-10,000 174 0.23

10,001-100,000 377 3.67

100,001 – and over 233 96.89

TOTAL 1,267 100.00 Source: Maverick annual report 2009

The ordinary shares held by the most significant shareholders as at 22 September 2009 are detailed below:

Name No of Ordinary

Shares Held Percentage of

Issued Shares (%)

Darina Enterprise PL 50,000,000 10.10%

MSF Nominees PL 50,000,000 10.10%

Breamline Inv Ltd 45,925,000 9.28%

Tonehill PL 17,333,400 3.50%

Total Top 4 163,258,400 32.98%

Others 331,635,220 67.02%

Total Ordinary Shares on Issue 494,893,620 100.00% Source: Maverick annual report 2009

As at the date of this report, Maverick has the following Options on issue:

Number of Unlisted options on Issue Expiry Date of Options Exercise Price

65,000,000 31 December 2010 $0.01 Source: Maverick annual report 2009

It is to be noted that these Options will be consolidated on a 3 to 1 basis if the resolution is passed at the Maverick Annual General Meeting.





The range of shares held in Maverick as at 22 September 2009 is as follows:


Shareholders % Issued Capital

1-1,000 112 0.01

1,001-5,000 371 0.20

5,001-10,000 174 0.23

10,001-100,000 377 3.67

100,001 – and over 233 96.89

TOTAL 1,267 100.00 Source: Maverick annual report 2009

The ordinary shares held by the most significant shareholders as at 22 September 2009 are detailed below:

Name No of Ordinary

Shares Held Percentage of

Issued Shares (%)

Darina Enterprise PL 50,000,000 10.10%

MSF Nominees PL 50,000,000 10.10%

Breamline Inv Ltd 45,925,000 9.28%

Tonehill PL 17,333,400 3.50%

Total Top 4 163,258,400 32.98%

Others 331,635,220 67.02%

Total Ordinary Shares on Issue 494,893,620 100.00% Source: Maverick annual report 2009

As at the date of this report, Maverick has the following Options on issue:

Number of Unlisted options on Issue Expiry Date of Options Exercise Price

65,000,000 31 December 2010 $0.01 Source: Maverick annual report 2009

It is to be noted that these Options will be consolidated on a 3 to 1 basis if the resolution is passed at the Maverick Annual General Meeting.



6. P R O F IL E O F TR I AN G L E E N E R G Y L IM I TE D

6.1 History Triangle Energy Limited is a newly formed unlisted public company which is focused on the production of oil and gas in Indonesia. On 29 May 2009 Triangle acquired all of the issued capital of Mobil Pase Inc. (MPI) from Mobil Petroleum Company Inc. and subsequently MPI’s name was changed to Triangle Pase Inc. (TPI). TPI became a wholly owned subsidiary of Triangle on 1 June 2009.

TPI owns and operates a 100% working interest in the Production Sharing Contract in respect of the Pase Block located in the Aceh Province, North Sumatra, Indonesia (Pase PSC). The Pase PSC was awarded to MPI, a wholly owned subsidiary of Mobil Petroleum Company Inc. (now Exxon Mobil Corporation) (ExxonMobil) in 1981 for a period of 30 years and presently encompasses 922km2. The Pase PSC relates to the Pase Field discovered in 1983 and it consists of a fractured carbonate reservoir. Production commenced in 1998 and in 2003 ExxonMobil estimated that the field contained 498 BCF gas in place with 54% of the gas contained in fractures and 46% in the reservoir matrix. Cumulative production to date is 183 BCF. The Pase PSC is an arrangement between TPI and the government of Indonesia. Under the Pase PSC, TPI is responsible for operating and funding all exploration and production operations. The PSC prescribes the formula for calculating the share of oil and of gas attributable to TPI and to the government of Indonesia. Under the Pase PSC the government of Indonesia’s share of gas production is 32.5%. The Pase PCS expires on 11 February 2011. Triangle is preparing an application for a 10 year extension to the Pase PSC term. The production wells at PASE now have a high water cut which suggests that much of the fracture gas has been produced. Accordingly, ongoing production is likely to be matrix and/or attic gas. The acreage has only been explored once, for gas, to feed the Arun LNG facility. Triangle has identified significant remaining potential in the Pase PSC through the improvement of current gas production through workovers, water handling and attic drilling. Triangle has also identified shallower bypassed gas as well as oil potential which has been neglected by ExxonMobil. Gas produced from the Pase PSC is sold through the Arun LNG plant at a premium price tied to a basket of crude oil markers. The current Directors of Triangle are:

John Towner; Steven Hamer; Franciscus Jacobs; and Lewis Johnson.






Triangle Energy Ltd

Unaudited

As at 30 June 2009

$

CURRENT ASSETS Cash and cash equivalents 251,636 Trade and other receivables 19,686 Other financial assets 285,978 TOTAL CURRENT ASSETS 557,300 NON-CURRENT ASSETS Other financial assets 124,146 Property, plant and equipment 19,881 Shares in Triangle Pase Inc 127,551 TOTAL NON-CURRENT ASSETS 271,578 TOTAL ASSETS 828,878

CURRENT LIABILITIES Trade and other payables 178,782 TOTAL CURRENT LIABILITIES 178,782 NON-CURRENT LIABILITIES Provisions 976 TOTAL NON-CURRENT LIABILITIES 976 TOTAL LIABILITIES 179,758 NET ASSETS 649,120 EQUITY Issued capital 1,094,000 Reserves (3,726) Retained earnings (441,154) TOTAL EQUITY 649,120

Source: Triangle Unaudited financial statements for the year ended 30 June 2009.

Triangle started operating in March 2009.

Other financial assets which are current in nature include a prepayment to Exxon Mobil totalling $191,074, in relation to the Pase Project in Indonesia. Other financial asset which are considered long term are funds on deposit as guarantee against Stand-By Letter of Credit.

On 1 June 2009, Triangle Energy Limited acquired 100% of the voting shares of Triangle Pase Inc. The goodwill associated with the acquisition totalled $127,551 as at 30 June 2009.

The majority of trade and other payables relate to accrued expenses.






Triangle Energy Ltd

Unaudited

As at 30 June 2009

$

CURRENT ASSETS Cash and cash equivalents 251,636 Trade and other receivables 19,686 Other financial assets 285,978 TOTAL CURRENT ASSETS 557,300 NON-CURRENT ASSETS Other financial assets 124,146 Property, plant and equipment 19,881 Shares in Triangle Pase Inc 127,551 TOTAL NON-CURRENT ASSETS 271,578 TOTAL ASSETS 828,878

CURRENT LIABILITIES Trade and other payables 178,782 TOTAL CURRENT LIABILITIES 178,782 NON-CURRENT LIABILITIES Provisions 976 TOTAL NON-CURRENT LIABILITIES 976 TOTAL LIABILITIES 179,758 NET ASSETS 649,120 EQUITY Issued capital 1,094,000 Reserves (3,726) Retained earnings (441,154) TOTAL EQUITY 649,120


Triangle started operating in March 2009.

Other financial assets which are current in nature include a prepayment to Exxon Mobil totalling $191,074, in relation to the Pase Project in Indonesia. Other financial asset which are considered long term are funds on deposit as guarantee against Stand-By Letter of Credit.

On 1 June 2009, Triangle Energy Limited acquired 100% of the voting shares of Triangle Pase Inc. The goodwill associated with the acquisition totalled $127,551 as at 30 June 2009.

The majority of trade and other payables relate to accrued expenses.



6.3 Historical Income Statements

Income Statement

Unaudited Year ended

30 June 2009 $

Revenue

Other income 1,913

Total Revenue 1,913

Expenses

Employee benefits expense (20,820)

Depreciation and amortisation expense (924)

Other expenses (421,323)

Loss before income tax expense (444,154)

Income tax expense -

Net loss (444,154)


The majority of other expenses totalling $421,323 are made from consulting and management fees.






The share structure of Triangle as at 26 August 2009 is outlined below:

Number



Top 20 Shareholders - % of shares on issue 100% Source: Triangle Energy Ltd share registry

The range of shares held in Triangle as at 26 August 2009 is as follows:


Shareholders No. of Ordinary

Shares %Issued

Capital

1-1,000 - - -

1,001-5,000 - - -

5,001-10,000 - - -

10,001-100,000 3 260,000 0.4%

100,001 – and over 14 57,626,667 99.6%

TOTAL 17 57,886,667 100.0% Source: Triangle Energy Ltd share registry

The ordinary shares held by the most significant shareholders as at 26 August 2009 are detailed below:

Name No of Ordinary

Shares Held Percentage of Issued Shares

Jarrad Street Corporate Pty Ltd 25,850,000 44.7%

Kenneth John Bull 10,000,000 17.3%

Ucan Nominees Pty Ltd 7,666,667 13.2%

Pt Prestige Global Petroleum 5,000,000 8.6%

Capersia Pte Ltd 4,000,000 6.9% Source: Triangle Energy Ltd share registry






The share structure of Triangle as at 26 August 2009 is outlined below:

Number



Top 20 Shareholders - % of shares on issue 100% Source: Triangle Energy Ltd share registry

The range of shares held in Triangle as at 26 August 2009 is as follows:


Shareholders No. of Ordinary

Shares %Issued

Capital

1-1,000 - - -

1,001-5,000 - - -

5,001-10,000 - - -

10,001-100,000 3 260,000 0.4%

100,001 – and over 14 57,626,667 99.6%

TOTAL 17 57,886,667 100.0% Source: Triangle Energy Ltd share registry

The ordinary shares held by the most significant shareholders as at 26 August 2009 are detailed below:

Name No of Ordinary

Shares Held Percentage of Issued Shares

Jarrad Street Corporate Pty Ltd 25,850,000 44.7%

Kenneth John Bull 10,000,000 17.3%

Ucan Nominees Pty Ltd 7,666,667 13.2%

Pt Prestige Global Petroleum 5,000,000 8.6%

Capersia Pte Ltd 4,000,000 6.9% Source: Triangle Energy Ltd share registry



7. E C O N OM I C AN AL YS I S

7.1 Current Economic conditions

After almost two years of decline, there are signs that the global economy is beginning to stabilise. Global industrial production and international trade activity have increased after recent declines. Sentiment appears to be improving and economic growth rates are being revised upwards. Lead by an improvement in bank lending and expansionary fiscal policy, economic recovery is particularly evident in China. By comparison, economic conditions remain weak in most advanced economies, particularly the US, but the rate of contraction is slowing.

The domestic economy has been particularly resilient to the challenging economic conditions caused by the global downturn. December 2008 and March 2009 quarter GDP data and general information circulating in the economy suggests that the contraction of the Australian economy will be modest compared to the strong contractions in most other countries. This resilience is the result of a number of contributing factors discussed below.

Firstly, Australia has a strong financial system. Australian banks have low exposure to risky assets, are well capitalized and have remained profitable throughout the financial downturn. In addition to this, the Australian government guarantees bank deposits and banks’ wholesale funding. Collectively, these factors have allowed Australian banks to maintain their high credit ratings and access capital funding. The health of the Australian financial sector is supporting credit availability, private investment and general economic stability.

Secondly, the Reserve Bank of Australia (“RBA”) and the Australian government have been proactive in their response to the global downturn. The RBA has reduced the official cash rate from 7.25% in March 2008 to 3.00% in April 2009. The health of Australian banks means that most of this reduction in the cash rate has been passed on to the end borrower. The Australian government’s fiscal policy has been expansionary through its stimulus package, first home buyer’s grant and planned infrastructure investment. These expansionary measures have increased household disposable income levels and as a result, household consumption has been stronger in Australia than it has been in many other countries.

The third factor that has contributed to the relatively good performance of the Australian economy is the strong recovery of China’s economy. China’s share of Australian merchandise exports has increased from 15% to 20% in the past two years. While most countries have recorded significant falls in their exports, Australian exports have increased slightly over the past 12 months. In addition to this, commodity prices are continuing to improve.

Another contributor to the performance of the Australian economy is the recovery of equity and real estate markets. Both of which have improved significantly from their recent lows. This environment has reversed much of the decline in household wealth that occurred during 2008 and early 2009. As a result, improved investor and consumer sentiment is having a flow on effect to other sectors of the economy.

The outlook for the Australian economy is far more optimistic than that for many other developed countries. Australia’s trade relationship with China and China’s strong economic performance are likely to provide some insulation from the weak economic conditions that are expected for the rest of the world. Driven by low interest rates and the government’s first home buyer’s grant, housing construction is forecast to increase during the second half of 2009. Business investment relative to GDP will continue to be low compared to historical levels but still well above levels expected in other countries. It is forecast that household consumption





will slow as the effects of the federal government’s stimulus package subside. Despite this, investment in public infrastructure is expected to more than offset declines in other areas.

7.2 Gas Industry Analysis

7.2.1 Background

Natural gas is a fossil fuel like oil and coal. It is a combustible mixture of hydrocarbon gases that in its pure form is colourless and odourless. Its combustible nature is where its value lies, as when burned it gives off substantial energy while emitting lower levels of harmful by-products than conventional energy sources.

Once a reserve is located and successfully drilled, the pressurised nature and physical properties of natural gas mean that it flows to the surface with little interference. When first drilled the formation is under pressure and produces at a fast rate, however as more gas is extracted the production rate of the well declines. Certain techniques can be applied to raise the production rate of a well once it reaches such a point. Once captured, natural gas can be stored for an indefinite period of time.

7.2.2 Reserves

The global proven reserve of natural gas at the end of 2008 was 185.02 trillion cubic meters (tcm). Of this reserve 15.39tcm, or around 8.3%, is located in the Asia Pacific region. The geographical distribution of reserves can be seen on the map below:

Source: BP Statistical Review of World Energy 2009

As the measurement of natural gas in the ground involves considerable inference and estimation, reserves are often subject to revision.

7.2.3 Market

The market for natural gas has changed dramatically over the last 20 years due to the deregulation of the industry. In today’s market, marketers facilitate the movement of natural gas from the producer to the end user. Previously it had been a case of gas being sold at the wellhead to large transport pipelines who sold it on to distribution





will slow as the effects of the federal government’s stimulus package subside. Despite this, investment in public infrastructure is expected to more than offset declines in other areas.

7.2 Gas Industry Analysis

7.2.1 Background

Natural gas is a fossil fuel like oil and coal. It is a combustible mixture of hydrocarbon gases that in its pure form is colourless and odourless. Its combustible nature is where its value lies, as when burned it gives off substantial energy while emitting lower levels of harmful by-products than conventional energy sources.

Once a reserve is located and successfully drilled, the pressurised nature and physical properties of natural gas mean that it flows to the surface with little interference. When first drilled the formation is under pressure and produces at a fast rate, however as more gas is extracted the production rate of the well declines. Certain techniques can be applied to raise the production rate of a well once it reaches such a point. Once captured, natural gas can be stored for an indefinite period of time.

7.2.2 Reserves

The global proven reserve of natural gas at the end of 2008 was 185.02 trillion cubic meters (tcm). Of this reserve 15.39tcm, or around 8.3%, is located in the Asia Pacific region. The geographical distribution of reserves can be seen on the map below:

Source: BP Statistical Review of World Energy 2009

As the measurement of natural gas in the ground involves considerable inference and estimation, reserves are often subject to revision.

7.2.3 Market

The market for natural gas has changed dramatically over the last 20 years due to the deregulation of the industry. In today’s market, marketers facilitate the movement of natural gas from the producer to the end user. Previously it had been a case of gas being sold at the wellhead to large transport pipelines who sold it on to distribution



utilities. Producers are now flexible to sell the resource to marketers, local distributors or directly to end users. The flexibility of the deregulated natural gas market facilitates transparency and price discovery through supply and demand.

In terms of market size, the global oil and gas market grew by 35.9% in 2008 to a value of $3,191.4 billion. This was on the back of a 1.1% increase in volume to 46.2 billion barrels of oil equivalent (“BOE”). These figures have been heavily influenced by the resources boom witnessed in the early 00’s right up to last year. The pressure on world financial markets has forced a correction in commodities prices and consequently growth is forecast to plateau over the coming years to achieve a value of $3,380.8 billion on a volume of 48.1 billion BOE in 2013.

7.2.4 Price Trends

Like any other commodity, the price of natural gas is predominantly a function of supply and demand. Since closing at a 2008 high of $13.28 on the first day of July, NYMEX Henry Hub Natural Gas contracts have been the subject of a consistent and substantial depreciation. A five year low of US$1.88 was witnessed as recently at 4 September 2009. These figures compare to a five year average contract price of around US$7.08.

Source: Bloomberg Data Service

Looking forward the analyst consensus forecast indicates a gradual recovery in prices as reflected in the chart above. In the September quarter 2010 it is anticipated the average contract price will be around US$5.96/t. Similar indications are evident in the annual forecasts, with contracts predicted to close at US$6.41 by the end of 2010, US$7.90 in 2011 and US$8.18 by the conclusion of 2012.

7.2.5 Indonesian Gas Industry

Indonesia is a major player in the natural gas sector as one of the world’s biggest exporters of the commodity. The country has proven natural gas reserves of 3.18tcm, which represents approximately 1.7% of world reserves. The bulk of its reserves are located near the Arun field in Aceh and the Nabak field in East Kalimantan.

Indonesian gas production is expected to rise from about 70bcm in 2008 to a peak of 91bcm in 2012, before pulling back to around 85bcm by 2018. With demand growth of 35%, this should see export peaking at 50.5bcm in 2012 (Indonesia Oil & Gas Report Q3 2009, Business Monitor International). Within the Asia Pacific region, Indonesia

0

2

4

6

8

10

Consensus Analyst Forecast - USD/t(NYMEX Henry Hub Natural Gas)





accounted for around 8% of natural gas consumption in 2008, and 19% of production. These numbers are forecast to ease slightly by 2013 to 7.6% and 18% respectively.

In terms of the Indonesian business environment, the transition to democracy in 2004 is a boost for investors. The Yudhoyono administration has reduced corruption and is progressively strengthening the legal system, which should act to buoy investor confidence in investing in the region. The Indonesian oil and gas industries are state run.

7.3 Coal Industry Analysis

7.3.1 Background

Coal deposits are found below the earth’s surface with the quality of a coal deposit determined by the length of time in formation, commonly known as its ‘organic maturity’, temperature and pressure. The rank of coal refers to the physical and chemical properties that coals of different maturities possess. Lower rank coals such as lignite generally possess a much lower organic maturity, have a soft texture, a dull earthly appearance and are characterized by high moisture levels and low energy (carbon) content. Higher ranked coals such as Anthracite, which is the highest ranking coal, are harder, stronger, contain less moisture, and produce more energy.

To date coal has been mined by two broad methods, opencast mining and underground mining, the choice of extraction method determined by the geology of the coal deposit.

7.3.2 Reserves

Globally, it is estimated that there is enough coal to last 190 years. However the discovery of new reserves through ongoing and improved exploration activities and advances in mining techniques may allow previously inaccessible reserves to be reached.

Coal reserves are available in almost every country worldwide, with recoverable reserves in around 70 countries. At current production levels, proven coal reserves are estimated to last 190 years. In contrast, proven oil and gas reserves are equivalent to around 42 and 60 years at current production levels respectively (Coal Facts 2008, World Coal Institute). As shown below, 33 per cent (272,246 Mt) of the world’s proven reserves are located in Europe and Eurasia, 30 per cent (250,510 Mt) are found in North America, 22 per cent (183,053 Mt) in Asia Pacific and 9 per cent (76,200 Mt) in Australia. While coal reserves are important for long term energy sustainability, the timely satisfaction of the world’s energy requirements is dependant on the rate at which the reserves can be brought into production.





accounted for around 8% of natural gas consumption in 2008, and 19% of production. These numbers are forecast to ease slightly by 2013 to 7.6% and 18% respectively.

In terms of the Indonesian business environment, the transition to democracy in 2004 is a boost for investors. The Yudhoyono administration has reduced corruption and is progressively strengthening the legal system, which should act to buoy investor confidence in investing in the region. The Indonesian oil and gas industries are state run.

7.3 Coal Industry Analysis

7.3.1 Background

Coal deposits are found below the earth’s surface with the quality of a coal deposit determined by the length of time in formation, commonly known as its ‘organic maturity’, temperature and pressure. The rank of coal refers to the physical and chemical properties that coals of different maturities possess. Lower rank coals such as lignite generally possess a much lower organic maturity, have a soft texture, a dull earthly appearance and are characterized by high moisture levels and low energy (carbon) content. Higher ranked coals such as Anthracite, which is the highest ranking coal, are harder, stronger, contain less moisture, and produce more energy.

To date coal has been mined by two broad methods, opencast mining and underground mining, the choice of extraction method determined by the geology of the coal deposit.

7.3.2 Reserves

Globally, it is estimated that there is enough coal to last 190 years. However the discovery of new reserves through ongoing and improved exploration activities and advances in mining techniques may allow previously inaccessible reserves to be reached.

Coal reserves are available in almost every country worldwide, with recoverable reserves in around 70 countries. At current production levels, proven coal reserves are estimated to last 190 years. In contrast, proven oil and gas reserves are equivalent to around 42 and 60 years at current production levels respectively (Coal Facts 2008, World Coal Institute). As shown below, 33 per cent (272,246 Mt) of the world’s proven reserves are located in Europe and Eurasia, 30 per cent (250,510 Mt) are found in North America, 22 per cent (183,053 Mt) in Asia Pacific and 9 per cent (76,200 Mt) in Australia. While coal reserves are important for long term energy sustainability, the timely satisfaction of the world’s energy requirements is dependant on the rate at which the reserves can be brought into production.



Source: BP Statistical Review of World Energy June 2009

7.3.3 Market

Due to the significant expense involved in the transportation of coal, world trade is effectively divided into two regional markets; the Atlantic market and the Pacific market. The Pacific market is the larger of these, comprising around 57% of world seaborne steam coal trade and boasting the world’s two largest exporters. In 2007 Australia was the top exporter of coking coal with 132 Mt, while Indonesia led steam coal, exporting 171 Mt.

7.3.4 Price trends

Coal is a global commodity and, as such, prices are determined by global supply and demand factors. With both the international community and the world’s dependency on energy growing, fuel products are the single most important input affecting global economic growth. As a result coal is a highly marketable commodity, and with world consumption estimated to increase 60% by 2030, the long term price outlook is strong.

During 2007-2008, elevated demand for coal as the cheapest source of power saw prices increase by around 200%. This diverged from historical trends where coal has generally traded at a lower, more stable price than more volatile commodities such as oil and gas. Coking coal currently trades at an average price of around US$100/t, down from a peak of over US$200/t mid 2008. Speculation about sustainability of prices in light of the economic slowdown and a slackening steel market caused the correction from the highs experienced, however in comparison to an average between US$20/t to US$40/t throughout the 1990’s, the current price is still well above historical levels.

30%

9%

22%

4%

33%

2%

Proven World Coal Reserves (2008 - end)

North America

Australia

Asia Pacific

Middle East & Africa

Europe & Eurasia

South & Central America





Source: Energy & Metals Consensus Forecasts - April 2009

Going forward the outlook is more positive, with a stabilisation in coal prices anticipated. Industry analyst consensus indicates prices of US$127.70 and US$72.50 in the second half of 2009 for coking and steaming coal respectively, with both experiencing further improvement in 2011. A gradual appreciation is in line with expectations of a recovery in the world economy over the coming years with the continued expansion of India and China in particular driving demand for both energy and iron and steel production.

7.3.5 Outlook

World coal consumption currently exceeds 4,050Mt per annum and this figure is estimated to increase 60% by 2030. In response to this, global production is set to exceed 7 billion tones in 2030 with China accounting for around half the increase over this period (The Coal Resource: A Comprehensive Overview of Coal, World Coal Institute).

As the major source of electricity generation (currently 40% of the world’s electricity) and a vital input for the production of iron and steel, coal will continue to play a major role in industry in the 21st Century. In 2013 the global coal market is forecast to have a value of $473.8 billion, an increase of 16% since 2008, while the compound annual growth rate over this period is predicted to be 3% (Global-Coal and Consumable Fuels, Datamonitor 2009). Longer term, consumption of steam coal is projected to grow by 1.5 per cent per year until 2030 and demand for coking coal is expected to increase by 0.9 per cent per year over this period.

Growth will be the strongest in developing Asian countries, especially in the steam and coking coal markets, stemming from electricity demand, car production, and demand for household appliances. Resultantly demand and supply are set to remain fairly tight into the future, substantiating a positive outlook for the industry.

20

40

60

80

100

120

140

Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11

Consensus Analyst Forecast - USD/t(Australian-Japanese Contracts - Free on Board)

Coking coal Steaming coal





Source: Energy & Metals Consensus Forecasts - April 2009

Going forward the outlook is more positive, with a stabilisation in coal prices anticipated. Industry analyst consensus indicates prices of US$127.70 and US$72.50 in the second half of 2009 for coking and steaming coal respectively, with both experiencing further improvement in 2011. A gradual appreciation is in line with expectations of a recovery in the world economy over the coming years with the continued expansion of India and China in particular driving demand for both energy and iron and steel production.

7.3.5 Outlook

World coal consumption currently exceeds 4,050Mt per annum and this figure is estimated to increase 60% by 2030. In response to this, global production is set to exceed 7 billion tones in 2030 with China accounting for around half the increase over this period (The Coal Resource: A Comprehensive Overview of Coal, World Coal Institute).

As the major source of electricity generation (currently 40% of the world’s electricity) and a vital input for the production of iron and steel, coal will continue to play a major role in industry in the 21st Century. In 2013 the global coal market is forecast to have a value of $473.8 billion, an increase of 16% since 2008, while the compound annual growth rate over this period is predicted to be 3% (Global-Coal and Consumable Fuels, Datamonitor 2009). Longer term, consumption of steam coal is projected to grow by 1.5 per cent per year until 2030 and demand for coking coal is expected to increase by 0.9 per cent per year over this period.

Growth will be the strongest in developing Asian countries, especially in the steam and coking coal markets, stemming from electricity demand, car production, and demand for household appliances. Resultantly demand and supply are set to remain fairly tight into the future, substantiating a positive outlook for the industry.

20

40

60

80

100

120

140

Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11

Consensus Analyst Forecast - USD/t(Australian-Japanese Contracts - Free on Board)

Coking coal Steaming coal



8. V AL U AT I O N AP P R O AC H AD O P TE D

8.1 Value of the Consideration

The consideration to be paid by Maverick for the 100% interest in Triangle will be paid in scrip. Scrip consideration reflects the value of a company; therefore, we will value Maverick to place a value on the Company’s shares.

There are a number of methodologies which can be used to value a business or the shares in a company. The principal methodologies which can be used are as follows:

Net Assets on a going concern basis (‘NTA”)

Quoted Market Price Basis (“QMP”)

Capitalisation of future maintainable earnings (“FME”)

Discounted Cash Flow (“DCF”)

A summary of each of these methodologies is outlined in Appendix 2.

Different methodologies are appropriate in valuing particular companies, based on the individual circumstances of that company and available information. In our assessment of the value of Maverick shares we have chosen to employ the following methodologies:

Net Assets on a going concern basis; and

Quoted Market Price Basis.

We have chosen these methodologies for the following reasons:

The core value of Maverick is the capitalised exploration and evaluation expenditure it holds. This expenditure is recorded as an asset in the balance sheet. From this we are able to value Maverick using the net assets on a going concern basis.

We have instructed Malcolm Castle to prepare an independent specialist’s valuation on the coal assets held by Maverick in the Waterberg Coalfield, South Africa.

We have instructed John Blumer of RobSearch Australia Pty Ltd (“RobSearch”) to prepare an independent specialist’s valuation on the gas production and exploration assets held by Maverick in the Reid’s Dome tenement, Queensland, Australia.

We have not been provided with any reliable forecasts on the future cash flows of Maverick and as such, this means that the DCF method is not appropriate.

Maverick does not generate any regular trading income. Therefore, there are no historic profits that could be used to represent future earnings. This means that the FME valuation methodology will not be appropriate.

Maverick’s shares are traded on the ASX. This means there is a regulated and liquid market where Maverick’s shares can be traded. However, in order for the quoted market price to be considered appropriate the company’s shares should be liquid and the market should be fully informed as to Maverick’s activities. We have considered these factors in Section 9.2.





8.2 Value of interest in Triangle Energy Limited

We have chosen to employ the NTA methodology in valuing the 100% interest in Triangle.

We have chosen this methodology for the following reasons:

The core value of Triangle is the capitalised exploration and evaluation expenditure it holds. This expenditure is recorded as an asset in the balance sheet. From this we are able to value Triangle using the net assets on a going concern basis.

We have instructed Roger Whyte to prepare an independent specialist’s valuation on the gas assets held by Triangle in Indonesia.

We have not been provided with any reliable forecasts on the future cash flows of Triangle and as such, this means that the DCF method is not appropriate.

Triangle does not generate any regular trading income. Therefore, there are no historic profits that could be used to represent future earnings. This means that the FME valuation methodology will not be appropriate.

Triangle’s shares are not traded on the ASX. This means that there is not a regulated and liquid market where Triangle’s shares can be traded and therefore the quoted market price is not considered to be an appropriate valuation methodology.





8.2 Value of interest in Triangle Energy Limited

We have chosen to employ the NTA methodology in valuing the 100% interest in Triangle.

We have chosen this methodology for the following reasons:

The core value of Triangle is the capitalised exploration and evaluation expenditure it holds. This expenditure is recorded as an asset in the balance sheet. From this we are able to value Triangle using the net assets on a going concern basis.

We have instructed Roger Whyte to prepare an independent specialist’s valuation on the gas assets held by Triangle in Indonesia.

We have not been provided with any reliable forecasts on the future cash flows of Triangle and as such, this means that the DCF method is not appropriate.

Triangle does not generate any regular trading income. Therefore, there are no historic profits that could be used to represent future earnings. This means that the FME valuation methodology will not be appropriate.

Triangle’s shares are not traded on the ASX. This means that there is not a regulated and liquid market where Triangle’s shares can be traded and therefore the quoted market price is not considered to be an appropriate valuation methodology.



9. V AL U AT I O N O F C O N S I DER AT I O N P AY AB L E B Y M AV E R I C K

In assessing the fairness of the transaction, we have valued the consideration payable by Maverick to the vendors. Under the agreement, the consideration payable will be 1,018,300,000 post consolidation Maverick Shares. 9.1 Net Tangible Asset Valuation of Maverick

We have undertaken a valuation of Maverick using the net tangible assets methodology.

When calculating the net asset value of a Maverick share, we have assessed the net assets of Maverick prior to the announcement of the acquisition. This has been calculated using the most recently audited balance sheet of Maverick, that being as at 30 June 2009. The net asset value per share is calculated by using the total number of shares that are on issue.

The value of Maverick assets per share on a going concern basis prior to the acquisition is reflected in our valuation below:

Ref

As at

High Maverick Energy Limited 30-Jun-09 Low Preferred $ $ $ $ ASSETS

$ $

Cash and cash equivalents 249,703 249,703 249,703 249,703

Other Current Assets 10,962 10,962 10,962 10,962

Exploration and Evaluation Expenditure 9.1.1 1,538,444 110,000 300,000 600,000 TOTAL ASSETS 1,799,109 370,665 560,665 860,665

LIABILITIES

Payables 29,354 29,354 29,354 29,354

Other non-current liabilities 16 16 16 16 TOTAL LIABILITIES 29,370 29,370 29,370 29,370

NET ASSETS VALUE OF MAVERICK 1,769,739 341,295 531,295 831,295

Ordinary Maverick shares currently on issue

494,893,620 494,893,620 494,893,620

VALUE PER SHARE

$0.0007 $0.0011 $0.0017

The table above indicates the value of a Maverick share after adjustments on a net asset basis is between $0.0007 and $0.0017, with a preferred value of $0.0011. We have made the following adjustment as set out below:

9.1.1 Exploration and evaluation expenditure

a) We instructed Malcolm Castle to prepare a specialist independent valuation on the interest Maverick has in the Loopleegte Coal Project in the Waterberg Coalfield, South Africa. Mr Castle’s report is attached as Appendix 3 to this report.





The results of the market value of Maverick’s interest in the Loopleegte Coal Project are:

Loopleegte Coal Project Low Value A$M

Preferred A$M

High Value A$M

Total Exploration Assets 14.97 16.43 17.93

The assets above have been valued using the Geoscientific Rating Method at a market rate. We consider that this method is appropriate for Maverick’s interest in the Loopleegte Coal Project.

Under the terms of the Joint Venture Agreement Maverick is able to earn a 30% in the Loopleegte Coal Project upon the outlay of $550,000 to complete a Bankable Feasibility Study. As at 30 June 2009, Maverick has accumulated expenditure of $80,000 on exploration on the project. In order for Maverick to earn its 30% interest, they would be required to spend a further $470,000 by 19 December 2009.

Maverick is entitled to earn an additional 44% in the Loopleegte Coal Project by making either:

A cash payment of R2.50/tonne (A$0.34/tonne) of mineable coal based on up to 44% of the mineable coal indicated in the Bankable Feasibility Study with any excess expenditure above $550,000 to be deducted from the earn out payment; or

A share equivalent payment (by way of the issue of Maverick shares) of R3.50 (A$0.48) per tonne of mineable coal based on up to 44% of the mineable coal indicated in the Bankable Feasibility Study with any excess expenditure above $550,000 to be deducted from the earn out payment.

In determining our low, high and preferred value of Maverick’s interest in the Loopleegte Coal Project, we have considered the requirements of the joint venture agreement, the balance sheet position of Maverick and other announcements in relation to the Project. Based on this we are of the opinion that it is more probable than not that Maverick will not earn the 30% interest in the Loopleegte Coal Project.

In forming this view we note that Maverick do not currently have the cash to complete the required expenditure to earn the 30% interest. Maverick has not announced any capital raising activities other than those in relation to the Transaction.

We also note that it is still possible that the Company may earn the interest or realise value through other means. Maverick stated per ASX announcements they are currently undertaking a strategic review of expenditure commitments and are reviewing existing projects and their future potential. Should this occur the resulting value would be greater than that which we have adopted below.





The results of the market value of Maverick’s interest in the Loopleegte Coal Project are:


Preferred A$M

High Value A$M

Total Exploration Assets 14.97 16.43 17.93

The assets above have been valued using the Geoscientific Rating Method at a market rate. We consider that this method is appropriate for Maverick’s interest in the Loopleegte Coal Project.

Under the terms of the Joint Venture Agreement Maverick is able to earn a 30% in the Loopleegte Coal Project upon the outlay of $550,000 to complete a Bankable Feasibility Study. As at 30 June 2009, Maverick has accumulated expenditure of $80,000 on exploration on the project. In order for Maverick to earn its 30% interest, they would be required to spend a further $470,000 by 19 December 2009.

Maverick is entitled to earn an additional 44% in the Loopleegte Coal Project by making either:

A cash payment of R2.50/tonne (A$0.34/tonne) of mineable coal based on up to 44% of the mineable coal indicated in the Bankable Feasibility Study with any excess expenditure above $550,000 to be deducted from the earn out payment; or

A share equivalent payment (by way of the issue of Maverick shares) of R3.50 (A$0.48) per tonne of mineable coal based on up to 44% of the mineable coal indicated in the Bankable Feasibility Study with any excess expenditure above $550,000 to be deducted from the earn out payment.

In determining our low, high and preferred value of Maverick’s interest in the Loopleegte Coal Project, we have considered the requirements of the joint venture agreement, the balance sheet position of Maverick and other announcements in relation to the Project. Based on this we are of the opinion that it is more probable than not that Maverick will not earn the 30% interest in the Loopleegte Coal Project.

In forming this view we note that Maverick do not currently have the cash to complete the required expenditure to earn the 30% interest. Maverick has not announced any capital raising activities other than those in relation to the Transaction.

We also note that it is still possible that the Company may earn the interest or realise value through other means. Maverick stated per ASX announcements they are currently undertaking a strategic review of expenditure commitments and are reviewing existing projects and their future potential. Should this occur the resulting value would be greater than that which we have adopted below.



The summary of our valuation is as follows:


Preferred A$M

High Value A$M

Total Exploration Assets 14.97 16.43 17.93 Maverick’s interest (%) 0% 0% 0% Maverick’s interest ($) 0.00 0.00 0.00

b) We instructed John Blumer of RobSearch to prepare a specialist independent valuation on the interest Maverick has in its Reid’s Dome Project, Queensland. Mr Blumer’s report is attached as Appendix 4 to this report. The results of the market value of Maverick’s interest in the Reid’s Dome Project are:

Valuation Low Value A$M

Preferred A$M

High Value A$M

Maverick’s 20% interest 0.11 0.30 0.60

The assets above have been valued using past and potential transactions, at a market rate, relating to the Petroleum Lease which Maverick has an interest. We consider that this method is appropriate for Maverick’s interest in its Reid’s Dome Project.

c) The addition of both values of Maverick’s interest in the Loopleegte Coal Project and the Reid’s Dome Project, gives Maverick exploration assets valued between $110,000 and $600,000, with a preferred valuation of $300,000.

Maverick’s Interests Low Value A$M

Preferred A$M

High Value A$M

Loopleegte Coal Project 0.00 0.00 0.00

Reid’s Dome Project 0.11 0.30 0.60

Total Interest 0.11 0.30 0.60





9.2 Quoted Market Prices for Maverick Securities

9.2.1 Quoted Market Price Value

To provide a comparison to the valuation of Maverick in Section 9.1, we have also assessed the market price for a Maverick share.

The following chart provides a summary of the share price movement from 7 July 2008 (the day Maverick relisted on the ASX) to 2 July 2009 (the day prior to the initial announcement of the Transaction).


The daily price of Maverick shares from 7 July 2008 to 2 July 2009 has ranged from a high of $0.080 on 24 July 2008 to a low of $0.003 on 15 April 2009.

To provide further analysis of the market prices for Maverick shares, we have also considered the weighted average market price for 10, 30, 60 and 90 day periods to 2 July 2009.

2 July 2009 10 Days 30 Days 60 Days 90 Days

Closing price $0.009

Weighted Average price $0.010 $0.009 $0.009 $0.008 Source: Bloomberg Data Service

The above weighted average prices are prior to the date of the announcement of the Transaction to avoid the influence of any increase in the price of Maverick shares that has occurred since the Transaction was announced.

We consider the trading of Maverick shares prior to the announcement on 3 July 2009 unlikely to include speculation of a transaction.

Our assessment of the value of a Maverick share based on the quoted market price is between $0.008 and $0.010.

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9.2 Quoted Market Prices for Maverick Securities

9.2.1 Quoted Market Price Value

To provide a comparison to the valuation of Maverick in Section 9.1, we have also assessed the market price for a Maverick share.

The following chart provides a summary of the share price movement from 7 July 2008 (the day Maverick relisted on the ASX) to 2 July 2009 (the day prior to the initial announcement of the Transaction).


The daily price of Maverick shares from 7 July 2008 to 2 July 2009 has ranged from a high of $0.080 on 24 July 2008 to a low of $0.003 on 15 April 2009.

To provide further analysis of the market prices for Maverick shares, we have also considered the weighted average market price for 10, 30, 60 and 90 day periods to 2 July 2009.

2 July 2009 10 Days 30 Days 60 Days 90 Days

Closing price $0.009

Weighted Average price $0.010 $0.009 $0.009 $0.008 Source: Bloomberg Data Service

The above weighted average prices are prior to the date of the announcement of the Transaction to avoid the influence of any increase in the price of Maverick shares that has occurred since the Transaction was announced.

We consider the trading of Maverick shares prior to the announcement on 3 July 2009 unlikely to include speculation of a transaction.

Our assessment of the value of a Maverick share based on the quoted market price is between $0.008 and $0.010.

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Total monthly volume traded on-market Weighted average on-market monthly share price



In order to demonstrate the liquidity of Maverick’s shares we have analysed the volume of trading in Maverick shares for the period to 2 July 2009 as set out below:

Low

$ High

$ Cumulative

Volume Issued Capital

% 1 Trading Day 0.009 0.009 545,020 0.11% 10 Trading Days 0.009 0.011 4,495,461 0.91% 30 Trading Days 0.007 0.014 20,584,565 4.16% 60 Trading Days 0.003 0.014 34,700,976 7.01% 90 Trading Days 0.003 0.014 39,161,419 7.91% 180 Trading Days 0.003 0.014 49,635,334 10.03% 1 Year 0.003 0.080 171,695,804 34.69%


This table indicates that Maverick shares display a low level of liquidity, with approximately 8% of the Company’s current issued capital being traded over the last 90 trading days to 2 July 2009.

For the quoted market price methodology to be reliable there needs to be a ‘deep’ market in the shares. RG 111.53 indicates that a ‘deep’ market should be liquid and active. We consider the following characteristics to be representative of a deep market:

Regular trading in a company’s securities;

Approximately 1% of a company’s securities are traded over five days;

The spread of a company’s shares must not be so great that a single minority trade can significantly affect the market capitalisation of a company; and

There are no significant but unexplained movements in share price.

A company’s shares should meet all of the above criteria to be considered ‘deep’, however, failure of a company’s securities to exhibit all of the above characteristics does not necessarily mean that the value of its shares cannot be considered relevant.

In the case of Maverick, while the shares are not highly liquid they are traded on a regular basis. However, the share price is volatile and small changes in share price can result in a significant change in the market capitalisation of Maverick. Therefore, we consider that the quoted market price can be relied upon as an indicator of the value of a Maverick share when compared with alternative valuation methods.

We have not applied a premium of control to the market share price of Maverick due to the stock not being highly liquid.

Our assessment is that a range of values for Maverick shares based on market pricing, after disregarding post announcement pricing, and disregarding a premium for control is between $0.008 and $0.010.

9.3 Conclusion on Value of a Maverick Share

The results of the valuations performed are summarised in the table below:

Maverick Energy Limited Low $

Preferred $

High $

Net tangible assets (Section 9.1) 0.0007 0.0011 0.0017

ASX market prices (Section 9.2) 0.0080 0.0090 0.0100

BDO Preferred Valuation 0.0007 0.0011 0.0017





Based on the results above, our value of existing Maverick shares is between $0.0007 and $0.0017 with a preferred value of $0.0011. We have relied on the NTA valuation as Maverick shares are illiquid and do not give a true reflection of the value of the Company.

9.4 Assessment of Consideration Payable by Maverick

As part of the consideration for the acquisition is 1,018,300,000 Maverick shares, we conclude that the value of the consideration is between $713,000 and $1,731,000 with a preferred value of $1,120,000.

Consideration Offered Low Preferred High

BDO Preferred Valuation $0.0007 $0.0011 $0.0017

Maverick Shares Offered 1,018,300,000 1,018,300,000 1,018,300,000

Total Consideration $713,000 $1,120,000 $1,731,000





Based on the results above, our value of existing Maverick shares is between $0.0007 and $0.0017 with a preferred value of $0.0011. We have relied on the NTA valuation as Maverick shares are illiquid and do not give a true reflection of the value of the Company.

9.4 Assessment of Consideration Payable by Maverick

As part of the consideration for the acquisition is 1,018,300,000 Maverick shares, we conclude that the value of the consideration is between $713,000 and $1,731,000 with a preferred value of $1,120,000.

Consideration Offered Low Preferred High

BDO Preferred Valuation $0.0007 $0.0011 $0.0017

Maverick Shares Offered 1,018,300,000 1,018,300,000 1,018,300,000

Total Consideration $713,000 $1,120,000 $1,731,000



10. V AL U AT I O N O F I N TE R EST I N TR I AN G L E

The value of Triangle assets on a going concern basis is reflected in our valuation below:

Ref

As at Preferred Triangle Energy Limited 30-Jun-09

$ $ ASSETS

Cash and cash equivalents 251,636 251,636

Trade and other receivables 19,686 19,686

Other financial assets – current 285,978 285,978

Other financial assets – non current 124,146 124,146

Property, plant and equipment 19,881 19,881

Shares in Triangle Pase Inc 10.1 127,551 8,836,870 TOTAL ASSETS 828,878 9,538,197

LIABILITIES Trade and other payables 178,782 178,782

Provisions 976 976

TOTAL LIABILITIES 179,758 179,758

NET ASSETS VALUE OF TRIANGLE 649,120 9,358,439

The table above indicates the preferred value of Triangle on a net asset basis is $9.36 million. We have made the following adjustment to the assets of Triangle to arrive at this value range.

10.1 Shares in Triangle Pase Inc

This balance relates to goodwill on the acquisition of Triangle Pase Inc. We have substituted the goodwill balance in the Triangle consolidated balance sheet with the value of the Pase PSC assets. We instructed Roger Whyte to prepare a specialist independent valuation of the gas assets of Triangle. Mr Whyte’s report is attached as Appendix 5 to this report. The result of the market value of Triangle’s gas asset in Indonesia is:

Valuation Preferred A$

Total Exploration Assets 8,836,870

The assets above have been valued using the Net Present Value (“NPV”) method, post Indonesian Tax, at a market rate. We consider that this method is appropriate for valuing the exploration and evaluation assets held by Triangle Pase Inc, of which Triangle has a 100% interest.

Some of the key assumptions in the NPV method include:

Gas Production; Gas Price; Actual Recovery; Government Tax Entitlement; ExxonMobil Royalty; and





Operating Cost.

A full review of the assumptions can be seen in Roger Whyte’s Report attached as Appendix 5 to this report.

The NPV was calculated in $USD and as such, an exchange rate has been applied to the value to convert it into $AUD. The foreign exchange rate used is $0.86AUD/$USD which we have concluded to be a reasonable assumption in the NPV as at the date of Roger Whyte’s report.

A discount rate of 10% has been used in the valuation which we have reviewed and conclude that it is both reasonable and conservative for the valuation of the Pase PSC.

10.2 Assessment of Interest in Triangle

Maverick will acquire 100% of Triangle. Based on the net assets on a going concern valuation, we set out the value of Maverick’s interest in Triangle below:

Triangle Energy Limited Value per share ($M)

Low Preferred High

Net tangible assets (Section 10.1) 9.36 9.36 9.36 Interest 100% 100% 100% Value of Maverick Interest 9.36 9.36 9.36

We conclude that the value of a 100% interest in Triangle is $9.36 million.

11. I S TH E TR AN S AC TI O N F AI R?

The following table summarises our assessment of the value of the consideration to be paid by Maverick and the 100% interest in Triangle.


Preferred $

High $


The value of the assets to be acquired is greater than the value of the consideration. Therefore, we consider the Transaction is fair to Shareholders.





Operating Cost.

A full review of the assumptions can be seen in Roger Whyte’s Report attached as Appendix 5 to this report.

The NPV was calculated in $USD and as such, an exchange rate has been applied to the value to convert it into $AUD. The foreign exchange rate used is $0.86AUD/$USD which we have concluded to be a reasonable assumption in the NPV as at the date of Roger Whyte’s report.

A discount rate of 10% has been used in the valuation which we have reviewed and conclude that it is both reasonable and conservative for the valuation of the Pase PSC.

10.2 Assessment of Interest in Triangle

Maverick will acquire 100% of Triangle. Based on the net assets on a going concern valuation, we set out the value of Maverick’s interest in Triangle below:

Triangle Energy Limited Value per share ($M)

Low Preferred High

Net tangible assets (Section 10.1) 9.36 9.36 9.36 Interest 100% 100% 100% Value of Maverick Interest 9.36 9.36 9.36

We conclude that the value of a 100% interest in Triangle is $9.36 million.

11. I S TH E TR AN S AC TI O N F AI R?

The following table summarises our assessment of the value of the consideration to be paid by Maverick and the 100% interest in Triangle.


Preferred $

High $


The value of the assets to be acquired is greater than the value of the consideration. Therefore, we consider the Transaction is fair to Shareholders.



12. I S TH E TR AN S AC TI O N R E AS O N AB L E ?

12.1 Advantages

If the Transaction is approved, in our opinion, the potential advantages to the Shareholders include those listed in the table below:

Ref Advantage Description

12.1.1 The Transaction is fair RG 111 states that an Offer is reasonable if it is fair. As set out in section 11 the Transaction is fair, it is therefore also reasonable.

12.1.2 Exposure to Triangle assets generating cash flows.

If the Transaction proceeds, Maverick will acquire a 100% interest in the production sharing contract in respect of the Pase Block located in Indonesia. This asset is producing and has the potential to generate continuing cash flows into the future, which can be used for activities such as funding for future development and potential dividends.

12.1.3 Maverick will gain exposure to further assets

By approving the Transaction, Maverick will have exposure to the gas assets held by Triangle which will potentially give Maverick shareholders exposure to greater value than what they have currently. This is because an exploration asset can potentially hold greater future value. As such, Maverick may be valued higher than if it only held the current two exploration assets.

12.1.4 Possible improvement in liquidity because of assets

Trading in Maverick shares has displayed low liquidity. By acquiring Triangle and hence another exploration asset, there may be an increased interest in Maverick’s shares. This could improve liquidity which will make it easier for shareholders to dispose of their shares efficiently.

12.1.5 Increased market capitalisation

The acquisition of Triangle will increase the market capitalisation of Maverick, giving the Company a greater presence in the market and greater value. This may also make access to capital easier than as a smaller entity.

12.1.6 Diversification By acquiring the assets held in Triangle, Maverick will be exposed to gas assets in Indonesia, as well as their existing coal asset in South Africa and gas asset in Queensland.

12.1.7 Potential for further upside from Triangle’s assets

The Pase PSC expires in February 2011. If the contract is renewed, Maverick will be exposed to further upside potential from future cash flows and exploration opportunities from this contract.





12.2 Disadvantages

If the Transaction is approved, in our opinion, the potential disadvantages to the Shareholders include those listed in the table below:

Ref Disadvantage Description

12.2.1 Country and political risk The asset to be acquired is in Indonesia, and as such, Maverick will be exposed to country and political risks faced by entities operating in Indonesia. This may not suit all Shareholders’ risk profiles.

12.2.2 Dilution of Shareholders The consideration to be paid involves the issue of 1,018,300,000 post consolidation ordinary fully paid shares in Maverick. This will result in a dilution in the interest held by Shareholders in Maverick from 100.0% to 12.1% following the capital raising and assuming the convertible notes to be issued are converted.


As a result of the Transaction, the vendors of Triangle will have effective control of Maverick, with a 74.6% shareholding. Triangle will have the power to control the financial and operations aspects of Maverick and be able to control dividend policies. Triangle will also have the right to appoint directors to the board.

Triangle will have almost 75% of the shares on issue. If they were to obtain a 75% shareholding they would have the ability to pass special resolutions in the Company. Special resolutions include but are not limited to:

Giving different dividend rights or shares in the same class; and

Selective reduction of share capital.

In addition, Triangle will have the ability to pass ordinary resolutions. Ordinary resolutions include but are not limited to:

election/re-election of directors; appointment of an auditor; acceptance of reports at the annual general

meeting; strategic, commercial decisions; and

increase or reduce the number of directors.





12.2 Disadvantages

If the Transaction is approved, in our opinion, the potential disadvantages to the Shareholders include those listed in the table below:

Ref Disadvantage Description

12.2.1 Country and political risk The asset to be acquired is in Indonesia, and as such, Maverick will be exposed to country and political risks faced by entities operating in Indonesia. This may not suit all Shareholders’ risk profiles.

12.2.2 Dilution of Shareholders The consideration to be paid involves the issue of 1,018,300,000 post consolidation ordinary fully paid shares in Maverick. This will result in a dilution in the interest held by Shareholders in Maverick from 100.0% to 12.1% following the capital raising and assuming the convertible notes to be issued are converted.


As a result of the Transaction, the vendors of Triangle will have effective control of Maverick, with a 74.6% shareholding. Triangle will have the power to control the financial and operations aspects of Maverick and be able to control dividend policies. Triangle will also have the right to appoint directors to the board.

Triangle will have almost 75% of the shares on issue. If they were to obtain a 75% shareholding they would have the ability to pass special resolutions in the Company. Special resolutions include but are not limited to:

Giving different dividend rights or shares in the same class; and

Selective reduction of share capital.

In addition, Triangle will have the ability to pass ordinary resolutions. Ordinary resolutions include but are not limited to:

election/re-election of directors; appointment of an auditor; acceptance of reports at the annual general

meeting; strategic, commercial decisions; and

increase or reduce the number of directors.



12.3 Alternative Transaction

We are unaware of any alternative transaction that might offer the Shareholders of Maverick a premium over the value ascribed to that resulting from the Transaction.

12.4 Implications of the Transaction not being approved

We have analysed movements in Maverick’s share price since the Transaction was announced. A graph of Maverick’s share price since the announcement is set out below.


Maverick’s closing share price remained relatively constant post the announcement on 3 July 2009. The increase in share price and volume at approximately 1 August 2009 can be attributed to the quarterly cash flow and activity reports announced on the ASX on 31 July 2009. The increase in volume at approximately 15 September 2009 can be attributed to the announcement in relation to the acquisition of Triangle, further to the announcements made on 3 July 2009 and 11 August 2009.

We consider that the announcement of the Transaction on 3 July 2009 did not result in an improvement in the volume or price of Maverick shares. Therefore, in our opinion, if the Transaction is not approved, there will be little affect to the volume and price of Maverick shares.

If the Transaction is not approved, Maverick will evaluate future opportunities as and when they are presented. As noted in section 9, Maverick has a cash balance of $249,703 as at 30 June 2009. If Maverick wants to acquire a 30% interest in the Loopleegte Coal Project they will have to expend a further $470,000 to earn a 30% interest in this project. As Maverick does not have the necessary funds to earn this interest, it is likely that Maverick will have to conduct an equity capital raising in the near future. This capital raising would be likely to be at a discount to the value of Maverick and would dilute shareholders. If Maverick was unable to fund the additional $470,000 in exploration and it does not receive an extension to the expenditure deadline then it would relinquish the opportunity to take a 30% interest in the Loopleegte Coal Project.

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

0.000

0.002

0.004

0.006

0.008

0.010

0.012

0.014

01-Jul 15-Jul 29-Jul 12-Aug 26-Aug 09-Sep

Volu

me

Clo

sing

Sha

re P

rice

($)

Volume Closing Share Price





13. C O N C L U S I O N

We have considered the terms of the Transaction as outlined in the body of this report and have concluded that the Transaction is fair and reasonable to the non-associated shareholders of Maverick.





13. C O N C L U S I O N

We have considered the terms of the Transaction as outlined in the body of this report and have concluded that the Transaction is fair and reasonable to the non-associated shareholders of Maverick.



14. S O U R C E S O F I N F O RM AT I O N

This report has been based on the following information:

Draft Notice of General Meeting and Explanatory Statement on or about the date of this report;

Audited financial statements of Maverick for the years ended 30 June 2007, 30 June 2008 and 30 June 2009;

Unaudited management accounts of Triangle for the year ended 30 June 2009;

Independent Specialist Valuation Report on the coal assets held by Maverick, dated 12 September 2009 and prepared by Mr Malcolm Castle;

Independent Specialist Valuation Report on the gas assets held by Maverick, dated 21 September 2009 and prepared by Mr John Blumer of RobSearch;

Independent Specialist Valuation Report on the gas assets held by Triangle, dated 22 September 2009 and prepared by Mr Roger Whyte;

Share registry information;

Information in the public domain; and

Discussions with Directors and Management of Maverick and Triangle.

15. I N D E PE N D E N C E

BDO Kendalls Corporate Finance (WA) Pty Ltd is entitled to receive a fee of $24,000 (excluding GST and reimbursement of out of pocket expenses). Except for this fee, BDO Kendalls Corporate Finance (WA) Pty Ltd has not received and will not receive any pecuniary or other benefit whether direct or indirect in connection with the preparation of this report.

BDO Kendalls Corporate Finance (WA) Pty Ltd has been indemnified by Maverick in respect of any claim arising from BDO Kendalls Corporate Finance (WA) Pty Ltd's reliance on information provided by the Maverick, including the non provision of material information, in relation to the preparation of this report.

Prior to accepting this engagement BDO Kendalls Corporate Finance (WA) Pty Ltd has considered its independence with respect to Maverick and Triangle and any of their respective associates with reference to ASIC Regulatory Guide 112 “Independence of Experts”. In BDO Kendalls Corporate Finance (WA) Pty Ltd’s opinion it is independence of Maverick and Triangle and their respective associates.

Neither the two signatories to this report nor BDO Kendalls Corporate Finance (WA) Pty Ltd, have had within the past two years any professional relationship with Maverick, or their associates, other than in connection with the preparation of this report.

A draft of this report was provided to Maverick and its advisors for confirmation of the factual accuracy of its contents. No significant changes were made to this report as a result of this review.





16. Q U AL I F I C ATI O N S

BDO Kendalls Corporate Finance (WA) Pty Ltd has extensive experience in the provision of corporate finance advice, particularly in respect of takeovers, mergers and acquisitions.

BDO Kendalls Corporate Finance (WA) Pty Ltd holds an Australian Financial Services Licence issued by the Australian Securities and Investment Commission for giving expert reports pursuant to the Listing rules of the ASX and the Corporations Act.

The persons specifically involved in preparing and reviewing this report were Sherif Andrawes, Adam Myers and Steve van Nierop of BDO Kendalls Corporate Finance (WA) Pty Ltd. They have significant experience in the preparation of independent expert reports, valuations and mergers and acquisitions advice across a wide range of industries in Australia.

Sherif Andrawes is a Fellow of the Institute of Chartered Accountants in England & Wales and a Member of the Institute of Chartered Accountants in Australia. He has over twenty years experience working in the audit and corporate finance fields with BDO Kendalls and its predecessor firms in London and Perth. He has been responsible for over 100 public company independent expert’s reports under the Corporations Act or ASX Listing Rules. These experts’ reports cover a wide range of industries in Australia.

Adam Myers is a member of the Australian Institute of Chartered Accountants. Adam’s career spans 11 years in the Audit and Assurance and Corporate Finance areas.

17. D I S C L AI M E RS AN D C O N S E N TS

This report has been prepared at the request of Maverick for inclusion in the Explanatory Memorandum which will be sent to all Maverick Shareholders. Maverick engaged BDO Kendalls Corporate Finance (WA) Pty Ltd to prepare an independent expert's report to consider the acquisition of 100% of the issue shares of Triangle.

BDO Kendalls Corporate Finance (WA) Pty Ltd hereby consents to this report accompanying the above Explanatory Memorandum. Apart from such use, neither the whole nor any part of this report, nor any reference thereto may be included in or with, or attached to any document, circular resolution, statement or letter without the prior written consent of BDO Kendalls Corporate Finance (WA) Pty Ltd.

BDO Kendalls Corporate Finance (WA) Pty Ltd takes no responsibility for the contents of the Explanatory Memorandum other than this report.

BDO Kendalls Corporate Finance (WA) Pty Ltd has not independently verified the information and explanations supplied to us, nor has it conducted anything in the nature of an audit of Maverick or Triangle. However, we have no reason to believe that any of the information or explanations so supplied are false or that material information has been withheld.

With respect to taxation implications it is recommended that individual Shareholders obtain their own taxation advice, in respect of the Transaction, tailored to their own particular circumstances. Furthermore, the advice provided in this report does not constitute legal or taxation advice to the Shareholders of Maverick, or any other party.

BDO Kendalls Corporate Finance (WA) Pty Ltd has also considered and relied upon independent valuations for assets held by Maverick and Triangle.

The valuers engaged for the valuations possess the appropriate qualifications and experience in the industries specified to make such assessments. The approaches adopted and assumptions made in arriving at their valuations are appropriate for this report. We have





16. Q U AL I F I C ATI O N S

BDO Kendalls Corporate Finance (WA) Pty Ltd has extensive experience in the provision of corporate finance advice, particularly in respect of takeovers, mergers and acquisitions.

BDO Kendalls Corporate Finance (WA) Pty Ltd holds an Australian Financial Services Licence issued by the Australian Securities and Investment Commission for giving expert reports pursuant to the Listing rules of the ASX and the Corporations Act.

The persons specifically involved in preparing and reviewing this report were Sherif Andrawes, Adam Myers and Steve van Nierop of BDO Kendalls Corporate Finance (WA) Pty Ltd. They have significant experience in the preparation of independent expert reports, valuations and mergers and acquisitions advice across a wide range of industries in Australia.

Sherif Andrawes is a Fellow of the Institute of Chartered Accountants in England & Wales and a Member of the Institute of Chartered Accountants in Australia. He has over twenty years experience working in the audit and corporate finance fields with BDO Kendalls and its predecessor firms in London and Perth. He has been responsible for over 100 public company independent expert’s reports under the Corporations Act or ASX Listing Rules. These experts’ reports cover a wide range of industries in Australia.

Adam Myers is a member of the Australian Institute of Chartered Accountants. Adam’s career spans 11 years in the Audit and Assurance and Corporate Finance areas.

17. D I S C L AI M E RS AN D C O N S E N TS

This report has been prepared at the request of Maverick for inclusion in the Explanatory Memorandum which will be sent to all Maverick Shareholders. Maverick engaged BDO Kendalls Corporate Finance (WA) Pty Ltd to prepare an independent expert's report to consider the acquisition of 100% of the issue shares of Triangle.

BDO Kendalls Corporate Finance (WA) Pty Ltd hereby consents to this report accompanying the above Explanatory Memorandum. Apart from such use, neither the whole nor any part of this report, nor any reference thereto may be included in or with, or attached to any document, circular resolution, statement or letter without the prior written consent of BDO Kendalls Corporate Finance (WA) Pty Ltd.

BDO Kendalls Corporate Finance (WA) Pty Ltd takes no responsibility for the contents of the Explanatory Memorandum other than this report.

BDO Kendalls Corporate Finance (WA) Pty Ltd has not independently verified the information and explanations supplied to us, nor has it conducted anything in the nature of an audit of Maverick or Triangle. However, we have no reason to believe that any of the information or explanations so supplied are false or that material information has been withheld.

With respect to taxation implications it is recommended that individual Shareholders obtain their own taxation advice, in respect of the Transaction, tailored to their own particular circumstances. Furthermore, the advice provided in this report does not constitute legal or taxation advice to the Shareholders of Maverick, or any other party.

BDO Kendalls Corporate Finance (WA) Pty Ltd has also considered and relied upon independent valuations for assets held by Maverick and Triangle.

The valuers engaged for the valuations possess the appropriate qualifications and experience in the industries specified to make such assessments. The approaches adopted and assumptions made in arriving at their valuations are appropriate for this report. We have



received consents from the valuers for the use of their valuation reports in the preparation of this report.

The statements and opinions included in this report are given in good faith and in the belief that they are not false, misleading or incomplete.

The terms of this engagement are such that BDO Kendalls Corporate Finance (WA) Pty Ltd has no obligation to update this report for events occurring subsequent to the date of this report.

Yours faithfully


Sherif Andrawes Director

Adam Myers Associate Director Authorised Representative





Appendix 1 – Glossary of Terms

Reference Definition

The Act The Corporations Act

ASIC Australian Securities and Investments Commission

ASX Australian Securities Exchange

BDO Kendalls BDO Kendalls Corporate Finance (WA) Pty Ltd

BOE Barrels of Oil Equivalent

The Company Maverick Energy Limited

DCF Discounted Future Cash Flows

EBIT Earnings before interest and tax

EBITDA Earnings before interest, tax, depreciation and amortisation

ExxonMobil Exxon Mobil Corporation

FMD Future Maintainable Dividends

FME Future Maintainable Earnings

RBA Reserve Bank of Australia

ROC Return of Capital

Maverick Maverick Energy Limited

MPI Mobile Pase Inc.

NTA Net Tangible Assets

The Transaction The proposal to issue 1,018,300,000 post consolidation shares in Maverick to the vendors of Triangle in exchange for 100% of the issued shares of Triangle

TPI Triangle Pase Inc.

Triangle Triangle Energy Limited

Our Report This Independent Expert’s Report prepared by BDO Kendalls

VWAP Volume Weighted Average Price

Shareholders Non- Associated Shareholders of Maverick Energy Limited





Appendix 1 – Glossary of Terms

Reference Definition

The Act The Corporations Act

ASIC Australian Securities and Investments Commission

ASX Australian Securities Exchange

BDO Kendalls BDO Kendalls Corporate Finance (WA) Pty Ltd

BOE Barrels of Oil Equivalent

The Company Maverick Energy Limited

DCF Discounted Future Cash Flows

EBIT Earnings before interest and tax

EBITDA Earnings before interest, tax, depreciation and amortisation

ExxonMobil Exxon Mobil Corporation

FMD Future Maintainable Dividends

FME Future Maintainable Earnings

RBA Reserve Bank of Australia

ROC Return of Capital

Maverick Maverick Energy Limited

MPI Mobile Pase Inc.

NTA Net Tangible Assets

The Transaction The proposal to issue 1,018,300,000 post consolidation shares in Maverick to the vendors of Triangle in exchange for 100% of the issued shares of Triangle

TPI Triangle Pase Inc.

Triangle Triangle Energy Limited

Our Report This Independent Expert’s Report prepared by BDO Kendalls

VWAP Volume Weighted Average Price

Shareholders Non- Associated Shareholders of Maverick Energy Limited



Appendix 2 – Valuation Methodologies

1.1 Valuation methodologies

Methodologies commonly used for valuing assets and businesses are as follows:

1.1.1 Net tangible asset value on a going concern basis (“NTA”)

Asset based methods estimate the market value of an entity’s securities based on the realisable value of its identifiable net assets. Asset based methods include:

Orderly realisation of assets method

Liquidation of assets method

Net assets on a going concern method

The orderly realisation of assets method estimates fair market value by determining the amount that would be distributed to entity holders, after payment of all liabilities including realisation costs and taxation charges that arise, assuming the entity is wound up in an orderly manner.

The liquidation method is similar to the orderly realisation of assets method except the liquidation method assumes the assets are sold in a shorter time frame. Since wind up or liquidation of the entity may not be contemplated, these methods in their strictest form may not be appropriate. The net assets on a going concern method estimates the market values of the net assets of an entity but does not take into account any realisation costs.

Net assets on a going concern basis are usually appropriate where the majority of assets consist of cash, passive investments or projects with a limited life. All assets and liabilities of the entity are valued at market value under this alternative and this combined market value forms the basis for the entity’s valuation.

Often the FME and DCF methodologies are used in valuing assets forming part of the overall Net assets on a going concern basis. This is particularly so for exploration and mining companies where investments are in finite life producing assets or prospective exploration areas.

These asset based methods ignore the possibility that the entity’s value could exceed the realisable value of its assets as they do not recognise the value of intangible assets such as management, intellectual property and goodwill. Asset based methods are appropriate when entities are not profitable, a significant proportion of the entity’s assets are liquid or for asset holding companies.

1.1.2 Quoted Market Price Basis

A valuation approach that can be used in conjunction with (or as a replacement for) other valuation methods is the quoted market price of listed securities. Where there is a ready market for securities such as the ASX, through which shares are traded, recent prices at which shares are bought and sold can be taken as the market value per share. Such market value includes all factors and influences that impact upon the ASX. The use of ASX pricing is more relevant where a security displays regular high volume trading, creating a “deep” market in that security.





1.1.3 Capitalisation of future maintainable earnings (“FME”)

This method places a value on the business by estimating the likely FME, capitalised at an appropriate rate which reflects business outlook, business risk, investor expectations, future growth prospects and other entity specific factors. This approach relies on the availability and analysis of comparable market data.

The FME approach is the most commonly applied valuation technique and is particularly applicable to profitable businesses with relatively steady growth histories and forecasts, regular capital expenditure requirements and non-finite lives.

The FME used in the valuation can be based on net profit after tax or alternatives to this such as earnings before interest and tax (“EBIT”) or earnings before interest, tax, depreciation and amortisation (“EBITDA”). The capitalisation rate or "earnings multiple" is adjusted to reflect which base is being used for FME.

1.1.4 Discounted future cash flows (“DCF”)

The DCF methodology is based on the generally accepted theory that the value of an asset or business depends on its future net cash flows, discounted to their present value at an appropriate discount rate (often called the weighted average cost of capital). This discount rate represents an opportunity cost of capital reflecting the expected rate of return which investors can obtain from investments having equivalent risks.

A terminal value for the asset or business is calculated at the end of the future cash flow period and this is also discounted to its present value using the appropriate discount rate.

DCF valuations are particularly applicable to businesses with limited lives, experiencing growth, that are in a start up phase, or experience irregular cash flows.

1.1.5 Multiple of Exploration Expenditure (“MEE”)

The Past Expenditure method is a method of valuing exploration assets in the resources industry. It is applicable for areas which are at too early a stage of prospectivity to justify the use of alternative valuation methods such as DCF. The Past Expenditure method is often referred to as the Multiple of Exploration Expenditure method.

Past expenditure, or the amount spent on exploration of a tenement, is commonly used as a guide in determining value. The assumption is that well directed exploration adds value to a property. This is not always the case and exploration can also downgrade a property. The Prospectivity Enhancement Multiplier (“PEM”) which is applied to the effective expenditure therefore commonly ranges from 0.5 to 3.0. The PEM generally falls within the following ranges:

0.5 to 1.0 where work to date or historic data justifies the next stage of exploration;

to 2.0 where strong indications of potential for economic mineralisation have been identified; and

to 3.0 where ore grade intersections or exposures indicative of economic resources are present.





1.1.3 Capitalisation of future maintainable earnings (“FME”)

This method places a value on the business by estimating the likely FME, capitalised at an appropriate rate which reflects business outlook, business risk, investor expectations, future growth prospects and other entity specific factors. This approach relies on the availability and analysis of comparable market data.

The FME approach is the most commonly applied valuation technique and is particularly applicable to profitable businesses with relatively steady growth histories and forecasts, regular capital expenditure requirements and non-finite lives.

The FME used in the valuation can be based on net profit after tax or alternatives to this such as earnings before interest and tax (“EBIT”) or earnings before interest, tax, depreciation and amortisation (“EBITDA”). The capitalisation rate or "earnings multiple" is adjusted to reflect which base is being used for FME.

1.1.4 Discounted future cash flows (“DCF”)

The DCF methodology is based on the generally accepted theory that the value of an asset or business depends on its future net cash flows, discounted to their present value at an appropriate discount rate (often called the weighted average cost of capital). This discount rate represents an opportunity cost of capital reflecting the expected rate of return which investors can obtain from investments having equivalent risks.

A terminal value for the asset or business is calculated at the end of the future cash flow period and this is also discounted to its present value using the appropriate discount rate.

DCF valuations are particularly applicable to businesses with limited lives, experiencing growth, that are in a start up phase, or experience irregular cash flows.

1.1.5 Multiple of Exploration Expenditure (“MEE”)

The Past Expenditure method is a method of valuing exploration assets in the resources industry. It is applicable for areas which are at too early a stage of prospectivity to justify the use of alternative valuation methods such as DCF. The Past Expenditure method is often referred to as the Multiple of Exploration Expenditure method.

Past expenditure, or the amount spent on exploration of a tenement, is commonly used as a guide in determining value. The assumption is that well directed exploration adds value to a property. This is not always the case and exploration can also downgrade a property. The Prospectivity Enhancement Multiplier (“PEM”) which is applied to the effective expenditure therefore commonly ranges from 0.5 to 3.0. The PEM generally falls within the following ranges:

0.5 to 1.0 where work to date or historic data justifies the next stage of exploration;

to 2.0 where strong indications of potential for economic mineralisation have been identified; and

to 3.0 where ore grade intersections or exposures indicative of economic resources are present.



Appendix 3 to 5 – Independent Geologists Reports

.



•

•

•

•



TENURE Project Tenement

No. Equity Size

(km2) Status Grant

Factor Base Acquitition

Cost

South Africa

Low High

LOOPLEEGTE 302 LQ 100% 12.8 LIVE 1.00 14,250 14,750

•

•



•

•

KILBURN RATING CRITERIA - SIMPLIFIED

Rating Off Property Factor On Property Factor Anomaly Factor Geological Factor

1 Indications of Prospectivity

Indications of Prospectivity No targets outlined

Generally favourable geological environment

2 Resource targets Identified

Targets identified with successful early drilling

Exposure of mineralised zones or surface drilling (RAB)

Generally favourable lithology with structures or exposures of mineralised zones

3

Along Strike or adjacent to known mineralisation

Grade intercepts on adjacent sections - Exploration Targets Estimated from sound evidence

Significant grade intercepts not yet linked on cross and long sections

Significant mineralised zones exposed in prospective host rocks

4

Inferred Resource identified not yet estimated

Grade intercepts on adjacent sections

PROSPECTIVITY Project Off Site On Site Anomaly Geology

Low High Low High Low High Low High

South Africa

LOOPLEEGTE 302 LQ 3.50 3.60 2.50 2.60 2.50 2.60 2.50 2.60



Project Technical Value, A$m

Low High Preferred

LOOPLEEGTE 302 LQ 9.98 11.96 10.96



MARKET VALUATION, A$m

Market Factor 1.50

Project Low High Preferred

LOOPLEEGTE 302 LQ 14.97 17.93 16.43



•

•



•

•

•

•

•

•

•

•

•



•

•

•

•



KILBURN RATING CRITERIA - SIMPLIFIED

Rating Off Property Factor On Property Factor Anomaly Factor Geological Factor

0.1

Unfavourable geological environment

0.5

Extensive previous exploration with poor results - no encouragement

Minor favourable geological environment

0.9

Extensive previous exploration with encouraging results - regional targets

Generally favourable geological environment under cover

1 Indications of Prospectivity

Indications of Prospectivity No targets outlined

Generally favourable geological environment

2 Resource targets Identified

Targets identified with successful early drilling

Exposure of mineralised zones or surface drilling (RAB)

Generally favourable lithology with structures or exposures of mineralised zones

3

Along Strike or adjacent to known mineralisation

Grade intercepts on adjacent sections - Exploration Targets Estimated from sound evidence

Significant grade intercepts not yet linked on cross and long sections

Significant mineralised zones exposed in prospective host rocks



4

Inferred Resource identified not yet estimated

Grade intercepts on adjacent sections



RobSearch

RobSearch Australia Pty Limited (formerly Robertson Australia Pty Limited & Robertson Research (Australia) Pty Limited)

ABN: 29 000 762 078

INDEPENDENT CONSULTANTS NATURAL RESOURCES • SAFETY & ENVIRONMENTAL ENGINEERING • PROJECT IMPLEMENTATION

10th Floor, 80 Arthur Street, North Sydney, NSW 2060, Australia Phone: (02) 9957 3199 Fax: (02) 9954 4011 WebSite: www.robsearch.com.au E.Mail: [email protected]

21 September, 2009 Mr Sherif Andrawes BDO Kendalls (WA) Pty Ltd Level 8, 256 St Georges Terrace PO Box 7426, Cloister’s Square PERTH, WA, 6850 RA Ref: #4350 Dear Mr Andrawes,

Re: Independent Valuation of Maverick Energy Limited interest in PL 231, QLD

1.0 INTRODUCTION

The Directors of Maverick Energy Limited (Maverick) have retained BDO Kendalls to provide an Independent Expert’s Report (the Report)on the proposed transaction between Triangle Energy Limited to vend several oil and gas assets into Maverick for the consideration of Maverick shares.

BDO’s Report will be prepared under the provisions of the Corporations Act and the Listing Rules of the Australian Stock Exchange to provide an opinion to Maverick shareholders on whether the proposed transaction is fair and reasonable and in the interests of the shareholders.

BDO has requested RobSearch Australia Pty Limited (RobSearch) to prepare this valuation of Maverick’s interest in PL 231 in Queensland, to assist BDO in forming its opinion on the transaction. This valuation report by RobSearch may be included in whole or in part in the BDO Report as submitted to the Directors of Maverick and distribution to its shareholders.

RobSearch has previously prepared independent reports on this area as part of its Independent Geologist’s Report which was included in the Prospectus in 2005 for White Sands Petroleum Limited (WSP), which was subsequently renamed as Maverick Petroleum Limited.

RobSearch is an independent, Australian-owned and managed natural resource consultancy, specialising, inter alia, in the appraisal and valuation of petroleum resources and projects. In preparing this report, professional staff and associates of RobSearch have provided expert opinion on matters related to their specific expertise.



RobSearch

2

SUMMARY AND CONCLUSIONS

1 Petroleum Lease 231 is located over a large surface anticlinal feature on the western margin of the Denison Trough in the Permian - Triassic Bowen Basin in south-east Queensland.

2 The Denison Trough contains a number of producing gas field which are connected by pipeline to Brisbane and to Gladstone. PL 231 is located approximately 60 km west of this pipeline. Queensland Government estimates of the gas reserves of this area are estimated at some 331 bcf as at 2004. In addition, the basin has a growing coal seam gas industry, with planned LNG export from Gladstone.

3 Fifteen exploration wells have been drilled within the area of PL 231 over the past 55 years, seven of which flowed meaningful flows of gas to surface.

4 All gas flows have been from the shallow Cattle Creek Formation at around 400 m in depth. In addition, significant shows of gas have been encountered from the deeper Reid’s Dome Beds below 1,000 m.

5 No definitive calculation of gas reserves is possible on present data, but potential resources have been estimated at up to 30 bcf for the Cattle Creek Formation and as much as 300 bcf for the Reid’s Dome Beds. It must be emphasised, however, that this estimate is highly conjectural with the present limited data.

6 Establishing Contingent Resources and Proven Reserves for these accumulations will require further drilling for both reservoir horizons.

7 If sufficient reserves can be established to justify the building of a spur pipeline to the existing system, then profitable field developments should be possible.

8 Based on past and potential transactions relating to PL 231, RobSearch has concluded that the Market Value of Maverick’s 20 WI in the lease lies between a Low of $0.11m and a High of $0.6m, with a Most Likely value of $0.3m.



RobSearch

3



RobSearch

1

1.0 SOURCES OF INFORMATION

This report is based primarily on:

• confidential and non-confidential data made available by Maverick and BDO, the permit holders and their advisers,

• non-confidential data in the files of RobSearch, and

• other publicly available data.

Although Maverick and BDO have advised that they has provided all relevant data in their possession, RobSearch is not in a position to guarantee the accuracy or completeness of such data available to it in the preparation of this report.

2.0 EXPLORATION AND PRODUCTION POTENTIAL OF PL 231 (REIDS DOME)

2.1 Introduction

This Production License of 181 km2 lies over the Reids Dome anticline, which lies on the regional Serocold Anticline in the western Bowen Basin of south east Queensland, (see location map). Two deep tests and eleven shallow wells have been drilled on Reids Dome between 1954 and 2004. Gas flow rates in excess of 1 mmcfd have been achieved from some wells in the shallow Cattle Creek Formation sandstone. The reservoirs have relatively low permeability and are thought to be easily damaged by mud filtrate. Many of the wells have been drilled with very high mud weights, which increases the risk of formation damage. Better success has been achieved with wells drilled using air, (Anthony, 2004). Artificial stimulation by fracturing has not yet been attempted.

The Oil Company of Australia/Santos joint venture has been successful in exploiting gas reserves of the Denison Trough in the Bowen Basin. Proved and probable reserves as at June 2004 are reported (Anthony, 2004) as approximately 331 bcf, with slightly more than half of the reserves being in the Aldebaran Sandstone. Five percent of the total production to June 2004 is attributed to the Reids Dome Beds, i.e. 11.3 PJ.

2.2 Regional Geology

The Early Permian to Middle Triassic Bowen Basin covers an area of 160,000 km2 in Queensland. The Bowen Basin is part of Sydney–Gunnedah–Bowen system which extends from the Illawarra region south of Sydney to the northern Bowen Basin in the region of Collinsville. The southern part of the basin is overlain by the Jurassic to Cretaceous Surat Basin. The Bowen Basin began as a back arc basin, west of the continental Camboon Volcanic Arc. Early Permian extension resulted in a series of half grabens, with the Denison Trough being the most prominent in the general region of ATP 333P. Clastic sediments were laid down in the western part, while andesite and volcanoclastics were laid down in the eastern areas. Subsidence allowed the sea to enter from the east with deltaic sedimentation occurring along the western and northern flanks of the basin. Compressive uplift during the Late Permian resulted in the sea being restricted by the infilling of the basin with deltaic sediments and peat-forming wetlands. These peats became the coal measures of the Bowen Basin after they had been buried.

The Late Permian was marked by deposition of volcanolithic sediments of the Rewan Group in a terrestrial environment. This deposition continued into the Middle Triassic, when uplifted rocks from the western margins provided a supply of quartzose sands deposited as the Clematis Group. This deposition occurred in an inland sea or lake.



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Later in the Middle Triassic, following apparent uplift in the east, the Moolayember Formation was laid down. Sourced from a volcanic province, the environment of deposition is interpreted as fluvial to lacustrine.

Sediment thickness is up to 10 km in the two major basin depocentres, the Taroom Trough and the Denison Trough.

ATP 333P is located in the central Bowen Basin and lies on the north-trending Serocold Anticline on the western flank of the Denison Trough. The anticlinal Reids Dome structure has been breached by erosion, resulting in a crestal valley floor of Cattle Creek Formation surrounded on the flanks by escarpments of Aldebaran Sandstone. The Serocold Anticline is well located to receive hydrocarbons migrating from within the deeper parts of the Denison Trough. Oil shows have been recorded within the Bowen Basin sequence in this region; however, gas is the predominant hydrocarbon discovered to date. The depth of burial of potential source rocks is such that the source rocks would have passed through the oil generating window into the gas generating window. Gas fields of the Denison Trough have been supplying the Gladstone/Rockhampton region gas market since 1990. The proved and probable resource base as at July 2004 was 331.2 PJ (Anthony, 2004).

2.3 Stratigraphy

Reids Dome Beds The oldest sequence in this region of the Bowen Basin is the Reids Dome Beds of Early Permian age. The lower Reids Dome Beds consist of a non-marine sequence of interbedded sandstone, siltstone, shale, coal and conglomerate. They do not outcrop, but are encountered in a number of wells. These sediments are interpreted to have been deposited in environments ranging from alluvial fans to coal marshes. An unconformity at the top of the lower Reids Dome Beds is recognised on seismic in the northern part of Reids Dome. It is not possible to identify an unconformity in the southern part of Reids Dome, presumably due to the absence of coal beds in that area.

The upper Reids Dome Beds are mainly shale, with some coal in the northern part of Reids Dome and fluvial sands in the southern part.

Cattle Creek Formation A marine transgression represented by the marine sandstones, siltstone, shale and some coquina limestone of the Cattle Creek Formation.

Aldebaran Sandstone This formation was deposited in a regressive phase; lithologies include bioturbated sandstones, conglomerates with some coal, shale and siltstone. The Aldebaran Sandstone has been completely eroded from the crest of the anticline, being present only on the flanks.

The stratigraphy of younger sediments of the Bowen Basin is not discussed here, as these sediments are only present on the flanks of Reids Dome and as such would not be encountered by wells in the crestal area. These younger formations are shown in the stratigraphic table.

2.4 Exploration History

Reids Dome is a large elongated surface anticline trending north-south. It is almost 40 km long and 10km wide. The first exploration well by Australasian Oil Exploration Ltd (AOE), AOE 1, was drilled in the northern part of the Dome. This well spudded in the Cattle Creek Formation in August 1954 and reached total depth of 2761.5m. The well completion report states “Drilling was abandoned when it was apparent that the drill had entered a metamorphic zone.” It is not known if this zone was due to contact metamorphism from a sill, or indeed was metamorphic basement. Paten et al, 1979 indicate that the Reids Dome Beds exceed 3,000m in the Reids Dome area, based on regional studies. Based on seismic interpretation, it is inferred that the well was still in Reids Dome Beds at total depth.



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Oil shows were recorded at several levels, with frequent gas shows. Gas was tested from the Cattle Creek Formation and flowed at 0.550 mmcfd from the interval 136.6m to 142.3m. Methane content was 97.4 percent, with carbon dioxide 1.2 %, oxygen 0.5 % and nitrogen 0.9 %. Small flow rates were recorded from tests over intervals 822.7m to 827.8m and 1,359.4m to 1,364.6m within the Reids Dome Beds. Gas was recorded over the interval 2,350.0m to 2,353.7m, apparently from fractured shale. Attempts to test this zone were unsuccessful due to inability to move the test tools through a zone at 1,341.1m to 1,371.6m. Gas shows were also recorded over the interval 2,350.0m to 2,687.4m.

AOE 2 was drilled in 1955 updip from AOE 1 (Figure 14), primarily to test water filled sandstones encountered in AOE 1 between 518.2m and 1,286.3m. Correlations indicate that AOE 2 is some 190m updip from AOE 1. The productive sand in AOE 1 was not recognised in AOE 2 at the time, and it has been speculated the gas sand is present, but that its log response was attenuated by mud filtrate from the high-weight drilling mud. There is also the possibility that the sand is either not a continuous blanket or that there are permeability barriers within the sandstone interval. A cross section over Reids Dome just north of AOE 2 is presented as . Reverse faulting on the western margin of similar structures in the Denison Trough is recognised on modern seismic data (Anthony, 2004). It is likely that similar reverse faulting is present along the western margin of the Reids Dome closure.

Table 4 Exploration History of Reids Dome

Well Year Total Depth Comments

AOE 1 1954-55 2,761.5m 0.550 mmcfd

AOE 2 1955 1,237.5m no gas flows

MNX Reids Dome 1 1975 102m mechanical problems resulted in re-drill

MNX Reids Dome 1A 1975 139m calculated flow potential of 1 mmcfd

ERI Reids Dome 2 1980 150.6m 0.850 mmcfd



ERI Reids Dome 5 1980 182.9m no flow but suspended

RDE Nyanda 1 1987 450.8m flowed gas at RTSTM

VPE Aldinga North 1 1993 162.5m 1.2 mmcfd

VPE Aldinga East 1 1993 228.5m <0.005 mmcfd

VPE Aldinga West 1 1993 228.5m no flow

VPE Nyanda North 1 1993 228.5m did not encounter sand

TSE Nyanda 2 2001 214.9m flowed gas at RTSTM

TSE Nyanda 3 2001 215.5m no gas flow

WSP Primero 1 2006 1,565m 2.8 mmcfd

AOE – Australasian Oil Exploration MNX – Minex Incorporated ERI – Energy Resources Incorporated RDE – Reids Dome Exploration Company VPE – Victoria Petroleum NL TSE – Tri-Star Energy Company WSP – White Sands Petroleum Limited

Between 1975 and 2001, 13 more wells were drilled on the Reids Dome structure, all targeting the shallow Cattle Creek Formation sandstone which tested gas in AOE 1. Some encouraging gas flows have been recorded from this interval, but other wells did not flow or flowed at very low rates. Poor



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flow rates or lack of flow could be due damage by mud filtrate or to low inherent permeability. In some cases, completion design of the wells was less than optimal and this precluded effective testing.

Minex drilled MNX Reids Dome 1 just beside AOE 1. MNX Reids Dome 1 was terminated at 102 metres due to mechanical problems. MNX Reids Dome 2 was also drilled beside AOE 1 and encountered gas at approximately 138.5m and was terminated at 139m. Two production tests were conducted resulting in calculated open flow potentials of 1 mmcfd and 0.875 mmcfd. The well completion procedures were inadequate for the pressures encountered and the well was plugged at the direction of the Queensland Department of Mines. Gas analyses were similar to that of samples from AOE 1.

Energy Resources Incorporated (ERI) drilled 4 wells in 1980. ERI Reids Dome 2 was drilled 6m from MNX Reids Dome 1 and tested gas at 0.850 mmcfd from the Cattle Creek Formation sandstone. Flowing pressure was 122 psi and a well head pressure of 290 psi was recorded after the well had been shut in for several hours. ERI Reids Dome 3 was drilled approximately 305m west of ERI Reids Dome 2 and a test rate of 0.973 mmcfd was recorded.

ERI Reids Dome 4 was drilled about 305m south of ERI Reids Dome 2. A maximum stabilised flow rate of 0.485 mmcfd was recorded with a maximum shut in pressure of 290 psi. Reids Dome 5 was drilled approximately 610m northwest of ERI Reids Dome 2 and encountered the Cattle Creek Formation sandstone low on the structure and flowed water on test. These ERI wells were drilled, however, with mud weights in excess of 11 pound per gallon and there is a high risk of formation damage using such mud weight at such shallow depth.

Nyanda 1 was drilled in 1987 on the southern part of Reids Dome by the Reids Dome Exploration Company to a depth of 450.8m. A DST of the Cattle Creek Formation sandstone flowed gas at very low rates and interpretation of the DST chart indicated formation damage.

In 1993, Victoria Petroleum NL (VicPet) drilled three wells in the northern portion of Reids Dome, and one in the southern portion. Air drilling was used to minimise the risk of formation damage from drilling fluids.

Aldinga North 1, located 370m west of AOE 1, tested gas with a stable flow rate of 1.2 mmcfd from the Cattle Creek Formation sandstone. Aldinga East 1 was located 1.85km south of Aldinga North 1 and recorded a minor flow of gas from the Cattle Creek Formation sandstone at a rate of less than 5 mcfd (0.005 mmcfd).

Aldinga West 1 encountered the Cattle Creek Formation sandstone, but no flow could be achieved. Nyanda North 1, located 2.8 km north of Nyanda 1, did not encounter the Cattle Creek Formation sandstone.

In 2001, Tri-Star Petroleum drilled two wells following up on the Nyanda 1 well of 1987. Both wells were drilled using air. Nyanda 2 was located 38m southwest of Nyanda 1. The well encountered the Cattle Creek Formation sandstone, which flowed gas at a rate too small to measure (RTSTM). Nyanda 3 was located approximately 38m north of Nyanda 1 and no gas flow was recorded. Gas bleeding from the core was observed; this behaviour is indicative of very low permeability.

VicPet conducted mini-Sosie seismic surveys in the northern portion of Reids Dome in 1994 and 1995. Interpretation of these surveys suggests that the gas filled Cattle Creek Formation sandstone can be recognised by a high amplitude seismic character. This promising hypothesis has not yet been tested conclusively. The challenge will be distinguishing between gas filled very low permeability Cattle Creek Formation sandstone and gas filled sandstone with sufficient permeability to produce at potentially commercial rates. Seismic data of fair to good quality can be obtained in the crestal valley floor; however, data quality deteriorates on approach to the Aldebaran Sandstone escarpment.



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In 2005, VicPet negotiated a farmout with WSP and Dome Petroleum (Dome) whereby they could earn a 60% WI in the permit (then ATP 333) by drilling a well to a depth of 2,700m to test the gas potential of the Cattle Creek Formation and the Reids Dome Beds.

In June 2006, the Primero 1 well was spudded near the site of AOE 1 and in July reported obtaining a flow of 2.8 mmcfd of gas from a shallow interval between 135 - 151 metres. The well was continued to a depth of 1,565 m in the Reds Dome Beds, when drilling was stopped and the well completed as a potential gas producer.

Following the drilling of Primiro 1, APT 333P was converted to a Production Licence, PL 231.

The interests of the party in the tenement are currently:

Victoria Petroleum N.L (operator) 40% WI Dome Petroleum Resources Plc 40% WI Maverick Energy Limited 20% WI Victoria Petroleum N.L ORRI 7% ORRI

2.5 Gas potential of the Cattle Creek Formation

It should be noted that all references to reserves and resources made in this report are in conformity with the Petroleum Resources Management System (PRMS), in accordance with the recommendations of the ASX.

The pressure of the gas in the Cattle Creek Formation sandstone is greater (approx. 100 psi) than hydrostatic; that is it is overpressured. A definitive explanation of this overpressure is not available; however, some possible explanations are available. The most likely is that the pressure is “fossil” pressure from when the reservoir was buried much deeper and this high pressure has been preserved when the rocks were uplifted. This implies that the seals surrounding the reservoir are particularly effective. One of the benefits of overpressuring is that a greater volume of gas can be contained in the pore spaces of the reservoir than would be the case with a normally pressured reservoir. Also, the recovery factor is generally higher from overpressured reservoirs than from normally pressured reservoirs. Greater operational constraints apply when drilling overpressured reservoirs; however, the benefits generally outweigh the negatives.

The operator has estimated potential gas resources in the range of 15 to 30 bcf for the Cattle Creek Formation sandstone, but the lateral continuity of this sandstone is not well understood. The ability to predict the lateral continuity of Cattle Creek Formation sandstone which can sustain economic flow rates, and defining the optimal method of drilling and completion, are the two primary challenges to commercial development. Successful resolution of these two challenges could result in gas reserves greater than the current estimated range. However, it is also possible that the resources could be significantly lower if subsequent drilling demonstrated that the lateral extent of the reservoir sands were less than is currently interpreted.

2.6 Gas potential of the Reids Dome Beds.

The Reids Dome Beds at Reids Dome have not been conclusively tested. Commercial gas flow rates have been recorded from the Reids Dome Beds in the Westgrove area, particularly when air drilling has been used. A deep test of the Reids Dome Beds at Reids Dome is warranted. The structure is very large and well situated to trap gas migrating from within the Denison Trough. Consideration should be given to acquiring modern seismic over the Reids Dome Beds section, as seismic attribute analysis might be successful in indicating areas of better reservoir quality.



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Anthony 2004 reports that “Excellent post-frac results of the Reids Dome Beds were achieved in Merivale-5, -6, -7, -8 and –10”. The Merivale gas field is approximately 90 km south of Reids Dome. Lowe-Young 1999 reported that a post fracture stimulation test rate of 5.1 mmcfd from Merivale 8, compared to the DST flow rate of 0.764 mmcfd; a greater than six fold increase in flow rate after the frac treatment.

Potential resources

Only potential gas resources are considered, although oil shows have been recorded in some wells. All reservoirs encountered to date have relatively low permeability, and it is considered that the probability of achieving commercial oil deliverability rates is very low. This perception may need to be reviewed if future drilling identifies higher permeability reservoirs.

The intense drilling in the vicinity of AOE 1 has established a gas pool of some 1 bcf in the Cattle Creek Formation sandstone. The potential of this sandstone across the Reids Dome structure is dependent on the distribution of the higher permeability zones within the sandstone. The operator has estimated the potential at about 30 bcf. This estimate is considered as indicative of the potential, based on current knowledge.

The deeper potential of the Reids Dome Beds is much greater than that of the Cattle Creek Formation. The operator estimates potential gas recoverable resources of up to 202 bcf. Assuming relatively conservative parameters for a 10 metre net pay sand at 1,400m (porosity 12%, gas saturation 70 percent, gas expansion factor 125 and a recovery factor of 70%), the potential recoverable resource over 83 km2 is 217 bcf. Potential recoverable resource for 10m net sand at 2,500m is estimated at 309 bcf (porosity 10% and gas expansion factor of 200 with a recovery factor of 75%). Reservoir stimulation such as fraccing has the potential to enhance deliverability of anticipated low permeability reservoirs of the Reids Dome Beds. There is also the possibility of better permeability in conglomerates of the Lower Reids Dome Beds as have been encountered in the Westgrove region.

2.7 Future prospects

Clearly there are two targets in PL 231, the shallow Cattle Creek Formation sandstone and the reservoirs within the underlying Reids Dome Beds.

The challenge with the Cattle Creek Formation sandstone is identifying sands with sufficient permeability to be commercially productive prior to drilling. Previous attempts using analysis of seismic amplitudes have not been entirely successful; however, this does not rule out the possibility of using seismic attributes to identify areas of better permeability. Surface geochemical methods may also have applicability in PL 231. There are sufficient wells to calibrate such a surface geochemical technique, which would have to be followed up by drilling. A combination of both techniques could be appropriate.

Evaluating the potential of the Reids Dome Beds will require a deep well, preferably drilled using air. Any drilling will need to address sensitivity of reservoirs to water and also assess their potential for fraccing. The gas potential of the Reids Dome Beds is considerable and justifies a fully engineered deep test.



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3 VALUATION

3.1 VALUATION METHODOLOGY

Two basic valuation techniques are available which have general applicability and, in one form or another, are almost universally used within the petroleum exploration industry. The first of these approaches relates to the “notional” or “technical” value of a tenement (i.e. the Net Present Value (NPV) of discovered or undiscovered oil or gas), and the second to the “market” value of the tenement as a tradeable asset.

Technical valuations are most appropriate for identified developed and undeveloped fields where sufficient information exists to make reasonable estimates of the key technical parameters. The technique also has applicability in evaluating exploration properties in productive basins, but preferably only where prospects have been well delineated, and sufficient data exists with respect to probable geological field parameters.

The second approach is to look at the effective monetary consideration which might be obtained from the sale or transfer of an interest in the property to a third party, and is intended to be equivalent to the market values ascribed to, say, real estate.

The basic objective of market valuations is to estimate the amount an interest in a property might reasonably be expected to fetch if freely transferred between “a willing but not anxious seller and a willing but not eager buyer”. Market valuations are an attempt to determine the “real” value of a property at a given time as opposed to the technical valuation’s estimate of the theoretical value of future income from the sale of oil or gas.

In the case of oil or gas fields, the market value will commonly bear a close relationship to the technical value, but normally at a discount to provide for risks and uncertainties.

For exploration properties, although the consideration might be in the form of an immediate cash payment for the transfer of a working interest (WI) in a tenement, most commonly interests in tenements are acquired by means of farmout, whereby the purchaser (or farminee) agrees to pay a disproportionate share of future exploration costs up to an agreed limit. Thus, in its simplest form, parties with a 100% WI might agree to farmout a 70% WI in return for the farminee paying 100% of the cost of a well. In this case, the farminee is paying a premium of 30% of total costs above those which would be attributable to its 70% earned WI. If the cost of the well were $10m, the farminee would be paying a premium of $3m above the $7m attributable to the 70%WI. In other words, leaving aside taxation or time-value of money considerations, it is in the same situation as if it had paid $3m in cash for its 70% interest and then paid its proportionate share of costs.

In cases where the tenement in question has been recently subject to a farmout, calculation of the market value is relatively straightforward. Where, however, this is not the case, then it is necessary for the valuer to form a judgement of the farmout terms which might realistically be achievable. Ideally, this should be done by analysis of the terms achieved on other equivalent tenements in the area, but this may only be possible in active exploration provinces. If this is not the case, then the valuer must form a view based on a technical evaluation of the tenement and a knowledge of the industry, to come up with a realistic range of values. In these instances, the valuer may choose to look at a number of possible scenarios in order to derive a range of probable values using risk weighting techniques.

In the case of PL 231, there is currently insufficient information to derive any meaningful estimate of the notional value for the gas resources.

RobSearch has therefore used the second approach described above to derive market values for the company’s interest in this tenement.



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3.2 DISCUSSION

3.2.1 Previous Transactions

The last transactions relating to the tenement was those between VicPet and WSP, and WSP and Dome in 2005. The first involved WSP earning a 60 WI in the tenement for paying the cost of drilling one well to 2,700m and assuming its proportionate share of liabilities relating to the abandonment of previous wells. WSP then negotiated a secondary farmout to Dome, whereby the latter could earn a 40% WI by paying the cost of the well. As this was estimated at about A$1.0m, the effective consideration was $15,000 per 1.0% WI, or $0.3m for a 20% WI. (Note that the actual cost of this well is understood to be in excess of this figure.)

We have been informed by VicPet that it is presently arranging for the transfer of its 40% WI in PL 231 to Dome, for the sole consideration of Dome assuming all responsibility for its share of obligations under the Petroleum Lease including liabilities relating to the abandonment and rehabilitation of previous wells. We have been advised that the total cost of such works is estimated at $725,311, of which $220,991 is the responsibility of VicPet. This transaction would establish a base value of a 1.0% WI at $5,525. If a similar arrangement was agreed between Dome & Maverick, representing a liability of $225,990, the effective consideration would be $11,300 per 1.0% WI.

The VicPet/Dome transaction would place a value of $110,500 for the Maverick 20% WI, whereas the postulated Maverick/Dome transaction be equivalent to a consideration of $225,990.

3.2.2 Potential Farmout

As described in Section 2 of this report, there can be little doubt that PL 231 contains potentially commercial resources of gas, which could be as much as 300 bcf on current estimates. The Lease is only about 60 km from the nearest gas pipeline , increasing the chance of an economic development if sufficient reserves were proved up by future drilling.

It is therefore not unreasonable to postulate that Maverick might be successful in negotiating to farmout, say, 50% of its 20% WI to a third party in return for paying its share of a well designed to test the Reid’s Dome Beds. Such a well would probably cost in the order of $2.5m- $3.0m, drilled and tested, which would put a value on its interest of $0.5m - $0.6m

In summary, we estimate the Market Value of Maverick’s interest in PL 231 at between a low of $0.11m and a high of $0.6m, with an intermediate value of $0.3m.

4 DECLARATIONS

5.1 QUALIFICATIONS

RobSearch Australia Pty Limited (previously named Robertson Australia Pty Limited and Robertson Research Australia Pty Limited) has been established for nearly forty years and is one of the most experienced integrated independent natural resource consulting firms in Australia.

The core activities of RobSearch are in petroleum, minerals and coal exploration and development, including reserve assessment and production planning. The company has extensive experience in valuation of reserves and other assets on behalf of many international oil and mineral companies and financial institutions.

This report has been prepared for RobSearch by Mr. J. M. Blumer. His qualifications and experience is set out below.



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John Blumer - Chairman & Managing Director, RobSearch Australia B. Gen Sc. , MAAPG, FAusIMM (CPGeo), MMICA, MAIG, MPESA

John Blumer is one of Australia’s most experienced independent petroleum consultants, with over 45 years of experience in the Australasian and international oil exploration industry. He formed his own consulting firm in 1975, and became a major shareholder and Director of RobSearch Australia in 1990. He is specifically responsible for all petroleum related activities of the company, specialising in exploration management, valuation of exploration and production interests and the preparation of statutory reports. He is a member of the VALMIN Committee of the AusIMM, advising the Australian Stock Exchange and the Australian Securities and Investments Commission with respect to mineral valuation issues, and is past-President of the Earth Resources Foundation of the University of Sydney.

5.2 INDEPENDENCE

RobSearch Australia Pty Limited and J. M. Blumer have no pecuniary or professional interests which could reasonably be regarded in any way as affecting their abilities to report impartially on the value of the petroleum exploration interests which are the subject of this report.

5.3 PURPOSE OF THE REPORT

This report has been prepared for BDO solely for the purposes set out above and may not be relied on for any other purpose

RobSearch Australia Pty. Limited

J. M. Blumer B. Gen Sc., MAAPG, FAusIMM (CPGeo), MMICA, MAIG, MPESA Managing Director



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REFERENCES

Anthony, D.P., 2004 A review of recent conventional petroleum exploration and in-field gas reserves growth in the Denison Trough, Queensland in Boult P.J., Johns D.R. & Land S.C. (Eds) 2004. Eastern Australian Basins Symposium II. Petroleum Exploration Society of Australia, Special Publication p277-296

Dups, K.C., 1996 Seismic identification of the top Gyranda Formation, scoping study for Roma Petroleum N.L. unpublished

Lowe-Young, B., 1999 Exploration, Development and Production Activities in the Denison Trough: 1998-1999 in Mackie, S. (ed) 1999 PESA (Qld) 1999 Symposium

Lyons, D.A. & Gatti, G.R., 1984 ATP 247P Surat/Bowen Basins, Queensland, Permian report, A geological and geophysical review, Golden West Hydrocarbons N.L. unpublished QNRME CR13058

Mollan, R.G., Exon, N.F., Dickins, J.M. & Kirkegaard, A.G., 1967 Springsure 1:250,000 Geological Series map, Bureau of Mineral Resources

Paten, R.J., Brown, L.N. Brown & Groves, R.D., 1979 Stratigraphic concepts and petroleum potential of the Denison Trough, Queensland. APEA Journal vol 19 (1) p43-52



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APPENDIX A

GLOSSARY OF ABBREVIATIONS

bbl barrel (of oil)

bcf billion cubic feet (of natural gas), approximately equal to 1 PJ

bopd barrels of oil per day

JV Joint Venture

km; km2 kilometre; square kilometre (area)

m metre

m3 cubic metre (volume)

mcf thousand cubic feet (of natural gas)

mmcfd million cubic feet a day (of natural gas), approximately equal to 1 TJ

NPV Net Present Value

pa per annum

PJ PetaJoule

TJ TerraJoule

WI Working Interest



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GLOSSARY OF TECHNICAL TERMS & ABBREVIATIONS

Terms not inc lud ed in t he g lo ssary are u s ed in ac cordanc e w i th thei r d e fin i t ion i n the

Conc i s e Ox ford Dic t ionary .

andesite a fine grained extrusive (volcanic) rock composed largely of the minerals sodic plagioclase

feldspar, hornblende or augite and minor quartzproduct in feldspathic igneous rocks

anticline upward-arching fold of rock strata

barrel (bbl) a unit of volume in oil production; one barrel equals 42 U.S. gallons, 35 Imperial gallons, or approximately 159 litres

basement non-prospective rocks underlying a sedimentary basin

basin a segment of the earth's crust which has downwarped, and in which sediments have accumulated; such areas may contain hydrocarbons

bcf billion cubic feet, i.e., 1,000 million cubic feet (equivalent to approximately 28.3 million cubic metres) of gas

bed a layer of sedimentary rock, distinguishable from layers above and below

condensate hydrocarbons, often found with natural gas, which are themselves gases in the reservoir but which condense out to liquids when the pressure drops during production

conglomerate a sedimentary rock formed by the cementing together of rounded water-worn pebbles; distinct

from breccia

core solid continuous sample of rock provided by rotary drilling using diamond-impregnated bits

deltaic sediment a deposit of sediment formed at the mouth of a river either in the ocean or a lake, which results in progradation of the shoreline

depocentre an area or site of maximum deposition of sediments

deposition laying down of potential rock-forming material, i.e., sediment

development well a well drilled for the sole purpose of producing hydrocarbons in a field which has already been

delineated by appraisal wells

dip the angle that rock strata make with a horizontal surface, measured at right angles to the strike

dome a symmetrical anticline, around which strata dip outwards

drillstem test (DST) a test carried out in an oil or gas well, using testing tools attached to the drillstem, in order to assess the producing possibilities of one or more formations intersected by the well

facies the aspect, appearance and characteristics of a rock unit (e.g., member or formation), usually reflecting the conditions of deposition; sedimentary units commonly change laterally from one facies to another, such as from sandstone to shale, reflecting changes in depositional environment

farmin, farmout, farminee, farmor

descriptive of a joint venture in which an incoming farm-in partner (farminee) earns an interest in a property by funding costs of exploration, while the farm-out partner (farmor) owning the property does not contribute

fault (to form) a break in the subsurface strata; strata on opposite sides of a fault may be displaced vertically and/or laterally relative to their original position

fluvial laid down by river or stream

fold a bend in rock strata

formation a (named) succession of sedimentary beds having some common characteristic

formation damage adverse alteration to the permeability of a potential reservoir as a result of drilling, testing or

completion operations



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fracture stimulation,

fracturing, fraccing an operation in which a mixture of fine sand particles in oil is injected under very high pressure

into a producing formation in an oilwell in order to increase the rock permeability and thus

permit or improve the production of hydrocarbons

generation (of oil or gas)

process by which organic matter is transformed into hydrocarbons in a source rock

hydrocarbon a class of naturally-occurring organic compounds containing only carbon and hydrogen atoms (in practice, small quantities of sulphur, oxygen and nitrogen and their compounds may also be present); hydrocarbons include natural gas, liquefied petroleum gas, natural gas condensate and crude oil

interest pursuant to a joint venture or similar agreement, the undivided share held by a tenant in

common in a petroleum or mining tenement and in all other property acquired in relation

thereto

km kilometre

km2, sq km square kilometre

lacustrine produced by, belonging to or inhabiting lakes

lithology physical and mineralogical characteristics of a rock

m metre

metamorphic descriptive of a rock which has changed its structure and properties through the effects of heat and/or increased pressure over time

mmcfd million cubic feet of gas per day

net pay the cumulative thickness of porous and permeable reservoir beds within an overall hydrocarbon column in a structure

operator the member of an exploration joint venture of two or more exploration companies which has been appointed to carry out all operations on behalf of the parties

ORRI Overriding Royalty Interest

overthrust the result of strong compressional tectonic forces which have thrust a body of rock over an adjoining body along a fault plane

permeability the degree to which fluids such as oil, gas and water can move through the pore spaces of a reservoir rock

permit a petroleum tenement, lease, licence or block

petroleum general term for all phases of naturally-occurring hydrocarbons

PJ Petajoule

play a geological concept which, if proved correct, could result in the discovery of hydrocarbons

plug and abandon (P&A)

to cease all efforts to produce oil or gas from a well by plugging it in accordance with Government regulations

prospect (petroleum) a geological or geophysical anomaly that has been surveyed and defined, usually by seismic data, to the degree that its configuration is fairly well established, and on which further exploration such as drilling can be recommended

RTSM Rate Too Small to Measure

reserves quantities of economically recoverable hydrocarbons estimated to be present within a trap, classified as proven, probable or possible

reservoir a subsurface volume of rock of sufficient porosity and permeability to permit the accumulation of crude oil and natural gas under adequate trap conditions

sandstone a sedimentary rock which is generally composed essentially of sand-sized quartz grains

seal an impervious layer over a reservoir which prevents escape of fluids

section a general term used to refer to a sequence of sedimentary rocks, eg “sedimentary section”, “Mesozoic section”, etc.



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sediment (rock formed from) solid material, whether mineral or organic, which has been moved from its position of origin and redeposited

sedimentary rock, sediments

a rock formed as a result of consolidation of loose sediments, often created by weathering processes, such as sandstone & shale, or deposited by chemical processes, such as salt or limestone.

seismic survey a type of geophysical survey where the travel times of artificially created seismic waves are measured as they are reflected in a near-vertical sense back to the surface from subsurface boundaries. This data is typically used to determine the depths to the tops of stratigraphic units and in making subsurface structural contour maps and ultimately in delineating prospective structures.

sequence a succession of sedimentary rocks laid down in order

shale fine-grained sedimentary rock characterised by finely-laminated structure

siltstone a typically structureless sedimentary rock composed of silt-sized particles

source unit, source rock

a rock capable of generating oil and gas under the right conditions of temperature, pressure and time

spud in to commence drilling operations

stratigraphic trap a type of petroleum trap which results from variations in the lithology of the reservoir rock, which cause a termination of the reservoir, usually on the up-dip extension

stratigraphy the succession or superimposition of rock strata

structure a discrete area of deformed sedimentary rocks, in which the resultant bed configuration is such as to form a potential trap for migrating hydrocarbons

sub-basin a localised depression within a basin

subsidence a sinking of a large part of the earth's crust relative to the surrounding parts

tcf Trillion Cubic Feet

tectonic descriptive of all movements of the Earth's crust caused by directed pressures, and the results of these movements

tenements exploration or production leases

TJ/d Terrajoules per day

trap a body of reservoir rock, vertically or laterally-sealed, the attitude of which allows it to retain hydrocarbons which have migrated into it

unconformity lack of parallelism between rock strata in sequential contact, caused by a time break in sedimentation

up-dip at a structurally higher elevation within dipping strata

VALMIN Code The “Code and Guidelines for Technical Assessment and/or Valuation of Mineral and Petroleum Assets and Mineral and Petroleum Securities for Independent Expert Reports” issued by the Australasian Institute of Mining & Metallurgy, 1998

volcaniclastic (descriptive of) a clastic sediment containing material of volcanic origin


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