Progress Report on Kaitangata Coal Seam Gas Programme

COMPANY ANNOUNCEMENT

2nd April, 2012

Progress Report on Kaitangata Multi-Well Coal Seam Gas Programme

L&M Energy wishes to provide the following update regarding its Kaitangata CSG appraisal programme within PEP 38219, located 60km south of Dunedin.

The Taratu-1 well has reached a total depth of 378.8m and is currently suspending while proximate analysis is being carried out to confirm geological stratigraphic correlations before demobilising the drilling rig to the Washpool-1 well location.

In total the well intersected approximately 23m of the Kai Main coal seam and 12m of the Carson seam with a total of 47 canisters of coal, gathered for further analysis, including measurement of gas content and saturation levels.

Taratu-1 and Washpool-1 are the second and third wells respectively of a five well programme. The wells are set to test the coal seam gas potential from five sub-bituminous coal horizons (Capstick, Jordan, Kai Main, Carson and Shore) within the coalfield.

[Full release with maps: LME_PR_2_APR_2012.pdf]

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