Daydream-2 Funding Update

Elixir Energy Limited(“Elixir” or the “Company”) is pleased to provide a funding update on the Daydream-2 appraisal well planned for later this year (subject to rig availability) in its 100% owned Grandis Gas Project located in Queensland.

HIGHLIGHTS

• Advanced Finding received on R&D tax credits for Daydream-2
• Government will fund 43.5% of qualifying well costs
• Detailed technical presentation on Grandis made at the APPEA Conference today

Elixir has now received an Advanced Finding from the Australian Government’s Department of Industry, Science and Resources that that activities associated with the Daydream-2 project will qualify as eligible R&D Activities for the purpose of the R&D Tax Incentive. Subject to other eligibility requirements, eligible expenditure associated with these R&D activities may be claimed as a refundable R&D offset equal to 43.5% of the expenditure on eligible R&D activities. This primarily reflects the innovative technologies developed over the last decade to enhance stimulation techniques since BG Group (now Shell) drilled in the Taroom Trough.

This Finding is sufficiently strong to support non-recourse project financing of a significant majority of the amount to be claimed. Elixir is currently evaluating providers of such finance.

Elixir is also pleased to attach a presentation on a peer reviewed technical paper titled The Permian Gas Potential of the Taroom Trough, Queensland - New ideas to unlock a multi-TCF play. This will be delivered later today by Elixir’s Chief Geoscientist Greg Channon at the industry leading APPEA Conference.

Elixir’s Managing Director, Mr Neil Young, said: “Our technical team and supporting professional advisers have done a fantastic job on procuring this R&D Finding. This reflects the innovative thinking that we believe can crack the code to release the enormous gas in place known to be in the Taroom Trough. The paper delivered today at the APPEA Conference is yet another demonstration of this technical excellence.

Having the Government fund nearly half of Daydream-2 is a superb outcome for Elixir shareholders – and demonstrates that the Australian Government strongly recognizes the long term criticality of new East Coast gas supplies.”

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