ADX Energy Ltd.: ADX Welchau Gas Prospect (Phase 1) Farmin Completed And Well Site Drilling Access Agreement Signed

Welchau-1 well surface location flat ground and road access, ADX

Wien (pta029/14.12.2022/14:34 UTC+1)

"Kepis & Pobe Financial Group Inc. has satisfied completion conditions including the payment of initial farmin funds. In addition, ADX has signed a land access agreement for the Welchau-1 drill site with the Austrian Forestry Ministry".

Key points:

• Kepis & Pobe Financial Group Inc. (KPFG) has met the completion conditions in relation to the farmin agreement for funding 50% of the cost of the Welchau-1 exploration well to earn a 20% equity interest in the Welchau Farmin Area within the ADX' ADX-AT-II exploration license in Upper Austria by making an initial payment of predrill costs of EUR 197,000 as well as an option fee of EUR 100,000 (Option Fee). The Welchau-1 well cost is budgeted at EUR 3,810,000 (A$ 5,910,000).
• By payment of the Option Fee, KPFG may also elect to fund a further 50% of the Welchau-1 well cost to earn a further 20% equity interest in the Welchau Farmin Area (Option). The Option election must be made by 21 January 2023. If KPFG elects to exercise the Option, the Option Fee will be offset against the additional payment for 50% of Pre-drill Well Costs (refer ASX Release dated 29 November 2022).
• ADX has also executed a land access and rental agreement for the Welchau-1 surface drilling location with the Austrian Forestry Ministry.
• Securing access to the Welchau-1 well site, in combination with the procurement of long lead items required for the drilling of the well, provides ADX with the certainty to progress the process of finalising regulatory approvals and the commitment to a drilling rig slot for the large Welchau gas prospect.
• The Welchau prospect has the potential to contain an 807 Billion Cubic Feet (BCFE) equivalent (approx. 134 MMBOE) best technical prospective resource (*note 1) (refer ASX release dated20 June 2022).Welchau is located up-dip from a gas discovery (Molln-1 well) drilled in 1989 which intersected at least a 400 m gas column, with 900 m interpreted from pressure data and tested condensate rich, pipeline quality gas (40 barrels per mmcf and maximum flowrate of 3.5 mmcfpd). The Welchau prospect is relatively shallow (less than 2000 m) and within tie-in distance to the national gas pipeline network (approx. 18 km). (Refer ASX Release dated 29 November 2022).

ADX Executive Chairman, Mr Ian Tchacos, said, "The Board of ADX is delighted to report that drilling of Welchau gas prospect has gained increased certainty with the confirmation of farmin funding from Kepis & Pobe Financial Group Inc. and the agreement for land access with the Austrian Forestry Ministry at our preferred drilling location. At a time when certainty of access for exploration and development operations is becoming increasingly uncertain in many jurisdictions, ADX is very fortunate to be operating in oil and gas friendly Austria".

*Note 1: The prospective resource estimates in this release are classified and reported in accordance with the PRMS – SPE Guidelines for the exploration licenses ADX-AT-I and ADX-AT-II, in the Molasse Basin, Austria. Refer to the end of this release for an explanation of prospective resource classifications used and the basis on which the prospective resources were estimated. Prospective Resources are those estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) related to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further explorations appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.

ADX Energy Ltd (ASX Code: ADX) is pleased to advise that an initial agreed payment has been made by Kepis & Pobe Financial Group Inc.(KPFG) to fund 50% of the Pre-drill Well Costs of EUR 197,000 (A$ 305,000) for the Welchau-1 well and an option fee of EUR 100,000 (A$ 155,000) in accordance with a Joint Development Agreement (JDA) signed on the 28th of November 2022 to fund the drilling of the Welchau gas prospect in ADX-AT-II exploration license in Upper Austria. The Welchau-1 well drilling expenditure is budgeted at up to EUR 3,810,000 (A$ 5,910,000).

Under the terms of the JDA, KPFG will fund 50% of the Welchau-1 well drilling expenditure to earn a 20% equity interest in the Welchau Farmin Area. By the payment of the Option Fee, KPFG may elect to fund a further 50% of the Welchau-1 well drilling cost to earn a further 20% equity interest in the Welchau Farmin Area on or before 21 January 2023 (refer ASX Release dated 29 November 2022).

Assuming KPFG exercises the Option to fund the entire Welchau-1 well cost, at the completion of its farmin obligations, KPFG will hold 40% equity interest and ADX will retain a 60% equity interest in the Welchau Farmin Area (refer ASX Release dated 29 November 2022, Figure 1).

Land Access

In addition to the to completion of the farmin agreement with KPFG, ADX has executed a land access and rental agreement for the Welchau-1 surface drilling location with the Austrian Forestry Ministry. The finalisation of the land access agreement for the Welchau-1 well site in combination with the procurement of long lead items required for the drilling of the well provides ADX with the certainty to progress the process of obtaining regulatory approvals from the Austrian Mining Authority and all relevant local authorities together with the commitment to a drilling rig slot for the large Welchau gas prospect. (Refer Photograph of the Welchau-1 well surface location showing relatively flat ground and excellent road access. The site is ideally located in terms of the trajectory for the well's bottom hole location.)

Welchau Well Planning and Approvals

ADX will provide regular updates in relation to well planning and permitting for the Welchau-1 well. ADX is seeking to obtain the necessary regulatory approvals and access to a drilling rig slot to enable drilling the Welchau-1 well during the first half of 2023.

For further details please contact:

Authorised for lodgement by Ian Tchacos, Executive Chairman

Persons compiling information about Hydrocarbons:

Pursuant to the requirements of the ASX Listing Rule 5.31, 5.41 and 5.42 the technical and reserves information relating to Austria contained in this release has been reviewed by Paul Fink as part of the due diligence process on behalf of ADX. Mr. Fink is Technical Director of ADX Energy Ltd is a qualified geophysicist with 25 years of technical, commercial and management experience in exploration for, appraisal and development of oil and gas resources. Mr. Fink has reviewed the results, procedures and data contained in this release and considers the resource estimates to be fairly represented. Mr. Fink has consented to the inclusion of this information in the form and context in which it appears. Mr. Fink is a member of the EAGE (European Association of Geoscientists & Engineers) and FIDIC (Federation of Consulting Engineers).

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Emitter:	ADX Energy Ltd. Canovagasse 5 1010 Wien Austria
Contact Person:	DI Paul Fink
Phone:	+43 (0)50 724 5666
E-Mail:	paul.fink@adx-energy.at
Website:	www.adx-energy.com
ISIN(s):	AU000000ADX9 (Share)
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