Nido Petroleum : Quarterly Report and Appendix 5B, Q2 2016

Q2‌

2016 Activities Report

Quarterly Report

For the period ending 30 June 2016

HIGHLIGHTS

 Nido's net production from the Galoc oil field during the second quarter was 260,350 bbls on a 55.88% participating interest basis

 Production uptime for the Galoc oil field was 99.93% during the quarter and average gross daily pro- duction was 5,120 bopd (2,861 bopd net to Nido)

 Cargoes 51 and 52 were lifted on 19 April 2016 and 28 June 2016 respectively with the total lifted vol- ume of 351,861 bbls (196,618 bbls net to Nido) for cargo 51 and a total lifted volume of 334,670 bbls (187,012 bbls net to Nido) for cargo 52

 Cyclical production continued from the Nido and Matinloc oil fields (8,502 bbls net to Nido)

 The Company's AGM was held on 6 May 2016 at Nido's offices in Como, Perth with all resolutions passed

I am pleased to provide to you the following summary of the Company's activities for Q2 2016.

Galoc up-time was 99.93% for the quarter with gross average daily oil production of 5,120 bbls (2,861 bopd on a net to Nido basis) with total production of 465,913 bbls (260,350 bbls net to Nido).

Cargoes 51 and 52 were lifted on 19 April 2016 and 28 June 2016 respectively with the total lifted volume of 351,861 bbls (196,618 bbls net to Nido) for cargo 51 and a total lifted vol- ume of 334,670 (187,012 bbls net to Nido) for cargo 52.

The Nido and Matinloc oil fields continued to produce oil on a cyclical basis during the quarter. Oil production from these fields totalled 32,529 bbls (8,502 bbls net to Nido).

I am pleased to report that the Company's Annual General Meeting was held on 6 May 2016 at the Company's offices in Como, Perth and all resolutions were passed with an over- whelming majority.

The Galoc Joint Venture continued to progress sub-surface and preliminary engineering studies and is still considering a possible appraisal well in the mid-Galoc area of the field to confirm the commerciality of a potential Phase III develop- ment project.

The Company also continued to evaluate exploration, devel- opment and production assets in the region and is consider-

ing a number of assets in this context.

Subsequent to quarter end, the Permanent Court of Arbitra- tion in the Hague issued a ruling and found in favour of the Philippines in their long-running territorial dispute with the Peoples Republic of China regarding the South China Sea. At this stage there is no clarity on the impact this ruling may have on SC 58 and SC 63 and we will be following develop- ments in the Philippines closely.

DR MIKE FISCHER MANAGING DIRECTOR

Nido Petroleum Limited ABN 65 086 373 www.nido.com.au

Level 3, 1 Preston St, Como WA 6152 Australia P: [phone] F:[phone]

4F Zaragoza Building, 102 Gamboa Street, Legaspi Village, Makati City, 1229 Philippines P: [phone] F: [phone]

LIFTING SUMMARY Volumes - Lifted & Sold (stb)	Qtr 2 2016	Year-to-date 2016	Previous Qtr Q1 2016
Service Contract 14:	383,630	581,633	198,003
Galoc oil field (net to Nido)
Nido & Matinloc oil fields (net to Nido)*	9,745	13,870	4,125
TOTAL VOLUMES LIFTED & SOLD	393,375	595,503	202,128
FINANCIAL SUMMARY
Cash Inflows- US$ '000
Receipts from sale of crude oil	9,402	22,448	13,046
Interest & other	2	901	899
Refund of development expenditure	-	379	379
Proceeds from debt facility	-	-	-
TOTAL CASH INFLOWS	9,404	23,728	14,324
Cash Outflows-US$ '000
Exploration expenditure	(798)	(1,370)	(572)
Development expenditure	-	-	-
Production OPEX	(9,031)	(19,728)	(10,697)
Income taxes	(470)	(470)	-
Repayment of borrowings & financing costs	(175)	(14,548)	(14,373)
Administration & other expenses	(1,075)	(2,185)	(1,110)
Foreign exchange movement & other	9	(1)	(10)
TOTAL CASH OUTFLOWS	(11,540)	(38,302)	(26,762)
Cash Position - US$ '000
Cash on Hand 2,957		2,957	5,093
Debt - Secured Debt Facility (78,200)		(78,200)	(78,200)

* Nido and Matinloc figures are subject to change based on the latest lifting/production volume adjustment from the Operator

Nido ended the quarter with cash on hand of US$3.0 million and debt outstanding of US$78.2 million.

INFLOWS

Galoc production remained steady and cash inflows from crude oil sales totalled US$9.4 million with receipts from 1 cargo received in the reporting period. There were no cash receipts received from the Nido/Matinloc oil fields for this quarter.

Quarterly interest & other inflow movements were minimal. There was one crude oil hedge put option executed during the quarter (against the June 2016 average Dubai oil price), however the resulting cash inflow upon settlement was received in July 2016.

OUTFLOWS

Cash outflows from production operations at the Galoc oil field and the Nido/Matinloc oil fields amounted to US$9.0 million. There were no cash outflows for costs of crude oil hedge put options as the June option premium was paid in July 2016.

Cash outflows for exploration activities of US$0.8 million relate mainly to new venture and Galoc exploration activity.

Principal repayments and interest payments were deferred until at least 15 March 2018 as a result of the renegotiation of the Facility Agreement with the Bangchak Petroleum Public Company Limited ('BCP') in March 2016. There were minimal other financing- related outflows.

Income tax expense payments totalled $0.5 million during the quarter. General administration expenditure totalled US$1.1 million for the quarter.

PRELIMINARY (UNAUDITED) Q2 and HALF YEAR FINANCIAL INFORMATION

Nido has provided preliminary Q2 and Half Year 2016 financial information to BCP Energy International Pte Ltd ('BCPE') for their quarterly reporting process. The preliminary financial information is unaudited and subject to change and is set out in the following table:

Statement of Comprehensive Income for the Half Year 2016 (US$ '000) Revenue from sale of crude oil	30 June 2016 14,990
EBIT	(8,916)
Net profit / (loss) for the half year 2016	(11,118)
Balance Sheet as at 30 June 2016 (US$ '000) Current Assets	25,924
Non-current Assets	136,411
Current Liabilities	22,093
Non-current Liabilities	109,387
Net Assets	30,855
Statement of Cash Flows for the Half Year 2016 (US$ '000)
Net cash (used in) operating activities	(3,500)
Net cash (used in) investing activities	(899)
Net cash (from) financing activities	(10,175)

PRODUCTION AND DEVELOPMENT-Philippines

SERVICE CONTRACT 14C1 - GALOC OIL FIELD

Location:	Palawan Basin,
Area:	16,000 hectares	Operator:	Galoc Production Company W.L.L.
Nido's Interest:	55.88%	Activity:	Galoc Production

Gross production from the Galoc oil field during the quarter was 465,913 bbls (260,350 bbls net to Nido) with a gross average production rate of 5,120 bopd (2,861 bopd net to Nido).

Cargo 51 was lifted on 19 April 2016 with 351,861 bbls (196,618 bbls net to Nido) with a realised FOB price of US$40.53 per bbl. Cargo 51 was sold to SK Energy in South Korea.

Cargo 52 was lifted on 28 June 2016 with 334,670 bbls (187,012 bbls net to Nido) with a realised FOB price of US$48.15 per bbl. Cargo 52 was sold to Thai Oil Public Co. Ltd. in Thailand.

The Joint Venture is still considering a possible appraisal well in the mid-Galoc area to confirm the commerciality of a potential Phase III development. In this context the Joint Venture continued to progress relevant sub-surface and preliminary engineering studies.