Xstate Resources : Anshof-3 Discovery Testing Update - Rig Mobilised

ABN 96 009 217 154

11 April 2022

Announcement to ASX

Electronic lodgement

ANSHOF-3 DISCOVERY TESTING UPDATE

Xstate Resources Limited (ASX: XST) ("Xstate", "XST" or "the Company") is pleased to advise shareholders that Operator of the Anshof Prospect, ADX Energy Limited (ASX:ADX) has today provided an update advising mobilisation of the rig for commencement of flow testing at the Anshof-3 oil and gas discovery. The first well oil inflow is expected during the week commencing 18 April 2022.

Xstate holds a 20% working interest in the Anshof Prospect. A copy of the ADX release has been attached to this announcement.

This release was approved by the board of the Company

Andrew Childs

Executive Chairman Xstate Resources Limited Tel Office: [phone]

About Xstate Resources Limited:

Xstate Resources (ASX Code: XST) is an ASX listed company focused on the oil and gas sector. The Company has existing gas exploration assets located in the Sacramento Basin, California and associated gas production interests together with production interests in Alberta, Canada. Xstate is presently pursuing new opportunities in the oil and gas sector onshore North America and Europe.

Level 1, 31 Cliff Street, Fremantle WA 6160 | Tel + 61 8 9435 3200 |www.xstateresources.com.au

11 April 2022

Anshof-3 Discovery Testing Update

Rig mobilised for flow testing of the Eocene Oil Zone

Key points:

The RED Drilling & Services GmbH (RED) W-101 work over has been mobilised to the

Anshof-3 location.

First well oil inflow is expected during the week commencing 18th April 2022.

The testing program is designed to evaluate the long-term production and economic potential of the Eocene oil zone at the Anshof-3 well location as well as to obtain further valuable data to assess the Eocene oil reserves potential at the Anshof discovery.Following a successful test of the 6 m gross Eocene oil zone, the well is expected to be placed on production with an early production unit utilising a rod pump. Oil can be delivered for sale by truck to a nearby oil terminal prior to securing a production license for the entire Anshof discovery.

The RED W-101 workover rig set up over Anshof-3 well head in preparation for testing operations. Source ADX

ADX Energy Ltd (ASX Code: ADX) advises that the RED W-101 workover rig has been mobilised to location in preparation for testing the Eocene oil zone at its Anshof-3 well in the ADX-AT-II license in Upper Austria. The first oil inflow is expected to be recorded by the end of the week commencing 18th April 2022 when the Eocene oil zone will be perforated after running tubing in the well.

Testing is expected to include two flow periods and a pressure build up after well shut in to measure the pressure responses within the reservoir. Testing operations are expected to be concluded by the end of April. A summary of drilling and evaluation results is included in the Appendix attached to this release.

The testing program is designed to evaluate the long-term production, reserves and economic potential of the Eocene oil zone at the Anshof-3 well, the resources potential of the greater Anshof discovery and the ongoing appraisal and development of the Eocene oil discovery. Anshof is a large structure mapped with 3D seismic which has a vertical relief of up to 440 metres and extends over a total area of 24 km². Two follow up appraisal locations have already been identified based on the ongoing geological and geophysical (G&G) work undertaken to date.

Following the successful testing of the 6 m gross Eocene oil zone the well is expected to be placed on production with an early production unit utilising a rod pump and delivering oil for sale by truck to a nearby oil terminal. Interim production of up to 37,000 barrels (approximately 100 barrels per day for a period of one year) is allowed under Austrian legislation prior to finalising a production license for the entire much larger discovery area which ADX has mapped to extend over an area of approximately 24 km².

Further well testing reports

Further well testing reports will be provided as relevant information becomes available.

Note:

ADX announced a farmout to ASX listed Xstate Resources Limited to fund 40% of the Anshof-3 well costs to earn a 20% participating interest in the Anshof Prospect. Refer to ASX release dated 22 November 2021.

For further details please contact:

Paul Fink	Ian Tchacos
Chief Executive Officer	Executive Chairman
[phone]	[phone]
[e-mail]	[e-mail]

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 23 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).

Appendix

Summary of Anshof -3 well results, testing program and appraisal strategy

Map showing Anshof discovery in the ADX-AT-II license and nearby fields Voitsdorf, Bad Hall and Pfarrkirchen and Sierning as well as the nearby train transport oil loading facility. The Anshof-3 well test site is denoted by the green star symbol

The Anshof-3 well was spudded at 00.30 hours on the 18th of December 2021. The Anshof-3 well is located in the ADX-AT-II license in Upper Austria. The Anshof well site has provision for up to 3 drilling slots (the well name Anshof-3 stems from the fact that physical surface location number 3 which was the first approved by all necessary authorities to allow spudding of the well). Well operations were concluded following the running and cementing of 7 inch casing to a total depth (TD) of 2499 m. The RED E-200 rig was released on 15 January 2022. The well has been suspended in preparation for completion with production tubing utilising a workover rig prior to testing and potential long-term production thereafter.

The Anshof discovery well intersected 3 hydrocarbon bearing zones of interest in a large, high relief structure providing very significant appraisal and development potential in an onshore setting adjacent to readily available gathering, production and export infrastructure. The Anshof-3 well is expected to yield a second production asset in Austria for ADX in the near future.