Icon Energy Limited Annual Report 2017

DIRECTORS' REPORT for the year ended 30 June 2017 The Directors of Icon Energy Limited (Icon Energy or Company) present their report together with the financial statements of the Company and its controlled entities (“the Group” or “the Consolidated Entity”) for the financial year ended 30 June 2017. In order to comply with the provisions of the Corporations Act 2001 , the Directors of Icon Energy report as follows: PRINCIPAL ACTIVITIES The principal activities of Icon Energy during the year included the exploration, appraisal and development of oil and gas properties. There were no significant changes in the nature of these activities during the year. DIRECTORS The Directors of the Company who held office during or since the end of the year are set out below: Name Position First Appointed Stephen Michael Barry Non-executive Chairman Director since 05/01/1993 Raymond Swinburn James Managing Director Director since 01/02/1993 Dr Kevin Jih Executive Director, Chief Financial Officer & Company Secretary Director since 30/11/2011 Company Secretary since 13/05/2015 Dr Keith Hilless AM Non-executive Director Director since 03/04/2009 Howard Lu Non-executive Director Director since 07/01/2011 Derek James Murtagh Murphy Non-executive Director Director since 20/03/2009 Details of the qualifications and experience, other directorships of listed entities and special responsibilities of Directors are set out in the Board of Directors’ section of this Annual Report. Refer to table 8 of Remuneration Report for Directors’ interests in shares and performance rights. REVIEW OF OPERATIONS AND RESULTS A review of operations of the consolidated entity during the financial year and the results of those operations is included in the Review of Operations section of this Annual Report. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS ATP 594 Cooper-Eromanga Basin Queensland − ATP 594 is currently in the first half of Year 3 of the first 4-year period following its renewal by the Department of Natural Resources and Mines ( DNRM ) in April 2015. − An independent technical evaluation by Energeo has indicated a high degree of prospectivity within the permit, which has helped to focus future exploration activity. − The ATP 594 Harrier 3D Seismic Survey activity began in the northern block on 15 November 2016. There were delays due to wet weather. The survey was finally completed on 23 February 2017, with a total of 293 km of data acquired. − On 9 June 2017, the Harrier 3D seismic data was initially processed by Velseis Pty Ltd in Brisbane. The data is currently in the process of being evaluated. Once this interpretation has been completed and the results are fully evaluated, discussions will be held with potential farmin partners. ATP 855 Cooper-Eromanga Basin Queensland − The Stage 1 program in ATP 855 achieved all the exploration and technical objectives that were set by the Joint Venture partners. This included flowing natural gas from five wells, achieving the highest flow rate of 4.5 MMscf/d from a shale gas well (Halifax-1) in the Cooper Basin, having six Petroleum Discoveries and identifying a significant natural gas resource within the Permian Formations of the Nappamerri Trough. − On 31 March 2017, Icon took over the Operatorship of ATP 855. In its capacity as Operator, Icon assumed the rehabilitation liability for the exploration program, estimated at $5.23 million and joint venture assets, including all inventory and chemicals to the value of $4.89 million. Some of the ATP 855 inventory is held in leased storage and is currently being assessed for consolidation, with some items to be sold. − On 20 April 2017, Icon Energy lodged an application for eight Potential Commercial Areas ( PCA ) with DNRM, covering the entire area of ATP 855 in preparation for the next phase of activity in the permit. DNRM is reviewing these applications. − On 27 April, DNRM approved the Transfer of Interest ATP 855 to Icon Energy Limited. Icon now owns 100% of the tenement and is the appointed Operator. FINANCIAL REPORT 24 ICON ENERGY ANNUAL REPORT 2017