Icon Energy Limited Annual Report 2017

In ATP 594, Icon funded the Harrier 3D Seismic Survey, a large 293 sq km seismic program, in 2016-2017. Delays were caused by two periods of heavy rain and flooding. Waiting for this flat land to dry out after rain, plus the cost and distance to move a full crew of up to fifty personnel is not a simple or inexpensive task. The seismic results have now been processed and interpreted and we are negotiating with potential joint venture partners to assist Icon in drilling one or more wells on the targets now identified within the permit. Updates on the progress of the program will be announced to the Australian Stock Exchange ( ASX ) as results are available. In Victoria, our permits (granted and pending) have been the subject of a Moratorium and a permanent ban on fracking. On 16 March 2017, the State Government legislated the Moratorium to continue until 30 June 2020, thus preventing any onshore drilling for gas until that time expires. After that date, only conventional drilling under a revised work program can be performed. Your Board of Directors, having deliberated for a long time over Icon’s ultimate position, decided that it would be in the best interest of Icon’s shareholders to continue to pay all fees associated with the retention of PEP 170 (granted) and PEP’s 172 and 173 (grants pending) until further notice. With the closing of coal fired power stations in Victoria and the decline in offshore gas production, Icon is well placed to recommence operations in onshore Gippsland. Icon has 100% of the permits over three areas totalling 3,300 sq kms which are close to existing commercial gas flows from discovery wells nearby. The tenements are also close to necessary infrastructure including the gas plant located at Lonsdale. Recognising that capital and resources need to be focused on the most prospective areas, the Board determined not to pursue the less prospective tenements including ATP 626, ATP 549 West and ATP 794. All field operations currently are on a care and maintenance basis only, until new funding can be obtained to commence Stage-2 operations in the ATP 855 and 594 tenements. Minimal holding costs are being incurred in Victoria of approximately $19,000.00 per year. Throughout the past year, the petroleum exploration industry has been battling to survive. Icon has been able to survive this period with its robust cash position, accumulated in prior years. Conservation of cash has been a priority with staff reductions, freezing of salaries (other than contractual CPI adjustment) and the discretionary cancellation of all staff bonuses for the past two years. I would like to thank Icon’s team for their dedicated efforts over the past year. We are all excited that new activity is on the horizon. I anticipate that Icon’s planned new activity will be reflected in a better price for Icon’s quoted securities soon. S M Barry Chairman Image: The Burke and Wills Dig Tree on Cooper's Creek in ATP 855 3 ICON ENERGY ANNUAL REPORT 2017 CHAIRMAN’S LETTER