Company Announcements

16 January 2024

Block Energy plc

("Block" or the "Company")

Study Concludes Block XIB Offers Commercial Carbon Capture and Storage Opportunity

Block Energy plc, the development and production company focused on Georgia, is pleased to announce a study identifying a Carbon Capture and Storage ("CCS") opportunity within the Company's Block XIB with the potential to support a major net-zero CO₂ industrial hub.

The study, commissioned by the Company, estimates a CO₂ storage capacity ranking - at both reservoir and basin scales - amongst the highest in Europe. The reservoir scale storage is estimated at 256 million metric tonnes, equivalent to offsetting emissions from 55 million cars, and the basin scale at up to 8.7 gigatonnes, equivalent to offsetting emissions from Turkey for 20 years.

The research suggests Block XIB is best suited to the Mineral Trapping (Mineralisation) method whereby CO₂ is injected with water and mineralises as solid carbonates, a technique successfully used in Iceland to permanently inject 100,000 tonnes of CO₂ to date into basaltic rock.

The Middle Eocene volcaniclastics facilitate the movement and efficient containment of injected CO₂ and sections are abundant with Zeolites, highly reactive minerals, enriched with substantial calcium, that enhance the potential for successful and sustainable CCS by Mineralisation.

These and other supportive geological features, including an active aquifer and ideal pressure and temperature conditions, indicate the possibility for a very rapid rate of carbonation: initial calculations show 95% mineralisation of CO₂ within 250 days, compared to 1,000 years in sedimentary systems. Carbon storage capacity could be further enhanced by localised dissolution of fractures, increasing pore space and pore volume.

The study, commissioned in the course of the Company's Project III development planning, was undertaken by Oilfield Production Consultant ("OPC"), a consultancy recognised internationally for its expertise and experience in this field.

OPC have worked on the White Rose, Golden Eye, Gorgon and Viking projects, as well as on projects in the Gulf of Mexico. The study was led by Professor Eric Oelkers, a recognised expert in the field of water-rock interactions.

Block Energy plc's Chief Executive Officer, Paul Haywood, said:

"The CCS study opens another significant commercial opportunity for the Company while underlining our commitment to sustainability.

"The study highlights that Block XIB's storage potential could be amongst the largest in Europe, indicating the prospect of a major net-zero industrial hub within central Georgia - of interest to the hydrogen, fertiliser, steel and refined petroleum products industries - close to the XIB license."

**ENDS**

Stephen James BSc, MBA, PhD (Block's Subsurface Manager) has reviewed the reserve, resource and production information contained in this announcement. Dr James is a geoscientist with over 40 years of experience in field development and reservoir management.

THIS ANNOUNCEMENT CONTAINS INFORMATION PREVIOUSLY DEEMED BY THE COMPANY TO BE INSIDE INFORMATION AS STIPULATED UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED.  WITH THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, SUCH INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.

For further information please visit http://www.blockenergy.co.uk/ or contact:

Notes to editors

Block Energy plc is an AIM-listed independent oil and gas company focused on production and development in Georgia, applying innovative technology to realise the full potential of previously discovered fields.

Block has a 100% working interest in Georgian onshore licence blocks IX and XIB. Licence block XIB is Georgia's most productive block. During the mid-1980s, production peaked at 67,000 bopd and cumulative production reached 100 MMbbls and 80 MMbbls of oil from the Patardzeuli and Samgori fields, respectively. The remaining 2P reserves across block XIB are 64 MMboe, comprising 2P oil reserves of 36 MMbbls and 2P gas reserves of 28 MMboe. (Source: CPR Bayphase Limited: 1 July 2015). Additionally, following an internal technical study designed to evaluate and quantify the undrained oil potential of the Middle Eocene within the Patardzeuli field, the Company has estimated gross unrisked 2C contingent resources of 200 MMbbls of oil.

The Company has a 100% working interest in licence block XIF containing the West Rustavi onshore oil and gas field. Multiple wells have tested oil and gas from a range of geological horizons. The field has so far produced over 75 Mbbls of light sweet crude and has 0.9 MMbbls of gross 2P oil reserves in the Middle Eocene. It also has 38 MMbbls of gross unrisked 2C contingent resources of oil and 608 Bcf of gross unrisked 2C contingent resources of gas in the Middle, Upper and Lower Eocene formations (Source: CPR Gustavson Associates: 1 January 2018).

Block also holds 100% and 90% working interests respectively in the onshore oil producing Norio and Satskhenisi fields.

Project I is focused on developing oil production from the Middle Eocene reservoir of the West Rustavi/Krtsanisi field.

Project II aims to redevelop the Middle Eocene reservoir of the Patardzeuli and Samgori fields.

Project III is focused on the undeveloped gas-bearing natural fracture system within the Lower Eocene and Upper Cretaceous reservoirs - each more than a kilometre thick - spanning the XIB and XIF blocks.

Project IV is focused on exploring the full potential of our licences, including licence IX and Didi Lilo where we have identified significant prospectivity.

The Company offers a clear entry point for investors to gain exposure to Georgia's growing economy and the strong regional demand for oil and gas.

Glossary

·    bbls: barrels. A barrel is 35 imperial gallons.

·    Bcf: billion cubic feet.

·    boe: barrels of oil equivalent.

·    boepd: barrels of oil equivalent per day.

·    bopd: barrels of oil per day.

·    Mbbls: thousand barrels.

·    Mboe: thousand barrels of oil equivalent.

·    Mcf: thousand cubic feet.

·    MD: measured depth.

·    MMbbls: million barrels.

·    MMboe: million barrels of oil equivalent.

·    MMcf: million cubic feet.

·    TVD: True Vertical Depth.