Upland Resources : Annual Report and Consolidated Financial Statements for the Year Ended 31 Dec 2023

Jersey Company number: 129667

Upland Resources Limited

Annual Report and Consolidated Financial Statements

for the 18 month Period from 1 July 2022 to 31 December 2023 (with comparative period being the year ended 30 June 2022)

Upland Resources Limited

Contents

Officers and Professional Advisers		1
Board of Directors		2
Chairman's Statement		3-4
Strategic Report		5 - 8
Directors' Report	9	- 15
Statement of Directors' Responsibilities		16
Independent Auditor's Report	17	- 22
Consolidated Statement of Comprehensive Income		23
Consolidated Statement of Financial Position		24
Consolidated Statement of Changes in Equity		25
Consolidated Statement of Cash Flows		26
Notes to the Financial Statements	27	- 46

Upland Resources Limited

Officers and Professional Advisers

Directors	Bolhassan Di
	Aimi Nasharuddin
	Dixon Wong Kit Seng
	Andrew Hurst
Registered Office	3rd Floor
	44 Esplanade
	St Helier
	Jersey
	JE4 9WG
Jersey Company	129667
Number
Brokers & Financial	Optiva Securities Limited
Advisers	118 Piccadilly
	London
	W1J 7NW
	Oak Securities
	90 Jermyn Street
	London SW1Y 6JD
Auditors	PKF Littlejohn LLP
	15 Westferry Circus
	London
	E14 4HD
UK Legal Advisers	Hill Dickinson LLP
	The Broadgate Tower 20 Primrose Street
	London
	EC2A 2EW

Company Secretary Ogier

44 Esplanade St Helier Jersey

JE4 9WG

Principal Bankers Coutts & Co

440 Strand

London WC2R 0QS

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Upland Resources Limited

Board of Directors

Bolhassan Di - Chairman and Chief Executive Officer

Mr Di has many years of political and commercial experience within the Sarawak region. He has held positions as Chairman of the Public Accounts Committee, Assistant Minister in the Sarawak Chief Minister's Department and subsequently Assistant Minister at the Ministry of Infrastructure Development and Communication. A graduate of the School of Engineering at Sheffield University, he began his career in 1979 at Sarawak Shell Bhd. (a subsidiary of Royal Dutch Shell plc) where he gained project planning, design, construction, commissioning and start-up experience in offshore projects. These included the F6A project in Sarawak waters (the largest offshore gas project in the region), the E11 and F23 gas production projects in Sarawak waters and also projects such as the St Joseph and South Furious offshore oil production platforms in Sabah waters. From 1987 to 1997, he was also the Chairman of the Miri Port Authority, now a key economic catalyst in the industrial and economic development of Sarawak. He has also had significant oil and gas experience with Shell in South Korea, Singapore, the North Sea and the Netherlands.

Dixon Wong Kit Seng - Non-Executive Director

Mr Wong is a director of a number of businesses owned by Tune Group and has been involved in a variety of roles within the organisation including corporate finance, group strategy, driving organisational change and synergies across the group. One of Upland's major shareholders, Tune Assets Limited, is part of the Tune Group. Mr Wong has previously worked for HSBC Bank Malaysia and the Bank of Tokyo-Mitsubishi. Mr Wong holds a BCom, Accounting and Finance from the University of Queensland, Australia and a Master of Business degree from the Queensland University of Technology.

Aimi Nasharuddin - Non-Executive Director

Mr Nasharuddin carries over 30 years of business, corporate finance and hands-on operational experience. An accountant by profession, he started his career at Arthur Andersen & Co as an auditor and business advisor where he was involved in mapping out strategies and implementing business processes for various sectors of corporates, including manufacturing, financial and investment, property development, construction and oil and gas-based companies. He later gained further expertise in the corporate world at CIMB Investment Bank Berhad, the largest investment bank in Malaysia, where he was integral to some of the largest transactions involving financial restructuring, business re- engineering, takeovers, reverse takeovers, acquisitions and corporate financing.

Professor Andrew Hurst - Non-Executive Technical Director

Professor Hurst has a wealth of industry knowledge and expertise and has a proven track record in generating new oil-rich exploration plays. He has strong O&G industry connections that include research investment. With a distinguished academic career, Professor Hurst is currently the Chair of Energy Geoscience at the University of Aberdeen and was also academic lead for the creation and development of the Department of Petroleum Geoscience and a new MSc course in Petroleum Geoscience at University of Brunei. He has also served as advisor to and/or member to the Danish, Norwegian and UK Energy national research councils.

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Upland Resources Limited

Chairman's Statement

We are pleased to report our audited results for the 18-month period ended 31 December 2023.

The strategy for the Company is to acquire assets, businesses or target companies that have operations in the oil and gas exploration and production sector which it would then look to develop and expand. In this reporting period we have concentrated the majority of our efforts on opportunities in Sarawak, Malaysia.

Sarawak is a rapidly growing oil and gas producing region. Upland is uniquely positioned in Sarawak. In the reporting period we have been actively exploring a region centred around Limbang and Lawas. A block denoted as SK334 that is 6,685km2 in size.

During the reporting period the outlook for the Company and its shareholders improved dramatically with the signing on 1 September 2022 of an agreement between our associate Upland Big Oil Sdn Bhd (UBO) and Petroleum Sarawak Sdn Bhd (PETROS), the state regulator, to complete a 15-month Joint Technical Study of onshore block SK334 at a cost of US$1.3m. The JTS was completed on 26 November 2023. On 24 September 2023 our associate Upland Big Oil Sdn Bhd (UBO) commenced discussions with PETROS about the award of a Production Sharing Contact. Discussions are ongoing. Our partner in UBO is Big Oil Ventures Sdn Bhd, a company based in Kuching Sarawak whose principals have many years of technical experience.

Our technical team based in Sarawak is outstanding. Post period we have extended our technical team with a range of world class advisors and contractors so that our overall team who will work in Sarawak has over 600 years of experience. Our Sarawak management team is complemented at the Group corporate level by Andrew Hurst, Gerry Murray and myself all with extensive industry experience. Since we anticipate significant growth and to broaden our range of required experience, post period we have also appointed a Chief Commercial Officer, Albert May, who joined the company on May 1st 2024.

In line with our strategy to be focussed on Sarawak, as reported, licenses in Tunisia (Saouaf) and the UK(Dunrobin) have been relinquished or not renewed.

Regarding corporate matters, Professor Andrew Hurst of the University of Aberdeen joined the Board as Technical Director on 11 January 2023. We are delighted to welcome Andrew to the Upland Board. He has a wealth of industry knowledge and expertise ,with strong O&G industry connections. Notably he was the academic lead for the creation and development of the Department of Petroleum Geoscience at the University of Brunei and an expert witness at the Depp Water Horizon hearings. He will be a key member of the Sarawak Technical Committee constituted on 18 September 2023. The other Board change occurred when Chris Pitman decided not to seek re-election at our AGM held on 28 September 2022.

Our management team was strengthened in 2022 with the appointments of Gerard Murray as COO on 30 June 2022 and John Forrest as CFO on 6 May 2022. Gerry is an experienced energy industry professional who holds a MSc Oil & Gas Management from the University of Aberdeen while Chuck is a CPA with many years of public company experience who joined the Company after the unfortunate passing of Jeremy King. Gerry and Chuck have provided valuable support to me as CEO. Post period, on May 1 2024, we have appointed Albert May as CCO. Albert is a strategist and financial markets specialist who has previously been a KPMG London consulting partner and who holds a Bsc in Economics from the University of Bristol and Msc in Computer Science from the University of Cambridge.

Regarding finances, despite challenging financial markets, during the reporting period the Group raised £2,643,127, before expenses of £94,600. Further details can be found in the Directors Report which follows and in Notes 8 (Share-based payments) and Note 17 (Stated capital).

I am also pleased to report that on 26 April 2024 the Company announced a circa US$4m (approximately £3.2m) institutional placement of shares. The funds will be received post issuance of these accounts. These funds will contribute towards our current operational plan including the drilling

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of the first well on SK334. We also announced the appointment of Oak Securities Limited as Joint Broker.

We welcome our new investors and thank our loyal shareholder base who participated in these financings.

I look forward to updating shareholders as we progress during 2024 towards our goal to become the leading onshore exploration and production company in Sarawak.

CEO and Chairman

15 May 2024

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Upland Resources Limited

Strategic Report for the 18 month Period Ended 31 December 2023

The Directors present their strategic report for the period ended 31 December 2023.

Principal activity

The Company and Group was formed for the purpose of acquiring assets, businesses or target companies that have operations in the oil and gas exploration and production sector which it would then look to develop and expand.

During the period the Group's focus shifted to Block SK334 in Sarawak, Malaysia, This evolved through the staged acquisition of a 45% interest in Upland Big Oil Sdn Bhd (UBO) by our Sarawak subsidiary Upland Resources (Sarawak) Sdn Bhd. Details of the acquisition of our interest in UBO are provided in Note 12. UBO is reported as an Investment in Associate on the Consolidated Statement of Financial Position and accounted for by the Equity Method. As permitted by IFRS 6, until UBO receives a license, the cost of exploration and evaluation expenditures relating to Project SK334 are expensed in the UBO accounts, our share being £357,165 (refer Note 12).

Future strategy

The Sarawak Basin is a prolific oil and gas producing basin. Seven geological provinces have been identified in the basin, namely the West Baram Delta, Balingian, Central Luconia, Tinjar, Tatau, West Luconia and North Luconia.

Block SK334, Onshore Sarawak comprises of Limbang and Lawas areas, covering an area of 6,685km2. The Block is located directly south and east of Onshore Brunei Blocks L and M that are proven to be an active petroleum system with numerous oil and gas shows and discoveries.

Available data includes 6,350km2 of airborne Full Tensor Gravity (FTG) data acquired in 2015, 456km of 2D seismic data acquired in 2016 and various fieldwork reports, geochemical studies and technical reports. No wells have ever been drilled in Block SK334.

Block SK334 is expected to have good prospectivity as it shares the same geological setting and basin history with significant discoveries in the Belait and Jerudong fields in Brunei.

Several oil and gas seepages were recorded in the delineated prospective areas, and hydrocarbon micro-seepage study conducted in 2015 has confirmed the presence of active petroleum systems in the area.

Three prospects were mapped as faulted anticlinal closures, where the largest of the prospects has an asymmetric high relief dome. The other is a lead that has as a three- way fault closed structure.

Malaysia has doubled its exploration success in 2022 with 10 Discoveries. E&P Operators recorded a total of Ten hydrocarbon discoveries in Malaysia in 2022, following the increase of exploration activities in the country. Eight oil and gas discoveries were made off the coast of Sarawak, and one each off the coast of Sabah and Peninsular Malaysia.

It is the belief of the Upland Board of directors that the Company is unequally positioned in the region and that time and resources spent on proving up Block SK334 have potential to generate significant returns for shareholders. Our focus on Sarawak is in line with our corporate vision and strategy whereby we look for opportunities in the region where we have comparative advantages in terms of knowledge and corporate networking.

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Business activity during the period

Sarawak: Corporate Activity & JTS

On 2 September 2022 the Company announced that URS had entered into an agreement with BOV and PETROS to complete a 15-month Joint Technical Study (JTS). The main objectives of the JTS were (i) to assess the hydrocarbon potential of SK334;(ii) identify leads and prospects in the study area; (iii) derisk SK334 for future exploration.

On 10 October 2022 the Company announced that URS and BOV had reached agreement to use Upland Big Oil Sdn Bhd (UBO) to finance the costs of the JTS estimated at USD 1.25m The announcement also reported that technical data had been transferred from PETROS and the first technical workshop was set for 18 October 2022. URS purchased a 20% interest in UBO for nominal cost of Malaysian Ringgit (MR) 200 with an obligation to fund 20% of the JTS cost.

On 28 November 2022, discussions between BOV and URS commenced about URS acquiring a larger interest in UBO. Effective 1 April 2023, URS agreed to begin funding 45% of the monthly JTS cost.

On 19 December 2022, about 60 days into the JTS, a Progress meeting was held with PETROS who expressed satisfaction with the progress of JTS.

On 14 March 2023 the Company announced that Andrew Hurst (Non-Executive Technical Director) and Gerry Murray (COO) had joined the UBO Technical Study Committee as Geological Governance Lead and Corporate Advisor.

The JTS was completed on 28 November 2023 and presented to PETROS on 6 December 2023 during the final technical workshop. A Letter/Application in respect of the Production Sharing Contract (PSC) was submitted by UBO to PETROS on 24 September 2023

UBO commenced the search for a drill rig in July 2023. In November 2023 discussions with Huisman Geo BV commenced leading to a drillrig reservation agreement which has been signed in April 2024 to secure availability of the rig.

On 21 February 2023 URS completed the purchase of a further 25% of UBO, increasing the Group's interest to 45% at an aggregate cost of 423,597 (Note 12). The transaction was completed with a combination of cash and shares of UPL.

As mentioned, we are now fully focused on our intended high impact drill program onshore at Sarawak

The following is extracted from our market announcement on 28 March 2024 and provides a summary of our near-term plan

SK334 Exploration: Progress Report & Next Steps

• Drill crew & Project teams identified, contracts under review.
• Onshore drilling rig Inspection completed on 26th February 2024 at Sviadnov, Czech Republic, as part of SK334 drilling rig selection and operational preparation. The rig is concluded to be suitable for our plans.
• Pre-drillwork programme developed for accelerated drilling programme.
• Commencement of formal farm-out proceeding with interest from strategic reviewed, shortlist now being finalised.
• Planning & scheduling of anticipated works with PETROS.
• Engagement on PSC work scope with PETROS.
• Signed a Rig Reservation agreement with Huisman Geo BV which entails a commitment of Euro 125,000.

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PEDL299

Upland Resources (UK Onshore) Limited holds a 25% interest in PEDL 299. A cost-sharing arrangement has been put in place under the Joint Operating Agreement between the co-licencees (INEOS Upstream and Europa Oil & Gas). INEOS have extended the term of this licence to July 2024. As yet, no firm plans have been established.

Significant events since the balance sheet date

Since 31 December 2023, 16,833,332 shares have been issued on the exercise of 1.20 warrants for gross proceeds of £202,000.

On 13 April 2024 the Company entered into an agreement with Huisman Geo BV whereby the Company will pay a non-refundable fee of Euro 25,000 per month for a term of 3 months, extendable for a further 2 months, to reserve availability of a LOC400-6 Drill Rig.

On 26 April 2024 the Company announced a placement of 96,927,000 shares at 3.3p for gross proceeds of £3,198,591.

Principal risks and uncertainties

The directors consider that the main business risks and uncertainties of the Group are:

Sub-surface risks

Risk 1: The success of the business relies on accurate and detailed analysis of the sub-surface. This can be impacted by poor quality data, either historical or recently gathered, and limited data coverage. Certain information provided by external sources may not be accurate.

Mitigation: All externally provided historical data is rigorously examined and discarded when appropriate. New data acquisition will be considered and relevant programmes implemented, but historical data can be reviewed and reprocessed to improve the overall knowledge base.

Risk 2: Data can be misinterpreted leading to the construction of inaccurate models and subsequent plans.

Mitigation: All analytical outcomes are challenged internally and peer reviewed. Interpretations are carried out on modern geoscience software.

Corporate risks

Risk 1: The Group's success depends on skilled management as well as retention of technical and administrative staff and consultants. The loss of critical members of the Group's team could have an adverse effect on the business.

Mitigation: The Group periodically reviews the compensation and contract terms of its staff and consultants to ensure that they are competitive.

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Going concern risk

Risk: The Group at the date of approval of these accounts has insufficient financial resources to meet its non-discretionary expenses for the next 12 months nor the final capital expenditure amount for that period which is not yet known..

Mitigation: Despite challenging financial markets, the Group has a loyal shareholder base and raised £2,643,127 before expenses during the reporting period and has recently announced an approximate £3,198,000 financing which is scheduled to close later in May 2024. Also, the Company has received interest from several potential joint venture partners interested in financial participation in our opportunities in Sarawak.

Approved by the Board on 15 May 2024 and signed on its behalf by:

1. Nasharuddin Director

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