TERN PLC 
By 31 December 2012
Silvermere Energy plc ("Silvermere " or the "Company") Operations Update
Silverm ere Energy plc, the independent oil and gas company with assets in the Gulf of Mexico, provides an update on the sales of oil and gas from its Mustang Island 818 -L Fi eld foll owi ng the announcement dated 4 December 2012. This is based on inform ation provided by the Operator, Domini on Production Com pany LLC ("Domini on").
As at the date of this announcem ent the main int erconnect pipeli ne operated by Exxon Mobil remai ns shut down as a result of the repair work being carri ed out on it taking l onger than expected. It is anticipated that the pipeline will be restored to operation in the near future and the Com pany will issue a further update as soon as any further information becom es availabl e.
Silvermere Energy plc Andy Morrison, Chi ef Executi ve | +44 (0)7980 878 561 |
Merchant Securities Limited (Nominated Advi ser and Broker) Lindsay Mai r/Virgini a Bull/Catherine Miles | + 44(0)20 7628 2200 |
Peterhouse Corp orate Finance Limited Jon Levinson | +44 (0)20 7469 0937 |
Bi shop sgate Communication s Nick Rome/A nna Michniewicz/Ivana Petkova | +44(0)20 7562 3350 |
The Company has a 33.33 per cent working interest and 20.00 per cent net entitlement interest in the Mustang Licence A rea, an area within t he southern hal f of the north -west quarter and northern half of the south-west quarter of the Block 818 -L field as defined in State of Texas Oil and Gas Lease num bers
108873 and 108874. The M ustang Island 818-L fi eld (t he "Fi eld"), located in Kleberg County waters of the Gulf of Mexico, is home t o a field re -habilitation project targeting bypassed or only partially produced gas - condensate.
According to a recent update to the independent Com petent Persons Report published at admission in August 2011, the Mustang asset - which is operated by Domini on Production Com pany, the Field has a NPV10 of P roven and Probable reserves (P 1 + P2) estimated t o be US$14 milli on attributabl e to the Com pany's interest. It has an additional NPV10 of $57million net from the potential upgrade of Possible (3P) reserves. Thes e reserves are based on a projected three well programme.
Initially, Silverm ere is focussed on progressing production from the I-1 re-entry well where it has a 16.66 per cent working i nterest with a view to underpi nni ng its long -term obj ecti ve of creating a bankable and cash generati ve oil and gas company duri ng the medium term and then drilli ng the three new wells to access the NPV identifi ed in the CPR.
The Company maintai ns an active business devel opm ent programm e which aims to identi fy and acqui re additional val uable assets either i n or near production. These will be used to expand t he busin ess and provide additional value to sharehol ders over time. The Company's search is focussed on the US for the time being, both on -shore and off-shore, but may be expanded further afi eld in future.
Silverm ere is quot ed on the A IM Mark et of the London Stoc k Exchange plc (AIM: SLME ) with its offices in
London.
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