Nido Petroleum : Quarterly Report and Appendix 5B, Q3 2016

Q3‌

2016 Activities Report

Quarterly Report

For the period ending 30 September 2016

HIGHLIGHTS

 Total production from the Galoc oil field during the third quarter was 467,246 bbls and 261,095 bbls on a net to Nido basis

 Production uptime for the Galoc oil field was 99.3% during the quarter and average gross daily pro- duction was 5,079 bopd (2,838 bopd net to Nido)

 Cargo 53 was lifted on 30 August 2016 with the total lifted volume of 339,799 bbls (189,878 bbls net to Nido)

 Cyclical production continued from the Nido and Matinloc oil fields with total field production of 28,116 bbls (7,251 bbls net to Nido)

I am pleased to provide to you the following summary of the Company's activities for Q3 2016.

Galoc up-time was 99.3% for the quarter with gross average daily oil production of 5,079 bbls (2,838 bopd on a net to Nido basis) with total production of 467,246 bbls (261,095 bbls net to Nido).

Cargo 53 was lifted on 30 August 2016 with the total lifted volume of 339,799 bbls (189,878 bbls net to Nido). Cargo 53 was sold to Singapore Petroleum Company Ltd.

The Nido and Matinloc oil fields continued to produce oil on a cyclical basis during the quarter. Oil production from these fields totalled 28,116 bbls (7,251 bbls net to Nido).

A total of 25,801 bbs were lifted and sold from the Nido and Matinloc oil fields during the quarter (6,596 net to Nido).

The Galoc Joint Venture continued to progress sub-surface and preliminary engineering studies and is actively consider- ing a potential appraisal well in the mid-Galoc area of the field to confirm the commerciality of a potential Phase III de- velopment project.

The Company also continued to evaluate exploration, devel- opment and production assets in the region and is consider- ing a number of assets in this context.

During the quarter the Permanent Court of Arbitration in the Hague ruled in favour of the Philippines in relation to the terri- torial dispute with the Peoples Republic of China regarding the South China Sea.

The Company continues to monitor the situation closely and its potential impact on SC 58 in particular. SC 58 continues to remain in a period of suspension.

DR MIKE FISCHER MANAGING DIRECTOR

Nido Petroleum Limited ABN 65 086 373 www.nido.com.au

Level 3, 1 Preston St, Como WA 6152 Australia P: [phone] F:[phone]

4F Zaragoza Building, 102 Gamboa Street, Legaspi Village, Makati City, 1229 Philippines P: [phone] F: [phone]

LIFTING SUMMARY Volumes - Lifted & Sold (stb)	Qtr 3 2016	Year-to-date 2016	Previous Qtr Q2 2016
Service Contract 14:	189,878	573,508	383,630
Galoc oil field (net to Nido)
Nido & Matinloc oil fields (net to Nido)*	6,596	16,341	9,745
TOTAL VOLUMES LIFTED & SOLD	196,474	589,849	393,375
FINANCIAL SUMMARY
Cash Inflows- US$ '000
Receipts from sale of crude oil	18,641	41,090	9,402
Interest & other	68	968	2
Refund of development expenditure	-	379	-
Proceeds from debt facility	-	-	-
TOTAL CASH INFLOWS	18,709	42,437	9,404
Cash Outflows-US$ '000
Exploration expenditure	(598)	(1,968)	(798)
Development expenditure	-	-	-
Production OPEX	(5,594)	(25,322)	(9,031)
Income taxes	(252)	(722)	(470)
Repayment of borrowings & financing costs	(115)	(14,663)	(175)
Administration & other expenses	(950)	(3,135)	(1,075)
Foreign exchange movement & other	(11)	(12)	9
TOTAL CASH OUTFLOWS	(7,520)	(45,822)	(11,540)
Cash Position - US$ '000
Cash on Hand	14,146	14,146	2,957
Debt - Secured Debt Facility	(78,200)	(78,200)	(78,200)

* Nido and Matinloc figures are subject to change based on the latest lifting/production volume adjustment from the Operator

Nido ended the quarter with cash on hand of US$14.1 million and debt outstanding of US$78.2 million.

INFLOWS

Galoc production remained steady. Cash inflows from crude oil sales totalled US$18.6 million with receipts from 2 cargoes received in the reporting period. There were no cash receipts received from the Nido/Matinloc oil fields for this quarter.

Quarterly interest & other inflow movements were minimal. A crude oil hedge put option executed during the previous quarter (against the June 2016 average Dubai oil price) resulted in a relatively small cash inflow on settlement in July 2016.

OUTFLOWS

Cash outflows from production operations at the Galoc oil field and the Nido/Matinloc oil fields amounted to US$5.6 million. The cash outflow associated with the premium paid for the June 2016 crude oil hedge put option occurred in July 2016.

Cash outflows for exploration activities of US$0.6 million relate mainly to new venture and Galoc exploration activity.

Principal repayments and interest payments were deferred until at least 15 March 2018 as a result of the renegotiation of the Facility Agreement with the Bangchak Petroleum Public Company Limited ('BCP') in March 2016. There were minimal other financing- related outflows.

Income tax expense payments totalled $0.3 million during the quarter. General administration expenditure and staff costs, net of overhead recovery, totalled US$0.9 million for the quarter.

PRELIMINARY (UNAUDITED) Q3 FINANCIAL INFORMATION

Nido has provided preliminary Q3 financial information to BCP Energy International Pte Ltd ('BCPE') for their quarterly reporting process. The preliminary financial information is unaudited and subject to change and is set out in the following table:

Statement of Comprehensive Income for the nine months ending 30 September 2016 (US$ '000) Revenue from sale of crude oil	30 Sept 2016 33,356
EBIT	(9,452)
Net (loss) for the quarter ended 30 September 2016	(13,226)
Balance Sheet as at 30 September 2016 (US$ '000) Current Assets	26,623
Non-current Assets	131,226
Current Liabilities	18,977
Non-current Liabilities	110,180
Net Assets	28,692
Statement of Cash Flows for the nine months ended 30 September 2016 (US$ '000)
Net cash from / (used in) operating activities	8,506
Net cash (used in) investing activities	(1,589)
Net cash (from) financing activities	(10,290)

PRODUCTION AND DEVELOPMENT-Philippines

SERVICE CONTRACT 14C1 - GALOC OIL FIELD

Location:	Palawan Basin, Philippines
Area:	16,000 hectares	Operator:	Galoc Production Company W.L.L.
Nido's Interest:	55.88%	Activity:	Galoc Production

Gross production from the Galoc oil field during the quarter was 467,246 bbls (261,095 bbls net to Nido) with a gross average production rate of 5,079 bopd (2,838 bopd net to Nido). Uptime for the quarter was 99.3%.

Cargo 53 was lifted on 30 August 2016 with a total lifted volume of 339,799 bbls (189,878 bbls net to Nido) with a realised equivalent FOB price of US$45.46 per bbl. Cargo 53 was sold to Singapore Petroleum Company Ltd.

The Joint Venture is actively considering a potential appraisal well in the mid-Galoc area to confirm the commerciality of a potential Phase III development. In this context the Joint Venture continued to progress relevant sub-surface and preliminary engineering studies.