Xstate Resources : Settlement of Red Earth Oil Production Asset Acquisition

ABN: 96 009 217 154

Announcement to ASX

26 March 2021

Settlement of Red Earth Oil Production Asset Acquisition

Xstate Resources (ASX:XST ("Xstate" or "the Company") is pleased to advise that it has settled the acquisition of a 25% interest in the Red Earth oil producing assets in Canada, acquired from Blue Sky Resources Limited (Blue Sky).

Red Earth Assets

Level 1, 31 Cliff Street, Fremantle WA 6959 | Tel + 61 8 9435 3200 | Fax [phone] | www.xstate.com.au

ABN: 96 009 217 154

As reported in the ASX release dated 20 November 2020, the Red Earth assets consists of 6 oilfields and associated infrastructure, located 450 km north of Edmonton. At the date of closing the fields were producing 1070 BOEPD (gross), of which XST's share is 268 BOEPD (net).

Xstate Managing Director, David McArthur commented: We are pleased to have completed the acquisition and look forward to significantly increasing production. We note that the price of WTI oil has risen from US$42.40 to US$60.00 over time period from acquisition announcement to settlement, making this an extremely valuable purchase."

This release is authorised by the board of the company.

David McArthur Managing Director [phone]

About Xstate Resources Limited

Xstate Resources (ASX Code: XST) is an ASX listed company focused on the oil and gas sector. The Company has existing assets located in the Sacramento Basin in California and associated production interests together with production interests in Alberta Canada. Xstate is presently pursuing new opportunities in the oil and gas sector in North America.

Level 1, 31 Cliff Street, Fremantle WA 6959 | Tel + 61 8 9435 3200 | Fax [phone] | www.xstate.com.au