Reserves and Resources

Sproule International Limited prepared the Sproule Garmian Report relating to the Company’s crude oil Reserves and certain Prospective Resources on the Garmian Block as at December 31, 2015; and the Sproule Kurdamir Report relating to certain Contingent and Prospective Resources on the Kurdamir Block as at December 31, 2015.

Sproule performed an evaluation for the Company’s proved, proved plus probable, and proved plus probable plus possible oil Reserves on the Garmian Block and an audit of the Company’s P50 estimate of certain remaining Prospective Oil Resources in the Jeribe/Upper Dhiban reservoir, on the Garmian Block as at December 31, 2015, including 13 MMbbl of 2P light oil Reserves (Gross Block) and an additional 66 MMbbl of unrisked Prospective Resources of oil, Gross Block P50 estimate. No gas reserves have been assigned, as gas is currently only used for fuel and flare and there are no commercial arrangements for gas sales.

Sproule also performed an audit of the Company’s P50 estimate of the Contingent Resources and Prospective Resources in the Oligocene reservoir on the Kurdamir Block as at December 31, 2015, including 366 MMbbl of unrisked Contingent Resources of oil, 1.8 Tcf of unrisked Contingent Resources of gas, 55 MMbbls of unrisked Contingent Resources of condensate, 1 billion barrels of unrisked Prospective Resources of oil and 1 Tcf of natural gas (all Gross Block P50 estimates).

No additional projects have been defined at this time in respect of the estimates of Contingent Resources and Prospective Resources pertaining to other reservoirs for the Garmian and Kurdamir blocks, including the Kurdamir Eocene and Cretaceous reservoirs, the Sarqala Mio-Oligocene, Eocene and Cretaceous reservoirs, and the Mil Qasim Upper Fars reservoir. As such, the Company did not request Sproule to conduct an updated audit of the Company’s prior resource estimates for these reservoirs.