Start of well drilling operations

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the Rocky Mountain oil and gas company focused on responsible resource development and carbon-neutral operations, is pleased to announce the spud and start of the main drilling operation on the State 36-2 LNW-CC-R well (the "well") at Zephyr's flagship project in the Paradox Basin, Utah, U.S. (the "Paradox project").

Further to the Company's announcement on 17 April 2024, the rig-up operation for the Helmerich & Payne Rig 257 (the "Rig") was completed yesterday, 24 April, and shortly thereafter the surface section of the well was spud.

Figure 1: Helmerich & Payne Rig 257 in situ at the Paradox project

The well, for which the Company expects to recover substantially all the drilling costs incurred through the well control insurance policy that it had in place for the State 36-2 LNW-CC well (the "original well") will target the Cane Creek reservoir and the highly productive natural fracture system encountered by the original well. Drilling is planned to a total depth ("TD") of 10,362 feet measured depth (9,600 feet true vertical depth) and will incorporate a short, 270-foot horizontal reservoir section. The well has been designed and permitted such that the horizontal section can be extended to a further 10,000 feet in the Cane Creek reservoir, should that be required in the future.

Drilling operations are expected to take approximately 30 days. After reaching TD and setting a production liner, the Rig will be demobilised and the well will be prepared for production testing.

Colin Harrington, Zephyr's CEO commented: "After months of meticulous planning we are delighted to have commenced full drilling operations with the prime objectives of delivering a safe and timely drilling operation followed by a successful well test.

"We look forward to providing regular updates as drilling progresses."

Dr Gregor Maxwell, BSc Hons. Geology and Petroleum Geology, PhD, Chief Operating Officer of Zephyr Energy plc, who meets the criteria of a qualified person under the AIM Note for Mining and Oil & Gas Companies - June 2009, has reviewed and approved the technical information contained within this announcement.