Elixir Petroleum Limited : Quarterly Activities and Cashflow Report

ASX ANNOUNCEMENT

31 October 2013

QUARTERLY ACTIVITIES REPORT FOR THE PERIOD ENDED 30 SEPTEMBER 2013

HIGHLIGHTS

Renewal application for Moselle Permit has been submitted

Amended farmout terms agreed for Elixir's UK North Sea licence Fully underwritten entitlement issue raised approximately $1.85m Sam Willis appointed as non-executive director to the Board

Elixir Petroleum Limited (ASX:EXR) ("Elixir" or "Company") holds interests in exploration licences onshore France and in the UK North Sea, and in a production lease located in the Gulf of Mexico.
A summary of the Company's activities for the September 2013 quarter is set out below.

EXPLORATION

Project Name: Moselle Permit Location: North-eastern France Ownership: 100% Working Interest

Elixir continued its efforts to secure a partner to pursue the considerable conventional prospectivity within the Moselle permit on acceptable commercial terms. A number of parties have expressed some interest but none of these discussions have progressed to a meaningful stage at this juncture and it is uncertain if an acceptable deal will be reached in the near term. The feedback from various parties is that the jurisdiction and regulatory environment continues to be challenging and thus creates an impediment to attracting a farminee.
The Moselle Permit's initial five year exploration period is due to expire in January 2014, and accordingly a renewal application was lodged in early September 2013 with the relevant French authorities in accordance with a process prescribed by the French Mining Code. As required by the Mining Code, Elixir has identified areas comprising approximately 50% of the permit which will be relinquished upon entering Moselle's second 5-year exploration term. These areas cover the shallow flanks of the Saar-
Lorraine Basin, with the acreage to be retained comprising approximately 2,660 km2 of the central part of the basin and the areas considered most prospective for both conventional and unconventional hydrocarbons (including all of the conventional structural prospects and leads mapped in the permit to date). Under the Mining Code, permits are renewed based on maintaining the current period expenditure per kilometre per year which Elixir has committed to over the second five year exploration period. All obligations relating to the first exploration period have been met and the Company expects the extension
into a second exploration period to be forthcoming in due course. It is noted that it is likely to be some
time prior to the renewal extension being formally granted / approved due to the process involved.

Project Name: Sunset Prospect (Blocks12/18 and 12/19c)

Location: Inner Moray Firth UK North Sea

Ownership: 75% Working Interest, proposed to reduce to 20% non-operated Working

Interest
In December 2012, Elixir announced the farmout of the Sunset Prospect to Adriatic Oil Plc ("Adriatic"). Under the terms of the farmout, Adriatic was assigned a 25% participating interest in the licence in consideration for funding the cost of interpreting newly purchased 3D seismic data over the blocks
ASX CODE: EXR www.elixirpetroleum.com

Elixir Petroleum Limited

ABN 51 108 230 995

Level 3, 89 St George's Terrace

PERTH WA 6000, AUSTRALIA

T: +61 8 9226 2111 F: +61 8 9226 2099 E: info@elixirpetroleum.com
up to an agreed maximum value, together with a cash contribution towards Elixir's prior costs on the
project.
In September 2013, Elixir announced an amendment to the original farmout agreement. Under the amended terms of the farmout, and subsequent to the quarter, Adriatic was assigned a further 55% participating interest (resulting in a total 80% Adriatic participating interest) in the Licence in consideration for fully funding re-processing of the acquired 3D seismic data, and interpretation of the re- processed data. In addition, all costs related to any farm-out required to fulfil the licence's drill or drop requirements before February 2014 will be borne solely by Adriatic.
Elixir will retain a 20% participating interest (free carried until the drill or drop decision).

DEVELOPMENT AND PRODUCTION

Project Name: High Island Project (Block 268-A)

Location: High Island Area, Offshore Texas, USA

Ownership: 30% Working Interest (22.5% Net Revenue Interest)

The High Island field is located approximately 60 kilometres offshore the east Texas coast in the Gulf of Mexico. The field commenced production in September 2007 from two wells and has produced to date in excess of 4.2 billion cubic feet ("Bcf") of gas and approximately 195,000 barrels ("Bbls") of condensate (100% project).
The following table summarises the production achieved from High Island during the September 2013 quarter:

Elixir is currently considering its options with respect to its continued involvement with the High Island project, which is near the end of its economic life, and which may include divestment of the Company's working interest in the Project or withdrawal from the Joint Venture with the resultant crystallisation of abandonment liabilities

FINANCIAL SUMMARY AND OTHER MATTERS

The Company undertook a capital raising at the start of the reporting period in July 2013. Elixir raised approximately $1.85 million (before costs) via a fully underwritten non-renounceable rights issue. As a result of priority sub-underwriting of the issue, the Company's largest shareholder, New Standard Energy Limited (ASX:NSE), increased its ownership stake in the Company to 28.2%.
Following the completion of the fundraising the Board undertook a review of its composition and structure, and agreed to appoint Mr Sam Willis (a non-executive director of NSE) as a non-executive director to the Board. Contemporaneously with this appointment Mr John Robertson indicated that he would not be seeking re-election to the Board at the upcoming annual general meeting of the Company.
2
Further to the appointment of Mr Willis, the Board is in the process of a strategic review to determine the best way of enhancing shareholder value.
At the end of the reporting period, the Company held cash on hand of approximately $2.2 million. The
Elixir Group remains debt free.
Please find attached the Company's Appendix 5B for the 3 month period to 30 September 2013. Yours sincerely,

ELIXIR PETROLEUM LIMITED

Nicholas Ong

Company Secretary

For further information, please visit the Company's website at www.elixirpetroleum.com
3

Rule 5.5

Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/2013

Name of entity

ELIXIR PETROLEUM LIMITED

ABN Quarter ended ("current quarter")

51 108 230 995 30 September 2013

Cash flows related to operating activities

1.1 Receipts from product sales and related debtors

1.2 Payments for (a) exploration & evaluation

(b) development

(c) production

(d) administration

1.3 Dividends received

1.4 Interest and other items of a similar nature received

1.5 Interest and other costs of finance paid

1.6 Income taxes paid

1.7 Other (provide details if material)

Net Operating Cash Flows

+ See chapter 19 for defined terms.

01/05/2013 Appendix 5B Page 1

1.23 Aggregate amount of payments to the parties included in item 1.2

1.24 Aggregate amount of loans to the parties included in item 1.10

Current quarter

$A'000

61

-

1.25 Explanation necessary for an understanding of the transactions

Directors fees, salaries and professional consultancy fees. All are on arms-length commercial terms.

2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

N/A

2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

N/A

+ See chapter 19 for defined terms.

Appendix 5B Page 2 01/05/2013

Add notes as necessary for an understanding of the position.

3.1 Loan facilities

3.2 Credit standby arrangements

4.1 Exploration and evaluation

4.2 Development

4.3 Production(1)

4.4 Administration

(1)Estimated cash inflows from production amounting to $76,000 have been offset against estimated cash outflows to arrive at the net cash outflow position of $7,000.

Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.

+ See chapter 19 for defined terms.

01/05/2013 Appendix 5B Page 3

6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed

6.2 Interests in mining tenements and petroleum tenements acquired or increased

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

7.5 +Convertible debt securities (description)

+ See chapter 19 for defined terms.

Appendix 5B Page 4 01/05/2013

7.6 Changes during quarter

(a) Increases

through issues (b) Decreases through securities matured, converted

7.13 Unsecured notes (totals only)

1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 5).

2 This statement does give a true and fair view of the matters disclosed.

Sign here: ............................................................ Date: 31 October 2013 (Company secretary)

Print name: Nicholas Ong

+ See chapter 19 for defined terms.

01/05/2013 Appendix 5B Page 5

1 The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

2 The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements and petroleum tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement or petroleum tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.

4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of

Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.

5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

== == == == ==

+ See chapter 19 for defined terms.

Appendix 5B Page 6 01/05/2013

distributed by