Aeromagnetic Survey

A programme whereby the magnetic character of the rocks is measured by an airborne instrument

Anticline

A convex upwards fold in rocks.

ASX

Australian Stock Exchange Limited

AVO

Amplitude versus offset - a seismic processing method that is used to detect hydrocarbons

Basement

Unprospective rocks generally underlying a sedimentary basin

Basin

A depression of large size in which sediments have accumulated

Bbl

Barrel, a measure of volume equal to 42 US gallons

Bcf

Billion cubic feet

BOE

Barrel of oil equivalent, gas is converted to boe by dividing the mcf of gas by 6.

Bopd

Barrels of oil per day

Bwpd

Barrels of water per day

Compression

Earth movement resulting from crustal shortening

Cretaceous

A period of geological history about 65 to 141 million years ago

Farmout Agreement

An agreement by which an interest is assigned and/or transferred in an exploration or production permit to an incoming participant whereby that participant earns that interest by funding all or part of the exploration and development costs of the permit

Fault

A displacement in rocks whereby rocks have moved relative to each other

Fluorescence

A glowing effect from UV light indicative of hydrocarbon shows

Fluvial

Derived from river action

Flysch

A poorly sorted sediment that has been deposited in a rapidly subsiding basin

Formation

The primary unit based on the physical features of rock strata consisting of a succession of rocks and is a term useful for mapping or description

Graben

A region of sedimentary section that is laterally bound by down to the basin faults

Horst

An uplifted structure with its lateral boundaries controlled by normal faults

JOA

Joint Operating Agreement

L&M Energy

L&M Energy Limited ARBN 122 323 871

Lime and Marble

Lime and Marble Limited (CN 166586) a company incorporated in New Zealand on 3 July 1939

m

Metre/Metres

mcf

one thousand cubic feet

md

Millidarcy - a measure of permeability being the ability of a fluid to pass through rock

mj/cm

Megajoule per cubic metre

mmbbls

One million barrels

NZSX

New Zealand Stock Market operated by NZX

NZX

New Zealand Exchange Limited

NZSC

New Zealand Securities Commission, established under the Securities Act 1978 of New Zealand

PEP

A New Zealand petroleum exploration permit granted to L&M Energy under the Crown Minerals Act 1991

PJ

One petajoule

Porosity

Pore space between grains in a rock expressed as a percentage of rock volume

Prospect

An undrilled trap outlined with adequate geological and geophysical control

Reservoir

A pervious and porous rock capable of containing hydrocarbons

Seal

An impermeable rock that prevents the passage of hydrocarbons

Share Registrar

Computershare Investor Services Pty Limited ABN 48 078 279 277 or Computershare Investor Services Limited

Shares

Fully paid ordinary shares in the Company

Solander Basin

Means a depression of large size in which sediments have accumulated offshore the Western Southland region of the South Island of New Zealand due west of Stewart Island

Te Anau Basin

A depression of large size in which sediments have accumulated in the Te Anau area of the Western Southland region of the South Island of New Zealand

Tertiary

A period of geological time between 1 and 65 million years ago

TOC

Total Organic Carbon

Trap

A body of reservoir rock, vertically or laterally sealed, the attitude of which allows it to retain hydrocarbons

Turbidite

A sediment deposited by water based current in deep oceans

Unconformity

An absence in parallelism between juxtaposed rocks caused by uplift, erosion or a break in sedimentation

Waiau Basin

A depression of large size in which sediments have accumulated in the Western Southland region of the South Island of New Zealand, north west of Invercargill

Waiau JOA

The Joint Operating Agreement dated 30 August 2006 entered into by the Company and Mighty River Power Limited (MRP) in relation to the whole of PEP 38226

Western Southland Basin

A depression of large size in which sediments have accumulated in the Western Southland region of the South Island of New Zealand which comprises the Te Anau Basin, Waiau Basin, Solander Basin, Waitutu Basin, Balleny Basin and the Puysegur Basin.