Hawk Resources Limited

ABN 20 119 323 385

To be renamed:

N E W S T A N D A R D ENER G Y L T D

PROSPECTUS 2008

Prospectus for the offer of 32,500,000 shares at an issue price of $0.20 each to raise $6,500,000. Oversubscriptions of up to a further 5,000,000 shares at an issue price of $0.20 each to raise up to a further $1,000,000 may be accepted. This Prospectus also contains a separate offer to the holders of securities in New Standard Energy Ltd. IMPORTANT INFORMATION: This is an important document that you should read in its entirety. If you do not understand it, you should consult your professional advisor without delay. The Shares offered by this Prospectus should be considered speculative. This Prospectus is a short form prospectus issued in accordance with Section 712 of the Corporations Act. This prospectus does not of itself contain all the information that is generally required to be set out in a document of this type but refers to another document the information of which is deemed to be incorporated in this Prospectus.
CYGNET CA PI TA L

LEAD M AN AG ER AN D CORP ORAT E ADVISOR TO THE ISSUE

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Harry Hill Winton Willesee Mark Elliott

CORPORATE DIRECTORY

CURRE NT DIR E CTO RS

S O L I C I T O R S TO T H E C O M PA N Y
Steinepreis Paganin Lawyers & Consultants Level 4, Next Building 16 Milligan Street P E R T H W A 6 0 00

PR O P OS ED DI RECTO RS
Gordon Hill Non-Executive Chairman Sam Willis Executive Director Dr Mark Hagan Technical Director Ian Paton Non-Executive Director

I N V E S T I GAT I N G A C C O U N TA N T
BDO Kendalls Corporate Finance (WA) Pty Ltd 128 Hay Street SUBIACO WA 6008

C O MPA N Y S E C R E TA R Y
Winton Willesee

AUDITO RS
Leydin Freyer Corporate Pty Ltd Chartered Accountants Suite 304 2 2 S t Ki l d a R o a d S T K IL D A V I C 3 1 8 2

P R O P O S E D C O M PA N Y S E C R E T A R Y
Mark Clements

REGISTERED OFFICE
Level 16 190 Queen Street M EL B O U R N E VI C 3 0 0 0 Telephone: (03) 9602 4133 Facsimile: (03) 9670 6643

I N D E P E N D E N T G E O LO G I S T
Resource Invest Pty Ltd P O B o x 1 25 BEACONSFIELD TAS 7270

SHARE REGISTRY
Security Transfer Registrars Pty Ltd 770 Canning Highway Applecross W estern Australia 6153 P O B o x 5 35 Applecross W estern Australia 6953 Telephone: (08) 9315 2333 Facsimile: (08) 9315 2233

C O R P O R AT E AD V I S O R A N D M A N A G E R OF THE OFFER
Cygnet Capital Pty Ltd Ground Floor 30 Richardson Street W E S T P E R T H W A 60 05

I N V E S TM E N T H I G H L I G H TS A N D R I S K S

INVE S TM E NT HIG HLIG HTS

Dominant acreage position within the Canning Basin supported by a large information database from previous and current exploration efforts. In excess of 130 giant and super-giant oil and gas fields exist globally that exhibit similar source rock, structural trap, reservoir, seal and timing characteristics to the Canning Basin. Canning Basin contains proven petroleum systems that remain significantly under-explored. NSE has a very focused exploration approach across its acreage containing two proven petroleum systems: The Ordivician/Silurian system predominantly targeting the pre s alt res ervoir of the Ac acia Sandstone overlain by the rich Goldwyer source rock. The Devonian/Carboniferous system predominantly targeting the post salt reservoir of the Laurel Sandstone sourced by the Laurel shales.

IN VE S TM E N T R IS K S
The investment highlights are a summary only and must be read in conjunction with the remainder of the Prospectus. In particular, investors are directed to Section 13 of this Prospectus which sets out the risks associated with making an investment in the Company. The key risks associated with an investment in the Company include: E x p l o r a ti o n r i s k o i l a n d g a s e x p l o r a ti o n i s inherently risky. Title risk if permit conditions are not met, or if insufficient funds are available to meet expenditure commitments, NSE could lose title to or its interest in its permits. There is no guarantee that applications for, o r c o n v e r s i o n s o r re n e w a l s o f , t h e e x p l o r a t i o n p e r m i t s in which NSE has an interest will be approved as and when sought. F ut ur e c a pi t al r is k - n o as s u r anc e c a n b e gi v e n t h at future funding will be available to the Company on favourable terms (or at all). If adequate funds are not available on acceptable terms, the Company may not be able to further develop its projects. Key personnel risk the Companys success largely depends on the core competencies of its directors, and their familiarisation with, and ability to operate in, the petroleum exploration and extraction industry. In its initial stages, the Company will rely heavily upon Mr Sam Willis and Dr Mark Hagan. Price of oil risk - the fluctuation of the price of oil (and to a lesser extent gas) could have a significant impact on the value of the investment being considered. Avai l abi l i ty of res o urces ri s k - res ou rces re q uire d to undertake the intended work may not be able to be secured in the timeframes required or at a reas onable cost.

ARC Energy Ltd, through its wholly owned subsidiary Buru Energy Ltd, secured as a cornerstone investor and farm-in partner. Powerful technical team comprising proven oil finders with substantial exploration and developm ent e x p e r ti s e . Immediate drill ready prospects pursuing large targets a t s h a l l o w d e p t h s w i t h n u m e ro u s a d d i t i o n a l l e a d s f o r progression within the portfolio. Broad acreage providing longer term upside potential. Geological risk reduced through understanding a proven petroleum system. Geologically diverse range of targets and leads within the NSE portfolio. Favourable oil and gas prices making exploration attractive and even small discoveries potentially highly economic. Relatively low cost on-shore exploration setting. Advanced discussions to secure a drill rig for 2008 drilling program.

I n v e s t m e n t s p e c u l a t i v e i n v e s t m e n t i n e x p l o r a ti o n companies is an inherently risky investment and potential investors should consider that the investm ent in the Company is speculative and should consult their professional advisors before deciding whether to apply for securities pursuant to this Prospectus

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Dear Investor,

C H A I R M A N S L E TT E R

On behalf of both the current and proposed directors of Hawk Resources Limited (to be renamed New Standard Energy Ltd) (Hawk or the Company), we are pleased to present this Prospectus and to offer you the opportunity to either become a shareholder in the Company or to increase your investment if you are an existing shareholder. Hawk has recently announced the execution of an implementation agreement with New Standard Energy Ltd (New Standard) whereby the two com panies will effectively merge, subject to shareholder approval, following the com pletion of Hawk acquiring 100% of the issued capital of New Standard by Hawk. In conjunction with this, Hawk will change its nam e to New Standard Energy Limited, the board and management of New Standard will replace the existing Hawk board and the combined entity will raise a minimum of $6.5m (with the right to accept an additional $1.0m) in additional funds pursuant to the priority offers and general offer being made under this Prospectus. The new direction to be pursued by the Company is oil and gas exploration initially focused in the Canning Basin, onshore Western Australia. The acquisition of New Standard will provide access to an attractive industry with oil prices at record highs of well in excess of US$120 per barrel. New Standard also provides exposure to a highly prospective (yet vastly underexplored) acreage portfolio set in a region with proven petroleum systems that are known to host oil and gas, res ulting from over 15 2 years of effort to accumulate a contiguous land holding that now represents in excess of 90,000km of well positioned and prospective acreage. Importantly, New Standard has also secured a large and credible cornerstone investor and farm-in partner in ARC Energy Ltd (through its wholly owned subsidiary Buru Energy Ltd) to assist in exploring the Canning Basin. The proposed board and management will provide a strong technical and corporate team to drive and grow your Company over future years. Technically it will be lead by Dr Mark Hagan and Ian Paton, both of whom are highly credentialed and successful oil finders with in excess of 35 years industry experience each, and corporately Sam Willis has had in excess of 10 years corporate advisory and small company development experience. W e would also like to take this opportunity to thank Winton W illesee and M ark Elliott as retiring board m em bers for their valuable contributions to the Com pany over the past 12 m onths. Completion of the acquisition of New Standard as contemplated by the implementation agreement is, amongst other things, conditional upon various shareholder approvals being sought at the upcoming shareholder meeting scheduled for mid July 2008. The transaction and the resultant change in activities whilst exciting, also involves a number of risks that have been set out in this prospectus so please read the prospectus carefully before making your investment decision. On behalf of the current and proposed directors we recommend this investment to you and look forward to your involvement as a Shareholder going forward. Yours sincerely

H a r r y H i ll C H A I R MA N 17 June 2008

Gordon Hill PROPOSED CHAIRMAN

C ON T EN T S

CORPORATE DIRECTORY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 INVESTMENT HIGHLIGHTS AND RISKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

CHAIRMANS LETTER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 IMPORTANT NOTICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

3 4 5 6 7 8 9

INVESTMENT OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 DETAILS OF THE OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 NEW STANDARD ENERGY OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 INDEPENDENT GEOLOGISTS REPORT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 INFORMATION DEEMED TO BE INCORPORATED IN PROSPECTUS . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 COMPANY ACTIVITIES SINCE LISTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 INVESTIGATING ACCOUNTANTS REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

10 SOLICITORS REPORT ON PERMITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 11 PROPOSED DIRECTORS AN D CORPORATE GOVERNANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 12 MATERIAL CONTRACTS OF NEW STANDARD ENERGY AND HAWK . . . . . . . . . . . . . . . . . . . . . . . . . . 67 13 RISK FACTORS RELATING TO NEW STANDARD ENERGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 14 FURTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74 15 DIRECTORS AND PROPOSED DIRECTORS AUTHORISATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 16 GLOSSARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 17 OFFER TO SHAREHOLDERS OF NEW STANDARD ENERGY LTD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 GENERAL OFFER APPLICATION FORM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 ARC PRIORITY OFFER APPLICATION FORM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90 HAWK PRIORITY OFFER APPLICATION FORM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92

IMPORTANT NOTICE

This Prospectus is dated 17 June 2008 and was lodged with the ASIC on that date. The ASIC and its officers take no responsibility for the contents of this Prospectus or the merits of the investment to which the Pros pectus relates. The expiry date of this Prospectus 5.00pm WST on that date which is 13 months after the date this Prospectus was lodged with the ASIC (Expiry Date). No securities may be issued on the basis of this Prospectus after the Expiry Date. Application will be made to ASX within seven (7) days after the date of this Prospectus for Official Quotation of the Shares the subject of this Prospectus. The distribution of this Prospectus in jurisdictions outside A u s tr a l i a m a y b e r e s tr i c t e d b y l a w a n d p e r s o n s w h o come into possession of this Prospectus should seek advice on and observe any of these restrictions. Failure to comply with these restrictions may violate securities laws. Applicants who are resident in countries other than Australia should consult their professional advisors as to whether any governmental or other consents are required or whether any other formalities need to be considered a n d f ol l o w e d. This Prospectus does not constitute an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer. It is important that investors read this Prospectus in its entirety and seek professional advice where necessary. The securities the subject of this Prospectus should be considered speculative.

(i) the rights and liabilities attaching to the Shares; (ii) the capacity of the Company to issue the Shares; and ( i i i ) t h e a s s e t s a n d l i a b i l i t i e s , fi n a n c i a l p o s i t i o n a n d performance, profits and losses and prospects of Hawk Resources and NSE; (b) refers investors and their professional advisors to section 7 of this Prospectus which summarises the information in the IPO Prospectus deemed to be incorporated in this Prospectus; (c) refers investors and their professional advisors to section 10 of this Prospectus which summarises the inform ation in the Solicitors Permit Report deem ed to be incorporated in this Prospectus; (d) informs investors and thei r professional advisors that they are able to obtain, free of charge, a copy of the IPO Prospectus and the Solicitors Permit Report by contacting the Company at its registered office during normal business hours during the Offer Period; and (e) advises that the information in the IPO Prospectus and the Solicitors Permit Report will be primarily of interest to investors and their professional advisors or analysts.

W E B S I T E E L E CT RO NI C P RO S P E CT U S
A copy of this Prospectus can be downloaded from the website of the Company at www.hawkresources.com.au or from the NSE website at www.newstandard.com.au. Any person accessing the electronic version of this Prospectus for the purpose of making an investment in the Company must be an Australian resident and must only access the Prospectus from within Australia. The Corporations Act prohibits any person passing onto another person an application form unless it is attached to a hard copy of this Prospectus or it accompanies the complete and unaltered version of this Prospectus. Any person may obtain a hard copy of this Prospectus free of charge by contacting the Company.

SHO RT FO RM PRO S P E CTUS

This Prospectus is a short form prospectus issued in accordance with section 712 of the Corporations Act. This means this Prospectus alone does not contain all the information that is generally required to satisfy the disclosure requirem ents of the Corporations Act. Rather, it incorporates all other necessary inform ation by reference to information contained in the IPO Prospectus lodged with ASIC on 29 June 2007 and the Solicitors Permit Report dated 6 June 2008 lodged with ASIC immediately prior to this Prospectus. In referring to the IPO Pros pectus and the Solicitors Permit Report, the Company: (a) identifies the IPO Prospectus and the Solicitors Permit Report as being relevant to the offer of Shares under this Prospectus and containing information that will provide investors and their professional advisors to assist them in making an informed assessment of:

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3.1 3.2

IN V E S T M E N T OVERVIEW

I M P O R TA N T NO T I C E

This section is not intended to provide full inform ation for investors intending to apply for Shares offered pursuant to this Prospectus. This Prospectus should be read and considered in its entirety.

risks and project equity. In so doing, the Company aims to provide all Shareholders with the opportunity for attractive investment returns commensurate with the investment risk involved. The Company will continue with the exploration and evaluation of New Standard Energys onshore Canning Basin acreage portfolio in the pursuit of com m ercial oil and gas accumulations. On completion of the Offer, the Board believes the Company will have s ufficient working capital to ac hieve these objectives.

OFFERS UNDER T HIS PRO SPECT US

This Pros pectus contains the followi ng offers: (a) two priority offers and a general offer to the public to subscribe for 32,500,000 Shares at $0.20 cents each to raise $6,500,000 on the terms set out in this Prospectus (Offer). Refer to section 4.4 of this Prospectus for details; and (b) an offer to all shareholders of New Standard Energy Ltd (ABN 78 063 635 325) (New Standard Energy or NSE) to acquire all of their shares in New Standard Energy on the terms set out in this Prospectus (New Standard Offer). Refer to section 4.8 of this Pros pectus for details. If the New Standard Offer becomes unconditional and is completed, New Standard Energy will become a wholly owned subsidiary of the Company and will change its name to New Standard Exploration Ltd to allow the Company to adopt the name New Standard Energy Ltd. The Offer is conditional, amongst other things, on the New Standard Offer becoming unconditional (refer to Section 4.2 of this Prospectus). As such, this Prospectus contains statements in relation to the Company that presume the Company is the parent company of New Standard Energy. In the event the New Standard Offer does not become unc onditional within four (4) months after the date of this Prospectus and therefore the Company does not become the parent company of New Standard Energy, the Offer will lapse and all applications will be dealt with in accordance with the Corporations Act.

3.4

I N D I CAT I V E T I M E TA B L E
17 June 2008 16 June 2008 5.00pm WST 17 June 2008 7 July 2008 5.00pm WST 14 July 2008 5.00pm WST 22 July 2008 28 July 2008

Lodgement of Prospectus with the ASIC Record Date for Priority Offers Opening Date Priority Offers Closing Date General Offer Closing Date Despatch of Holding Statements Expected date for listing on ASX

These dates are indicative only and may vary. Applicants are encouraged to submit applications as soon as possible after the Opening Date.

3.5

PURPOS E OF THE OFFER A ND USE OF PROCEEDS

It is intended to apply funds raised from the Offer (together with existing cash reserves of $5,300,000) as follows over the next 12-24 months (assuming the Offer is fully subscribed to raise $6,500,000 and the Company acquires New Standard Energy under the New Standard Offer):
Use of Proceeds EP417 drilling EP442(A) drilling Seismic acquisition and reprocessing Expenses of issue Project generation Working capital and corporate overheads Total Dollars 6, 556, 000 2, 000, 000 1, 270, 000 625, 000 194, 000 1, 155, 000 11,800,000

3.3

OB J E C T I V E S

The strategic objective of the Company, presuming it acquires New Standard Energy in accordance with the New Standard Offer, is to system atically explore the Canning Basin acreage held by New Standard Energy with a v i e w t o s uc c es s f ul l y i d e nt if y i ng a m aj or oil pr ov i nc e and, if successful, progressing from pure explorer to developer and producer. Being a very large landholder, the Company, via New Standard Energy, intends to approach the exploration of the Canning Basin through a mi xture of Company work and joint venture partner contributions resulting in appropriate levels of dilution of both funding

Notes: (a) NSE will initially pursue EP417 and EP442 (A) on a 100% equity basis whilst continuing to progress discussions that are currently underway regarding farm-out of some of the work commitments on EP417 (2 wells) and EP442(A) (1 well and seismic) as described in Section 5.13 of this Prospectus. (b) EP417 drilling is currently focused on Lanagan A and Lanagan B. Res ults from Lanagan A or farm-out success may dictate that Lawford is drilled instead of Lanagan B as the second well and if this occurs costs are likely to change. It should be noted that the Company is actively discussing farm-out opportunities with potential partners and the successful completion of one or more of these negotiations may lead to changes in the relative amounts spent on the above activities by the Company over the next 12-24 months. In the event oversubscriptions (of up to $1,000,000 less additional costs of $60,000) are accepted they will be applied first to any drilling and/or seismic costs required and then to unallocated working capital. The table set out above is a statement of current intentions over the next 12-24 months as at the date of this Prospectus. As with any budget, intervening events (including exploration success or failure) may alter the way funds are actually applied. The Board reserves the right to vary the budget on this basis.

Notes:
1

Refer to Investigating Accountants Report for further information. Assumes that the Offer is fully subscribed (but that no Shares are allocated and issued for oversubscriptions). Should oversubscriptions be accepted then the number of shares on issue will increase by a maximum of 5,000,000 shares.

A total of 13,500,000 Management Options will be issued to the Proposed Directors. Refer to Section 14.1.2 for further details.
3 4

A total of 1,000,000 Promoter Options will be issued to Cygnet Capital. Refer Section 14.1.3 for further details.

Restricted securities Subject to the Company being admitted to the Official List, certain of the Shares issued to the NSE Shareholders, are likely to be classified by ASX as restricted securities and will be required to be held in escrow.

3.6

CA P I TA L S T R U C T U R E

The capital structure of the Company following completion 1 of the Offer is summarised below :
Shares Shares on issue at date of Prospectus Shares now offered Acquisition of New Standard Energy Total Shares on issue at completion o f th e O f f e r2 Options Options on issue at date of Prospectus Management Options3 Promoter Options4 Total Options on issue at completion of the Offer 13, 800, 000 13, 500, 000 1, 000, 000 28,300,000 Number 33, 637, 501 32, 500, 000 70, 405, 508 136,543,009

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4.1 OFFER

DETAILS OF T H E O F F ER S

By this Prospectus, the Company offers for subscription 32,500,000 Shares at $0.20 cents each to raise $6,500,000 (Offer). In addition, the Directors res erve the right to accept oversubscriptions of up to 5,000,000 shares at 20c each to raise up to an additional $1,000,000. The Offer consists of: (a) a Priority Offer to Shareholders of ARC Energy Limited (ABN 74 009 204 031) (ARC) (ARC Priority Offer); (b) a Priority Offer to Shareholders of Hawk (Hawk Priority Offer); and (c) a General Offer to the public (General Offer). The Shares offered under this Pros pectus will rank equally with the existing Shares on issue.

that those ARC Shareholders who validly apply for shares as part of the ARC Priority Offer will receive a minimum allocation of 25,000 shares (ie $5,000 parcels) with proportional scale backs to apply for any applications above this amount should they be required. Priority Offer to Hawk Shareholders Of the 32,500,000 Shares being offered, 2,500,000 Shares will be offered in priority to shareholders of Hawk registered as at the Record Date on a first come first served basis. To the extent that subscriptions from existing Hawk shareholders exceed 2,500,000 Shares, the excess applications will be considered after Shares have been allotted to ARC shareholders under the ARC Priority Offer and to the public under the General Offer. Applications for the Hawk Priority Offer will be treated on a first come first served basis. To the extent possible, the Company intends to apply an allocation policy such that those Hawk Shareholders who validly apply for shares as part of the Hawk Priority O ffer will rec eive a minim um allocation of 25,000 shares (ie $5,000 parcels) with proportional scale backs to apply for any applications above this amount should they be required. General Offer The pool for the General Offer will be a minimum of 15,000,000 Shares, with the balance of any Shares not applied for by ARC shareholders or Hawk shareholders under the relevant priority offers also forming part of the pool for the General Offer. In the event that subscriptions for the General Offer exceed 15,000,000 Shares, the Company may accept oversubscriptions of up to a further 5,000,000 Shares under the General Offer. A p pl ic at i o ns Applications for Shares under the ARC Priority Offer must be made using the blue ARC Priority Offer Application Form. Applications for Shares under the Hawk Priority Offer must be made using the green Hawk Priority Offer Application Form. Applications for Shares under the General Offer must be made using the General Offer Application Form. Payment for the Shares must be made in full at the issue price of $0.20 cents per Share. Applications for Shares must be for a minimum of 25,000 Shares and thereafter in multiples of 5,000 Shares. Completed application forms and accompanying cheques must be mailed to:

4.2

CONDITIO NS O F T HE OF F ER

The Offer is conditional upon the Implementation Agreement becoming unconditional. The Implementation Agreement, and the conditions to which it is subject, are summarised in Section 12.1 of this Prospectus.

4.3

C O N S E Q U E N C E I F C O N D I T I O N S OF O F F E R NOT SAT I S F I E D

If the Implementation Agreement does not become unc onditional within four (4) months after the date of this Prospectus, or such longer period as is permitted by the Corporations Act, none of the Shares offered under the Offer under this Prospectus will be allotted or issued. In t h e s e c i r c u m s t a n c e s , a l l a p p l i c a ti o n s w i l l b e d e a l t w i t h i n accordance with the Corporations Act.

4.4

A P P L I CAT I O N F O R S H A R E S U N D E R THE O FFER

Priority Offer to ARC Shareholders Of the 32,500,000 Shares being offered, 15,000,000 Shares will be offered in priority to s hareholders of ARC registered as at the Record Date on a first come first served basis. To the extent that subscriptions from existing ARC shareholders exceed 15,000,000 Shares, the excess applications will be considered after Shares have been allotted to Hawk shareholders under the Hawk Priority Offer and to the public under the General Offer. Applications for the ARC Priority Offer will be treated on a first come first served basis. To the extent possible, the Company intends to apply an allocation policy such

Sec urity Transfer Registrars Pty Ltd PO Box 535, Applecross Western Australia 6953 or delivered to: Sec urity Transfer Registrars Pty Ltd 770 Canning Highway Applecross Western Australia 6153 Cheques should be made payable to Hawk Resources Ltd Subscription Account and crossed Not Negotiable. Com pleted application forms in res pect of the Priority Offers must reach one of the above addresses by no later than the relevant Priority Offer Closing Date. Completed application forms in respect of the General Offer must reach one of the above addresses by no later than the General Offer Closing Date.

4.8

N E W STA N D A R D E N E R GY O F F E R

By this Prospectus, the Company also makes a separate offer to all of the NSE Shareholders to acquire all of their shares in New Standard Energy on the terms set out in this Prospectus (New Standard Offer). It is a condition of the New Standard Offer that all NSE Shareholders accept the New Standard Offer. The full terms and conditions of the New Standard Offer are set out in Section 17 of this Prospectus. Only shareholders in NSE may accept the New Standard Offer. Accordingly, do not complete the Acceptance Form for the New Standard Offer unless you are a shareholder in NSE. If you wish to apply for Shares under the ARC Priority Offer, the Hawk Priority Offer or General Offer, please com plete the relevant Application Form. To accept the New Standard Offer you must complete the Acceptance Form accompanying this Prospectus in accordance with the instructions accompanying it and lodge the completed form at the Companys registered office on or before the New Standard Closing Date.

4.5

A L LO T M E N T O F S H A R E S U N D E R THE O FFER

Subject to ASX granting approval for the Companys securities to be reinstated to trading following completion of the acquisition of New Standard Energy and the s u c c e s s f u l r a i s i n g o f t h e m i n i m u m s u b s c r i p ti o n u n d e r t h e Prospectus, allotment of Shares offered under the Offer by this Prospectus will take place as soon as practicable after the General Offer Closing Date. Prior to allotment, all application monies shall be held by the Company on trust. The Company, irrespective of whether the allotment of Shares takes place, will retain any interest earned on the application monies. The Directors reserve the right to allot Shares in full for any application or to allot any lesser num ber or to decline any application. Directors may in their discretion give preference to Shareholders in accepting applications under the Offer. W here the number of Shares allotted is less than the num ber applied for, or where no allotment is m ade, the surplus application m onies will be returned by cheque to the applicant within seven (7) days of the allotment date.

4.9

AS X L IST ING

The Company will apply to ASX within seven (7) days after the date of this Pros pectus for re-admission to the Official List and for Official Quotation of the Shares offered under this Pros pectus. If ASX does not grant permission for Official Quotation of the Shares offered pursuant to this Pros pectus within three (3) months after the date of this Prospectus, or such longer period as is permitted by the Corporations Act, none of the Shares offered by this Prospectus will be allotted or issued. In t h e s e c i r c u m s t a n c e s , a l l a p p l i c a ti o n s w i l l b e d e a l t w i t h i n accordance with the Corporations Act.

4.10 A P PL ICA NT S O UT S IDE A UST RAL IA

This Prospectus does not, and is not intended to, constitute an offer in any place or jurisdiction where, or to any person to whom, it woul d not be lawful to m ake suc h an offer or to issue this Prospectus. The distribution of this Pros pectus i n j u r i s d i c ti o n s o u t s i d e A u s tr a l i a m a y b e r e s tr i c t e d b y l a w and persons who come into possession of this Prospectus should seek advice on and observe any such restrictions. Any failure to com ply with such restrictions m ay constitute a violation of applicable securities law. No action has been taken to register or qualify these Shares or otherwise permit a public offering of the securities the subject of this Prospectus in any jurisdiction outside Australia. It i s t h e r e s p o n s i b i l i t y o f a p p l i c a n t s o u t s i d e A u s tr a l i a t o obtain all necessary approvals for the allotment and issue of Shares pursuant to this Prospectus. The return of a completed application form will be taken by the Company to constitute a repres entation and warranty by the applicant that all relevant approvals have been obtained.

4.6

MINIM UM SUBSCRIPTION

The minimum amount to be raised pursuant to this Prospectus is $6,500,000. If the minimum amount has not been raised within 4 months after the date of this Prospectus, all applications will be dealt with in accordance with the Corporations Act.

4.7

OVERSUBSCRIPTIO NS

As stated in Section 4.4 of this Prospectus, in the event that subscriptions for the General Offer exceed 15,000,000 Shares, the Company may accept oversubscriptions of up to a further $1,000,000 through the issue of up to a further 5,000,000 Shares at an issue price of $0.20 each under the General Offer. The maximum amount which may be raised under this Prospectus is therefore $7,500,000.

4.11 NO UNDE RW RITING

The Offer is not underwritten. However, pursuant to an agreement with Cygnet Capital, the Company has agreed to pay Cygnet Capital a management fee of 0.5% and a capital raising fee of up to 5.5% of the funds raised in respect of Application Forms submitted to the Company bearing a broker stamp. Cygnet, may in its discretion, pay any other licensed dealer a fee out of these agreed fees. Pleas e refer to section 12.4 of this Pros pectus for further inform ation regarding the Cygnet Capital mandate.

4 . 1 4 P R I VA C Y ACT
If you complete an application for Shares, you will be providing personal information to the Company (directly or by the Companys share registry). The Company collects, holds and will use that inform ation to assess your application, service your needs as a shareholder, facilitate distribution of payments and corporate communications to you as a shareholder and carry out administration. The information may also be used from time to time and disclosed to persons ins pecting the register, bidders for your sec urities in the context of takeovers, regulatory bodies, including the Australian Taxation Office, authorised securities brokers, print service providers, mail hous es and the Company share registry. You can access, correct and update the personal information that we hold about you. Please contact the Company or its registry if you wish to do so at the relevant contact numbers set out in this Prospectus. Collection, maintenance and disclosure of certain personal inform ation is governed by legislation including the Privac y Act 1988 (as amended), the Corporations Act and certain rules such as the ASTC Settlement Rules. You should note that if you do not provi de the inform ation required on the application for Shares, the Company may not be able to accept or process your application.

4.1 2 CH ESS
The Company already participates in the Clearing House Electronic Subregister System (CHESS). CHESS is operated by ASX Settlement and Transfer Corporation Pty Ltd (ASTC), a wholly owned subsidiary of ASX, in accordance with the Listing Rules and the SCH Business Rules. Under CHESS, the Company will not issue certificates to investors. Instead, investors will receive a statement of their holdings in the Company. If an investor is broker sponsored, ASTC will send a CHESS statement.

4 . 1 3 R I S K FA C T O R S
Prospective investors in the Company should be aware that subscribing for Shares the subject of this Prospectus involves a num ber of risks. These risks are set out in Section 13 of this Prospectus and Section 4 of the IPO Prospectus and investors are urged to consider those risks carefully (and if nec essary, cons ult their professional advisor) before deciding whether to invest in the Company. The risk factors set out in Section 13 of this Prospectus and Section 4 of the IPO Prospectus, and other general risks applicable to all investments in listed securities not specifically referred to, may in the future affect the value of the Shares. Accordingly, an investment in the Company should be considered speculative.

4 . 1 5 F I N A N C I A L FO R E C A S T S
The Directors have considered the matters set out in ASIC Policy Statement 170 and believe that they do not have a reasonable basis to forecast future earnings on the basis that the operations of the Company are inherently uncertain. Accordingly, any forecast or projection information would contain such a broad range of potential outcom es and possibilities that it is not possible to prepare a reliable best estim ate forec ast or projection.

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5
5.1

NEW STANDARD ENERGY OVERVIEW

BACK G R O U N D

New Standard Energy was founded in 1994 to apply for a Special Prospecting Authority with an acreage option that initially covered substantial parts of the Kidson and Gregory Sub-Basins of the Canning Basin. Following an initial evaluation of the acreage area, the portfolio was trimm ed to encompass the most prospective areas that now form the basis of the NSE portfolio. The first of the permits (EP417) was granted in February 2000 and the remainder of the portfolio has gradually progressed through native title over recent years resulting in NSE currently owning 6 granted exploration permits. More recently, NSE has also been awarded application area 28/07-8 and has an option over a 50% interest in application area 30/07-8. Both of these acreage areas are in the Canning Basin and are contiguous to existing granted permits in the NSE portfolio. The portfolio now represents a substantial 2 holding extending over in excess of 90,000km . In September 2007, an agreement was executed with ARC Energy Limited (ARC) whereby ARC have the right to earn a 75% interest in EP442 (excluding EP442(A)), EP443, EP450, EP451 and EP456 through completing a cornerstone investment in NSE and then sole funding the cost of a seismic program to acquire 1,000km of 2D seismic data in addition to the drilling of 3 wells on the permits forming the NSE/ARC joint venture (ARC Farm-in Agreement). As at the date of this Prospectus, ARC is entitled to a 10% interest in these permits. For further information on the ARC Farm-in Agreement please refer to Section 12.2 of this Prospectus.

and despite the relative lack of well density and seismic data the prospects have sufficiently defined geological parameters such as source rock, reservoir presence and quality, structural development and timing that assist to reduce the exploration risk. Whilst NSE will be focusing on progressing and exploring its current Canning Basin portfolio, it will also be assessing appropriate opportunities to enhance and diversify the asset portfolio further over time.

5.3

E X P L O R AT I O N P H I L O S O P H Y

NSE is primarily focused on developing a portfolio of prospects that have the potential to contain significant o i l a c c u m u l a t i o n s . A l t h o u g h n o t a s h o r t t e r m fo c u s o f t h e Company, the acreage is also prospective for significant gas deposits. In the Canning Basin NSE is focussed on pursuing two specific reservoir targets in two proven petroleum systems, neither of which in the Proposed Directors opinion have been the subject of sufficiently valid tests. Further details of these targets and the petroleum systems can be found in Section 5.10 and the Independent Geologists Report in section 6 of this Prospectus.

5.4

C O R P O R AT E S T R AT E GY A N D FA R M- I N PA R T N E R S

5.2

AS S E T P O R T F O L I O

NSE currently holds an interest in 6 granted petroleum exploration permits (namely EPs 417, 442, 443, 450, 451 and 2 456) that cover in excess of 20 million acres (72,000km ) in the Canning Basin in the north-west of W estern Australia. Additionally, NSE has been awarded a 100% interest in application area 28/07-8 and has an option (expiring 5 November 2008) over a 50% interest in application area 30/07-8. Interests in both of these areas were awarded as part of a Canning Basin acreage release undertaken in March 2008 and are contiguous to existing granted permits in the portfolio. Including these areas the land holding 2 covers some 90,000km . The current asset portfolio is of a high risk, high reward nature with most pros pects having large potential oil in place (OIP) estimates. Despite the remote location, being an onshore exploration play, the portfolio is set in a relatively low cost exploration and production environm ent

To assist with pursuing its exploration philosophy, NSE has successfully secured a major farm-in partner in ARC who will earn an interest in a substantial portion of the permit portfolio through sole funding work commitments. This strategic partnership has assisted to place NSE in a relative position of strength to advance its projects - particularly in relation to the lesser understood permits such as EPs 450 and 451. ARC is one of Australias pre-eminent energy companies, owning and operating oil and gas interests in the Perth, Canning and Bass basins and internationally in Yemen. ARC is listed on the ASX and has a current market capitalisation of around $500m and is presently the subject of a merger propos al with Australian Worldwide Exploration Ltd (AWE). In the event the merger of ARC with AWE proceeds, ARC has announc ed that it intends to transfer its rights under the ARC Farm-in Agreement to Buru Energy Ltd (Buru), which is to become an ASX listed company in its own right with substantial assets. More information on ARC and Buru can be found on ARCs website at www.arcenergy.com.au In conjunction with joint venture partners such as ARC, NSE will pursue large potential oil and gas exploration opportunities capable of being progressed to development

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and production within a short timefram e (ie, 1-2 years) following initial discovery. The identification of new exploration models and geological thinking, when combined with the experience of the personnel involved in both NSE and its joint venture partners, has provided NSE with powerful tools in its search for economic oil and gas deposits. NSE is also not constrained by the classical exploration model applied to the Canning Basin by previous participants. NSE has pursued a policy aimed at reducing risk, both geologically and fiscally, in joint venture participation of the lesser understood exploration permits whilst attempting to retain higher equities in the more advanced and high potential assets. NSE, will continue to seek to diversify such risk (where appropriate) through additional farm-in discussions. It should be noted that such discussions will be pursued and progressed with suitable partners on a continual basis and NSE intends to mitigate both financial and operational risk through pursuing additional farm-in agreements on appropriate terms.

5.6

P R E V I O U S E X P L O R AT I O N I N T H E CA N N IN G B A S IN

Petroleum exploration activity began in the Canning Basin in the early 1920s when the Freney Oil Company encountered as phaltic shows in drillholes on the Lennard Shelf. Guided by surface geology, their focus was on postsalt targets. Exploration intensified when the Bureau of Mineral Resources (BMR; formerly Australian Geological Survey Organisation or AGSO, now Geoscience Australia) and West Australian Petroleum (WAPET) conducted gravity, m a g n e t i c , a n d r e fl e c ti o n s e i s m i c a n d d r i l l i n g . W A P E T was a major operator in the basin from 1958 to 1974 and explored for both pre- and post-salt targets. It encountered numerous hydrocarbon shows but had no real exploration success. Following the W APET period, during the 1980s, many sm aller independent explorers, plus som e m ajors (notably Shell) entered the basin. This followed historically high oil prices in the late 1970s (Figure 1, page 14). Up until the mid-1980s, exploration largely focused on the northern and central basin areas and the primary exploration targets were the post-salt, Devonian and Permian - Carboniferous strata. Many exploration wells had shows, especially of oil, however very few yielded commercial hydrocarbons. This, together with a languishing oil price, lead exploration drilling activity to decline again from the early 1990s with sporadic activity mostly in the region of the Fitzroy Trough, seeking post-salt reservoirs. In total, just 263 exploration wells have been drilled ons hore and as a res ult the basin is substantially underexplored, particularly when only 177 of the wells are considered to be true exploration wells. Although the pre-salt Ordovician section has previously been the target of companies such as Shell, few valid pre-salt tests have been made, particularly in the Kidson sub basin and the Ordovician has not formed a major focus of any major recent exploration activity. W hilst this Ordovician play has been validated to the northeast of the New Standard permits by the recovery of hydrocarbons at Looma 1, by Shell in 1996 no pre-salt wells have ever been drilled within New Standards permits.

5.5

WHY THE CANNING BASIN?

There are in excess of 130 giant and super giant oil and gas fields globally with similar source rock and reservoir characteristics to the Canning Basin. Such basins have been proven to be highly productive as is evident in North America, North Africa and the North Caspian Basin of Khazakhstan and Russia. The Canning Basin may well be the least explored of the worlds known Palaeozoic basins that are known to host proven petroleum systems. Similar basins in North Am erica 2 are the most explored with 500 wells/10,000km compared 2 to the Canning Basin with only 4 wells/10,000km . The presence of five oil fields in the Canning, together with numerous oil and gas shows and the low well density, suggests that further exploration is warranted. Striking comparisons can be made between many of these global basins in that they exhibit a regional mega seal of salt that forms a very efficient lid on the petroleum system that in turn helps to pres erve the petroleum c harge present in the relevant petroleum system. This regional mega-seal of salt is also present in the Canning Basin, particularly across the NSE acreage in the Kidson sub basin. Similar basins to the Canning exist which are now very prolific oil producing regions that have been revisited and developed by explorers and producers following initial exploration failures. This serves to highlight that the development path being pursued by NSE in the Canning is not new and one that can be compared to other successful basin developments globally.

5.7

T H E N S E A P P R O A CH A D I F F E R E N T I AT I N G FA C T OR

In addition to inform ation regarding previous exploration activity in the Canning Basin as set out in section 5.6 above, it is important to note the elements of NSEs approach that differentiate it from previous exploration efforts. The table on page 14 outlines some of the reasons that NSE considers have contributed to previous participants in the Canning having limited exploration success to date together with factors that NSE believes places it in a comparatively strong position to succeed.

13

30

120

25

100

Number of Wells 20 Oil Price US$/bbl (nominal) Independents & Majors make initial discoveries 80

15

60

10 Freney period 5 WAPET period

40

20

0 1922 1927 1932 1937 1942 1947 1952 1957 1962 1967 1972 1977 1982 1987 1992 1997 2002 2007

Figure 1: Exploration wells drilled in the Canning Basin plotted against oil price 1922-2007 highlighting the vastly under-explored nature of the region and lack of recent activity compared with recent oil price rises

Factors differentiating New Standard Energys approach from previous explorers Contributing Factor Understanding of the petroleum systems Previous Explorers Limited understanding of petroleum systems based on limited information. Petroleum system styles unknown. Petroleum system properties and quality largely unknown. Exploration targets based on limited technical information. Targets chosen based largely on analogous successes in other basins New Standard Thorough understanding of underlying petroleum systems based on large database resulting from prior exploration. Petroleum system quality and characteristics quantified Exploration targets driven from large technical database of previous exploration efforts, modern interpretations and detailed understanding of petroleum system. Targets refined based on prior exploration failures Clear focus on post salt Laurel Sand reservoir and pre salt Acacia Sand reservoir. Neither reservoir has been tested in optimal locations Acreage consolidated into 3 major corporate holdings. High levels of collaboration via joint ventures and sharing of exploration results/information Oil and gas markets at record highs. Increase in exploration activity expected after a long hiatus of a c t iv it y

Exploration targets

Petroleum System Focus

Adhoc approach largely focused on Devonian reef plays in the post salt environment. Little or no valid pre salt tests of the Acacia Fragmented acreage holdings, up to 25 independent players. Little or no collaboration Depressed oil and gas prices and capital markets leading to cessation of activity and rapid exit from the Canning Basin

Acreage holdings and collaboration levels Oil and Gas Industry

Whilst exploration companies such as Shell have previously undertaken exploration activity in the region in the 1990s, the basin has been largely neglected by exploration companies for over 25 years. The exploration dynamics of the Canning Basin have been transformed by a combination of factors including oil prices well in excess of US$120/bbl which when combined with NSEs approach have created a different environment in which to explore.

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5.8

NS E S CA N N I N G B A SI N PO R TFO L IO

NSEs permits are located between 300-700km southeast of Broom e, which in turn is 2,560km north of Perth in Western Australia, Australia.

Figure 3: Two major petroleum systems of the Ordovician/Silurian (pre salt) and the Devonian/Carboniferous/Permian (post salt) relative to the NSE acreage holdings highlighting the relative stratigraphy Figure 2: Location of NSE and ARC Energy Ltd permits in relation to the towns of Broome, Derby and Fitzroy Crossing

EP417 lies south of the main all-weather road between Broome and W yndham providing good access whilst the other permits are m ore isolated to varying degrees. NSEs permits are not currently serviced by major infrastructure such as sealed roads or pipelines although there are a significant number of tracks and roads that will provide satisfactory access in most cases for drill rig entry in the northern tiers of EP417, 442, 443 and 456. Seismic acquisition and drilling in the more remote EP450 and 451 will be m ore logistically challenging in terms of access due to extensive dunal terrain and larger distances from any existing road, tracks or infrastructure. Given the large potential size of oil reservoirs being tested, in the event of a successful discovery being made arrangements for transporting oil to Broome or Wyndham for further shipment or on-sale can be made. Larger volum es of oil production would necessitate storage tanks being installed in either Broom e or W yndham and if very large oilfields are found m ore permanent infrastructure suc h as oil pipelines may need to be established.

Both the Ordovician and Devonian petroleum systems are considered to provide significant prospects for liquid hydrocarbons, with the potential to generate tens of billions of barrels of oil. In particular, the G oldwyer Formation, which blankets much of NSEs sub-salt acreage, is accepted as having the best source rock potential in the Canning Basin (Foster et al, 1986; King, 1998). Under optimum m aturity conditions, the G prisca algal rich Unit 4 has well documented Type 1 source potential in wells on the Barbwire Terrace and could have generated tens of billions of barrels of oil (Foster et al, 1986). The ability for the Goldwyer to have generated substantial amounts of oil is demonstrated by the presence of oil shows over an approxim ate 50 metre interval in Loom a - the first proof of mature migrated oil from a source in the southern Canning Basin. Devonian carbonates are also productive on the Lennard Shelf and to date the Early Carboniferous has produced m ainly oil and minor gas, with several small oilfields (Boundary, Sundown, and West Terrace) in the Permian-Carboniferous system res ervoirs. The Proposed Directors are of the opinion that significant potential exists for large amounts of oil to have been generated from the Goldwyer and other generative settings in the deeper sections of the Kidson sub-basin to the southwest. This oil is likely to have migrated up-di p to shallower portions of the basin where potential traps of very early formation could contain large oil accum ulations that have had their structure preserved through limited faulting and the presence of a mega seal in the overlying salt beds. This massive salt seal (the Mallowa Salt) is evident in the region and may provide an effective seal to traps throughout the area. The Gregory Sub-Basin and Balgo Terrace provide a different geological setting in which mature Devonian and Carboniferous source rocks provide the hyrdrocarbons for the reservoirs of the Poole, Grant, Anderson, Laurel and Knobby formations. These reservoir sandstone targets are expressed in many different structural styles suc h as fault block, thrust related anticlines and drape anticlines.

5.9

P E T RO L E U M P RO S P E CT I V I T Y

The prospectivity of the NSE portfolio can be divided into the two major petroleum systems that the permits encompass: 1. Sub-Salt: EPs 442, 443, 450, 451 and 456 across the Kidson Sub-Basin/Crossland Platform that are exposed to the Ordovician/Silurian source/reservoir/seal sequence. Major reservoir target: Acacia Sands; and Post-Salt: Gregory Sub-Basin/Balgo Terrace present in EP417 that are exposed to the Devonian/Carboniferous/ Permian source/reservoir/seal sequence. Major reservoir target: Bas al Laurel Sands

2.

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5 . 1 0 N S E P R O S P E CTS
NSE has a very extensive acreage holding in the Canning Basin consisting of 6 granted exploration permits (EPs 417, 442, 443, 450, 451 and 456). These holdings total 2 72,000km and represent a major part of the Canning Basin (and particularly the Kidson sub-basin) and encompass most of the oil exploration targets pres ent in the Canning B a s i n i n t e r m s o f a g e a n d s tr u c t u r a l / g e o l o g i c a l s e t ti n g s . These permits provide a broad spectrum of hydrocarbon prospects ranging from Permo-Carboniferous to Ordovician re s e r v o i r s t h a t h a v e t h e p o t e n t i a l t o c o n t a i n m a j o r o i l reserves. In addition, NSE has recently been awarded a 100% interest in application area 28/07-8 and has an option (expiring 5 November 2008) over a 50% interest in application area 30/07-8. Including these areas the land 2 holding covers some 90,000km .

The most advanced drill targets are contained on EP417 and EP442(A) and are summarised in the following table:

In the Proposed Directors opinion, all of the provinces within the NSE acreage provide differing geologic environm ents and all of which are highly pros pective for black oil discoveries at reservoir depths of between 1,000m and 3,000m.

Gre g o r y S u b - B a s i n (Post s a l t t a rg e t s ) : E P 4 1 7
EP417 encompasses 3 discrete geologic provinces being the Balgo Terrace, the Gregory sub-basin and the Lawford 2 High. EP417 covers an area of 6,300km and is the oldest granted permit in the NSE portfolio having been origi nally awarded in February 2000 and the subject of various subsequent extensions and variations. NSE currently has a 100% equity interest and is progressing potential farm-in discussions.

Figure 4: NSE acreage holdings highlighting the ARC/NSE joint venture ground (blue), the 100% owned acreage (green) and the new application areas that NSE has an interest in

The acreage consists of both advanced prospects containing drill ready targets and identified leads as well as less advanced acreage requiring additional seismic and interpretation to derive drillable targets. As a result, the initial focus for NSE is going to be on the more advanced areas including: Drill targets on EP417 in the Balgo Terrace and the Lawford High; Drill targets and additional seismic acquisition on EP442(A) along the eastern margin on the Crossland Platform; and Structures to be detailed through a substantial seismic acquisition program across EP450, EP451 and EP442.
Figure 5: EP417 structural provinces and prospects

16

Lanagan Prospect The Lanagan prospect comprises five separate seismically 2 defined closures ranging in size from 5km (1,235 acres) 2 to 25km (6,175 acres) with the Lanagan A structure the largest and m ost robust of these. The primary Lanagan objectives are the Laurel Formation sandstones, with secondary objectives in the Knobby sandstones, Grant Group sandstones and the Poole Sandstone. Devonian fore-reef shales (Gogo Formation) and marls and/or Early Carboniferous Laurel Formation marine shales and limestones in adjacent downfaulted areas are expected to be the main source rocks for the prospect. A tight Knobby sandstone had gas shows in the nearby Lake Betty 1 well where the reservoir sand is in the gas generation window. This sandstone unit should be encountered more than 1,200 metres shallower over the crest of the Lanagan structure, and thus exhi bit better reservoir characteristics than at Lake Betty 1. Vertical seals for reservoirs over the crest of the Lanagan structure would be lower Laurel Formation carbonates and shales as encountered in Lake Betty 1. In the Sundown field, located on the southern edge of the Margaret Terrace to the northwest, 370 API oil was tested from Grant sandstones, whilst at Bindi-1 to the southeast, heavy immature oil shows were recorded in Poole sandstones. Thick Upper Grant shales should provide excellent vertical reservoir seals for Middle and Lower Grant res ervoirs and the stratigraphically higher Poole sandstones should be vertically sealed by Poole and/or Noonkanbah shales. The trap at Lanagan is a horst block with four-way dip 2 closure and has an area of approximately 25km with a vertical relief of around 110 metres. Using an area of only 2 20km , and a net pay of 15 metres, the potential oil in place for this structure is 220 mm b under expected res ervoir parameters.

Figure 7: Interpreted seismic line S 85M-4 across the Lanagan A prospect highlighting structural closure, the sandstone reservoir and the seal of the Laurel carbonate

Lawford Prospect In the Gregory sub-basin within EP417 numerous large prospects have been identified for potential oil accumulations in the Permo-Carboniferous sandstones of the Poole, Grant, Anderson and Laurel formations. The Lawford High province is unique in that it is sited over a large regional magnetic high that is considered important to the extent of maturation levels in the PermoCarboniferous s ource rocks, particularly the Laurel Shales. The Lawford structure is a faulted anticline with 150 m etres 2 of vertical relief over an areal extent of 69km (17,000 acres). Potential oil in place for this structure exceeds 400 m m b u n d e r e x p e c t e d re s e r v o i r p a r a m e t e r s .

Figure 6: EP417 Lanagan Prospects, 2-way time map near top laurel Carbonate, highlighting the cluster of Lanagan Prospects and their relative size

Figure 8: EP417 Lawford prospect, TWT base Grant Formation

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The Lawford prospect is attractive given it was in place early enough to receive oil from the Gogo and Laurel Formation shales during the time of oil generation up to the Early Jurassic.

NSE has targets within EP442(A) which are located west of the major Dummer Range Fault Zone and within the salt basin providing maximum seal capacity and minimising the possibilities of late stage res ervoir breachi ng by fault activity. Two initial pros pects withi n this province, known as Woolnough and Prider, have been identified as the initial targets to test for possible oil accumulations mainly within the Acacia sandstone formation at depths of between 2,000m and 2,500m (see Figure 10 below). The size and areal extent of closure over these two structures illustrates the potential in each of the prospects which could well be in excess of 150mmb of OIP.

Figure 9: Interpreted seismic line S87-L08 across the Lawford prospect showing the primary targets of the thick Grant and Laurel successions above a large Devonian igneous intrusion

Although some distance away from Lawford, the W hite Hills structure drilled by Mobil in 1982 can be viewed as analogous to the Lawford structure in terms of stratigraphy and structural style. The W hite Hills #1 well encountered num erous oil and gas occ urrences - particularly over the 1,000m of Anderson/Laurel interval. These oil and gas shows represented entrapped oil and gas and demonstrate the capability of the Devonian/Carboniferous source system to fill the large anticlinal structures such as Lawford within the Gregory Sub-Basin.

Figure10: The Woolnough and Prider prospects are located on the EP442 (A) sub block inside the edge of the salt seal and west of the Drummer Range Fault Zone and have both the Acacia and Nita reservoirs for entrapment.

K i d s o n S u b - B a s i n ( P re S a l t Targ e t s ) : EP442, EP443, EP450, EP451 and EP456

The pre salt targets form a large part of the NSE portfolio and provide a major play that has been largely untested in the Canning and never previously tested on NSEs acreage. The pre salt targets can be split into those advanced drill ready targets that exist on EP442 and the less advanced leads across EP443, EP450, EP451 and EP456. EP442 can be further divided into EP442 and EP442(A). EP442(A) represents 22 graticular blocks that have been excised from the balance of EP442 and not included in the ARC Farm-in Agreement (refer Figure 10 below). NSE currently retains a 100% interest in thes e blocks. However, in the event that NSE does not secure a farm-in partner over EP442(A) on or before 30 September 2008, the excised blocks will autom atically bec ome subject to the Farm-in Agreement with ARC being entitled to an immediate 10% interest, and a right to earn up to a 75% interest in total in accordance with the ARC Farm-In Agreement. For more details on the Farm-In Agreement please refer to Section 12.2 of this Prospectus.

The reservoir targets of the Acacia (prim ary res ervoir) and Nita (secondary reservoir) are ideally located to entrap oil generated from the adjacent westerly basin deeps of the Kidson sub-basin. Large oil columns in these res ervoirs have been found in the Looma#1 well situated to the north of NSE acreage. The prospects and leads in the northern tier of EP442 are more favourably located to encounter improved reservoir properties in the Acacia sandstones than those found in the same sands in the Looma#1 well. The W oolnough and Prider prospects will test the Acacia sandstones in a structural/stratigraphic position that has not yet been evaluated by exploratory drilling in the basin. Woolnough Prospect The W oolnough Prospect is a large 4-way dipping anticline with target reservoirs anticipated at approximately 2,400, depth. The integrity of the Woolnough structure at the Nita/Goldwyer level appears intact, which provides some confidence that the structure is not breached at the Acacia reservoir level. This prospect is along strike from the previously drilled Percival 1 well which had oil & gas shows through the Goldwyer Formation and gas shows in the Acacia Sandstone. A major difference between the Percival and W oolnough prospects is that the W oolnough structure looks to be an older structure than Percival, and hence in place to trap migrating hydrocarbons from the Ordovician source rocks. Woolnough also has the added benefit of the overlying mega seal of the Mallowa salt formation that has remained largely unbreac hed during later tectonic events.

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drape anticlinal leads on the Sahara shelf; and fault traps leads on the Crossland Platform, Stansmore Zone and the Sahara Shelf. Again, these leads are large with potential s tr i k e l e n g t h s o f 1 0 k m t o 5 0 k m . EP456: Across most of EP 456, the Acacia Sandstone is expected to be absent, however a regional analysis has produced a number of Nita Dolomite leads. W ork undertaken by previous explorers has shown numerous oil and gas occurrences in wells in a broad arc surrounding the NSE acreage to the north and northeast of EP456 and thus there is a demonstrated potential for the Nita Dolomite to have been adequately sourced in EP456, and further work to high grade the mapped leads is justified.
Figure 11: EP442(A) Woolnough prospect TWT structure (simplified) Top Nita/Goldwyer showing the large areal extent and clear 4 way dip closure

The m axim um areal closure of this pros pect is of the order 2 of 50km (12,350 acres). A reserve determination assuming half this area of clos ure, 75 m etres of vertical clos ure, 35% net to gross, and 12% porosity indicates the potential for some 300 mmb of oil in place. At the maximum area of closure oil-in-place could exceed 500 mmb. The second prospect called Prider is similar in style to Woolnough although potentially larger based on current information available to NSE. Additional seismic information is required over this prospect before more definitive plans can be m ade regarding drilling and additional seismic data is due to be acquired during 2008.

NSE currently has a 100% interest in EP442, EP443, EP450, EP451 and EP456 (but with ARC currently entitled to a 10% interest that has been lodged with DOIR but is yet to be registered) and will be diluting to 25% under the ARC Farm-in Agreement. For further detailed information on EP442, EP443, EP450, EP451 and EP456 please refer to the Independent Geologists Report contained in section 6 of this Prospectus.

5 . 1 1 A P P L I C ATI ON A R E A S 28 / 0 7 -8 AND 3 0 / 0 7 -8
As part of an acreage release undertaken by DoIR in March 2008, NSE has secured a 100% interest in application area 28/07-8 and an option over a 50% interest in application area 30/07-8 which was recently awarded to ARC. Both of these areas are significant contiguous land holdings to existing granted permits in the NSE portfolio and provide additional long term potential. Although native title negotiations are yet to commence in relation to these application areas and thus they do not form part of the immediate work program, they do provide potentially valuable extensions to existing plays being pursued on both EP417 (post salt) and EP442 (pre salt). For more information please refer to the Independent Geologists Report contained in section 6 of this Prospectus.

L o n g e r Te r m P o r t f o l i o : E P 4 5 0 , E P 4 5 1 a n d E P 4 5 6
The staggered nature of the granting of permits within the NSE portfolio and the res ultant spread of work commitments means that there is som e natural definition to the longer term portfolio. EP450, EP451 and EP456 are still relatively early in the permit life and as a result will form a longer term (but equally important) objective for NSE to progress and pursue over time. A brief review of thes e areas reveals the followi ng: EP450 and EP451: Regional scale isopach and facies analysis through these permits, combined with the regional geophysics has allowed NSE to postulate a trend of carbonate build-ups withi n the G oldwyer Formation along a structural province termed the Sahara shelf. There is seismic evidence of such build-ups. These proposed Goldwyer build-ups differ from the upper Devonian carbonate build-ups elsewhere in the basin in that they are sourced and sealed by underlying and overlying shales and are unaffected by Mesozoic tectonics. Thes e leads require greater seismic definition and will most likely change in size, but as indicated by mapping they are potentially large features covering many square kilometres. In addition, Nita Formation and Acacia Sandstone structural objectives are present in a number of anticlinal leads on the Sahara shelf, Admiral Bay Arch and the Stansmore Zone;

5 .1 2 NSE PO RTFO L IO SUM M ARY

All the NSE permits and application areas are interpreted to possess prospects of sufficient size, proximity to source and the right age of structure to host substantial oil and gas accumulations. The diversity of the geologic target horizons and the sedimentary provinces within which they are situated also provide an inherently well balanced portfolio of drilling prospects in terms of commercial risk. NSEs initial drilling is likely to focus on EP417 and EP442(A), however, the remainder of the NSE acreage covers a vast area and still remains highly prospective but under-explored. Under the ARC Farm-in Agreement, NSE will participate in and be carried with no financial outlays, for the drilling of 3 wells initially in addition to the acquisition of 1,000km of 2D seismic data over the next 24 months across EPs 442, 443, 450, 451 and 456. Completion of this work will also see NSE retain significant equity of 25% in each permit outlined above. The farm-in agreement with ARC will see the understanding of these permits advanced significantly through additional seismic data and further geophysical studies before drilling some of the more advanced prospects.

19

NSE is also aiming to broaden the portfolio of assets further by assessing selected exploration and/or production opportunities in conjunction with other appropriate opportunities in the energy sector. This strategy is intended to provide som e further diversification across geographic regions and as well as a more balanced asset mix for exploration, development and production assets and associated timing of work commitments.

5.13 P E RM IT S CH E DUL E
The following table details the projects in which NSE has an interest together with a table of work commitments by perm it year for each permit:
Permit Number E P 4 17 EP442 (A) EP442* EP443* EP450* EP451* EP456* Permit Size 6,300 km2 1,771 km2 13,971 km2 1,850 km2 16,005 km2 16,036 km
2

Award Date 22 Feb 2000 23 S ept 2 00 5 23 S ept 20 05 23 S ept 2 00 5 28 S ept 20 06 28 S ept 20 06 16 Oct 2007

NSE Interest 100% 100% 100% 100% 100% 100% 100%

JV Partner Interest 0% 0% 0% 0% 0%

Farm-out Details N /A If not farmed out by 30 September 2008 diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC

16,018 km2

* in relation to the JV partner interests noted above ARC is currently entitled to a 10% interest in permits EP442 (excluding EP442(A)), EP 443, EP450, EP 451 and EP456. Transfers have been lodged with DOIR but are yet to be registered

In addition to the above granted permits, NSE has a 100% interest in application area 28/07-8 and the rights to a 50% interest in application area 30/07-8 held by ARC. Both of these areas are very recently awarded and yet to commence native title n e g o ti a ti o n s .
Permit Number Year 1 E P 4 17 Studies (met) Year 2 Revised to nil Work Commitments Year 3 Revised to nil Year 4 Revised to nil Year 5 Revised to nil Year 6 2 wells (ending 21. 0 2. 0 9) 1 well

E P 4 42

Studies (met)

Seismic (180km). Year 2 suspended and extended for 12 mths to 22 Sept 2008. Seismic (50km). Year 2 suspended and extended for 12 mths to 22 Sept 2008. Seismic (200km) Seismic (170km) Seismic (210km) 2 Laurel Sand wells 2 Acacia or Nambeet wells

1 w ell

1 w ell

Studies

E P 4 43

Studies (met)

1 w ell

1 w ell

Studies

1 well

E P 4 50 E P 4 51 E P 4 56 28/7-08 30/07-8

Studies Studies Studies Seismic (150km) Seismic (400km)

1 w ell 1 w ell 1 w ell Studies Studies

1 w ell 1 w ell 1 w ell Seismic (200km) Seismic (200km)

Studies Studies Studies Studies Studies

1 well 1 well 1 well Review 1 w ell

The above work commitments are the minimum statutory work based commitments that the DOIR expects NSE to meet during the life of the granted permit in order to keep the permits in good standing. Under the ARC Farm-in Agreement, ARC will sole fund and complete, the acquisition of a collective 1,000km of 2D seismic across EPs 442, 443, 450, 451 and 456 followed by the drilling of 2 wells (with an option to drill a third well) over the next 24 months. This work should cover a large proportion of the statutory work requirements required by the DOIR and as set out in the tables above. NSE will initially pursue EP417 and EP442 (A) on a 100% equity basis whilst continuing to progress discussions that are currently underway regarding farm-out of some of the work commitments on EP417 (2 wells) and EP442(A) (1 well and seismic).

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6
3 June 2008

INDEPENDENT GEOLOGISTS REPORT

The Directors Hawk Resources Ltd Level 16, 190 Queen Street Melbourne, VIC, 3000. Dear Sirs, seal/trap geom etries and adequate to exc ellent res ervoir properties that m ay enable entrapm ent, and the potential commercial production of oil. Exploration in the basin has been sporadic since the 1920s, with the last active period some twenty years ago. Sixty per cent of all exploration drilling has occurred in the area of the Lennard Shelf and Fitzroy Trough in the northeast of the basin. This area represents only 20% of the overall basin. A small amount of oil is currently produced from three fields on the Lennard Shelf. In contrast, over the area of the New Standard permits, previous drilling has been very much of a frontier nature. Most of these tests have been shown to be invalid through lack of closure, trap timing or seal breach. Many wells in the New Standard permit region were also designed as stratigraphic tests, and not optimal as exploration wells. No pre-salt exploration wells have ever been drilled in New Standards permits. New Standard has a large acreage position in the basin with som e 72,000 s quare kilometres under leas e through six permits. This area represents 13.5% of the entire basin area. Five permits are c ontiguous blocks that cover a m ajor portion of the central and southern basin and include parts of the Kidson Sub-basin and Crossland Platform. This area is ideally positioned to explore the pre-salt Ordovician Acacia Sandstone and Nita dolomite targets sourced by the rich G oldwyer shale. Here, the Mallowa Salt of the Carribuddy Group forms a regionally undisturbed mega-seal over early formed structural leads. Seismic evidence suggests that prospects in these permits formed in the Late Silurian / Early Devonian. This is prior to likely oil migration, and provides viable, previously untested, exploration targets in these permits. Prospects and leads in these permits have also largely escaped the Mesozoic wrenching associated with the Fitzroy movement which affected the Fitzroy Trough and Gregory Sub-basin to the northeast.

EP S 41 7 , 44 2, 44 3 , 45 0, 45 1, 45 6, AN D APP L I CATI O N A R E A S 2 8 / 0 7 - 8 , 3 0 / 0 7 -8
This report has been prepared for inclusion in a Prospectus to be lodged by Hawk Resources Ltd (Hawk) on or about 10 June 2008 with the ASX for the issue of a minimum of 32.5 million shares at 20 cents per share to raise $6.5 million. Over subscription of an additional 5 million shares at 20 cents each will be accepted at the discretion of the Directors. This prospectus was foreshadowed by Hawk when it announced the merger with New Standard Energy Ltd (New Standard) on 12 May 2008, when it also announced a change of focus in activities primarily towards oil and gas exploration and development.

E X E C U T I V E S U M M A R Y A N D C O N C LU S I O N
The Palaeozoic Canning Basin in central-northern W estern Australia is large, remote and under-explored. The onshore succession ranges in age from the Ordovician to the Cretaceous across a number of structural provinces that encompass several distinct petroleum systems. Widespread salt deposition in the late Ordovician over the central and southern parts of the basin, further divides petroleum systems stratigraphically into pre-salt and post-salt systems. The pre-salt system has undergone scant exploration, but offers significant potential with the combination of the rich Goldwyer Formation source rocks and Ordovician reservoirs. The post-salt systems offer Devonian to Permian carbonate and clastic reservoirs sourced by intra-formational shales. New Standard is exploring both pre and post salt systems across large tracts of the basin. Its major focus is the evaluation of Lower Laurel (Carboniferous) sandstones in the post salt section, and Acacia (Ordovician) sandstones in the pre salt section. Both these target sands offer attractive s ource/

22

The sixth permit, EP 417, lies nearer the eastern margin of the basin in the Gregory Sub-basin and Balgo Terrace and is prospective for oil in the Devonian to Permian section. EP 417 is highly structured, with several prospects, mapped from earlier seismic surveys, which offer PermoCarboniferous and Devonian plays on the Balgo Terrace, and Permo-Carboniferous targets in the Gregory Subbasin. The Lanagan prospects are a complex of several culminations; with Lanagan A and Lanagan B both ready to drill. Any success here has immediate follow-up potential. Other prospects in EP 417 include the Lawford and Spinifex prospects. New Standard has proposed a work programme and budget in EP 417 that includes the drilling of at least 2 wells over the next 2 years. New Standard is the preferred applicant for 28/07-8, an application area adjacent to EP 417 on the Balgo Terrace, which is also pros pective for Perm o-Carboniferous targets. New Standard has undertaken detailed regional analysis over the Kidson Sub-basin and Crossland Platform permit areas, which has incorporated historic aeromagnetic and gravity data; regional seismic, and some detailed seismic in portions of EP 417 and EP 442. This work has been done with a thorough regional geological understanding, and has resulted in a large number of leads at the Acacia Sandstone level. Porosity and permeability within these sands is expected to be s ufficient to support oil production, if oil were to be present. The New Standard acreage is notable in that it covers a substantial portion of the Kidson sub-basin that has a coincidence of the rich Goldwyer source rock (which has a demonstrated capacity to have generated very large volumes of oil), and a widespread reservoir sand in the Acacia Sandstone. This sandstone is present across broad areas of the Kidson sub-basin and Crossland Platform areas. The coincidence of the Goldwyer source rock and the Acacia reservoir sand is a major element of the prospectivity of the New Standard acreage, as it provides locations where reservoir sands can be immediately overlain by source rock. Many of these locations are favourably positioned, at shallower depths than elsewhere in the basin. The Acacia sandstone as a pre-salt target has yet to be adequately tested in the basin with only three valid structural pre-salt wells (Loom a, Percival and Dodonea) having reached the Acacia reservoir. New Standard has mapped 18 leads based on regional seismic lines in EP442 where the Acacia and Goldwyer are expected to be well located. While these leads are large in area, many require ac quisition of additional seismic lines to develop into potential drill prospects. We have undertaken our own interpretation of seismic data from a limited number of lines in EP 442 and have confirmed a high level of structuring that justifies prospect scale seismic surveying and/or drilling. One such drill ready prospect is Woolnough, in EP 442, which is a large four way dip closure

in the Dummer Fault Zone east of the Crossland Platform. It is close to the Percival 1 well that encountered both oil and gas shows, but Woolnough is likely to have been in place prior to the Percival structure. It would appear to have been less affected by the Fitzroy movement than Percival. Woolnough is expected to have Goldwyer source rock immediately overlying the Acacia reservoir at a depth where reasonable porosity and permeability may be present. The Woolnough structure is an attractive target at the Acacia Sandstone reservoir level and has the potential to contain s i g nif ic a nt v ol um es of oil. New Standard has entered into a joint venture arrangement with Arc Energy Ltd over EP 442 (excluding EP 442(A)); EP 443; EP 450; EP 451 and EP 456 in which that company will f u n d 1 , 0 0 0 k i l o m e tr e s o f s e i s m i c a c q u i s i t i o n a n d t h e d r i l l i n g of three wells. Under this arrangem ent, Arc Energy will earn 75% in these permits, in a staged process, depending o n w or k c om plet i o n. In a joint arrangement with Arc Energy, New Standard also holds a 50% interest in the application area 30/07-8, which will cover any extension of the Acacia Sandstone play along strike to the southeast of EP 442. New Standard, in conjunction with its joint venture partner, proposes an exploration programme over EP442, EP450 and EP451 that includes prospect focused seismic surveying of the order of 1,000 line kilom etres over the next 2 years. Assuming seismic acquisition can elevate some leads to prospects, New Standard also anticipates drilling up to 4 wells over these permits during 2008 and 2009. We are confident that the New Standard exploration strategy of targeting large structures in the Ac acia at relatively shallow depths that are sourced by the Goldwyer will lead to a new phase of Canning Basin exploration with a lower drilling risk than there has previously been in the basin particularly in the region of the Kidson sub basin. Under the current high oil price regime, the economics of oil and gas production from remote localities has never been as attractive as it is now. As has been the case for many basins in the past, renewed interest in the Canning Basin by a new generation of explorers will, we believe, lead to the first major drilling program in the basin for twenty years. The initial program proposed by New Standard and its joint venture partners, of up to 1,300km of 2D seismic acquisition and 4 to 6 valid exploration wells in the first two years shoul d provide a solid foundation to begin system atically expl oring this under explored region. Renewed exploration drilling after a period of sustai ned inactivity often benefits greatly from a re-look at past results. Combined with contemporary analysis, modern seismic ac quisition and s eism ic interpretation technologies the New Standard program should assist greatly to reinvigorate the region.

23

INDEPENDENT GEOLOGISTS REPORT T A B L E O F C ON T E N T S

1 2 3 4 5

INTRODUCTION AND TENEMENT SCHEDULE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 REGIONAL GEOLOGY AND PROSPECTIVITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 2.1 Stratigraphy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 EXPLORATION HISTORY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 CANNING BASIN PETROLE UM SYSTEMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 PETROLEUM GEOLOGY, PERMITS EPS 442, 443, 450, 451, 456 AND APPLICATION 30/07-8 . . . . . . 33 5.1 Reservoir. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 5.2 Source . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 5.3 Hydrocarbon Seals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 5.4 Structure and Timing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 5.5 Prospects and Leads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 PETROLEUM GEOLOGY, PERMIT EP 417 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 6.1 Stratigraphy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 6.2 Source Rock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 6.3 Reservoir and Seal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 6.4 Prospects and Leads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 DECLARATION OF INDEPENDENCE AND VERACITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 QUALIFICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

7 8 9

10 REFERENCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

24

INTRODUCTION AND TENEMENT SCHEDULE

New Standard has six granted exploration leases, and interests in two application areas, in the Canning Basin of W estern Australia as summarised in Table 1 and shown in Figure 1 and Figure 2. New Standard has been advised that it is the preferred applicant for 28/07-8 and will be offered the permit for grant upon com pletion of a Native Title Agreem ent. Arc Energy Ltd (Arc Energy) is the preferred applicant for area 30/07-8, and New Energy has an option with Arc Energy to participate in the permit at a 50% level. This permit will also be granted upon Native Title Agreem ent. Work commitments for the permits are s hown in Table 2. The Canning Basin is served by two industrial centres, Broome and Derby, which have suitable shipping support. Broome has air support and s erves as the shipping terminal for the crude oil produced from the Lennard Shelf. Minor pipeline grids are mainly near Derby. Major roads service parts of the basin, mainly near the coast and along the northern margin where there are settlem ents and pastoral leas es. Rem ote drilling loc ations have had roads specifically prepared to facilitate operations. Muc h of the central and southern areas of the basin are rem ote and uns ettled, with a regional network of un-mai ntained or p o o r l y m a i n t a i n e d tr a c k s . Table 1. New Standard Schedule of Permits.
Permit Size 6,300 km2 1,771 km2 13,971 km2 1,850 km2 16,005 km2 16,036 km
2

Permit Number E P 4 17 EP442 (A) EP442* EP443* EP450* EP451* EP456* Application 28/07-8 Application 30/07-8

Award Date 22 Feb 2000 23 Sept 2005 23 Sept 2005 23 Sept 2005 28 Sept 2006 28 Sept 2006 16 O c t 2007 -

NSE Interest 100% 100% 100% 100% 100% 100% 100% 100% -

JV Partner Interest 0% 0% 0% 0% 0% 100%

Farm-out Details N /A If not farmed out by 30 September 2008 diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Diluting to 25% under farm-in with ARC Preferred applicant New Standard has an option to participate at 50%

16,018 km2

* in relation to the JV partner interests noted above ARC is currently entitled to a 10% interest in permits EP442 (excluding EP442(A)), EP 443, EP450, EP 451 and EP456. Transfers have been lodged with DOIR but are yet to be registered

Table 2.
Permit

New Standard permit work commitments.

Work Commitments Year 1 Year 2 Revised to nil Year 3 Revised to nil Year 4 Revised to ni l 1 well 1 well 1 w ell 1 w ell 1 w ell Seismic (200kms) Seismic (200kms) Year 5 Revised to ni l Studies Studies Studies Studies Studies 1 well Studies Year 6 2 wells (ending 21. 02. 09) 1 well 1 well 1 we l l 1 we l l 1 we l l Review 1 we l l Studies (met)

EP 417

EP 442 EP 443 EP 450 EP 451 EP 456 28/07-8 30/07-8

Studies (met) Studies (met) Studies Studies Studies Seismic (150 k ms ) Seismic (400 k ms )

Seismic (180km). Year 2 suspended and extended for 12 mths to 22 Sept 2008 Seismic (50km). Year 2 suspended and extended for 12 mths to 22 Sept 2008 Seismic (200km) Seismic (170km) Seismic (210km) 2 Laurel Sand wells 2 Acacia & Nambeet wells

1 w ell 1 w ell 1 w ell 1 w ell 1 w ell Review Studies

Figure 1.

New Standard Permits EP 417, 442, 443, 450, 451 & 456, including application areas.

25

is defined by an area of shallow basement called the Warri Arch. It is separated from the Amadeus Basin to the east by an arch of Upper Proterozoic sediments. Offshore, the Canning basin Palaeozoic sediments deepen considerably and underlie a thick Mesozoic and Cainozoic rifted m argin sequenc e similar to that extending along the rest of Australias northwest margin. Figure 3. Intracratonic basin of northwestern Australia (Brown et al, 1984).

Figure 2.

New Standard Permits in regional context.

REGIONAL GEOLOGY AND PROSPECTIVITY

Figure 4.

Canning Basin - Major tectonic elements.

The Canning Basin is one of a series of large Palaeozoic intracratonic basins in northwestern and central Australia (Figure 3) where sedimentation began as early as the Late Proterozoic in the Amadeus and Officer Basins, and continued through to the Permian in the Canning and Bonaparte Basins. These four basins are separated by large Precambrian metamorphic blocks and shallow basement arches of Archaean granites and metasediments. The Canning Basin, which covers an area on shore of about 530,000 square kilometres, is bounded to the north by the Precambrian Kimberly Block and to the south and southeast by the Pilbara and Musgrave blocks. Its boundary with the Proterozoic and Palaeozoic sediments of the Officer Basin

26

The main tectonic elements of the Canning Basin are shown in Figure 4 with the New Standard permits superimposed. The southern Canning Basin is dominated by the Kidston and Willara sub-basins (separated by the Munro Ach) which contain Ordovician to Permo-Carboniferous sediments up to 5 kilometres thick (King, 1998). The area of shallow basement along the southern flank of these sub-basins is referred to as the Anketell-Tabletop Shelf. Basement rises to the north of thes e sub-basins forming a central shallow ridge, the Broome Arch and its southerly extension, the Crossland Platform. The Admiral Bay Fault, which separates the Broom Arch and the Willara sub-basin, appears to die out to the southeast, although it may continue as a subtle hinge line m arking the otherwise vague boundary between the Crossland Platform and the Kidson Sub-basin (Brown et al, 1984). North of these bas em ent highs, a series of rotated fault blocks forming the Barbwire, Dam pier and J ugurra terraces step down into the Fitzroy Trough and Gregory sub-basin, representing a major graben containing up to 12 kilometres of Devonian to Permian sediments. The New Standard permits extend across, at least part, of most of these tectonic elements. The Canning Basin developed in the earliest Ordovician as an extensional intracratonic sag basin. During the Early Devonian the Broome Arch / Crossland Platform formed as a pre-rift arch to the proto-Fitzroy Trough to the north, and produced asymmetry in the Kidson sub-basin towards the south. During the late Devonian, deposition was confined to the Fitzroy Trough. Transpressive reactivation during the late Carboniferous, and again during the Late Triassic-Early Jurassic, produced large anticlines and flower structures in the Fitzroy Trough and reactivated older faults on the adjacent terraces. The structural development of the basin is shown schematically in Figure 5 (from Brown et al, 1984).

Figure 5. Schematic tectonic evolution of the Canning Basin (Brown et al,1984).

27

2.1

S T RAT I G R A P H Y

The stratigraphy of the southern Canning Basin, as recognised in the Kidson Sub-basin and on the Crossland Platform is shown in Figure 6. Figure 6. Southern Canning Basin stratigraphy.

the Kidson Sub-basin. The two oldest units comprise interbedded shales and limestones deposited in mid to outer ramp settings, and are around 70 and 120 metres thick respectively. A third unit (from 40 to 100 m eters thick) contains a series of shoaling upward limestones, minor shales, and some shallow marine shoaling sands deposited in an inner to mid ramp setting. The youngest unit (50 to 100 metres thick) consists predominantly of shales deposited in a subtidal-lagoonal environment and contains abundant algae with excellent source potential. The Nita Formation (up to 150 metres thick) is a regressive sequence, which conformably overlies the Goldwyer Formation. It has been interpreted to contain up to 43 progradational cycles (Karajas and Kernick, 1984) comprising limestones, dolomites and shales deposited in subtidal to supratidal environments. 2.1.2 Silurian The Silurian Carribuddy Group is poorly defined due to limited fossil material. Deposition is believed to have started in the Silurian, but may have begun in the Late Ordovician. The Group can be divided into five units, identified throughout the Southern Canning Basin. The oldest, Bongabinni Formation comprises up to 200 metres of red-brown claystones and minor dolomite, deposited in a supratidal to continental environm ent. The Minjoo Salt (halite with red-brown claystone, up to 160 metres thick) and lateral equivalent Mount Troy Formation (dolomite, shale and siltstones up to 35 metres thick) conformably overly the Bongabinni Formation. The depositional environment was salina and supratidal. The overlying Nibil Formation consists of some 400 metres of claystone, dolomite and siltstone, deposited in a supratidal / playa lake environm ent. The Mallowa Salt unit comprises up to 700 metres of cyclic, massive halite and dolomite deposited in a saltern setting. The supratidal Sahara Formation overlies the M allowa s alt and consist of red-brown dolomite and siltstone (up to 150 metres thick). The Worral Formation unconformably overlies the Carribuddy Group. It consists of red-brown siltstones, sandstones and may be up to 200 metres thick. 2.1.3 Devonian The Devonian Tandalgoo Sandstone unconformably overlies the W orral Formation and consists of up to 400 metres of red-brown aeolian sandstones. The M ellinjerie Limestone unconformably overlies the Tandalgoo Formation and consists of up to 300 m etres of limestones, with minor shales, evaporites and dolomites, and was deposited in shallow marine to supratidal environments. 2.1.4 Permo-Carboniferous to Recent The Permo-Carboniferous Grant Group unconformably overlies the Palaeozoic sequence. The Grant Group is up to 300 metres thick in the southern Canning Basin and was deposited in fluvio-glacial to m arine environm ents. It is subdivided into three formations: the Betty Formation (sandstones and conglomerates), the Winifred Formation (dominantly siltstones) and the Carolyn Formation (sandstone, conglomerate and mudstone).

2.1.1 Ordovician Deposition commenced in the earliest Ordovician (Tremadocian) unconformably over Precambrian basement. The Nambeet Formation comprises 230 400 metres of sandstones, shales, limestones and dolomites, and is a transgressive, shallow marine unit containing graptolites, brachiopods, conodonts and gastropods. The W illara Formation conformably overlies the Nambeet Formation and is a carbonate dominated transgressive sequence. It can be subdivided into three units: the Lower Willara limestones, the Acacia Sandstone and laterally equivalent Middle Willara calcareous shales, and the Upper Willara interbedded limestones and shales. Deposition occurred on inner carbonate ram ps and shallow tidal flats, and the formation is generally around 300 metres thick. The Goldwyer Formation, deposited during the Middle Ordovician, consists of four units recognized on and around the mid basin arch, and around the flanks of

28

The post-Grant Group sequence in the southern Canning Basin is generally less than 150 m etres thick, and is largely undifferentiated. The remaining Permian section consists of the Poole Sandstone, Noonkanbah Formation and Liveringa Sandstones (mainly shallow marine siltstones and sandstones). The post Permian section consists of late Middle Jurassic marine sandstones (Wallal Sandstone, Alexander Formation, Jarlemai Siltstone) and Cretaceous continental sandstones (Broome Sandstone). Thin lateritic and alluvial sediments constitute the Quaternary cover.

of the few wells, being valid structural tests. Although the sub-salt Ordovician section has previously been the target of companies such as Shell, few valid sub-salt tests have been made, particularly in the Kidson sub basin. No presalt wells have been drilled within New Standards permits. This Ordovician play has been validated to the northeast of the New Standard permits by the recovery of hydrocarbons at Looma 1, by Shell, in the southern Canning Basin in 1996. Figure 7. Exploration drilling in Canning Basin with oil price 1922 2008 (part)
30 120

EXPLORATION HISTORY
25 100

Petroleum exploration activity began in the Canning Basin in the early 1920s when the Freney Oil Company encountered as phaltic shows in drillholes on the Lennard Shelf. Guided by surface geology, their focus was on postsalt targets. Exploration intensified when the Bureau of Mineral Resources (BMR; formerly Australian Geological Survey Organisation or AGSO, now Geoscience Australia) and West Australian Petroleum (WAPET) conducted gravity, magnetic, and reflection seismic and drilling. WAPET was a major operator in the basin from 1958 to 1974 and explored for both pre- and post-salt targets. It encountered numerous hydrocarbon shows but had no real exploration success. Following the W APET period, during the 1980s, many smaller independent explorers, plus som e m ajors notably Shell, entered the basin. This followed historically high oil prices in the late 1970s (Figure 7). Up until the mid-1980s, exploration largely foc used on the northern and central basin areas. The primary exploration targets were the post-salt, Devonian and Permian - Carboniferous strata. Many exploration wells had shows, especially of oil. Few, however, yielded commercial hydrocarbons. Exploration drilling activity declined again from the early 1990s, with sporadic activity mostly in the region of the Fitzroy Trough seeking post-salt reservoirs. In total, 167 exploration wells have been drilled ons hore. The basin is substantially under-explored, with only a small percentage

Nu m b er of W ell s 20 O il P r i c e U S $ /b b l ( n o m in a l) In d e p e n d e n t s & M a j o r s m a k e in it i a l d i s c o v e r i e s 80

15

60

10 F r e n e y p e r io d 5 WA PET p eriod

40

20

0 19 22 19 27 1 93 2 1 93 7 1 9 42 1 94 7 19 5 2 19 5 7 1 96 2 19 67 1 97 2 1 97 7 19 82 19 87 1 9 92 1997 2 00 2 2 00 7

Figure 7 is a plot of exploration well drilling history in the basin compared with oil price and shows the marked increase in drilling activity after the oil price rise in the late 1970s. If history is any guide, the current oil price s hould pr es a g e a n i m m i n e nt dr il li n g i nc r e as e. Table 3 indicates the wells and formations that either have production or from which substantial recoveries and flow tests have been made. Of these 24 wells, 75% are either in the Lennard Shelf or Fitzroy Trough areas. Four of the wells had oil in Ordivician age reservoirs on the Broome Platform or Barbwire Terrace.

29

Table 3. Fields and significant discoveries in the Canning Basin (after GSWA, 2006). Field or Well M eda 1 Frome Rocks 2 St Georges Range 1 Yulleroo 1 Mimosa 1 Ellendale 1 Blina Sundown Boronia 1 Cycas 1 West Kora Pictor 1 Cudalgarra 1 M ir bel i a 1 West Terrace D odonea 1 K ennedi a1 Lloyd Janpam North 1 Crimson Lake 1 Boundary Point Torment 1 Wattle 1 Looma 1 Year 1958 1959 1965 1967 1973 1979 1981 1982 1982 1983 1984 1984 1984 1985 1985 1985 1985 1987 1987 1988 1990 1992 1994 1996 Reservoir(s) Laurel Nullara Fairfield Laurel Laurel Pillara Laurel Nullara Yellow Drum Grant Pillara Noonkanbah Grant Anderson Anderson Nita Carribuddy Nita Mellinjerie Grant Goldwyer Nita Anderson Nullara Grant Grant Anderson Yellow Drum Acacia Nita Nambeet Age of reservoir Carboniferous Upper Devonian Devonian Carboniferous Carboniferous Carboniferous Upper Devonian Carboniferous Upper Devonian Lower Carboniferous PermianCarboniferous Upper Devonian Permian PermianCarboniferous Carboniferous Carboniferous Ordovician Silurian Ordovician Devonian PermianCarboniferous Ordovician Ordovician Lower Carboniferous Devonian PermianCarboniferous PermianCarboniferous Carboniferous Lower Carboniferous Ordovician Ordovician Ordovician Sub-basin Lennard Shelf Jurgurra Terrace Fitzroy Trough Fitzroy Trough Lennard Shelf Fitzroy Trough Lennard Shelf Lennard Shelf Lennard Shelf Fitzroy Trough Lennard Shelf Broome Platform Broome Platform Barbwire Terrace Lennard Shelf Barbwire Terrace Lennard Shelf Lennard Shelf Lennard Shelf Lennard Shelf Lennard Shelf Fitzroy Trough Fitzroy Trough Broome Platform

While most of these wells cannot be considered commercial discoveries, they represent a discovery rate of 14.5% of the total 165 new field wildcats drilled since 1930. Many of the remaining wildcats have had oil and gas shows during drilling. In a less remote and vast basin, this number of wells would have been drilled in a m uc h shorter time frame than the 75 years considered here. Sixty per cent of all wildcats have been drilled on the Lennard Shelf or Fitzroy Trough, in an area that represents only 20% of the total basin area. Of the 65 wildcat wells drilled outside the Lennard Shelf and Fitzroy Trough areas, 55% have had som e form of oil or gas show during drilling. Further sub-division to investigate target reservoirs of past wells, reveals that outside the Lennard Shelf and Fitzroy Trough, only 19 wells adjacent to the New Standard acreage penetrated pre-salt section. This emphasises the

under-explored status of this basin, and the New Standard p e r m i t s. Post mortem analysis of these dry wells suggests several reasons for failure. Apart from the over-riding integrity of many traps drilled with limited structural control; reservoir presence and quality, seal, trap timing, and long range migration are the m ai n caus e of failure. Under the current high oil price scenario, and the renewed interest in the basin by a new generation of explorers, we believe the Canning Basin is poised to undergo its first major drilling programme for twenty years. As has been the case for many basins in the past, renewed exploration drilling after a period of sustained inactivity will benefit greatly from the re-look at past results, combined with contemporary analysis and modern seismic technology.

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CANNING BASIN PETROLEUM SYSTEMS

There are three active petroleum systems in the Canning Basin and these are correlated to source rocks of Ordovician to Permian age (Goldwyer-Bongabinni; Gogo; and Laurel-Anderson-Grant). In the central Canning Basin there is a further distinction made between pre-salt (Goldwyer-Bongabinni) and post-salt (Gogo; and LaurelAnderson-Grant) systems. Figure 8 presents a basin wide schematic of the stratigraphy and petroleum systems (Geological Survey of Western Australia, 2002). The systems are identified, with proven source-rock intervals in: the Ordovician Nambeet, Willara, Goldwyer, and Carribuddy Formations. the Devonian, Givetian, and Frasnian intervals where the highest source potential is in anoxic carbonaceous lithofacies of the back-reef subfacies of the Pillara Limestone and basin facies of the Gogo Formation. The Lower Carboniferous Fairfield Group that includes effective source rocks in the Laurel and Anderson Formations (that sourced the Lloyd 1, West Kora 1, and Point Torment 1 hydrocarbon accumulations.) The Carboniferous and Permian sequences that include source rocks in the Upper Grant Group shales, Poole Sandstone, and Noonkanbah Formation.

The Ordovician and Devonian petroleum systems are considered to provide significant pros pects for liquid hydrocarbons, with the potential to generate tens of billions of barrels of oil. Devonian carbonates are productive on the Lennard Shelf. To date the Early Carboniferous has produced m ainly oil and minor gas, with several small oilfields (Boundary, Sundown, and West Terrace) in the Permian-Carboniferous system res ervoirs. The petroleum systems present in the New Standard permits are marked on Figure 8, and show the five contiguous permits (EPs 442, 443, 450, 451 and the EP 456), that lie across the Broome Arch, Crossland Platform and the Kidson Sub-basin, are exposed to the pre-salt Ordovician, Silurian and Devonian system, while the EP417 Gregory Sub-basin permit is exposed to the Devonian to Permian systems. A more detailed description of play types is shown in Table 4, which is modified after Ferdinando (2003). Here the distinction between the EP 417 Devonian and Permo-Carboniferous plays and the Ordovician play in the remaining permits is clear. Given this distinction, we separate the discussion of the petroleum geology of EP 417 from that of EPs 442, 443, 450, 451, and 456.

E P 417

E P s 442, 443, 450, 451 & 456

Figure 8.

Stratigraphy and petroleum systems of the Canning Basin.

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Table 4.

Play types in the central Canning Basin

Seal Noonkanbah Fm Intraformational shales Intra-Anderson Fm silts and shales Laurel Fm shales Source Intra Grant Gp Shales Structure Drape over fault related or reefal highs; wrench anticlines; salt related traps Drape over fault related or reefal highs; wrench anticlines; salt related traps N S E P e rm i t EP 417 Prospect & Leads Lawford Spinifex Lanagan Lawford Spinifex Lanagan EP 417 EP 417 EP 450

Reservoir Poole Sandstone Grant Group Anderson & Laurel sandstones

Lanagan

Nullara Fm, Knobby Sandstone Pillara Fm platform & slope carbonates Tandalgoo Gp & Boab Sandstone Worral Fm

Fairfield Gp, intra-formational shales Intra Pillara shale, tight carbonates, Laurel Fm Dominic Shale Worral Fm shales

Gogo Fm Biothermal buildups; anticlinal drapes controlled by transverse faulting

Lanagan

Intra formational shales or Gogo Fm

Bongabinni, Goldwyer or Gogo Fms

Pillara event extension structures; Triassic wrench/inversion structures - 4 way dip and fault bounded; rotated fault blocks, salt diapirs, sandstone drape over basement highs Devonian extension structures; Triassic wrench/inversion structures - 4 way dip and fault bounded; rotated fault blocks, salt diapirs, sandstone drape over basement highs 4 way dip closed anticlines and fault-closed anticlines

Nita Fm Acacia Sandstone

Bongabinni Fm shale Goldwyer Fm & inter Willara Fm shale Intra Nambeet Sst shales Goldwyer Shale

EP 442, EP 443, EP 451, EP 456

Woolnough Prider Numerous leads

Nambeet Sandstone

Intra Nambeet Sst & younger Ordovician shales

Broome Plt & Barbwire Tce

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P E T RO L E U M G E O L O G Y , PERMITS EPS 442, 443, 450, 451, 456 AND APPLICATION AREA 30/07-8

Figure 10. Structural provinces EPs 442, 443, 450, 451 and 456.

In the five contiguous New Standard permits (EPs 442, 443, 450, 451 and 456) and the application area 30/07-8, that lie across the Broome Arch, Crossland Platform and the Kidson Sub-basin, the prim e exploration play is the presalt Ordovician and Silurian system. This relies on Acacia Sandstone and Nita Formation reservoirs, sealed by the Goldwyer Formation and Bongabinni Shale respectively. The Goldwyer Formation is also a high quality regional source rock. Stratigraphically higher in the Carribuddy Formation is the Mallowa Salt unit that can be considered as offering high order seal potential. The relationship between these various units is shown in Figure 9. The presence of oil s h o w s t h ro u g h t h i s s e c t i o n i n re g i o n a l w e l l s i s a n n o t a t e d i n Figure 6. The structural provinces within thes e five areas are shown in Figure 10. Figure 9. Seal, Source and Reservoir geometry.

5.1

RESERVOIR

There are two principal res ervoir targets in New Standard permits the Ordovician Acacia Sandstones of the Willara Formation; and the Ordovician/Lower Silurian Nita Dolomites of the Nita Formation. 5.1.1 Acacia Sandstone The Acacia Sandstone has been penetrated with good reservoir characteristics in at least six wells in or adjacent to the New Standard permits - Acacia 1&2, Dodonea 1, Percival 1, Setaria 1, and Solanum 1. It is over 100 metres thick in Acacia 1 and 80 metres thick in Percival 1. The sands are interpreted (King, 1998) to have been deposited as delta front, distributary and tidal channels on a broad tidal flat. Petrographic studies indicate monocrystalline quartz, varying from subangular finer gr ai ns t o w ell r ou n d e d m e di u m gr ai ns . Sands on the Barbwire Terrace range between 10 to 30 metres thick, with core porosity up to 21% and corresponding permeabilities up to 505 mD in Acacia 1. In Pegasus 1 the sand reached 74 metres thick but was of poor quality. Log analysis suggests that porosity may reach as high as 23%, and at a 10% porosity cut off, net to gross may reach 30%. A plot of depth versus porosity is given in Figure 11 for five wells, and illustrates that porosity is not solely related to depth, and suggests depositional environment is also an influence. The best reported flow from the Acacia sand was 1,760 barrels per day of water from Acacia 2 which illustrates sufficient permeability to flow oil (if present) at these rates. The Acacia Sandstone is expected to be absent in EP 456 but present in all other permits, and thicken towards the east. It also shallows towards the east and thus is expected to provide more accessible targets across the Dummer and Tina Springs Fault Zones in EP 442.

33

Figure 11. Depth versus porosity for selected wells.

reported values are exceptional, and analyses from other wells generally indicate lower porosities and substantially lower permeabilities. A plot of porosity versus permeability for the Nita Formation is given in Figure 12 and indicates a porosity expectation from 0% to approximately 15%. Figure 12. Nita Formation - Porosity versus Permeability.

5.1.2 Nita Dolomite Repeated oil and gas shows have led to the Nita Formation being ranked as a promising potential reservoir unit within the Ordovician section of the Canning Basin. This formation consists of subtidal to supratidal, argillaceous limestones, dolomites and shales, and ranges in thickness from 50 110 metres. In general the supratidal facies comprise syngenetic dolomites, the intertidal zone has in part been diagenetically dolomitised, while the subtidal zone has not been dolomitised. Petrographic studies (King, 1998) identified three main types of porosity intercrystalline, vuggy, and fracture and confirmed a complex diagenetic history. Visible vuggy porosity is commonly present within intervals of late-diagenetic replacement dolostone particularly in the middle to lower Nita Formation, but it is generally not clear to what degree the vugs are interconnected (Haynes, 2004). Karajas and Kernick (1984) reported core-derived porosities of 10 18.5% and permeabilities ranging between 35 and 3310 mD in Aquila 1, which penetrated approximately 30 m of water saturated res ervoir beds exhi biting both vuggy and intercrystalline porosity. These

5.2

SOURCE

The Goldwyer Formation is accepted as having the best source rock potential in the Canning Basin (Foster et al, 1986; King, 1998). In particular the G prisca algal rich Unit 4 has well documented Type 1 source potential in wells on the Barbwire Terrace. Under optimum m aturity conditions this unit alone could have generated tens of billions of barrels of oil (Foster et al, 1986). Good source potential has also been described from shales within Goldwyer Units 1, 2 & 3 in the W illara Formation. The ability for the Goldwyer to generate substantial amounts of oil is demonstrated by the presence of oil shows over an approximate 50 metre interval in Looma 1. The results of heat flow modelling indicates that the Goldwyer Formation over most of the Crossland Platform and Kidson Sub-Basin reached thermal maturity during the late Carboniferous with a vitrinite reflectance of between 0.7% - 1.3%. Exploration well based thermal gradient m easurements, and conodont alteration indices analysed by New Standard and others (Brown et al, 1984) provide a regional maturity map that indicates most of the com panys permit areas offers mature source rock potential (Figure 13).

34

Figure 13. Goldwyer Formation maturity map.

Further to any regional analysis of source rock data, there is the demonstrated existence of significant generation in many regional exploration wells as shown in Table 5. Table 5. Well Looma 1 Looma 1 Acacia 2 Setaria 1 D odonea 1 Pictor 1 McLarty 1 Percival 1 Oil shows in regional wells. Reservoir Acacia N it a Acacia Acacia Acacia Acacia Acacia Acacia Oil Show Bleeding oil from core Bleeding oil from core Trace bitumen Fluorescence and gas Oil & gas shows Small oil column Bitumen and fluorescence Dead oil coating sand grains

5.3

HYDRO CARBO N SEAL S

Integration of depth to basement values and fault framework by New Standard has demonstrated a likely regional hydrocarbon kitchen in the Kidson Sub-basin. Analysis of migration pathways indicates that any structural trends within the New Standard permits would focus hydrocarbon charge from the south. A potential large fetch area with substantial migration distance exists within the Kidson Sub-Basin. This source rock blankets the New Standard permits at a thickness of between 150 and 350 metres, as shown in the Goldwyer Formation isopach map in Figure 14. In places, the G oldwyer is likely to directly overlie the prim ary Ac acia Sandstone res ervoir target at relatively shallow levels. This rich source rock has the potential to fill any Acacia Sandstone structures, which is a major contributor to the prospectivity of the many leads and prospects mapped by New Standard. Figure 14. Goldwyer Formation isopach map.

The evaporitic Siluro-Ordovician Caribuddy Group is present throughout the southern Canning Basin, except over parts of the Broome Arch and Crossland Platform where it is eroded. The oldest unit, the Bongabinni Formation, comprises up to 200 metres of red-brown claystones and is expected to form an effective seal to the Nita Formation reservoir (King, 1998). In EPs 442, 443, 450, 451 and 456 it is expected to be between 50 and 100 metres thick. Shales within the Goldwyer Formation also offer potential widespread seals. These intra formational shales, and dolomitic shales, and tight carbonates of the W illara Formation, should form a top seal to the Acacia Sandstone reservoir. In Percival 1 the Goldwyer shale is 150 metres thick and sits directly on underlying Acacia sands. To the northeast, the s ands lie beneath the tight Upper W illara carbonates.

5.4

ST RUCT URE AND TIM I NG

The major trap style anticipated in these New Standard permits is a simple four-way dip anticlinal closure oriented in the northwest / southeast grain of the basin. They were formed by the intersection of the dominant northwest/ southeast faulting with northeast/southwest cross faults. Some faulting of the anticlines can be expected. These structures (with Ordovician objectives) could have formed during the late Silurian / early Devonian Prices Creek Movement and been reactivated in the Late Carboniferous Meda Transpression. Variations in burial histories between tectonic elem ents in the basin, and changes in geothermal gradients through time imply that source rocks have different maturation histories in different parts of the basin. Kennard et al (1994) suggested the Lower Goldwyer source intervals matured prior to late Devonian deposition, and probably generated large am ount of oil during the Ordovician Silurian. The upper Goldwyer source interval is immature across much of the Broome Arch, but where it has been down faulted, maturation commenced after Devonian deposition. A different, pulsed, heat flow m odel presented by Russell (1998) suggests that hydrocarbon generation could be delayed until the Permo-Triassic.

35

This highlights the primary risk in pre-salt plays of the timing of generation relative to trap formation. If later generation or charging of hydrocarbons occurred, then the risk of Ordovician targets is reduced. Despite this possible variation in timing, from the evidence of recovered oil in Loom a 1, it is likely that generation and c harging occurred af t er t h e c om pr es s i on al t ec t o ni c e v e nt s i n t h e S il ur i a nDevonian that created traps.

Figure 16. Schematic cross-section through EP 450, 451, 442, 44 3.

5.5

P R O S P E CT S A N D L E A D S

New Standard has undertaken extensive basic geophysical interpretation, using existing aerom agnetic, gravity and seismic data. Geophysical potential field methods are important first pass methods where seismic and drilling are sparse. A magnetic anomaly lead map is shown in Figure 15, and distinguishes between high frequency magnetic anomalies and lower frequency anomalies that allowed depth to basement calculations. In the pres ent context, the high frequency anomalies are more likely to be related to structural anomalies of interest in oil exploration. Insight into structural grain, fault trends and sediment thickness can be interpreted from magnetic and gravity mapping. This is particularly so in EP 450 and EP 451 which contain no wells and only sparse seismic. These two permits lie largely within the Kids on Sub-basin as shown in section in Figure 16 where the Caribuddy salt/ shale sequence cover is complete. Figure 15. Magnetic anomalies, EPs 442, 443, 450 and 451.

5.5.1 EP 450 and EP 451 Regional scale isopach and facies analysis through these permits, combined with the regional geophysics has allowed New Standard to postulate a trend of carbonate build-ups within the Goldwyer Formation along a structural province termed the Sahara shelf (Figure 17). There is some seismic evidence of such build-ups. Figure 17. Goldwyer carbonate build-up play EP 450, 451.

36

A schematic of a proposed buildup is shown in Figure 18, next to a seismic example (Figure 19), which shows thickening between basement and the top of the Nita Formation. Figure 18. Schematic of Carbonate buildup.

EP450 and EP451 are both large, under-explored acreage holdings that have a well developed pre-salt hydrocarbon system in which Goldwyer oil can source reservoirs in the overlying Nita (limestones/sands), the intra Goldwyer carbonate build-ups and the underlying Acacia sandstones. This system provides viable exploration targets, with the major risk being reservoir quality. The number and size of the leads is notable. By way of example, a prospect of 25 square kilometres, with 30 metres net pay of 12% porosity and 70% oil saturation has the potential to contain of the order of 300 million barrels of oil in place. Leads of this magnitude justify more detailed appraisal. Figure 20. Nita and Acacia Leads EP 450 & EP 451.

Figure 19. Seismic line through Lead 450-4.

5.5.2 EP 442, EP 443, EP 456, Application area 30/07-8 These permits, adjoining EP 450 and EP 451 to the north and northeast have greater seismic coverage than the Kidson blocks, and therefore, some better developed leads. High frequency magnetic anomalies have again provided confirmation to some of these leads. EP 442 extends to the northeast across the limit of the salt edge as approxim ately defined by the Dummer Fault Zone (Figure 21). West of the fault zone anticlinal fault traps have formed in the Ordovician targets with minimal post-Devonian movement that provides seal integrity. East of the fault zone, Late Devonian and Mesozoic tectonics may have induced salt movement and dissolution. Mesozoic tectonism, while creating structural traps, formed them too late to capture peak oil migration. Mesozoic faulting also risks the loss of top and lateral seals. Most of the leads shown in Figure 20 are insufficiently defined to calculate meaningful potential resource figures, but they are consistently large in areal extent and thus attractive for further evaluation. In order to maximise porosity perm eability characteristics, and keep within limits that would maximise the comm ercial potential, only leads that are less than approximately 3,500 metres depth have been selected. The application area 30/07-8 lies to the southeast of EP 442, and abuts EP 451 on its northwest boundary, and thus covers the south-easterly extension of the Acacia reservoir play from EP 442 and EP 442(A) (Figure 21).

The play schematic in Figure 18 shows the sequence of the Goldwyer-Transgressive basal shale/carbonates (oil source rich Units 1 and 2) overlain by an offlapping, regressive Unit 3 (from which oil has been recovered at Percival 1 for example), which in turn is over-stepped and sealed by Unit 4 shales (oil source) providing prospects for porosity and permeability retention through early source and seal. These proposed Goldwyer build-ups differ from the upper Devonian carbonate build-ups elsewhere in the basin in that they are sourced and sealed by underlying and overlying shales and are unaffected by Mesozoic tectonics. These leads require greater seismic definition and will most likely change in size, but as indicated on this mapping they are potentially large features covering many square kilometres. In addition, Nita Formation and Acacia Sandstone structural objectives are present in a number of anticlinal leads on the Sahara shelf, Admiral Bay Arch and the Stansmore Zone; drape anticlinal leads on the Sahara shelf; and fault traps leads on the Crossland Platform, Stansmore Zone and the Sahara Shelf (Figure 20). Again, these leads are large with potential strike lengths of 10 to 50 kilometres. 37

Figure 21. Ordovician leads EP 442, EP 443, EP 450 & EP 451.

is very poor, making the res ervoir geom etry at the Ni ta/ Acacia level difficult to im age, and im plying significant faulting at this level. This highlights a significant characteristic of prospects and leads in EP 442 to the southwest of the Dummer Fault Zone in that they are likely to have form ed earlier (in the Early Devonian Prices Creek compressional movement) and been in place to receive hydrocarbon charge from Ordovician source rocks from the late Devonian and early Carboniferous. They have the added advantage of the thick overlying M allowa Salt seal that rem ained potentially unbreached during the later Fitzroy Movement. Figure 25. Line 84 - 48 through Percival 1.

A more detailed prospect and lead map for EP 442 (Figure 22) indicates two prospects, Woolnough and Prider, and a number of additional leads. Of the two prospects, Woolnough is mapped with seven dip lines and three strike l i n e s a n d i s c o n s i d e re d re a d y t o d r i l l . Figure 22. Prospect and lead map, EP 442.

A simplified two-way-time structural map of the prospect is given in Figure 26. The m aximum areal closure of this prospect, as shown, is of the order of 50 square kilometres (12,350 acres). A resource determination assuming half this area of closure, 75 metres of vertical closure, 35% net to gross, and 12% porosity indicates the potential for some 300 million barrels of oil in place. At the maximum area of closure oil-in-place could exceed 500 million barrels. Figure 26. Woolnough prospect TWT structure (simplified) Top Nita / Goldwyer 4.

A strike line and a dip line over the W oolnough prospect are shown in Figure 23 and Figure 24 respectively. Apart from the major Dummer Fault to the southwest of the structure there is little post-Nullara faulting evident on these lines. The integrity of the structure at the Nita/G oldwyer level appears intact, which provides some confidence that the structure is not breached at the reservoir level. This pros pect is along strike from Percival 1 which had oil & gas shows through the Goldwyer Formation and gas shows in the Acacia Sandstone. Line 84-48 across Percival is shown in Figure 25. A major difference between these prospects is the thi nni ng that occ urs between the Nullara and the Caribuddy horizons over W oolnough, but not in Percival. This indicates the W oolnough structure to be a much older structure than Percival, and hence able to trap migrating hydrocarbons at a time when Percival was not. In addition, data quality below the Caribuddy in the Percival section

A simplified TWT map at top Carribuddy level of a second prospect called Prider, located to the southwest of Woolnough is shown in Figure 27. Again, this structure

38

Figure 23. Woolnough Prospect, strike line C74-5L.

Figure 24. Woolnough prospect, dip line BONG85-14.

39

shows four-way dip closure with the possibility of an unbreached target Acacia sandstone reservoir. Some additional seismic is warranted along strike and at its southwestern margin to fully mature this lead to a drillable prospect. Figure 27. Prider structure TWT map (simplified), top Carribuddy Formation.

the Sally May 1 well drilled in early 2005 by Kingsway Oil close to New Standards permits near the junction of EPs 442, 443 and 456, encountered good oil shows in the Nita Formation. Kingsway Oil has estimated a prospective resource potential in the Nita Formation in this structure of between 3 and 190 million barrels of oil (ISIS, 2006). There is possible additional potential in the deeper Acacia Sandstone, which was below the total depth of the well. Planned appraisal of Sally May 1 will provide significant information relevant to the prospectivity of EPs 442, 443 and 456. Thus, there is a dem onstrated potential for the Nita Dolomite to have been adequately sourced in EP 456, and further work to high grade the mapped leads is justified. Figure 29. Arc of Ordovician oil & gas occurrences.

This structure is approxim ately 16 s quare kilom etres (4,000 acres) in area, with a potential vertical relief of approximately 40 metres. Using an area of 12 square kilometres, a net pay of 30 metres, and a porosity of 12% this structure could potentially contain 160 million barrels of oil i n pl ac e. In the EP 456, where the Acacia Sandstone is expected to be absent, a similar regional analysis has produced a number of Nita Dolomite leads as shown in Figure 28. Figure 28. EP 456, Nita Dolomite leads.

P E T RO L E U M G E O L O G Y , P E R M IT E P 4 1 7

EP 417 covers an area of approximately 6,300 square kilometres and lies largely within the south-easterly trending, Gregory Sub-basin (Figure 30). The northern part of the permit is on the Betty/Balgo Terrace, a region of faulted basement blocks, which is separated from the Gregory Sub-basin by basin-edge faults. The objective in this permit is the Gogo and Laurel-Anderson-Grant system of the post-salt Permian, Carboniferous and Devonian sequences. This system relies on source rocks in the Fairfield Group, the Gogo, the Upper Grant Group shales, and Noonkanbah Formations. The Application area, 28/07-8 lies on the Balgo Terrace, adjacent to the north-eastern boundary of EP 417. Work undertaken by previous explorers has shown numerous oil and gas occurrences in wells in a broad arc surrounding the New Standard acreage to the north and northeast of EP456 as shown in Figure 29. In particular, New Standard has undertaken exploration studies that focus on basal Laurel sand targets along the basin-wood margin of the Balgo Terrace (the Lanagan prospects), and in compressional features on the Lawford High (Figure 32). The Balgo Terrace play is similar to the more densely

40

drilled Lennard Shelf play to the northwest, which provides the basins only oil production. Some advantage might be expected here due to larger potential traps and superior reservoir developm ent. This play extends into the area covered by the application 28/07-8 where 4-way dip closures of Carboniferous age Laurel sands, sealed and sourced by the Laurel shales / carbonates can be expected Figure 30. EP 417 Structural setting.

Figure 31. EP417 Stratigraphy.

6.2

SOURCE ROCK

Over 1,000 kilometres of 1980s seismic and two wells exist in the permit. Lake Betty-1 was drilled by WAPET in 1971 and had gas shows in a Lower Laurel sandstone. Bindi-1, drilled by Santos in 1984, had oil shows in the Permian Poole sandstone and five dry gas shows in Carboniferous Anderson sandstones. Bindi-1 was drilled on or near the Devonian Nullara carbonate shelf margin, but is now mapped as being outside closure. Other key wells to this permit include Olios 1, drilled by Gulf Oil in 1983, Ngalti 1, drilled by Pontoon Oil & Minerals in 1984; Selenops 1; Atrax 1, and Kilang Kilang 1. Both Selenops 1 and Atrax 1 were stratigraphic tests and not drilled on structural culminations.

Geochemical evaluation of five Palaeozoic formations in the eastern Canning basin (Wulff, 1987), indicated that the Goldwyer, Pillara, and Gogo Formations have the greatest potential to generate significant hydrocarbons. The Laurel Formation can also offer sourcing potential adjacent to Laurel depocentres such as on the downthrown side of listric faults that separate the Billiluna Shelf from the Balgo Terrace, where organic preservation is likely to be greater. In addition, the Noonkanbah Formation is considered a potential source for shallow oil accum ulations in the Gregory Sub-basin, but is likely to be immature on the shelf areas. Within EP417, geochemistry from Bindi 1 confirmed evidence from many other Permo-Carboniferous tests in the Canning Basin that the best source rock is contained in the Poole and Noonkanbah Formations, with the Upper Grant having fair to good organic content (Lehman & Haines, 1985). The Poole Formation yielded the only oil shows in Bindi and also exhibited the best source rock characteristics with TOC values of 2.26 to 5.30% and potential yields of 2.43 to 6.59 kg hydrocarbons per tonne. Two major heating events controlled hydrocarbon generation from the Palaeozoic sediments in this area. The earliest event occurred around Tournasian time and was associated with extensive faulting, prior to uplift along the northern margin of the Fitzroy-Gregory Sub-basins. The second event was during the Late Triassic-Early Jurassic associated with the rifting phase of the Northwest Shelf break-up (W ulff, op cit).

6.1

S T RAT I G R A P H Y

The stratigraphic colum n for this area is shown in Figure 31 and indicates the multiple objective horizons that have hosted previous oil and gas shows. The distinction between the base Anderson Formation and the Laurel Formation is problematic in the literature, and in this figure the Laurel can be considered as part of the Fairfield Group.

6.3

RE SE R VO IR AN D S EA L

A number of good quality reservoirs can be anticipated in EP417, ranging in age from Late Devonian to Permian. The Poole sandstones in Bindi 1 had porosities of 20 to 27% at 910 metres, and a DST that indicated good permeability. The porosity range for the upper Grant Group was 13 to 30% at 990 metres. The individual clean sand bodies in Bindi-1 range in thickness from 6 to 77 metres with an average thickness of 20 metres.

41

In Olios 1, porosity is generally excellent, with the Poole Sandstone showing log porosities of 28 to 30%, and sandstones within the Grant Formation porosities between 26 and 37%. These sands are massive and generally free from clays, so their permeability can also be expected to be excellent (Crocker, 1984). The Laurel sands are thin and silty but still have good porosity at around 20%. The Late Devonian Knobby Sandstone had log porosities of 6 to 18%, although low permeability of between .01 and 4.8 mD (Klappa et al, 1984). In the Ngalti 1 well, however, the reservoir characteristics of parts of the Knobby Sandstone are much better, with porosities of 18 to 23% and permeabilities from 200 to 980 mD (Smith, 1985). The basal Laurel sands in Ngalti 1 also show excellent porosity and perm eability. Porous sandstones of the Upper Laurel Formation (part of the Fairfield Group) also offer high reservoir potential with porosities of 15 to 20% and permeability up to 500 mD. Oil flowed from Laurel Formation carbonates in Meda 1, and the same formation flowed gas in Yulleroo 1 and St George R ange 1. Intra-formational shales of the Laurel Formation offer good seal potential for Laurel sands, and shales within the Anderson Formation and the Grant Group offer adequate sealing potential for the Devonian and Carboniferous reservoirs. The widespread Noonkanbah Formation shales are relied on to provide seals for the Poole Sandstone.

Figure 32. EP 417, Structural provinces and prospects.

6.4.1 Lanagan Prospect The Lanagan prospect comprises five separate seismically defined clos ures ranging in size from 5 square kilom etres (1,235 acres) to 25 square kilometres (6,175 acres) Figure 33. The Lanagan A structure is the largest and most robust and is likely to be the first target in the New Standard drilling programme. The Lanagan objectives include the Knobby Sandstone, Laurel Formation sandstones, Grant Group sandstones and the Poole Sandstone. Devonian fore-reef shales (Gogo Formation) and m arls and/or Early Carboniferous Laurel Formation marine shales and limestones in adjacent downfaulted areas are expected to be the main source rocks for the prospect. A tight Knobby sandstone had gas shows in the nearby Lake Betty 1 well where it is in the gas generation window. This sandstone unit should be encountered more than 1200 metres shallower over the crest of the Lanagan structure, and thus exhibit better reservoir characteristics than at Lake Betty 1. Vertical seals for reservoirs over the crest of the Lanagan structure woul d be lower Laurel Form ation shales as encountered in Lake Betty 1. In the Sundown field, located on the southern edge of the Margaret Terrace to the northwest, 370 API oil was tested from Grant sandstones, whilst at Bindi-1 to the southeast, heavy immature oil shows were recorded in Poole sandstones. Thick Upper Grant shales should provide excellent vertical reservoir seals for Middle and Lower Grant reservoirs and the stratigraphically higher Poole sandstones should be vertically sealed by Poole and/or Noonkanbah shales. The trap at Lanagan is a horst block with four-way dip closure. It is a Carboniferous age structure with some Late Triassic regeneration. A cross-section from Lake Betty 1 through the Lanagan structure and to Bindi 1 is shown in Figure 34. The Lanagan A culmination has an area of approximately 25 square kilometres with a relief of around 110 metres. Using an area of 20 square kilometres, and a net pay of 15 metres, the potential oil in place for this structure is 220 million barrels under expected reservoir parameters.

6.4

P R O S P E CTS A N D L E A D S

Two wrench related Mesozoic prospects, Lawford and Spinifex, and an Early Carboniferous feature, the Lanagan prospect, have been identified in this permit since the 1980s (Munro and Burbury, 1988; Munro, 1986). Lawford and Spinifex, are in the Gregory Sub-basin portion of the permit. Lanagan is on the edge of the Balgo Terrace, a basinal position similar to the Blina and Sundown oil fiel ds on trend to the northwest. Four-way dip closure is anticipated on the main res ervoir units in all three pros pects, and economic quantities of hydrocarbons could have been generated and migrated into the m apped structures. The Lanagan prospect on the Balgo Terrace has the potential to intersect all reservoirs to the Devoni an, while Spinifex and Lawford offer primarily the PermoCarboniferous (Figure 32). The Lanagan prospect will likely be the first well drilled in this permit as it offers a test of a suite of four-way d i p a n ti c l i n a l s tr u c t u r e s t h a t h a v e d e v e l o p e d a l o n g t h e basin edge, at a depth of less than 2,000 metres. Here, mature oil source rock from within the Gregory Sub basin is expected to be juxtaposed against basal Laurel and Knobby sandstones.

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Figure 33. EP 417 Lanagan Prospect, 2-way time map near top Laurel carbonate.

Using an area of approximately 40 square kilometres, and a net pay of 15 m etres, the potential oil in pl ace for this structure exceeds 400 million barrels under expected reservoir parameters. Figure 35. EP 417, Lawford prospect, TWT base Grant Formation.

Figure 34. Diagrammatic Section Lake Betty 1 Lanagan Bindi 1.

6.4.3 Spinifex Prospect The Spinifex anticlinal complex is located north of the Lawford Prospect, and was first identified in 1981 by the Lake Betty SS (ESP Interior Pty Ltd, 1981). The target culmination is Spinifex A in Figure 36. It is well controlled by seismic in a dip direction, with one crestal strike line that ties the dip lines. Spinifex is a faulted, postrift compressional fold that formed in the Late Triassic, and was thus in place to receive oil from the Mesozoic generation from Gogo and Laurel shales. The Spinifex A culmination has an area of approximately 80 square kilometres (20,000 acres) with a relief of around 100 metres. Using an area of approximately 32 square kilometres, and a net pay of 15 metres, the potential oil in place for this structure is 350 million barrels under expected reservoir param eters. Figure 36. Spinifex prospect, EP 417 TWT Top Noonkanbah.

6.4.2 Lawford Prospect The Lawford structure (Figure 35) is a faulted anticline with 150 m etres of vertical relief over an areal extent of 69 square kilometres (17,000 acres). It is an Early Carboniferous structure that was rejuvenated during the Mesozoic wrenching event. Targets are the Poole Sandstone and sands within the Grant and Anderson Formations. The Knobby Sandstone is anticipated at depth but would not be drilled without encouragement from the shallower section. Although crestally faulted, the Noonkanbah Formation is expected to adequately seal the Poole Sandstone. Intraform ational Grant and Anderson shales are required to seal the deeper objectives. Seal is a risk in this pros pect. The structure formed in the Late Triassic, although early growth in the Devonian and Carboniferous has been suggested (Munro, 1986). The prospect was thus in place to receive oil from the Gogo and Laurel Formation shales during the time of generation up to the Early Jurassic.

43

CONCLUSION

New Standard has a large contiguous acreage position in the Canning Basin that encompasses both pre-salt and post-salt petroleum systems. Regional mapping has indicated a num ber of m ature and semi-mature pros pects that offer significant potential as indicated in Table 6 below. In addition, a large number of potential leads have been mapped throughout the companys permits. The company has attracted a joint venture partners to undertake extensive seismic surveying and drilling over the next one to two years, which could see the drilling of up to six wells. No pre-salt wells have been drilled on the companys acreage, which is ideally positioned to explore for Acacia Sandstone and Nita Formation targets. Provided suitable reservoir rocks can be found, thes e targets are expected to be sourced by the rich Goldwyer Shale. Targets are potentially large, and if hydrocarbons are present, the potential resource volumes given should be considered as possible estimates only. They have been calculated by using best-estimate projections of reservoir param eters from wel ls outside the New Standard permits. Aerial and net pay estimates used are lower than the maximum indicated by the present mapping to be conservative, and to reflect the structural risk associated w it h t hi s m a p pi n g. Reservoir quality and structure are the m ajor exploration risks present, but the exploration strategy adopted by New Standard is sound, and the proposed work program can be well justified from a technical viewpoint.

DECLARATION OF INDEPENDENCE AND VERACITY

ResourceInvest Pty Ltd has prepared this report at the request of New Standard Exploration and will be paid a normal consulting fee for this service. Payment of the fee is in no way contingent upon the outcome of the report. No other benefit will be received by ResourceInvest. Neither Peter Cameron nor Jennifer Baird has any pecuniary or other interest, which could be regarded as capable of affecting their ability to provide an unbiased opinion in relation to the report. ResourceInvest Pty Ltd believes that the report is a true, full and accurate account of the assets that comprise the subject of this report, and includes all relevant information and assumptions. Except to the extent indicated in the report, all inform ation and explanations requested and required to prepare the report were available and us ed subject to satisfactory verification to the extent set out in the report. The opinions expressed by ResourceInvest Pty Ltd in this report are independent and impartial. The information contained in this report was obtained from sources we believe to be reliable but ResourceInvest Pty Ltd, its directors, employees and consultants do not represent, warrant or guarantee that this information is complete or accurate and no liability is accepted for any errors or omissions.

Table 6.
Permit E P 4 4 2 (A ) EP 417

EP 442 and EP 417 Exploration Targets.

Prospect Woolnough Prider Lanagan A Lanagan B Spinifex A Lawford A Depth (metres) 2, 400 2, 500 1,800 1, 800 2, 000 2, 500 Target Ordovician Sands / Dolomite Ordovician Sands / Dolomite Devonian sands Devonian sands Permian sands Permian / Carboniferous sands Potential Oil in Place (million barrels) 330 165 220 150 350 440

44

QUALIFICATIONS

This report has been prepared by Peter Cameron of ResourceInvest Pty Ltd. ResourceInvest is an Oil & Gas sector consultancy that undertakes both technical and financial analysis.

Peter Cameron Peter Cameron graduated with a B Sc (Hons) in Geophysics from the University of Tasmania in 1971, and has held a number of managerial and cons ulting roles in both the res ource industry and the s ecurities industry. During his career he has worked for the Australian Government (Bureau of Mineral Resources / AGSO / GA), BHP Petroleum, Weeks Australia Ltd, Peko Oil Ltd, several stockbrokers, and as a consultant to the oil & gas, mining and securities industries. He has gained significant technical, management, and joint venture administrative experience in the oil & gas industry. He moved to the financial sector in 1986, as a resources analyst, before establishing his own consulting business. Ten years of consulting enabled him to work on both financial and technical aspects of the resource industry. After a period of full time resource sector research and research management with Johnson Taylor Potter (now Bell Potter Securities) he formed ResourceInvest Pty Ltd in 2001, with geologist Dr Jennifer Baird. Through ResourceInvest Pty Ltd, Peter provides contract and subscription research to the resource and finance sectors. ResourceInvest is the publisher of the Australian Oil & Gas Review. Peter is a Fellow and Certified Professional (Management) of the Australasian Institute of Mining and Metallurgy, and a Member of the Petroleum Exploration Society of Australia.

Jennifer Baird Jennifer Baird has a B.Sc (Hons) and Ph.D from Monash University. She spent three years as a staff geologist with Shell Australia, before becoming a consultant. For the past twelve years Jennifer has worked for clients including BHP Petroleum, Cue Energy N.L., Esso, Lakes Oil N.L., Mobil, Nexus Energy, Woodside, Santos and Shell. These assignments included seismic interpretation and mapping, depth conversions, geochemistry and biostratigraphy reviews, basin and gazettal reviews, farm-in and farm-out preparation and evaluations, and well post-mortems. A two-year period co-running a consultancy was undertak en during this tim e, which provided out-sourced seismic interpretation (sequence stratigraphy bas ed) that resulted in multi-client reports and study group projects covering m any Australian and S.E. Asian petroleum provinces. Clients included most of the companies now actively exploring in Australia. Jennifer formed ResourceInvest Pty Ltd with Peter Cameron in 2001 and now writes broader based resource company research, in addition to maintaining an active technical role in geological and geophysical consulting within the oil & gas industry. Jennifer is a Member of the Petroleum Exploration Society of Australia. Yours faithfully

Peter Cameron ResourceInvest Pty Ltd

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10 REFERENCES
Apak, S.N. & G.M. Carlsen, 1996, A compilation and review of data pertaining to the hydrocarbon Prospectivity in the Canning Basin, Geological Survey of Western Australia, Record 1996/10, 108p. Brown S. A, I. M. Boserio, K. S. Jackson, and K. W. Spence, 1984. The geological evolution of the Canning Basin - implications for petroleum exploration, in Purcell P. G., (Ed), The Canning Basin, W.A.: Proceedings of Geol. Soc. Aust./Pet. Expl. Soc. Aust. Symposium, Perth, 1984. Crocker, H., 1984. Olios 1 Petrophysical Interpretation, in Klappa, C.F., D.C. Shelby, & K.P. Appleton, 1984, Olios 1 W ell Completion Report, Gulf Oil Australia Ltd (unpublished), pp352. ESP Interior Pty Ltd, 1981, EP170 Annual Report, Appendix 3, 1981 Betty Terrace Seismic Survey Interpretation Report (unpublished). Ferdinando, D., 2003, Regional play analysis of the central Canning basin, in Petroleum in W estern Australia, Department of Industry & Resources, WA. Foster, C. B., G. W. OBrien, and S. T. Watson, 1986. Hydrocarbon source potential of the Goldwyer Formation, Barbwire Terrace, Canning Basin, Western Australia, APEA Journal, 26,1, pp142-155. Geological Survey of W estern Australia and Petroleum Division, 2002. Summary of petroleum Prospectivity, onshore Western Australia 2001: Canning, Officer, Southern Carnarvon, and Bonaparte Basins: Western Australia Geological Survey, 20p. Haynes, P . W., 2004, Depositional facies and regional correlations of the Ordovician Goldwyer and Nita Formations, Canning Basin, Western Australia, with implications for petroleum exploration, Western Australia Geological Survey, Record 2004/7, 45p. ISIS, 2006, Independent geological report on the hydrocarbon prospectivity of acreage held by Kingsway Oil Pty Ltd in the Canning Basin, Western Australia, (unpublished), available at http:// mem bers.iinet.net.au/~kingsway/ . Karajas, J., and Kernick, C. N., 1984, A prospective Nita Formation reservoir trend on the Broome Platform, in Purcell, P. G. (Ed), The Canning Basin, W.A.: Proceedings of Geol. Soc. Aust./Pet. Ex pl. Soc. Aust. Symposium, Perth, W.A., 1984, Proceedings, p. 169177. Kennard, J. M., M.J. Jackson, K.K. Romine, R.D. Shaw and P.N. Southgate, 1994, Depositional sequences and associated petroleum systems of the Canning Basin, WA, in Purcell, P.G. & R.R, (Eds), The Sedimentary Basins of Western Australia: Proceeding of Petroleum Ex ploration Society of Australia Symposium, Perth, 1994. King M. R., 1998. Looma-1 reopens the Palaeozoic play in the south Canning Basin, APEA Journal, 38,1, pp254-277. Klappa, C.F., D.C. Shelby, & K.P. Appleton, 1984, Oilios 1 W ell Completion Report, Gulf Oil Australia Ltd (unpublished), pp352. Lehmann, P.R., & R.A. Haines, 1985, Bindi 1 Well Completion Report, Volume 1, Santos Ltd (unpublished), pp89. Munro, A.S. & J.E. Burbury, 1988, Final Report Lawford Seismic Survey, EP170 Canning Basin, Command Petroleum, (unpublished). Munro, A.S., 1986, EP170 Lake McLernon Seismic Survey Interim Interpretation Report, Sydney Oil Company (unpublished). Smith, G., 1985, Ngalti 1 Well Completion Report, Pontoon Oil & Minerals NL (unpublished), pp48. Wulff, K., 1987, Source rock evaluation of the eastern Canning Basin, Petroz Petroleum Australia (unpublished), WAPIMS S 3147, pp189.

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7
7.1

INFORMATION DEEMED TO BE INCORPORATED IN P R O S P E C T U S

and future profitability of the Company. The factors referred to are economic risks, market conditions, risks related to investment in tungsten exploration, production risks, operating risks, compulsory work obligations, commodity price risks, additional requirements for capital, environmental risks, title and native title risks, risks associated with insurance, occupational health and safety, reliance on key management, legislation and the speculative nature of the investment. Section 5 Independent Geologists Report Section 5 contains the Independent Geologists Report prepared by Veronica Webster Pty Ltd. The report was included in the IPO Prospectus to assist investors and their financial advisors in making an assessment of the Companys production and exploration permits. Section 6 - Investigating Accountants Report & Financial Information Section 6 contains the Investigating Accountants Report prepared by RSM Bird Cameron Corporate Pty Ltd and financial information as prepared by the Company. The report and information were included in the IPO Prospectus to assist investors and their financial advisors in making an assessment of the financial position of the Company. Section 7 Solicitors Report on Tenements Section 7 contains a Solicitors Report on Tenements by Steinepreis Paganin in relation to the one exploration permit held by the Company at the time of the IPO and the Companys interests and obligations under such permit. Section 8 - Additional Inform ation Section 8 sets out additional information required to be disclosed in the IPO Prospectus including: (a) rights attaching to the Shares offered by the IPO Prospectus; (b) terms and conditions of options on issue at the date of the IPO Prospectus; (c) disclos ure of interests of Directors, including share qualifications, rem uneration and hol dings; (d) interests of persons named in the IPO Prospectus; (e) details of the consents of persons named in the IPO Prospectus; ( f) a s u m m a r y o f t h e m a t e r i a l c o n tr a c t s t o w h i c h t h e Company was a party at the time of the IPO; (g) expenses of the offer; (h) a statement that the Company is not involved in any legal proceedings, nor are any proceedings pending or threatened against the Company; and (i) an overview of the employee incentive scheme. 48

S H O R T FO R M P R O S P E CT U S

This Prospectus is a short form prospectus issued in accordance with section 712 of the Corporations Act. This means that this Prospectus does not of itself contain all the information that is generally required to be set out in a document of this type, however, it incorporates by reference information contained the IPO Prospectus that has been lodged with the ASIC. The inform ation to be incorporated by reference into this Prospectus is summarised below in section 7.2 and will primarily be of interest to investors and their professional advisors or analysts. Investors and their professional advisors are able to obtain a copy of the IPO Prospectus free of charge by contacting the Company at its registered office during normal business hours during the Offer Period. The IPO Prospectus will also be available by searching the ASICs records in relation to Hawk Resources Ltd, or by visiting the Companys website at www.hawkresources.com.au.

7.2

S U M M A R Y O F I N F O R M AT I O N D E E M E D TO B E I N C O R P O R AT E D

Set out below is a summary of the information contained in the IPO Prospectus that is deemed to be incorporated in this Pros pectus to assist investors and their professional advisors to determine whether they need to obtain a copy of the IPO Prospectus for the purposes of making an informed investment decision in relation to the Shares. The sections referred to in thi s section 7 are references to sections in the IPO Prospectus. Section 1 Details of the Offer Section 1 contains the details of the offer of Shares at IPO, including the purpose of the offer and how the funds raised were to be used. Section 2 Company and Project Overview Section 2 contains the following inform ation: (a) the business strategy and background of the Company; (b) an overview of the tungsten market; and (c) details on the Companys exploration projects. Section 3 Directors and Corporate Governance Section 3 contains inform ation relating to the Directors, key executive and advisors of the Company and details the Companys corporate governance policy. Section 4 - Risk Factors Section 4 notes that an investment in the Company has risks reasonably expected of an investment in a business of its type. It details a number of factors that may impact on the success

8
8.1

COMPANY ACTIVITIES SINCE LISTING

AC T I V I T I E S S I N C E L I S T I N G O N A S X

Since listing on ASX, the Company has completed the following key activities:

K e p p e l Cre e k Tu n g s t e n Te n e m e n t A p p l i c a t i o n ELA 5115 ( Vic)

On 25th October 2007, the Company announced to ASX that it had lodged Exploration License Application ELA 5115 (Keppel Creek Application)to the northwest of the Companys existing Wilks Creek project. The area covered by the Keppel Creek Application has known tungsten mineralisation in the north of the application area, which was identified from historical stream and soil sampling activities conducted in the early 1980s. Soil samples up to 75ppm W have been reported in the upper drainage area of Keppel Creek, which is approximately 12km north of the W ilks Creek Wolfram Mine and within the area covered by the Keppel Creek Application.

W i l k s Cre e k Tu n g s t e n Pro j e c t E L 4 9 4 4 ( V i c )
Since listing in August 2007, the Company has completed a series of grid soil sam pling programs at its W ilks Creek Project (EL 4944) and has now fully delineated and defined the large tungsten soil anomaly, ready for drilling. Close spaced samples have consistently shown patterns believed to reflect structural control on the tungsten hosting veins, giving the Company further confidence for targeting the planned drilling program. The Company has completed studies on the heavy mineralogical contents of the historic tailings. The study confirms that the target mineralogy is dominantly very coarse-grained wolframite, with miner scheelite. Trace pyrite and chalcopyrite is also present. All the metallurgical and plant records on the historical Wilks Creek plant have been compiled and the current sampling confirms the coarse nature, and limited range and amount of other heavy minerals.

M o u n t M c D o n a l d N o r t h C o a l Pro j e c t E P C 1 0 7 0
On 17th December 2007, the Company announced to ASX that it had acquired the right to a 100% interest in Exploration Permit for Coal EPC 1070 (Mount McDonald North) under an agreem ent with Kingsreef Pty Ltd (Kingsreef). EPC 1070 is prospective for semi-soft coking coal. The transfer of EPC 1070 from Kingsreef to the Company has been lodged and is awaiting registration. EPC 1070 is located in the central Bowen Basin of Central Queensland, approximately 25km north-east of Emerald, near road and rail facilities.

C a l l i e S o a k Tu n g s t e n Pro j e c t E L A 2 0 / 6 6 9 (WA)
On 3 October 2007, the Company announced to ASX that a Heads of Agreement had been signed with Richmond Resources Pty Ltd (Richmond) in relation to the Callie Soak Tungsten Project (ELA20/669) which is located approximately 40km west-northwest of Cue in W estern Australia. On 28 December 2007, the Company announced to ASX that its detailed due diligence had been completed, a formal sale and purchase agreement with Richmond had been executed in relation to ELA 20/669. ELA 20/669 is an application and as such remains in Richmonds name. Under the agreement, Richmond holds the Companys 80% interest in ELA 20/669 on trust until a tenem ent is granted, at which tim e Richm ond m ust transfer an 80% interest in the tenement to the Company and the Company must issue the $40,000 worth of Shares to Richmond or its nominee. Richm onds 20% interest is free carried until a feasibility study is completed.

8.2

I N T E N T I O N S I N R E L AT I O N TO E X I S T I N G HA W K AS S E T S

Following completion of the New Standard Offer, it is the intention of the Proposed Directors to undertake an assessment of the existing tungsten and coal assets in the Com panys exploration portfolio. Given the new focus of the Company will be oil and gas exploration, the Board will consider alternatives available to it in relation to crystallizing value for all shareholders.

49

INVESTIGATING A C C O U N TA N TS RE P O R T
BDO Kendalls Corporate Finance (WA) Pty Ltd Level 8, 256 St Georges Terrace PERTH WA 6000 PO Box 7426 Cloisters Square Perth WA 6850 Phone 61 9360 4200 Fax 61 9481 2524 bdo@bdo.com.au www.bdo.com.au ABN 27 124 031 045 AFS Licence No 316158

Our ref: PT:PC 16 June 2008 The Directors Hawk Resources Limited Level 16, 190 Queen Street Melbourne VIC 3000 Dear Sirs INVESTIGATING ACCOUNTANTS REPORT

1.

IN T R O D U CT IO N

We have prepared this Investigating Accountants Report (Report) on historical financial information of Hawk Resources Limited (Hawk or the Com pany) for inclusion in the Pros pectus. Broadly, the Prospectus will offer up to 32,500,000 shares at an issue price of $0.20 each (the Offer) to raise $6.5 million before costs with the ability to accept an additional $1.0 million in oversubscriptions at the discretion of the Directors. Expressions defined in the prospectus have the same meaning in this Report.

2.

B A S I S O F P R E PA R AT I O N

This Report has been prepared to provide investors with information on the Income Statement, Statement of Changes in Equity and the Balance Sheet and the pro-forma Balance Sheet and Statement of Changes in Equity as noted in Appendices 1, 2 and 3. The consolidated reviewed Hawk Income Statement for the half year ended 31 December 2007 has been prepared as if Hawk and New Standard Energy Limited (NSE) had been operating as one consolidated group for the entire year. This Report does not address the rights attaching to the shares to be issued in accordance with the Prospectus, nor the risks associated with the investment, and has been prepared based on the complete Offer being achieved. BDO Kendalls Corporate Finance (WA) Pty Ltd (BDO Kendalls) has not been requested to consider the prospects for the Company, the shares on offer and related pricing issues, nor the merits and risks associated with becoming a shareholder and accordingly has not done so, and does not purport to do so. BDO Kendalls accordingly takes no responsibility for these m atters or for any m atter or omission in the Pros pectus, other than res ponsibility for this Report. Risk factors are set out in the Prospectus.

3.

BACK G R O U N D

Hawk is an Australian based minerals expl oration com pany with its projects loc ated in Victoria with pros pects in tungs ten and gold. Since listing in August 2007, Hawk has made a number of acquisitions including a prospective tungsten tenement in Western Australia and a coking coal tenement located in the Bowen Basin in Queensland.

50

The companys tenement portfolio now includes: W ilks Creek Project: Pros pective tungsten tenem ent near Marysville in central Victoria where an active expl oration program has been maintained. Keppel Creek Project: Prospective tungsten tenement. Exploration licence application (EL5115) extends over a 79km area north of W ilks Creek Project. Callie Soak Project: Agreem ent signed for the acquisition of 80% interest in the project loc ated 40km west-northwest of Cue in W estern Australia. Prospective tungsten tenem ent with previ ous workings. Mount McDonald North: Prospective coking coal tenement in the Bowen Basin Queensland. The com pany has entered into a m erger implem entation agreem ent (Agreem ent) to acquire all of the fully paid ordinary shares of NSE through the issue of 70,405,508 fully paid ordinary shares of Hawk to the shareholders of NSE. As part of the Agreement Hawk will raise $6.5 million before costs pursuant to this prospectus through the issue of 32.5 million shares at $0.20 each with the ability to accept an additional $1.0 million in oversubscriptions at the discretion of the Directors. NSE is an emerging oil and gas explorer with a significant land holding in the Canning Basin. The Canning Basin has been recognised as being highly prospective for hosting sizeable targets for oil and gas exploration and discovery. NSE is of the view that the Canning Basin has remained largely unexplored due to a few main reasons: Historical prices for oil and gas being well below current levels. W ith the recent rise in oil and gas prices globally, previously uneconomic targets are now becoming much more attractive to pursue Logistical difficulties in accessing the remote region and securing access to enable exploration to proceed. NSE now has granted exploration permits with native title approvals to enable suc h exploration to proceed Lack of expl oration and res ulting data has resulted in m any of the secrets of the Basin rem aini ng misunderstood. NSE has revisited its acreage and prioritised its targets bas ed on a different perspective to most previous and c urrent explorers in the region As a result NSE is now uniquely positioned to develop as a major player in the re-energised push into exploring the Canning Basin which today still rem ains one of the worlds largest and m ost under explored regions known to host significant occurrences of oil and gas.
2

4.

SCOP E

You have requested BDO Kendalls to prepare an Investigating Accountants Report covering the following financial information: the Income Statement for the half year ended 31 December 2007; the reviewed Balance Sheet and Statement of Changes in Equity as at 31 December 2007; the proforma Balance Sheet and Statement of Changes in Equity as at 31 December 2007 reflecting the actual position as at that date, major transactions between that date and the date of our report and the proposed capital raising under the Prospectus; and t h e a c c o u n t i n g p o l i c i e s a p p l i e d b y H a w k i n p r e p a r i n g i t s fi n a n c i a l s t a t e m e n t s . The historical financial information set out in the appendices to this Report has been extracted from the financial statements of the Company for the half year ended 31 December 2007. The Directors are responsible for the preparation of the historical financial information including determination of the adjustments. We have conducted our review of the historical financial information in accordance with the Australian Auditing and Assurance Standard AUS 902 Review of Financial Reports. W e made such inquiries and performed such procedures as we, in our professional judgment, considered reasonable in the circumstances including: a review of work papers, accounting records and other documents pertaining to balances in existence at 31 December 2007; a review of the assumptions used to compile the pro-forma Balance Sheet; a review of the adjustments made to the pro-forma historical financial information; a comparison of consistency in application of the recognition and measurement principles in Accounting Standards and other mandatory professional reporting requirements in Australia, and the accounting policies adopted by the Company disclosed in the appendices to this Report; and enquiry of Directors and others. These procedures do not provide all the evidence that would be required in an audit, thus the level of assurance provided is less than given in an audit. We have not performed an audit and, accordingly, we do not express an audit opinion. Our review was limited primarily to an examination of the historical financial information, the pro-forma financial information, analytical review procedures and discussions with both management and Directors. A review of this nature provides less assurance than an audit and, accordingly, this Report does not express an audit opinion on the historical information or proforma financial inform ation included in this Report or elsewhere in the Pros pectus. In relation to the information presented in this Report: support by another person, corporation or an unrelated entity has not been assumed;

51

 the amounts shown in respect of assets do not purport to be the amounts that would have been realised if the assets were sold at the date of this Report; and the going concern basis of accounting has been adopted.

5.

C O N C LU S I O N

Statem ent on Historical Financial Information Based on our review, which was not an audit, nothing has come to our attention which would cause us to believe the historical financial inform ation as set out in the Appendices to this report does not pres ent fairly the financial performance for the period ended 31 December 2007 or the financial position as at 31 December 2007 in accordance with the measurement and recognition requirem ents (but not all of the disclos ure requirem ents) of applicable Accounting Standards and other m andatory professional reporting requirements in Australia. Statem ent of Pro-forma Financial Information Based on our review, which was not an audit, nothing has come to our attention which would cause us to believe the pro-forma financial information does not present fairly the financial position of the Company as at 31 December 2007, in accordance with the m easurem ent and recognition requirem ents (but not all of the disclosure requirements) of applicable Accounting Standards and other m andatory professional reporting requirem ents in Australia as if the pro-form a transactions had occurred on that date.

6.

SUBSEQUENT EVENTS

Apart from the matters dealt with in this Report, and having regard to the scope of our Report, to the best of our knowledge and belief, no other material transactions or events outside of the ordinary business of the Company have come to our attention that would require com m ent on, or adjustment to, the information referred to in our Report or that would c ause suc h information to be misleading or deceptive. Significant events subsequent to 31 December 2007 and prior to the date of this report are as follows: The issue of 5.9 million NSE Director options valued at $365,181; Added exploration costs of $40,000 in Hawk and $76,000 in NSE for the period from 31 December 2007 to the date of this report; The issue of 137,500 fully paid ordinary shares in Hawk and a cash payment of $20,000 as consideration for the purchase of the Tungsten Project. The value of these shares at transaction date were deemed to be $0.40 per share; The issue of 4,166,667 fully paid ordinary shares in NSE at $0.18 per share to raise $641,941, net of capital raising costs, for working capital purpos es; and The subsequent cancellation of the 5.9 million NSE Director options valued at $365,181.

7.

AS S U M P T I O N S A D O P T E D I N C O M P I L I N G T H E P R O -F O R M A B A L A N C E S H E E T

The pro-forma balance sheet post issue is shown in Appendix 2. This has been prepared based on the reviewed financial statements as at 31 December 2007 and the transactions and events relating to the issue of shares under this Prospectus: The issue of 32.5 million fully paid ordinary shares at $0.20 each, to raise $6.5 million pursuant this pros pectus; The payment of expenses associated with the preparation and the issue of the prospectus and the relisting of the company amounting to $625,000. These costs have been netted of against the share capital raised; The issue of 13.5 million options to the Directors of NSE valued at $1,665,900; The issue of 1 million options to Cygnet Capital as payment for services, valued at $130,200. These costs have been netted of against share capital raised; and The consolidation of NSE, following the acquisition of NSE. Consideration for the acquisition is the issue of 70,405,508 fully paid ordinary shares of Hawk plus associated transaction costs of $50,000

8.

D I S C LO S U R E S

BDO Kendalls Corporate Finance (WA) Pty Ltd is the corporate advisory arm of BDO Kendalls in Perth. Neither BDO Kendalls Corporate Finance (WA) Pty Ltd nor BDO Kendalls, nor any director or executive or employee thereof, has any financial interest in the outcome of the proposed transaction except for the normal professional fee due for the preparation of this Report. Consent to the inclusion of the Investigating Accountants Report in the Prospectus in the form and context in which it appears, has been given. At the date of this Report, this consent has not been withdrawn. Yours faithfully BDO Kendalls Corporate Finance (WA) Pty Ltd Peter Toll Director 52

APPENDIX 1

HAWK RESOURCES LIMITED INCOME STATEMENT

Hawk reviewed half year ended 31 December 2007 $ NSE reviewed half year ended 31 December 2007 $ 106, 665 1, 185, 945 1, 292, 610 Pro-forma for t he hal f y ear ended 31 December 2007 $ 205, 187 1, 18 5, 94 5 1, 391, 132

Revenue R ev e nu e Impairment rev ersal of deferred exploration and ev aluation expendi ture Total Revenue Expenses Administrative expenses Depreciation Exploration expenditure Consulting fees Directors fees Bad debts Rent Travel Profit/(Loss) from ordinary activities before income tax expense Income tax expense relating to ordinary activities Net Profit/(loss) from ordinary activities after income tax expense attributable to m em bers (103, 346) (18, 520) (38, 873) (62, 217) (62, 217) (8, 651) (1, 644) (82, 570) (50, 000) (61, 278) (30, 458) (9, 214) 1, 048, 795 1, 048, 795 (111, 997) (1, 644) (18, 520) (82,570) (88, 873) (61,278) (30,458) (9, 214) 986, 578 986,578 98, 522 98, 522

The Income Statement is to be read in conjunction with the notes to and forming part of the historical financial information set out in Appendix 4. Note: The pro-forma Income Statement assumes the acquisition of NSE occurred at the commencement of the half year ended 31 December 2007. Note: No income tax expense is required to be recognised for NSE for the half year ended 31 December 2007 as there are adequate available carried forward tax losses.

53

APPENDIX 2 HAWK RESOURCES LIMITED BALANCE SHEET

Hawk reviewed 31 December 2007 $ CURRENT ASSETS Cash and cash equivalents Trade and other receivables TOTAL CURRENT ASSETS NON-CURRENT ASSETS Deferred exploration and evaluation Other financial assets Intangibles Plant and equipment Other TOTAL NON-CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Trade and other payables Deferred tax TOTAL CURRENT LIABILITIES TOTAL LIABILITIES NET A SSETS EQUITY Contributed equity Retained earnings/ (accumulated losses) Reserves TOTAL EQUIT Y 7 8 9 3, 998, 567 (77, 389) 18, 520 3,939,698 2, 967, 001 16, 510 2,983,511 696, 941 696,941 8, 473, 7 33 (2,926,313) 1, 777, 580 7,325,000 16, 136, 242 (2, 987, 192) 1, 796, 100 14,945,150 6 37, 890 37,890 37,890 3,939,698 68, 873 68,873 68,873 2,983,511 696,941 450,000 450,000 450,000 7,325,000 106,763 450, 000 556,763 556,763 14,945,150 3 4 5 250, 292 77, 901 328,193 3,977,588 1, 400, 535 58, 513 1,459,048 3,052,384 191, 000 191,000 696,941 1, 950, 000 1,950,000 7,775,000 3, 791, 827 58, 513 77, 901 3,928,241 15,501,913 2 3, 611, 628 37, 767 3,649,395 1, 576, 077 17, 259 1,593,336 505, 941 505,941 5, 825, 000 5,825,000 11, 518, 646 55, 026 11,573,672 NSE reviewed 31 December 2007 $

Notes

Subsequent Events $

Pro-forma Adjustments $

Pro-forma A f te r I s s u e $

The pro-forma Balance Sheet after Issue is as per the Balance Sheet before Issue adjusted for significant subsequent events since 31 December 2007 and the transactions relating to the issue of shares pursuant to this Prospectus. The Bal ance Sheet is to be read in conjunction with the notes to and forming part of the historical financial information set out in Appendix 4. The above pro-forma Balance Sheet has been based on the minimum subscription. If the oversubscriptions are achieved the cash and cash equivalents and contributed equity will increase by $1,000,000 less additional costs of the offer of $60,000. The transaction costs have assumed zero stamp duty is payable based on specific legal advice the Company has received in relation to this transaction. 54

APPENDIX 3 HAWK RESOURCES LIMITED S TA TE M E N T O F C H A N G E S I N E Q U I TY

Hawk reviewed 31 December 2007 $ Balance as at 1 July 2007 Profit/(Loss) for the period Total recognised for the period Transactions with equity holders in their capacity as equity holders: Contributions of equity, net of transaction costs Share based payments Reserve Total equity 3, 998, 567 18, 520 3,939,698 2, 967, 001 2,983,511 696, 941 696,941 8, 473, 733 1,777,580 7,325,000 16, 136, 242 1, 796, 100 14,945,150 (15, 172) (62, 217) (77,389) NSE reviewed 31 December 2007 $ (1, 032, 285) 1, 048, 795 16,510 Subsequent Events $ Pro-forma Adjustments $ (2,926,313) (2,926,313) Pro-forma after Issue $ (1, 047, 457) (1, 939, 735) (2,987,192)

The Statement of Changes in Equity is to be read in conjunction with the notes to and forming part of the historical financial information set out in Appendix 4.

55

APPENDIX 4 HAWK RESOURCES LIMITED NOTES TO AND FORMING PART OF THE HISTORICAL FINANCIAL INFORMATION FOR THE PERIOD ENDED 31 DECEMBER 2007
1. S U M M A R Y O F S IG N IF I CA N T AC C O U N T IN G P O L IC IE S

The significant accounting policies adopted in the preparation of the historical financial information included in this Report have been set out below. (a) Basis of preparation of historical financial information The historical financial information has been prepared in accordance with the recognition and m eas urem ent, but not all the disclosure requirem ents of the Australian equivalents to International Financial Reporting Standards (AIFRS), other authoritative pronouncements of the Australian Accounting Standards Board, Australian Accounting Interpretations and the Corporations Act 2001. The financial report has also been prepared on a historical cost basis, except for derivatives and available-for-sale financial assets that have been measured at fair value. The carrying values of recognised assets and liabilities that are hedged are adjusted to record changes in the fair value attributable to the risks that are being hedged. Non-current assets and disposal groups held-for-sale are m easured at the lower of carrying amounts and fair val ue less costs to sell. Compliance with AIFRS ensures that the financial report, comprising the financial statements and notes thereto, complies with International Financial Reporting Standards. (b) Reverse Acquisition In accordance with AASB 3 Business Combinations, when Hawk (the legal parent) acquired NSE (the legal subsidiary), the acquisition was deemed to be a reverse acquisition since the substance of the transaction is that the existing shareholders of NSE have effectively acquired Hawk. Under reverse acquisition accounting, the consolidated financial statements are prepared as if NSE had acquired Hawk, not vice versa as represented by the legal position. In reverse acquisition accounting, the cost of the business is deemed to have been incurred by the legal subsidiary (the ac quirer for accounting purposes) in the form of equity instrum ents issued to the owners of the legal parent (the acquiree for accounting purposes). However, due to the fact that the fair value of the equity instrum ents of the legal subsidi ary (NSE) was not clearly evident at the date at which the control was passed, the alternative method was elected (per AASB 3, para B6), where the cost of the business combination was determined as the total fair value of all the issued equity instrum ents of the legal parent (Hawk) immedi ately prior to the business com bination. In the separate financial statements of the legal parent (Hawk), the investment in legal subsidiary (NSE) was accounted for at cost. As a consequence: an exercise is performed to fair value the ass ets and liabilities of the legal ac quirer, NSE; the cost of investment held by the legal parent (Hawk) in the legal subsidiary (NSE) reversed on consolidation and the cost of reverse acquisition is eliminated on consolidation against the consolidated equity and reserves of Hawk and its consolidated entities at the date when control is passed. The effect of this is to restate the consolidated equity and reserves balances to reflect those of NSE at the date of acquisition; the amount recognised as issued equity instruments are determined by adding to the issued equity of the legal subsidiary immediately before the business combination, the cost of the combination; and the consolidated financial statements are issued under the name of the legal parent (Hawk) but are a continuation of the financial statements of the deemed acquirer (NSE) under the reverse acquisition rules. Hence the comparative figures on the consolidated financial statements are that of Hawk and its controlled subsidiary for the half year ended 31 December 2007. (c) Foreign Currency Translation The functional and presentation currency of Hawk is Australian dollars (A$). Foreign currency trans actions are translated into the functional currency using the exc hange rates ruling at the date of the trans action. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exc hange ruling at the balance sheet date. Foreign exc hange gains and loss es resulting from settling foreign currenc y trans actions, as well as from restating foreign c urrenc y denominated m onetary assets and liabilities, are recognised in the incom e statem ent, except for differences on foreign currency borrowings that provide a hedge against a net investment in a foreign entity. Non-m onetary items meas ured at fair value in a foreign currency are translated using the exc hange rates at the date when fair value was determined. 56

(d) Revenue Recognition Revenue from the sale of goods or services is recognised when the service is provided. Sale of Goods and Services Revenue from sale of goods or services is recognised when the significant risks and rewards of ownership have passed to the buyer and can be reliably measured. Risks and rewards are considered passed to buyer when goods have been delivered to the customer. Interest Revenue is recognised as interest accrues using the effective interest method. The effective interest method uses the effective interest rate which is the rate that exactly discounts the estimated future cash receipts over the expected life of the financial asset. (e) Income Tax The income tax expense for the period is the tax payable on the current periods taxable income based on the national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to tem porary differences between the tax base of assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses. Deferred tax assets and liabilities are recognised for all tem porary differences, between carrying am ounts of assets and liabilities for financial reporting purposes and their respective tax bases, at the tax rates expected to apply when the assets are recovered or liabilities settled, based on those tax rates which are enacted or substantively enacted for each jurisdiction. Exc eptions are m ade for certain tem porary differences arising on initial recognition of an asset or a liability if they aros e in a transaction, other than a business com bination, that at the time of the trans action di d not affect either accounting profit or taxable profit. Deferred tax assets are only recognised for deductible tem porary differences and unused tax losses if it is probable that future taxable am ounts will be available to utilise thos e tem porary differences and losses. Deferred tax assets and liabilities are not recognised for temporary differences between the carrying amount and tax bases of investments in controlled entities, associates and interests in joint ventures where the parent entity is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future. Current and deferred tax balances relating to amounts recognised directly in equity are al so recognised directly in equity. (f) Impairment of Assets At each reporting date the Company assesses whether there is any indication that individual assets are impaired. W here impairm ent indicators exist, recoverable am ount is determined and impairment loss es are recognised in the incom e statem ent where the assets carrying value exceeds its recoverable amount. Recoverable amount is the higher of an assets fair value less costs to sell and value in use. For the purpose of assessing value in use, the estimated future cash flows are discounted to their pres ent value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Where it is not possible to estimate recoverable amount for an individual asset, recoverable amount is determined for the cash-generating unit to which the asset belongs. (g) Cash and Cash Equivalents Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the balance sheet. (h) Investments and Other Financial Assets All investments and other financial assets are initially stated at cost, being the fair value of consideration given plus ac quisition costs. Purchases and sales of investments are recognised on trade date which is the date on which the Company commits to purchas e or sell the asset. Accounting policies for each category of investments and other financial assets subsequent to initial recognition are set out below. Held for Trading Investm ents held for trading are measured at fair value with gains or losses recognised in the incom e statem ent. A financial asset is classified as held-for-trading if acquired principally for the purpose of selling in the short term or if it is a derivative that is not designated as a hedge. Investments held for trading are classified as current assets on the balance sheet. Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets with fi xed or determinable paym ents and fi xed m aturities that the Company has the positive intention and ability to hold-to-maturity and are measured at amortised cost subsequent to initial recognition using the effective interest method. Available-for-sale financial assets Available-for-sale financial assets com prise investments in listed and unlisted entities and any non-derivatives that are not classified as any other category, and are classified as non-current assets. After initial recognition, these investments are

57

measured at fair value with gains or losses recognised as a separate component of equity (available-for-sale investments revaluation reserve). W here losses have been recognised in equity and there is objective evidence that the asset is impaired, the cum ulative loss, being the difference between the ac quisition cost and current fair val ue less any im pairment loss previously recognised in the income statement, is removed from equity and recognised in the income statement. Reversals of impairment losses on equity instrum ents classified as available-for-sale cannot be reversed through the i ncom e statement. Reversals of impai rment losses on debt instrum ents classified as available-for-sale can be reversed through the incom e statem ent where the reversal relates to an increas e in the fair value of the debt instrum ent occurring after the impairment loss was recognised in the income statement. Loans and receivables Non-current loans and receivables include loans due from related parties repayable no earlier than 365 days of balance sheet date. As thes e are non-interest bearing, fair val ue at initial recognition requires an adjustment to discount thes e loans us ing a market-rate of interest for a similar instrument with a similar credit rating. The discount is credited to the income statement immediately and am ortised using the effective interest method. (i) Fair value estimation Fair values may be used for financial asset and liability measurement and well as for sundry disclosures. Fair values for financial instruments traded in active markets are based on quoted market prices at balance sheet date. The quoted market price for financial assets is the current bid price and the quoted market price for financial liabilities is the current ask price. The fair value of financial instrum ents that are not traded in an active market are determined using valuation tec hniques. Assumptions used are based on observable market prices and rates at balance date. The fair value of long-term debt instruments is determined using quoted market prices for similar instruments. Estimated discounted cash flows are used to determine fair value of the remaining financial instruments. The fair value of forward exchange contracts is determined using forward exchange market rates at balance sheet date. The fair value of interest rate swaps is calculated as the present value of estim ated future cas h flows. The fair value of trade receivables and payables is their nominal value less estimated credit adjustments. (j) Payables Trade and other payables represent liabilities for goods and services provided to the Company prior to the year end and which are unpaid. These amounts are unsecured and have 30-60 day payment terms. (k) Employee Benefits Wages and Salaries, Annual Leave and Sick Leave Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave expected to be settled within 12 months of balance sheet date are recognised in respect of employees services rendered up to balance sheet date and measured at amounts expected to be paid when the liabilities are settled. Liabilities for non-accumul ating sick leave are recognised when leave is taken and measured at the actual rates paid or payable. Liabi lities for wages and salaries are included as part of Other Payables and liabilities for annual and sick leave are included as part of Employee Benefit Provisions. Long Service Leave Liabilities for long service leave are recognised as part of the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees to the balance sheet date using the projected unit credit method. Consideration is given to expected future salaries and wages levels, experience of employee departures and periods of service. Expected future payments are discounted using national government bond rates at balance sheet date with terms to m aturity and c urrency that match, as clos ely as possible, the estimated future cas h outflows. Profit-sharing and Bonus Plans The Company recognises an expense and a liability for bonuses and profit-sharing when the entity is contractually obliged to make such payments or where there is past practice that has created a constructive obligation. Retire ment Benefit Obligations The Company has a defined contribution superannuation fund. Contributions are recognised as expenses as they become payable. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available. (l) Contributed Equity Ordinary shares are classified as equity. Mandatorily redeem able preference s hares are classified as liabilities. Costs directly attributable to the issue of new shares or options are shown as a deduction from the equity proceeds, net of any income tax benefit. Costs directly attributable to the issue of new shares or options associated with the acquisition of a business are included as part of the purchase consideration.

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(m) Exploration and evaluation expenditure Exploration and evaluation expenditure encompasses expenditures incurred by the Company in connection with the exploration for and evaluation of mineral res ources before the tec hnical feasibility and comm ercial viability of extracting a mineral resource are demonstrable. Exploration and evaluation expenditure incurred by the Company is accumulated for each area of interest and recorded as an a s s e t i f: (i) the rights to tenure of the area of interest are current; and (ii) at least one of the following conditions is also m et: (1) the exploration and evaluation expenditures are expected to be recouped through successful development and exploitation of the area of interest, or alternatively, by its sale; and (2) exploration and evaluation activities in the area of interest have not at the reporting date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing. For eac h area of interest, expenditure incurred in the ac quisition of rights to explore is capitalised, classified as tangible or intangible, and recognised as an exploration and evaluation asset. Exploration and evaluation assets are measured at cost at recognition. Exploration and evaluation expenditure incurred by the Company subsequent to acquisition of the rights to explore is expensed as incurred. A provision for unsuccessful exploration and evaluation is created against each area of interest by means of a charge to the income statement. The recoverable amount of each area of interest is determined on a bi-annual basis and the provision recorded in respect of that area adjusted so that the net carrying amount does not exceed the recoverable amount. For areas of interest that are not considered to have any commercial value, or where exploration rights are no longer current, the capitalised amounts are written off against the provision and any remaining amounts are charged against profit. Recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful development and comm ercial expl oitation, or alternatively, sale of the res pective areas of interest. (n) Goods and Services Tax Revenues, expenses and assets are recognised net of GST except where GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item. Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet. Cash flows are included in the cash flow statement on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority. (o) Share Based Payments The Company provides benefits to employees (including directors) of the Company in the form of share-based payment transactions, whereby employees render services in exchange for shares or options over shares (equity-settled transactions). The fair value of options is recognised as an expense with a corresponding increase in equity (share option reserve). The fair value is measured at grant date and recognised over the period during which the holder become unconditionally entitled to the options. Fair value is determined by an independent valuer using a Black-Scholes option pricing model. In determining fair value, no account is taken of any performance conditions other than those related to the share price of Hawk (market conditions). The cumulative expense recognised between grant date and vesting date is adjusted to reflect the directors best estimate of the number of options that will ultimately vest because of internal conditions of the options, such as the employees having to rem ain with the com pany until vesting date, or such that em ployees are required to m eet internal sales targets. No expense is recognised for options that do not ultimately vest because internal conditions were not met. An expense is still recognised for options that do not ultimately vest because a market condition was not met. Where the terms of options are modified, the expense continues to be recognised from grant date to vesting date as if the terms had never been changed. In addition, at the date of the modification, a further expense is recognised for any increase in fair value of the transaction as a result of the change. W here options are cancelled, they are treated as if vesting occurred on cancellation and any unrecognised expenses are taken immediately to the income statement. However, if new options are substituted for the cancelled options and designated as a replacement on grant date, the combined impact of the cancellation and replacement options are treated as if they were a modification.

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Reviewed 31 December 2007 $ NOTE 2. CASH AND CASH EQUIVALENTS Cash at bank Adjustments arising in the preparation of the pro-forma balance is summarised as follows: Reviewed balance at 31 December 2007 NSE cash at bank balance at 31 December 2007 Payments for added exploration costs Cash consideration as payment for purchase of Tungsten Project Proceeds from the issue of fully paid ordinary shares in NSE for working capital purposes net of transaction costs. 3, 611, 628

Pro-forma A f te r I s s u e $

11, 518, 646

3, 61 1, 62 8 1, 576, 077 (116, 000) (20, 000) 641, 941 5, 693, 646

Proceeds from shares issued under this Prospectus Share issue costs Transaction costs at acquisition of NSE Pro-forma Balance If the over subscriptions are achieved, cash and cash equivalents will increase by $1,000,000 less additional costs of the issue of $60,000.

6, 500, 000 (625, 000) (50, 000) 11, 518, 646

NOTE 3. EXPLORATION AND EVALUATION EXPENDITURE Exploration and Evaluation Expenditure Adjustments arising in the preparation of the pro-forma balance is summarised as follows: Reviewed balance at 31 December 2007 NSE Exploration and evaluation expenditure balance at 31 December 2007 Acquisition of tenements Additional exploration and evaluation expenditure subsequent to 31 December 2007 250, 292 1, 400, 535 75, 000 116, 000 1, 841, 827 Fair value adjustment of Hawk on consolidation of NSE Pro-forma Balance 1, 950, 000 3, 791, 827 250, 292 3, 791, 827

NOTE 4. OTHER FINANCIAL ASSETS Investment in controlled entities Adjustments arising in the preparation of the pro-forma balance is summarised as follows: Reviewed balance at 31 December 2007 The acquisition of NSE through the issue of 70,405,508 fully paid ordinary shares in Hawk Elimination of investment in NSE on consolidation Pro-forma Balance 14, 0 8 1, 10 2 (14, 081, 102) -

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Reviewed 31 December 2007 $ NOTE 5. INTANGIBLES Goodwill Adjustments arising in the preparation of the pro-forma balance is summarised as follows: Reviewed balance at 31 December 2007 Goodwill recognised in Hawk on consolidation of NSE W rite off of goodwill in Hawk Pro-forma Balance -

Pro-forma A f te r I s s u e $

1, 337, 802 (1, 337, 802) -

NOTE 6. DEFERRED TAX Deferred tax liabilities Adjustments arising in the preparation of the pro-forma balance is summarised as follows: Reviewed balance at 31 December 2007 Deferred tax asset recognised on acquisition of NSE Pro-forma Balance 450, 000 450, 000 450, 000

NOTE 7. CONT RIBUTE D EQUIT Y N u mb e r o f Shares As at 31 December 2007 Adjustments arising in the preparation of the pro-forma balance is summarised as follows: Shares issued as part consideration for acquisition of the Coal Project from Kingsreef Proceeds from the issue of fully paid ordinary shares in NSE for working capital purposes net of transaction costs. Share capital of NSE as at 31 December 2007 137, 500 33, 6 3 7, 50 1 Shares at $0.20 each issued pursuant to the Prospectus Share issue expenses 1 million options issued to sponsoring broker Fully paid ordinary shares issued as consideration for the acquisition of NSE Elimination of fully paid ordinary shares issued as consideration for the acquisition of NSE Elimination of the share capital of Hawk in reverse acquisition Consideration for the acquisition of NSE Pro forma balance If the oversubscriptions are achieved, contributed equity will increase by 5,000,000 shares to raise an additional $1,000,000 less additional costs of $60,000. 32, 5 0 0, 00 0 70, 40 5, 5 08 136, 543, 009 55, 000 641, 941 2, 967, 001 7, 662, 509 6, 500, 000 (625, 000) (130, 200) 14, 081, 10 2 (14, 081, 102) (3, 998, 567) 6, 727, 500 16, 136, 242 33, 5 0 0, 00 1 $

3, 998, 567

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Reviewed 31 December 2007 $ NOTE 8. RETAINED EARNINGS/(ACCUMULATED LOSSES) Accumulated Losses Adjustments arising in the preparation of the pro-forma cash balance is summarised as follows: Reviewed balance at 31 December 2007 Balance of retained earnings in NSE Elimination of retained earnings balance of Hawk on reverse acquisition 5.9 million options issued to Directors for nil consideration Cancellation of 5.9 million options 13.5 million options issued to Directors of the company Write off of goodwill on acquisition of NSE Pro forma balance 77,389

Pro-forma A f te r I s s u e $

2, 987, 192

77, 389 (16, 510) (77, 389) 365, 181 (365, 181) 1, 66 5, 9 00 1, 33 7, 8 02 2, 98 7, 1 92

NOTE 9. RESERVES Number of Options As at 31 December 2007 Cancellation of the pre-acquisition share based payments reserve in Hawk 5.9 million options issued to Directors Cancellation of 5.9 million options issued to Directors 13.5 million options issued to Directors 1 million options issued to Sponsoring Broker for nil consideration Proforma balance 4, 100, 000 (4, 100, 000) 5,900,000 (5, 900, 000) 13, 500, 000 1, 000, 000 14, 500, 000 $

18, 520 (18, 520) 365, 181 (365, 181) 1, 665, 900 130, 200 1, 796, 100

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a) 4,500,000 options were issued to the Directors with an exercise price of $0.28 and a term of 4 years. Using the Black Scholes Model the fair value of an option is approximately $0.0580 cents based on the following criteria: Input Value Underlying share price $0.18 cents Exercise price $0.28 cents Expected volatility 60% Option life 4.0 years Expected dividends Nil Risk free interest rate 6.26% b) 1,400,000 options were issued to the Directors of the Company with an exercise price of $0.18 and a term of 4 years. Using Black Scholes Model, the fair value of an option is approximately $0.0728 cents based on the following criteria: Input Value Underlying share price $0.18 Exercise price $0.216 Expected volatility 50% Option life 4 years Expected dividends Nil Risk free interest rate 6.26% c) 13,500,000 options were issued to the Directors of the Company with 50% exercisable at a price of $0.20 and 50% exercisable at a price of $0.25 with terms of 4 years. Using Black Scholes Model, the fair value of an option is approximately $0.1302 and $0.1166 cents respectively based on the following criteria: Input Value Underlying share price $0.23 Exercise price 50% at $0.20 and 50% at $0.25 Expected volatility 60% Option life 4 years Expected dividends Nil Risk free interest rate 6.64% d) 1,000,000 options were issued to Sponsoring Broker with an exercise price of $0.20 and a term of 4 years. Using Black Scholes Model, the fair value of an option is approximately $0.1302 cents based on the following criteria: Input Value Underlying share price $0.23 Exercise price $0.20 Expected volatility 60% Option life 4 years Expected dividends Nil Risk free interest rate 6.64% NOTE 9: RELATED PARTY DISCLOSURES Transactions with Related Parties and Directors Interests are disclosed in the Prospectus. NOTE 10: COMMITMENTS AND CONTINGENCIES At the date of the report no material commitments or contingent liabilities exist that we are aware of, other than thos e disclosed in the prospectus.

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10

SOLICITORS REPORT ON PERMITS

10. 1 S HO R T FO RM P RO SP ECT US
Steinepreis Paganin has completed a Solicitors report in relation to NSEs permits (Solicitors Report). This Prospectus is a short form prospectus issued in accordance with section 712 of the Corporations Act. This means that this Prospectus does not of itself contain all the information that is generally required to be set out in a document of this type, however, it incorporates by referenc e inform ation contained the Solicitors Report that has been lodged with the ASIC. The inform ation to be incorporated by reference into this Prospectus is summarised below in section 10.2 below and will primarily be of interest to investors and their professional advisors or analysts. Investors and their professional advisors are able to obtain a copy of the Solicitors Report free of charge by contacting the Company at its registered office during normal business hours during the Offer Period. The Solicitors Report will also be available by searching the ASICs records in relation to Hawk, or by visiting either the Companys website at www.hawkresources.com.au or NSEs website at www.newstandard.com.au.

Section 4 Report Section 4 provides details on: (a) NSEs interest in the permits; (b) the standing of NSEs permits; and (c) third party interests in NSEs permits. Section 5 Description of the Permits Section 5 summarises the nature of NSEs permits as established and governed by relevant legislation, including relevant rights, term and conditions. Section 6 Aboriginal Heritage Section 6 summarises the application of aboriginal heritage legislation to NSEs permits. Section 7 Native Title Section 7 identifies native title claims and determinations that apply to the land covered by NSEs permits, and summ arises the effect of native title on NSEs permits. Section 8 Assumptions and Qualifications Section 8 sets out the assumptions and qualifications for the Solicitors Report. Section 9 Consent Under Section 9 Steinepreis Paganin gives its consent for the Solicitors Report to be used by the Company in relation to the Prospectus.

1 0 . 2 S U M M A R Y O F I N F O R M AT I O N D E E M E D TO B E I N C O R P O R AT E D
Set out below is a summary of the information contained in the Solicitors Report that is deemed to be incorporated in this Pros pectus to assist investors and their professional advisors to determine whether they need to obtain a copy of the Solicitors Report for the purposes of making an inform ed investment decision in relation to the Shares. The sections referred to in this section 10 are references to sections in the Solicitors Report. Section 1 - Scope Section 1 sets out the scope and purpose of the Solicitors Report. Section 2 - Searches Section 2 sets out the searches that were undertaken in relation to NSEs permits. Section 3 Executive Summary Section 3 provides an executive summary as to: (a) NSEs interest in the permits; (b) the standing of NSEs permits; and (c) third party interests in NSEs permits.

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Schedule 1 Part 1 of Schedule 1 lists NSEs permits and provides material information in relation to them, including the registered holders, the term, minimum expenditure requirements and third party interests identified. A summary of provided below.
PERMIT HOLDER SHARES HELD 100/100 GRANT DATE (APPLICATION DATE) 22. 0 2. 0 0 EXPIRY DATE 21. 0 2. 0 6 (extended to 21.02.09) 22. 0 9. 11 (extended to 22.09.12) 22. 0 9. 11 (extended to 22.09.12) 27. 0 9. 12

E P 4 17

New Standard Exploration Pty Ltd New Standard Exploration Pty Ltd New Standard Exploration Pty Ltd New Standard Exploration Pty Ltd New Standard Exploration Pty Ltd New Standard Exploration Pty Ltd

E P 4 42

100/100

2 3. 0 9. 0 5

E P 4 43

100/100

2 3. 0 9. 0 5

E P 4 50

100/100

2 8. 0 9. 0 6

E P 4 51

100/100

2 8. 0 9. 0 6

27. 0 9. 12

E P 4 56

100/100

1 6. 1 0. 0 7

15. 1 0. 12

It is noted in the Solicitors Report that transfers to ARC of a 10% interest in permits EP 442, EP 443, EP 450, EP 451 and EP 456 pursuant to the ARC Farm-In Agreement (summarised in section 12.2 of this Prospectus) have been lodged with DoIR but not yet registered and hence ARCs 10% interest is not yet reflected in the above table. Part 2 of Schedule 1 summarises the status of the native title claims and determinations that apply to the land covered by NSEs permits.

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11

PROPOSED DIRECTORS AND CORPORATE GOVERNANCE

(ASX: NEC) and Future Corporation Ltd (ASX: FUT). Sam has been a Director of NSE since 12 January 2004. Technical Director Dr Hagan holds a Ph.D in Geology from the University of Western Australia (1974) and has over 30 years experience in oil and gas exploration and production with expertise in the integration and operation of all technical, operational and marketing aspects of oil and gas business ventures. He spent over 18 years in USA/Europe on worldwide projects in a variety of positions and was ultimately responsible for exploration activities in Europe, Africa, South America and Asia for Sun Oil Company - a large US based integrated oil company. Mark was on the board of Sun Exploration and Production Company from 1989 to 1991 during which time new discoveries were made in diverse exploration spheres and oil production rose to 70,000 barrels/day. Since returning to Australia in 1991, Mark has been an independent cons ultant, mainly on projects in the Australia/ Asia region and is past Chairman of Empire Oil and Gas NL (1999-2002) a small ASX listed exploration company. Mark has been a Director of NSE since March 2008.

1 1 . 1 E XI S T I NG DI R E CTO RS
Details on the Existing Directors are set out in the IPO Prospectus. Please refer to Section 7 of this Prospectus for further details.

Dr Mark Hagan

1 1. 2 PRO P O S E D DIRE CTO RS

In the event the Offer is successful, the Existing Directors will be replaced by the Proposed Directors. The board and management will be comprised of a mixture of founding directors of New Standard Energy and experienc ed professionals in their respective fields. The Proposed Directors have a sound spread of corporate, fi n a n c i a l a n d l e g a l s k i l l s a s w e l l a s s p e c i f i c t e c h n i c a l experience in the oil and gas exploration and production industry. Further details of the each of the Proposed Directors are set out below: Non- Executive Chairman Gordon Hill is a form er Minister in the G overnm ent of Western Australia, holding senior portfolios including Mines, Trade, Fisheries, and Employment and Training. He served the State of W estern Australia in that capacity for 7 years and was a Member of Parliament for over 12 years. Gordon developed strategic plans for enhancing investment in the fast-growing mining and petroleum sector and was responsible for introducing policy initiatives that were incorporated into legislation and practice. Gordon is a qualified Barrister and Solicitor of the Supreme Court of Western Australia and the High Court of Australia and his commercial and legal experience extends to joint venture and native title negotiations, corporate and business advice and litigation. Gordon is currently a director and Chairman of ASX listed public companies Goldstar Resources NL (ASX: GDR) and Deep Sea Fisheries Ltd (ASX: DSF) and has been a director and Chairman of NSE since foundation in 1994. Executive Director Sam has worked in the corporate advisory field for over 8 years where his primary duties have involved assisting companies achieve an ASX listing, providing general corporate advice, M&A assessment, deal co-ordination and structuring and capital raising for unlisted and listed companies. Sam has previously worked as a private client advisor with Hartleys, in an advisory capacity with Red Dingo (venture capital), and as an investment analyst with both Deutsche Bank and Schroders Investment Management in London. Sam holds a Bachelor of Commerce from the University of W estern Australia where he majored in Accounting and Finance with a Marketing minor and is currently non exec utive director for Northern Energy Corporation Ltd

G o rd o n H i l l

I a n Pa t o n

Non-Executive Director Ian has been working as an International Petroleum Consultant specialising in Engineering and Geoscience from 2000 until the present. Among numerous other roles, Ian has been most recently focussed on Coogee Resources projects in the Timor Sea where he has identified and developed significant oil discoveries res ulting from exploration success. Production from these discoveries now approaches 40,000 bopd.

Sa m W illis

Prior to his consulting role Ian was technical director at Amity Oil where he discovered two commercial gas fields in Turkey. Ian also held positions as technical manager of CONOCO Oceania where he ran all operations in Australia and PNG as well as holding the role of exploration and development manager at Santos where he was responsible for oil field developm ents in South Australia and leading Santos into the north-west shelf where he oversaw numerous discoveries. Ian has been a Director of NSE since March 2008.

1 1 . 3 C O R P O R AT E GO V E R N A N C E
The Directors m onitor the bus iness affairs of the Company on behalf of Shareholders and have formally adopted a corporate governance policy which is designed to encourage Directors to foc us their attention on accountability, risk management and ethical conduct. The information on corporate governance contained in section 4 of the IPO Prospectus is incorporated here by reference. 66

12

MATERIAL CONTRACTS OF NEW STANDARD ENERGY AND HAWK

(b) the Company must, amongst other things, procure the issue of Hawk Shares to NSE shareholders, allot the Management Options and appoint the Proposed Directors.

1 2 . 1 I M P L E M E N TAT I O N A G R E E M E N T
The Company and NSE are parties to an implementation agreement dated 12 May 2008 (Implementation Agreement) which the Company agreed to make the New Standard Offer to the shareholders of NSE and otherwise regulates the merger between the Company and NSE. The Implementation Agreement is subject to a number of conditions precedent including: (a) the Company obtaining all necessary regulatory and shareholder approvals required to complete the New Standard Offer includi ng, without limitation, sharehol der approval to: (i) change the nature and/or scale of the Companys activities; (ii) proceed with the Offer; (iii) issue Shares to NSE Shareholders in accordance with the New Standard Offer; (iv) change the name of the Company to New Standard Energy Limited; and (v) appoint the Proposed Directors to the board of directors of the Company at settlement of the Implem entation Agreem ent (Settlement ); and (vi) issue 13,500,000 Management Options to the Proposed Directors or their nominees at Settlement; (b) the New Standard Offer becoming unconditional; (c) the minimum subscription being raised under the Offer; and (d) the existing directors of the Company agreeing to resign at Settlem ent. The above conditions must be satisfied or waived by 31 July 2008 (or such later date as agreed) otherwise either party may terminate the agreem ent. Within 28 days of the date of the Implementation Agreement, the Company must use its best endeavours to convene a shareholders meeting by 25 July 2008 to give approvals as provided for by the Implementation Agreement. At settlem ent of the Implementation Agreem ent: (a) NSE must, amongst other things, procure its sharehol ders to transfer their NSE shares to the Company and register the Company as the holder of those NSE shares and cancel all existing options for NSE shares; and

1 2 . 2 A R C FA R M - I N A G R E E M E N T
ARC and NSE are parties to a farm-in agreement (Farm-in Agreement) dated 14 September 2007 under which ARC agreed to acquire an interest in NSE and earn up to a 75% interest in certain petroleum exploration permits held by NSE. The material terms of the Farm-in Agreem ent are set out below. (a) (Cornerstone Funding): ARC agrees to subscribe for, and NSE agrees to issue, 8,333,333 ordinary shares at an issue price of $0.18 per share to raise $1,500,000 (Cornerstone Funding). The Cornerstone Funding was completed on 24 September 2007. This shareholding has now been transferred to Buru Energy Ltd, a wholly owned subsidiary of ARC. (b) (Further equity interests): ARC has a first right of refusal over any issue of equity interest by NSE (other than an initial public offering). The first right of refusal lasts until the earlier of 2 years after the date the Cornerstone Funding is completed and NSE completing an initial public offering of shares. This right will continue to apply if NSE becomes a wholly owned subsidiary of Hawk. (c) (Farm-in obligations): ARC has agreed to undertake the following exploration activities in return for the right to earn up to a 75% interest in petroleum exploration permits EP 417, EP 442 (other than the EP 442(A) subblock), EP 443, EP 450, EP 451 and EP 456 (Permits). (i) ARC must complete, at its sole expense, a gross 1,000 kilometres of 2D Seismic surveying on the Permits that satisfies DOIRs work commitments for the Permits (Seismic Program). If ARC does not fulfil this obligation, NSE may to terminate the Farm-in Agreement and ARC forfeits any interest it has earned in the Permits. (ii) ARC must drill, at its sole expense, two wells on the Permits to satisfy DOIRs work commitments for the Permits and a third well at ARCs option. Should ARC not meet the required obligations, then NSE may terminate the Farm-in Agreement with t h e fo l l o w i n g o u t c o m e s :

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(A) if ARC has not drilled any well, ARC retains its 10% interest in the Permits but forfeits any further 35% interest that it has earned in the Permits and forfeits any right to future interests under the Farm-in Agreem ent; and (B) if ARC has drilled the first well as required but not the second well, ARC retains any interest i t h a s e a r n e d i n t h e P e r m i ts b u t f o r fe i t s a n y right to future interests under the Farm-in Agreement. (d) (Farm-in Interests): NSE must assign interests in each of the Permits to ARC as follows: (i) a 10% interest upon completion of the Cornerstone Funding (this has occurred); (ii) a further 35% interest upon com pletion of the Seismic Program; (iii) a further 10% interest following the completion of the first well; (iv) a further 10% interest following com pletion of the second well; and (v) if ARC elects to drill a third well within 30 days of completing the second well, and drills that well at its sole cost at a location agreed by the parties, a further 10% interest following the completion of the third well. (e) (Joint Venture and Operatorship): The parties must enter into a joint operating agreement in relation to the Permits as soon as practicable after the execution of the Farm-in Agreem ent. Upon completion of the Cornerstone Funding, ARC will be appointed as operator of each of the Permits. (f) (Future Applications): If either party applies for further exploration acreage that is contiguous with or adjacent to the Permits, the other party has a right of first refusal to participate at equity level of up to 50%. (g) (EP 442 (A) Sub-block): In relation to the EP 442(A) sub-block, NSE has until 30 September 2008 to farm out an interest (with ARC having a first right of refus al over any farm out offer NSE is willing to accept from third parties). In the event an interest is not farmed out by 30 September 2008, the EP 442 (A) sub-block will form part of the Permits the subject of the ARC Farmin Agreement (Reversion ). As such, ARC will become entitled to an immediate 10% interest in the EP 442(A) sub-block, and further interests up to a total of 75% subject to ARC completing its obligations under the Farm-in Agreement. If the Pijalinga Northeast Seismic Survey (Survey) is acquired before the Reversion occurs, ARC agrees to reimburse NSE for 75% of the costs of the Survey. (h) (Right of first refusal on dealings in Permits): Each party has a right of first refusal in relation to a propos ed dealing in relation to the other partys interest in the Permits, other than a dealing with an Affiliate.

1 2 .3 O P T IO N A N D S A L E AG R E E M E NT
On 6 March 2008, ARC applied to DOIR for a petroleum explorati o n p er mit ov er A p pl i c ati o n Are a L 0 7-9 (Appl icat ion ). ARC has recently been awarded this acreage area and is now the registered hol der of applicati on area 30/07-8. On 8 April 2008, NSE and ARC entered into an Option and Sale Agreement under which ARC has agreed to grant NSE an option to acquire an interest in the Application. The material terms of the agreement are as follows. (a) (Grant of Option) If DOIR makes an offer to ARC in relation to the Application and ARC accepts, ARC will grant NSE a 6 month option to acquire a fifty percent (50%) interest in the Application and any permit granted as a res ult of the Application. DOIR has made an offer to ARC on 30 April 2008 and ARC accepted the offer on 5 May 2008. As such, NSE has a 6 month option (expiring 5 November 2008) to exercise its option. If NSE exercises the option, it must reimburse ARC for 50% of ARCs costs to date in lodging the Application. (b) (Joint Venture) From the date NSE acquires a 50% interest in the Application, ARC and NSE will form an uni ncorporated joint venture and shall, withi n 6 months, negotiate and execute a joint operating agreement.

1 2 . 4 C Y G N E T C A P I TA L M A N DAT E S
On 3 October 2007, Cygnet Capital Pty Ltd (ABN 88 103 488 606) (Cygnet Capital) and the Company entered into an Asset Procurement Mandate letter under which Cygnet agreed to assist Hawk procure assets. Under this mandate, the Company must pay Cygnet Capital, on completion of the New Standard Offer, a success fee of up to $262,500 (based on a maximum deal value of $3,000,000). This mandate will continue after the completion of the New Standard Offer. The Company has engaged Cygnet Capital to provide corporate advice in the months leading up to this Prospectus, with a monthly corporate advice fee of $4,000. On 27 May 2008, Cygnet Capital and the Company entered into a mandate letter entitled Acquisition of New Standard Energy under which the engagement of Cygnet Capital was terminated (except for payment of fees incurred to date) and a new mandate was agreed in relation to the provision of corporate advice and assistance with the acquisition of NSE. The material terms of this new m andate are s et out below. (a) (Capital Raising and Corporate Advice): Cygnet Capital will raise up to $3.5 million under the Hawk Priority Offer and the General Offer, and will use best endeavours to raise oversubscriptions of up to $1 million and plac e any shortfall under the ARC Priority Offer. Cygnet Capital will provide corporate advice in relation to the acquisition of NSE and post acquisition on an as needs basis. (b) (Remuneration ): Cygnets fees for the completion of the c apital raising and Corporate Advisory role will comprise the following:

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(i) management fee of 0.5% plus a capital raising fee of 5.5.% on all capital raised by Cygnet Capital under the Offer. The 0.5% fee, but not the 5.5% fee, will be payable on any capital directly raised under the ARC Priority Offer. Cygnet may pass on up to 5.5.% of the capital raising fee to other stockbroking and advisory groups who participated in the propos ed offer; (ii) 1,000,000 Promoter Options for nil consideration exercisable at $0.20, expiring 30 June 2012 (refer to Section 14.1.3 for details); (iii) $6,000 (plus GST) for Corporate Advisory Services provided up to completion of the acquisition of NSE (May July 2008 inclusive); (iv) $4,000 (plus GST) for ongoing Corporate Advisory Services after the acquisition of NSE is completed; and (v) any out of pocket expenses. Cygnet will seek approval for any costs over $500. (c) (Term and Termination): Cygnets engagement is until the com pletion of the capital raising under the Offer. Any continuing obligations of the parties in relation to the engagement survive termination.

(b) agreed to engage Dr Schneider as a consultant to identify investment opportunities to complement NSEs portfolio upon NSE listing on the ASX. NSE has agreed to pay a success fee to Dr Schneider of 2% of the total value of any deal with a value up and including US$10m, and 1% of the total value of any deal with a value in excess of US$10m. NSE must pay Dr Schneider 0.5% of the deal value upfront (once the deal is unconditional) and the remainder as farm-in work is undertaken. NSE must also pay Dr Schneider a monthly retainer of $3,000 for assistance in identifying and securing additional opportunities internationally. Either party may terminate the agreem ent by provi ding two weeks written notice to the other party.

1 2 . 7 D R I L L I N G C O N T R ACT
NSE is in advanced negotiations with a company to provide drilling services. The agreement is likely to be on the basis that the company drills 2 wells in EP 417 with NSE having an option to require a further 2 wells to be drilled, and otherwise on terms and conditions usual for this type of agreement.

12.8 CO NST RUCTIO N SERVICE

NSE has engaged Inland Essential Services to provide construction site and access works in relation to its drilling program in EP 417.

1 2 . 5 FA R M - I N M A R K E T I N G S E R V I C E S A G R E E M E N T U S A A N D C A N A DA
On 25 March 2008, NSE entered into an agreement with Texpetro Global Ventures LLC (TGV) pursuant to which TGV is granted an exclusive 6 m onth right to secure a farm-in partner for exploration permits EP417 and EP442 sub-block (Permits) in the USA and Canada. The material terms of the agreement are set out below. (a) (Services): TGV agrees to market the Permits to pros pective farm-in partners and introduce any interested farm-in partner to NSE. (b) (Success Fees): NSE will pay a success fee to TGV in the amount of 2.5% of the total value of any agreement. This amount will be paid by NSE as follows: (i) 1.5% paid upfront upon satisfaction of the conditions precedent to a farm-in agreem ent; and (ii) 1% to be paid each quarter based on the amount spent by the farm-in partner during that quarter. (c) (Termination): Either party may terminate the agreem ent by providi ng two weeks written notice to the other party. For a period of 18 months after termination of this agreem ent, TGV will rem ain entitled to be paid a success fee in the event a party it introduced to NSE enters into a farm-in agreem ent within that period.

1 2 . 9 E X E C U T I V E C O N S U LTA N CY A G R E E M E N T S
Consultancy Agreement Sam Willis The Company has entered into a consultancy agreement (Agreement) with Sam Willis (Consultant) through his consultancy company, Wilcorp Nominees Pty Ltd (Consulting Company), on the following material terms and conditions: (a) (Conditions): the Agreement is conditional on the New Standard Offer reaching completion. (b) (Term): the Consultant is engaged on a four (4) day a week basis for a period of one (1) year commencing on the date the Implementation Agreement reaches settlement with the Consultant having an option to extend the Agreement for a further one (1) year. (c) (Position): the Consultant is engaged as the managing director and chief executive officer of the Company. (d) (Remuneration): the Company will pay the Consulting Company $15,000 (plus GST) per month, (Fee) reviewed on 31 December 2008 and thereafter annually. (e) (Termination by Consultant): the Consultant may terminate the Agreem ent: (i) at any time for any reason by giving three (3) months written notice to the Company. If notice is given, the Company may elect to terminate the Agreement immediately upon paying the Consultant the equivalent of three (3) months Fee; or

1 2 . 6 FA R M - I N M A R K E T I N G S E R V I C E S AG R EE M E N T EU RO P E
NSE and Dr Hans Schneider (Dr Schneider) are parties to an agreement dated 3 April 2008 under which NSE has: (a) granted Dr Schneider an exclusive 6 month right to secure a farm-in partner for exploration permits EP417 and EP442 sub-block (Permits) in Europe; and

(ii) immediately if the Consultants role as managing director is terminated without cause. The Company must pay the Consultant an amount equivalent to the Fee that would have been payable over a nine (9) month period if the Agreement had not been terminated; or

69

(f) (Termination by Company without cause): the Company may terminate the Agreement without cause: (i) immediately by serving written notice on the Consultant and paying him an amount equivalent to the Fee that would have been payable over a nine (9) month period if the Agreement had not been terminated; or (ii) with three (3) months written notice, provided the Company then pays the Consultant an amount equivalent to the Fee that would have been payable over a six (6) month period if the Agreement had not been terminated. (g) (Termination by Company with cause): the Company may terminate the Agreement by serving one (1) months notice on the Consultant, or paying one months Fee in lieu of notice, if: (i) the Consulting Company goes into liquidation or mak es an arrangem ent with creditors or tak es advantage of any status for relief of insolvent d e bt or s ; (ii) the Consultant or the Consulting Company commits any serious or persistent breach of any of the provisions contained in the Agreement and the breach is not remedied within 14 days of the receipt of written notice from the Company to do so; (iii) in the reasonable opinion of the Board, the Consultant demonstrates incompetence with regard to the performance of his duties under the Agreement, or is neglectful of his duties under the Agreement or otherwise does not perform his duties under this Agreement in a satisfactory manner; (iv) the Consultant is guilty of any grave misconduct o r w i l f u l n e g l e c t i n t h e d i s c h a r g e o f h i s d u ti e s a n d the breach is not remedied within 28 days of the receipt of written notice from the Com pany to the Consultant to do so; or (v) the Consultant is of unsound mind or under the control of any committee or officer under any law relating to mental health. (h) (Immediate termination by Company with cause): the Company may terminate the Agreement immediately if: (i) the Consultant or the Consulting Company is convicted of a major criminal offence which brings the Consulting Company, the Consultant or the Company or any of its related bodies corporate into lasting disrepute; or

(ii) the Company considers that the Consultant has committed a material breac h of its policy concerning the use and access to the Internet or use of email; (iii) the Consultant or the Consulting Company disclose, communicate, use or misuse price sensitive information without the prior written consent of the Board except where disclosure is required by law. (i) (No Obligation): The Company is not obliged to make a paym ent for termination of the Agreem ent to the extent that such a payment would breach the ASX Listing Rules or the Corporations Act. Consultancy Agreement Dr Mark Hagan The Company has entered into a consultancy agreement (Agreement) with Dr Mark Hagan (Consultant) through his consultancy company, Venus Bay Pty Ltd (Consulting Company), on the same material terms and conditions as those summarised above in relation to Sam Willis except that: (a) (Term): the Consultant is engaged on a three (3) day a week basis for a period of one (1) year commencing on the date the Implementation Agreement reaches settlement with the Consultant having an option to extend the Agreement for a further one (1) year. (b) (Position): the Consultant is engaged as the technical director of the Company.

1 2 . 1 0 NAT I V E T I T L E A N D A B O R I G I N A L H E R I TAGE AG R EE M E N T S
NSE has entered into a number of Native Title and Aboriginal Heritage agreem ents in relation to the Permits as part of satisfying native title and Aboriginal heritage requirements under the Native Title Act 1993 (Cth). The agreements are on terms and conditions usually found in such documents, and impose a number of obligations o n N S E i n re l a t i o n t o c a r r y i n g o u t a c t i v i t i e s w i t h i n t h e Permits. Under the agreements, NSE is, amongst other things, required to pay a percentage of exploration costs as com pens ation to native title parties for work conducted on lands that are subject to a native title claim.

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13

R IS K F A C T OR S RELATING TO NEW S T A N DA R D E N E R G Y
portion of the year. The remote locati on also provides logistical challenges of gettin g drill rig s, vehicle s and other supplies to the required site s. This difficult access may caus e del ays or additi onal costs to be inc urred i n an attempt to progress the wor k being undertaken.

1 3 .1 I N T R O D U CT I O N
An i nvestment i n the Com pany is not risk free and pros pec ti ve new i nvestors s h o ul d co ns i d er th e ri s k factors described below, together with informa tion contai ned els ewhere i n this Prospectus, before deci ding wh eth er to a p ply for S h ares . The followi ng is not intended to be an exhausti ve list of the ri sk factors to whi c h N SE ( an d th erefore t h e Company) is exposed.

1 3 . 4 R E G U L AT O R Y A P P R OV A L S
Re g ul at or y a pproval s thro ug h b o di es s uc h as th e DO IR a nd DO CEP am o n gst ot h ers ( i e, dr il l i ng a p proval s , e nvi ro nm e ntal a p proval s a n d HSE ap prov al s ) are re q u ire d pri o r to a n y work being unde r t aken on th e ground. Th e gr a nti n g of s uc h ap proval s m ay t ake ti m e to ac hi eve a n d n o g u ar ant ee s c an b e gi ve n t h at th e a p p rovals w i ll be grant e d in the req u i red timeframe o r at all.

13.2 ECONOMIC RISKS

General economic conditi ons , movements i n i nterest and infl ati on rates and currenc y exc hange rates may have an adverse effect on NSEs explorati on, developm ent an d pro d uc ti on ac ti vi ti es , as we l l as o n i t s a b i l i t y t o f u n d t ho s e ac t i vi t i es .

1 3 . 5 AVA I L A B I L I T Y O F R E S O U R C E S
The availability of suitable resources such as drill rigs, drilling engineers, rig crews, service providers (mud l o g g e r s , c e m e n t tr u c k s ) , s e i s m i c c r e w s , e q u i p m e n t a n d supplies (drill pipe, drill mud etc) cannot be guaranteed. The current demand being driven by the resources industry has created a shortage of supply of available resources and the limited supply m ay create situations where resources required to undertake the intended work m a y n o t b e a b l e t o b e s e c u r e d i n t h e t i m e fr a m e s r e q u i r e d or at a reasonable cost.

1 3 .3 T E N U R E A N D A C C E SS
The permits comprising NSEs projects are located in Western Australian and as suc h, are s ubject to the Western Au stralian legislative require men ts with respect to the processes for permit applica tion, gran t, conversion and renewal. There is no guarantee that current or future applications, conversion s or renewals of the exploration permits in whic h NSE has an interest or potential interest will be approved. Per m it a ppli c at i ons m ay r es ult i n a r e quir e m e nt for N S E t o com m ence n e g oti ati o ns wit h th e relev a nt l a n d h ol d ers and/or indi genous repres entative bodi es to gai n access to the underlying land. There is no guarantee that suc h ne g oti at i o n s wi l l be su ccess fu l. Petrole um te ne m e nts are s u bj ect to a n um b er of st ate s pec i fi c legi s l ati ve co nditi o n s in c l u d i ng p a y ment of ren t a nd m e eti n g m i ni m um a n n u al e xp e n di t ure co m m i tm e nts . Th e ren ew al of th e ter m of a gra nte d t e n e m e nt i s al s o s ubj ec t to th e di screti o n of the releva nt M i ni s ter a n d m a y tr igger na tive title ne go tia tio n righ t s. The ina b i l i t y t o meet these conditions or trig ger negotiation procedures i n r e l a t i o n t o a n y o f N S E p er m i t s c o u l d a f f e c t t h e standing of a permit or restr ict its ability to be renewed , advers ely affec ti ng the operations, fi n a ncial position an d performance of NSE. Physical access can be difficult or impossi ble at times throughout the year due to difficult terra in su ch as des ert sand dunes and regi onal l ake s ystems. Local rivers and lakes are also prone to flooding during the wet s e as o n m ak i ng access d iffi c ul t i f n ot i m p oss i ble for

13.6 REL IA NCE O N K E Y P E RS O NNEL

NSEs success largely depends on the core competencies of its directors, and their familiarisation with, and ability to operate in, the mineral expl oration and extraction industry. In its initial stages, NSE will rely heavily upon Mr Sam W illis and Dr Mark Hagan. The loss of one or more of these persons, or other key persons or consultants, could have a materially adverse effect on NSEs business, financial position and results of operations.

13.7 COMMODITY P RIC E A ND C U R R E N CY V O L AT I L I T Y

C o m m odity prices inherently fl u c tuate and are affecte d by n um ero us fac tors b eyo n d th e co ntrol of NS E, i n c l u d i n g w o r ld de m a nd for p a r t i c u l ar com m o d i t i e s , forward s e lli n g by pro d u cers a n d t h e level of prod u c tio n costs i n m aj or com m odi t y pro duc i ng regi o ns . M oreover , com m odi ty pr i ces are al s o af fec te d by m ac roeco n om i c fa c t ors su c h as exp e c t a t i o n s re g a rd i n g i n f l a t i o n ,

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i n t e rest rates a n d global and regio n a l de m a nd fo r , an d s up ply of, a com m odi t y. Com m o d i t i e s are p r i n c i p a l ly sold t h roug h o ut t h e wo r l d in U S dol l a rs. In t h i s p a r t i c u lar s i t u a t i o n t h e fl u c t u a t i on o f t h e p r i ce o f oi l ( and to a les s er ext e nt g as ) coul d h a ve a s i gni fi c ant i m pac t o n th e val u e of t h e i n vestm ent b ei n g co ns i d ered. A s a re s u l t , a n y s i g n i f i c a n t a n d / o r s u s t a i n e d f l u c t u a t i o n s i n the exchange rate between the Australian dollar and the US dollar and/or adverse movements in commodity prices (in particular, oil and/or gas), could have a m aterially adverse effect on NSEs operations, financial position (including revenue and profitability) and performance. NSE may undertake measures where deemed necessary by the board of directors to mitigate such risks.

environmental hazards, industrial accidents, technical failures, labour disputes, unusual or unexpected rock formations, flooding and extended interruptions due to inclem ent or hazardous weather conditions and fires, explosions and other accidents. No assurances can be given that NSE will ac hieve com m ercial viability through t h e d e v e l o p m e n t o f i ts p r o j e c t s .

13.10 E N V I R O N M E N TAL
NSEs projects are subject to Australian State and Commonwealth laws and regulations regarding environmental matters and the discharge of hazardous wastes and materials. As with all such projects, NSEs projects are expected to have a variety of environmental impacts should development proceed. NSE intends to conduct its activities in an environm entally responsible manner and in accordance with all applicable laws. The NSE portfolio is also located in an area prone to large interruptions vi a storm, cyclone and other such large natural events which may cause unforeseen delays to access and the ability to progress exploration and or development work on the projects.

1 3 . 8 E X P LO R AT I O N S U C C E SS
The p etrole um t en em ents of NSE as d es c r i bed in thi s Pros pec t us are at v ar i ou s stag es of exp lorati o n, a n d pote n t ial i n ves t o rs shou l d unde r s tand tha t p e t role u m e x p lor a t i o n a n d develo p m e n t are h i g h - r i s k u n d e r t a k i n g s. There c a n b e n o ass ur ance th at explorati o n of t he p e r m i t s, o r a n y o t h e r p e r m i t s t h a t m a y be a c q u i re d i n the future, will res u l t in t h e discovery o f an econo m i c oi l a n d g as . Eve n i f a n ap p are ntly vi a ble d e p os i t is ide n t i f i e d , t h e re i s no guaran t e e t h at it can b e eco n om i c al ly exploi t e d. The explorati o n costs of NS E des c r i be d i n th e In de p e n de nt G e ologi sts Rep or t are bas ed on cer tai n as s u m pti o n s w i th respe c t to t h e m e t hod a n d t i min g o f explora t i o n . By t h ei r nat u re, thes e esti m ates an d as s u mptio n s are s u b ject to significant uncer t a int i e s a n d , accord i n gly , t h e a c t u al costs m a y m a t e r i a l ly diffe r from thes e esti m ates a nd ass um pti o ns . Accordi n gly, n o ass ur ance c an b e gi ve n th at the cost es ti m ates a n d t h e und e r ly i n g assu m p t i o n s w i l l b e rea l i s ed in pra c t i ce , whi c h m a y m ater i al ly a nd ad ver s ely affec t NSEs v i a b i l i t y.

13.11 S H O RTA G E O F C A P I TAL

NSE plans to raise further capital in the future. NSEs ability to raise further capital (equity or debt) within an acceptable time, of sufficient quantum and on terms acceptable to NSE will vary according to a number of factors, including: prospectivity of projects (existing and future); the results of exploration, subsequent feasibility studies, development and production; broader investment, stock market and industry conditions; and the price of relevant commodities and exchange rates. No assurance can be given that future funding will be available to NSE on favourable terms (or at all). If adequate funds are not available on acceptable terms NSE may not be able to further develop its projects.

1 3 . 9 D E V E LO P M E N T A N D P R O D U CT I O N
Possible future developm ent of a petroleum extraction operation at any of NSEs projects is dependent on a number of factors including, but not limited to, the acquisition and/or discovery of recoverable oil and/or gas resources, favourable geological conditions, receiving the necessary approvals from all relevant authorities and parties, seasonal weather patterns, unanticipated technical and operational difficulties encountered in extraction and production activities, m echanical failure of operating plant and equipment, unexpected shortages or increases in the price of consumables, spare parts and plant and equipment, cost overruns, access to the required level of funding and contracting risk from third parties providing essential services. In the event that NSE commences production, its o p e r a ti o n s m a y b e d i s r u p t e d b y a v a r i e t y o f r i s k s and hazards which are beyond its control, includi ng

13.12 J O I N T V E N T U R E A G R E E M E N T S A N D PA R T N E R S
W hi l st NSE has s ec ure d j oi n t vent ure p ar tners th at i n th e Pro p os e d Di rec tors opi ni o n are credi ble a nd h a ve t h e a b i l i ty t o gre a t ly ass i st b o th f i n a n c i a l ly a nd t ec hni c al ly to a dv a nce t h e NSE pros p ec ts a n d t h e farm-in agre e m e n ts have cre a t ed ob l i g a t i o n s o n th os e p ar tners to provi d e fun di ng a nd com plet e cer tai n wor k com m i tm ents , n o g u ara nte e ca n be gi ven t o the p e rfo r m a n ce of th o s e jo i n t ven t u re p a rtner s a n d t h e refore t o t h e co m p le t i o n of t h e o b l i g a t i o n s committed t o u n d e r a g re e m e n t and the wo r k o u t l i n e d i n the fa r m - i n agree m e n t s . W hi l st NSE wi l l m ake ever y reas o n able e n d ea vo ur to e n s ure com pleti o n occ urs no g uara nt e e c an b e gi v e n i n th i s regard.

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13.13 T I T L E R I S K S A N D NAT I V E T I T L E
Interests in petroleum tenements in Australia are governed by the respective State legislation and are evidenced by the granting of permits or licenc es. Each permit or licence is for a specific term and carries with it annual expenditure and reporting commitments, as well as other conditions requiring compliance. Consequently, NSE could lose title to or its interest in its permits if permit conditions are not met or if insufficient funds are available to meet expenditure commitments. It i s a l s o pos s i b le t h a t , i n re l a t i o n t o p e t rol e u m t e n e m e n t s w h i ch N S E h a s an i n t erest i n or w i l l i n t h e f u t u re a c q u i re su c h an i n t e rest, t h ere m a y be area s over w h i ch le g i t i m a t e c o m m o n law na t i ve t i tle ri g h t s of A b o r i g i n a l A u str a l i a n s ex i st. I f native t i t le ri g h ts d o exi s t, th e a bi l i ty of NSE t o g ai n access to ten em e nts ( throug h obt ai ni n g co ns e nt o f an y releva nt l a n dow n er ) , or to progress from the e x p loration phase to t h e d evelo pm e nt a n d pro duc ti on ph as es of o perati o ns m ay be a d vers ely affec te d. The Dire ctors will clo sely mo nitor the po ten tia l e ffe ct of native title claims involving petroleum tenements in whic h NSE has or may have an interest.

13.14 I N V E S T M E N T S P E C U L AT I V E
The above list of risk factors ought not to be taken as exhaustive of the risks faced by NSE or by i nvestors in the Company. The above factors, and others not specifically referred to above, may in the future m ater i ally affec t the fi n an c i a l p e r fo r m a nce of N S E, a n d therefore the Com pany, and the val ue of the sec urities offere d u nd er thi s Pros p ec t u s. Therefore, the secur itie s to be issued pursuant to this Prospectus carry no g u ar a nt e e w i t h r es p ec t t o t h e p a y m e nt of di v i de n ds , returns of capital or the market value o f those se cur itie s. Pote nti al i n vestors s h o ul d co ns i d er th at t h e i n vestm e nt in the Com pany is specul ati ve and s hould cons ult their professi on al ad vi s ors before d e c i d i n g w h e t h e r to a p p ly for securities pursuant to this Pro spectu s.

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14

FURTHER INFORMATION

1 4 . 1 R I G H T S ATTA C H I N G TO S E C U R I T I E S
14.1.1 Ordinary Shares The information on the rights attaching to Shares contained in section 4 of the IPO Prospectus is incorporated here by reference. The Shares to be issued under this Prospectus will from the time they are issued, rank pari passu with all the Companys existing Shares. 14.1.2 Management Options The Implementation Agreement provides that on completion under that agreement the Company must issue the Proposed Directors or their nominees with 13,500,000 Management Options in the following proportions: (a) Gordon Hill 500,000 Management Options; (b) Sam Willis 5,250,000 Management Options; (c) Mark Hagan 7,250,000 Management Options; and (d) Ian Paton 500,000 Management Options; The Management Options entitle the Optionholder to subscribe for Shares in the Company on the following terms and conditions: (a) Each Management Option gives the Optionholder the right to subscribe for one Share. To obtain the right given by each Management Option, the Optionholder must exercise the Management Options in accordance with the terms and conditions of the Management Options. (b) The Management Options will expire at 5:00 pm (WST) on 30 June 2012 (Expiry Date). Any Management Option not exercised on or before the Expiry Date will automatically lapse on the Expiry Date. (c) 50% of the Management Options will be exercisable at 20c per Share and 50% of the Management Options will be exercisable at 25c per Share (Exercise Price). (d) Subject to (e) below, the Management Options will vest and therefore be exercisable on the following basis: (i) 50% upon successful re-listing of the Company on ASX; (ii) 50% on the date which is 12 months from the date of re-listing on ASX on the basis that the Optionholder is still a Director of the Company at the time of vesting; and (e) Any unvested Management Options will vest autom atically under the following circumstances:

(i) in the event a takeover bid is made for all of the shares in the capital of Company (Bid), the bidder under the Bid ac quires a relevant interest in at least 50% of the shares in the Company and the Bid i s d e c l a re d u n c o n d i t i o n a l ; (ii) at any time after a change in control event has occurred (meaning an event entitling a person or group to sufficient shares in the Company to give that person or group the ability in general meeting to repl ace all or a m ajority of the Board); ( iii) t h e d e at h or p er m a n e nt di s a bl em e nt of t h e Optionholder occurs; or (iv) the cessation of the Optionholders position as Director of the Company except if Director voluntarily resigns or if, in the reasonable opinion of the Board, the Optionholder has acted dishonestly or fraudulently in any material respect or is in m aterial breac h of his obligations to the Company. (f) Upon resignation or removal as a Director, the holder will have 45 days to exercise any vested Management Options following which any vested Management Options that remain unexercised will lapse. Any Management Options that are not vested upon resignation or removal as a Director will automatically lapse. (g) The Management Options held by each Optionholder may be exercised in whole or in part, and if exercised in part, multiples of 1,000 must be exercised on each occasion. (h) An Optionholder may exercise their Management Options by lodging with the Company, before the Expiry Date: (i) a written notice of exercise of Management Options specifying the number of Management Options being exercised (Option Exercise Notice); and ( i i ) a c h e q u e o r e l e c tr o n i c f u n d s tr a n s f e r f o r t h e Exercise Price for the number of Management Options being exercised , (i) An Option Exercise Notice is only effective when the Company has received the full amount of the Exercise Price in cleared funds. (j) Within 10 Business Days of receipt of the Exercise Notice the Company will allot the number of Shares required under thes e terms and conditions in respect of the number of Management Options specified in the Exercise Notice.

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(k) With the exception of related parties to a Director, the Management Options are not transferable. (l) All Shares allotted upon the exercise of Management Options will upon allotment rank pari passu in all respects with other Shares. (m) The Company will not apply for quotation of the Management Options on ASX. However, The Company will apply for quotation of all Shares allotted pursuant to the exercise of Management Options on ASX within 10 Business Days after the date of allotment of those Shares should the Companys ordinary shares be listed on the ASX at that time. (n) If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction. (o) There are no participating rights or entitlem ents inherent in the Management Options and Optionholders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Management Options. However, the Company will ensure that for the purpos es of determining entitlements to any such issue, the record date will be at least 6 Business Days after the issue is announced. This will give Optionholders the opportunity to exercise their Management Options prior to the date for determining entitlements to participate in any such issue. (p) In the event the Company proceeds with a pro rata issue (except a bonus issue) of securities to Shareholders after the date of issue of the Management Options, the exercise price of the Management Options will be reduced in accordance with the formula set out in ASX Listing Rule 6.22.2. (q) In the event the Company proceeds with a bonus issue of securities to Shareholders after the date of issues of the Management Options, the number of securities over which an Management Option is exercisable may be increased by the number of securities which the Optionholder would have received if the Management Option had been exercised before the record date for the bonus issue. 14.1.3 Promoter Options The Cygnet Mandate provides that the Company must issue Cygnet Capital with 1 million Promoter Options upon completion of the Offer. The Promoter Options entitle the Optionholder to subscribe for Shares on the following terms and conditions: (a) Each Promoter Option gives the Optionholder the right to subscribe for one Share. To obtain the right given by each Promoter Option, the Optionholder must exercise the Promoter Options in accordance with the terms and conditions of the Promoter Options. (b) The Promoter Options will expire at 5:00 pm (WST) on 30 June 2012 (Expiry Date). Any Promoter Option not exercised on or before the Expiry Date will automatically lapse on the Expiry Date.

(c) The Promoter Options will be exercisable at 20c per Share (Exercise Price). (d) The Promoter Options will vest upon grant. (e) The Promoter Options held by an Optionholder may be exercised in whole or in part, and if exercised in part, multiples of 1,000 must be exercised on each occasion. (f) An Optionholder may exercise their Promoter Options by lodging with the Company, before the Expiry Date: (i) a written notice of exercise of Promoter Options specifying the number of Promoter Options being exercised (Promoter Option Exercise Notice); and (ii) a cheque or electronic funds transfer for the Exercise Price for the number of Promoter Options being exercised. (g) A Promoter Option Exercise Notice is only effective when the Company has received the full amount of the Exercise Price in cleared funds. (h) Within 10 Business Days of receipt of the Promoter Option Exercise Notice the Company will allot the number of Shares required under these terms and conditions in respect of the number of Promoter Options specified in the Promoter Option Exercise Notice. (i) The Promoter Options are not transferable. (j) All Shares allotted upon the exercise of Prom oter Options will upon allotment rank pari passu in all respects with other Shares. (k) The Company will not apply for quotation of the Promoter Options on ASX. However, The Company will apply for quotation of all Shares allotted pursuant to the exercise of Promoter Options on ASX within 10 Business Days after the date of allotment of those Shares should the Companys ordinary shares be listed on the ASX at that time. (l) If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction. (m) There are no participating rights or entitlements inherent in the Promoter Options and Optionholders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Promoter Options. However, the Company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 6 Business Days after the issue is announced. This will give Optionholders the opportunity to exercise their Promoter Options prior to the date for determining entitlements to participate in any such issue. (n) In the event the Company proceeds with a pro rata issue (except a bonus issue) of securities to Shareholders after the date of issue of the Prom oter Options, the exercise price of the Promoter Options will be reduced in accordance with the formula set out in ASX Listing Rule 6.22.2.

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(o) In the event the Company proceeds with a bonus issue of securities to Shareholders after the date of issues of the Prom oter Options, the num ber of securities over which an Promoter Option is exercisable may be increased by the number of securities which the Optionholder would have received if the Promoter Option had been exercised before the record date for the bonus issue.

Director Gordon Hill Sam Willis Mark Hagan Ian Paton

Shares 7,581,7522 5,329,5003 1,650,0004 ni l

Options 500, 0001 5,250,0001 7,250,0001 500,0001

1 4 . 2 L I S T I N G O N A S X A N D E S C R OW OF SECURIT IES
Hawk Resources Limited (previously Lonhro Resources Limited) was admitted to the Official List on 15 August 2007 with Official Quotation of its Shares commencing on that date. Pursuant to chapter 9 of the ASX Listing Rules a number of the securities issued pursuant to the IPO Prospectus have been made subject to escrow requirements. Details of these securities subject to escrow and the periods of escrow of thos e securities are as follows: (a) 5,281,250 Shares escrowed until 15 August 2009; (b) 5,350,000 Options exercisable at $0.30 on or before 14 May 2010 escrowed until 15 August 2009; and (c) 3,000,000 Options exercisable at $0.20 on or before 14 May 2010 escrowed until 15 August 2009. At the date of this Prospectus, the Company has 33,637,501 Shares and 13,800,000 unquoted Options on issue.

1. Assumes that each Proposed Director or their nominee is issued with the Management Options as per Section 14.1.2 of this Prospectus. 2. Assumes that entities associated with Gordon Hill accept the New Standard Offer in relation to NSE shares in which he has a beneficial interest. 3. Assumes that the W illis Family Super Fund will not subscribe for its subscription under the Hawk Priority Offer, and that entities associated with Sam Willis accept the New Standard Offer in relation to NSE shares in which he has a beneficial interest. 4. Assumes that entities associated with Mark Hagan accept the New Standard Offer in relation to NSE shares in which he has a beneficial interest. 5. Assumes that the Proposed Directors do not acquire any other Hawk Shares other than as set out above.

1 4 . 4 R E M U N E R AT I O N
The Companys Constitution provides that the remuneration of non-exec utive Directors will be not m ore than the aggregate fixed sum determined by a general meeting. The aggregate remuneration for non-exec utive Directors has been set at an amount not to exceed $250,000 per annum. The remuneration of executive Directors will be fixed by the Directors and may be paid by way of fixed salary or consultancy fee. The remuneration and emoluments from the Company to the Directors for both the current financial year and previous financial year are set out below:
Directors Harry Hill Winton Willesee Mark Elliott Current Financial Year $78,714 $49,581* $15,333 Previous Financial Year Nil Nil Nil

1 4 . 3 D I S C LO S U R E O F I N T E R E S T S
Directors are not required under the Companys Constitution to hold any Shares. As at the date of this Pros pectus, the Directors have relevant interests in Securities as set out in the table below:
Director Harry Hill Winton Willesee Mark Elliott Shares 950, 000 300, 000 1,600,000 Options 700, 000 550, 000 2, 650, 000

Shareholder approval is being sought to allow the Directors to subscribe for Shares under the Offer (up to a $300,000 worth in aggregate). As at the date of this Prospectus, the Proposed Directors have relevant interests in Securities as set out in the table below:
Director Gordon Hill Sam Willis Mark Hagan Ian Paton Shares ni l 120,0001 ni l ni l Options ni l 150, 000 ni l ni l

* In addition, an entity associated with Winton Willesee received fees in the sum of $22,500 for office and other corporate services.

If the Proposed Directors are appointed as directors of the Company, the Company proposes to remunerate the Proposed Directors as follows: (a) Gordon Hill: $50,000 (plus GST) per annum (including superannuation) as Chairman of the Company; (b) Sam Willis: $15,000 (plus GST) per month as managing director of the Company; (c) Mark Hagan: $15,000 (plus GST) per month as Technical Director of the Company; and (d) Ian Paton: $30,000 (plus GST) per annum (including superannuation) as Non-executive Director of the Company.

Notes: 1. Sam Willis has a beneficial interest in 120,000 shares and 150,000 options held by the Willis Family Super Fund.

The Propos ed Directors will obtai n additional relevant interests in Sec urities as set out in the following table as a result of the acquisition of New Standard Energy and the issue of the Management options:

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14. 5 FEES A ND B E NEF I TS

Other than as set out below or elsewhere in this Prospectus, no: (a) Director of the Company; (b) person named in this Prospectus as performing a function in a professional advisory or other capacity in connection with the preparation or distribution of this Prospectus; (c) promoter of the Company; or (d) underwriter (but not a sub-underwriter) to the issue or a financial services licensee named in the Prospectus as a financial services licensee involved in the issue, has, or had within 2 years before lodgement of this Prospectus with the ASIC, any interest in: (i) the formation or promotion of the Company; (ii) any property acquired or proposed to be acquired by the Company in connection with its formation or prom otion or in connection with the offer of Shares under this Prospectus; or (iii) the offer of Shares under this Prospectus, and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to be given to any of those persons as an inducement to become, or to qualify as, a Director of the Company or for services rendered in connection with the formation or promotion of the Company or the offer of Shares under this Prospectus. Cygnet Capital Pty Ltd has acted as Corporate Advisor and Manager to the Offer pursuant to this Prospectus. The Company estimates that it will pay Cygnet a total of $18,000 (plus GST) in corporate advisory fees for these services and will issue Cygnet Capital with 1 million Prom oter Options (refer to section 12.4 of this Pros pectus for details). In addition, the Company must pay Cygnet Capital: (a) a capital raising fee of 5.5% (plus GST) on capital that Cygnet raises under the Offer, up to a maximum of $247,500 (plus GST) based on raising $4,500,000 (being $7,500,000 excluding the ARC Priority Offer amount of $3,000,000); (b) a capital raising fee of 5.5% (plus GST) on capital that Cygnet raises making up any shortfall under the ARC Priority Offer, up to a max of $165,000 (plus GST), based on the entire $3,000,000 ARC Priority Offer being unsubscribed and Cygnet raising $3,000,000 to make up the shortfall; (c) a management fee of 0.5% (plus GST) on capital raised under the Offer, up to a maximum of $37,500 (plus GST) based on a maximum capital raising of $7,500,000; (d) an ongoing corporate advisory fee of $4,000 (plus GST) per month after completion of the Offer for future corporate advice; and (e) a success fee of $262,500 (plus GST) (upon completion of the New Standard Offer under the terms of an Asset Procurement Mandate dated 3 October 2007. Cygnet Capital has also been engaged as corporate advisor by Hawk for periods of time prior to the engagement as Corporate Advisor and Manager to the Offer. During the 24

months preceding lodgement of this Prospectus with the ASIC, Cygnet has received: (a) capital raising fees of $273,900 (inclusive of GST) paid in respect of Hawks pre-IPO and IPO capital raised by Cygnet Capital during May 2007 to August 2007; and (b) corporate advisory fees totalling $88,091.67 (inclusive of GST) in respect of Hawks pre-IPO and post-IPO corporate advisory services from May 2007 to April 2008. Cygnet Capital has also been engaged as corporate advisor by NSE. NSE estimates that it will pay Cygnet a total of $12,000 (plus GST) in corporate advisory fees for advice in relation to the New Standard Offer and the Offer. During the 24 months preceding lodgement of this Prospectus with the ASIC, Cygnet Capital has received corporate advisory fees of $22,500 (plus GST) and capital raising fees of $45,000 (plus GST) from NSE. NSE presently sub-leases its premises from Cygnet Capital on arms length terms. In the 24 months preceding lodgement of this Prospectus with the ASIC, Cygnet Capital has received rent of $50,555.58 (plus GST) from NSE. Cygnet Connect (a related party to Cygnet Capital) was engaged by NSE in January 2008 to provide marketing and investor relation services. NSE must pay Cygnet Connect a fee of $17,000 (plus GST) for these services in the 2008 calendar year. Leydin Freyer Corporate Pty Ltd (Leydin Freyer) has acted as auditor to the Company. During the 24 months preceding lodgement of this Prospectus with the ASIC, Leydin Freyer has been paid $10,092 for its services. BDO Kendalls Audit and Assurance (WA) Pty Ltd (BDOAA) has acted as the auditor to NSE. During the 24 months preceding lodgement of this Prospectus with the ASIC, NSE has advised that BDOAA has been or will be paid a total of $4,000 by NSE for its services. BDO Kendalls Corporate Finance (WA) Pty Ltd (BDOCF) has prepared an Investigating Accountants Report which has been included in Section 9 of this Prospectus. The Company estimates it will pay BDOCF a total of $21,000 for these services. Subsequently, fees will be charged in accordance with normal charge out rates. Steinepreis Paganin has acted as the solicitors to the Company and NSE in relation to this Prospectus, has prepared a Solicitors Report on Permits which has been included in Section 10 of this Prospectus and has been involved in due diligence enquiries on legal matters. The Company estimates it will pay Steinepreis Paganin $25,000 (plus GST) for these services and NSE estimates it will pay Steinepreis Paganin $10,000 (plus GST) for these services. Subsequently, fees will be charged in accordance with normal charge out rates. During the 24 months preceding lodgement of this Prospectus with the ASIC, Steinepreis Paganin has received $44,926.50 (plus GST) in other fees for legal services provided to the Company and $71,359 (plus GST) in other fees for legal services provided to NSE. Resource Invest Pty Ltd has acted as the Independent Geologist in relation to NSEs permits and has prepared an Independent Geologists Report which has been included in Section 6 of this Prospectus. The Company and NSE

77

estimate that they have or will pay Resource Invest Pty Ltd a total of $31,350 for these services. During the 24 months preceding lodgement of this Prospectus with the ASIC, Resource Invest Pty Ltd has received a total of an additional $9,354 in other fees from either the Company or NSE.

14.6 CONSE NTS

Eac h of the parties referred to in this section: (a) does not make, or purport to make, any statement in this Prospectus other than those referred to in this section; and (b) to the maximum extent permitted by law, expressly disclaim and take no res ponsibility for any part of this Prospectus other than a reference to its name and a statement included in this Prospectus with the consent of that party as specified in this section. The Proposed Directors have consented in writing to the various statements throughout this Prospectus that have been attributed as being stated in their opi nion (in the form and context in which they are included). The Proposed Directors have not withdrawn their consent prior to lodgement of this Prospectus with ASIC. NSE has consented in writing to the various statements throughout this Prospectus that have been attributed as being stated in its opinion (in the form and context in which they are included). NSE has not withdrawn its consent prior to lodgement of this Prospectus with ASIC. Cygnet Capital Pty Ltd has given its written consent to being named as Corporate Advisor and Manager to the Offer. Cygnet Capital Pty Ltd has not withdrawn its consent prior to lodgement of this Prospectus with the ASIC. Leydin Freyer Corporate Pty Ltd has given its written consent to being named as auditor to the Company in this Prospectus. Leydin Freyer Corporate Pty Ltd has not withdrawn its cons ent prior to lodgem ent of this Pros pectus with the ASIC. BDO Kendalls Audit and Assurance (WA) Pty Ltd has given its written consent to being named as auditor to NSE in this Prospectus. BDO Kendalls Audit and Assurance Pty Ltd has not withdrawn its consent prior to lodgem ent of this Prospectus with the ASIC. BDO Kendalls Corporate Finance (WA) Pty Ltd has given its written consent to being named as Investigating Accountant to the Company in this Prospectus and to the inclusion of the Investigating Accountants Report in Section 9 of this Pros pectus in the form and context in which the report is included. BDO Kendalls Corporate Finance (WA) Pty Ltd has not withdrawn its consent prior to lodgem ent of this Prospectus with the ASIC. Steinepreis Paganin has given its written consent to being named as the solicitor to the Company and NSE in this Prospectus, to the inclusion by reference in this Prospectus of the Solicitors Report on Tenements from Section 8 of the IPO Prospectus and the inclusion of the Solicitors Report on Permits in Section 10 of this Prospectus in the form and context in which the reports are included. Steinepreis Paganin has not withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.

Resource Invest Pty Ltd has given its written consent to being named as the Independent Geologist to NSE in this Prospectus and to the inclusion of the Independent Geologists Report in Section 6 of this Prospectus in the form and context in which the report is included. Resource Invest Pty Ltd has not withdrawn its cons ent prior to the lodgement of this Prospectus with the ASIC. Sec urity Transfer Registrars has given its written cons ent to being named the Companys Share Registry in this Prospectus and has not withdrawn its consent prior to lodgement of this Prospectus with the ASIC. Veronica W ebster Pty Ltd has given its written consent to being named as the Independent Geologist to the Company in the IPO Prospectus and to the inclusion by reference in this Prospectus of the Independent Geologists Report from Section 6 of the IPO Prospectus in the form and context in which the report is included in this Prospectus. Veronica Webster Pty Ltd has not withdrawn its cons ent prior to the lodgement of this Prospectus with the ASIC. RSM Bird Cameron Pty Ltd has given its written consent to being named as the Investigating Accountant to the Company in the IPO Prospectus and to the inclusion by reference in this Prospectus of the Investigating Accountants Report from Section 7 of the IPO Prospectus in the form and context in which the report is included in this Prospectus. RSM Bird Cameron Pty Ltd has not withdrawn its consent prior to the lodgement of this Pros pectus with th e A S IC .

1 4 .7 R E S T R ICT E D S E C U R IT I E S
ASX has indicated that certain existing security holders m a y b e r e q u i r e d t o e n t e r i n t o a g r e e m e n t s w h i c h r e s tr i c t dealings in Securities held by them. These agreements will be entered into in accordance with the Listing Rules.

14.8 EXPE NSE S OF TH E OFFER

The total expenses of the Prospectus are estimated to be approximately $625,375 and are expected to be applied towards the items set out in the table below:
Disclosure Item ASIC AS X Capital Raising Fee Legal Fees Management Fee Success Fee Investigating Accountants Report Printing & Postage Independent Geologists Report TOTAL Amount ($) $2,101 $20,424 $192,500* $35,000 $32,500 $262,500 $12,000 $37,000 $31,350 $625,375

* This amount will increase if Cygnet Capital raises any funds for oversubscriptions or shortfall under the ARC Priority Offer. Refer to Section 14.5 of this Prospectus for details.

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14. 9 L I TI GATI ON
As at the date of this Prospectus, the Company and NSE are not involved in any legal proceedings and the Directors are not aware of any legal proceedings pending or threatened against the Company or NSE.

1 4 . 1 0 E L E CT R O N I C P R O S P E C T U S
Pursuant to Class Order 00/044, the ASIC has exempted compliance with certain provisions of the Corporations Act to allow distribution of an electronic pros pectus and electronic application form on the basis of a paper prospectus lodged with the ASIC, and the publication of notices referring to an electronic prospectus or electronic application form, subject to compliance with certain conditions. If you have received this Prospectus as an electronic Prospectus, please ensure that you have received the entire Prospectus accompanied by the relevant application forms. If you have not, please email the Company at info@hawkresources.com.au or NSE at info@newstandard.com.au and you will be sent, for free, either a hard copy or a further electronic copy of the Prospectus or both. Alternatively, you may obtain a copy of the Prospectus from the Companys website at www.hawkresources.com.au or NSEs website at www.newstandard.com.au The Company reserves the right not to accept an application form from a person if it has reas on to believe that when that person was given access to the electronic application form, it was not provided together with the electronic Prospectus and any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered.

1 4 . 1 1 TA X AT I O N
The acquisition and disposal of Securities in the Company will have tax consequences, which will differ depending on the individual financial affairs of each investor. All potential investors in the Company are urged to obtain independent financial advice about the consequences of acquiring Securities from a taxation viewpoint and generally. To th e m a xi m um exte nt p er m i tted by l a w, th e Com pa n y, i ts offi cers and e ac h of t hei r res pec ti ve a dvi s ors accept no li a b ility a n d respo n s ibili t y with re s p ect to t h e t a x at i on c o ns e q u e nc es of s u bs c r i bi ng for S h ares u n der thi s Pros pec t us .

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15

DIRECTORS AND PROPOSED DIRECTORS AUTHORISATION

This Prospectus is issued by the Company and its issue has been authorised by a resolution of the Directors, with which the Proposed Directors have agreed in writing. In accordance with Sections 716 and 720 of the Corporations Act, each Director and Proposed Director has consented in writing to the lodgement of this Prospectus with the ASIC and the inclusion of any statements in the Prospectus attributable to them.

Winton Willesee Director For a nd o n b eh a l f o f Hawk Resources Limited

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16

GL O S S A R Y

Where the following terms are used in this Prospectus they have the following meanings: A$ or $ means an Australian dollar. ARC means ARC Energy Ltd (ABN 74 009 204 031). ARC Priority Offer means the offer of 15,000,000 Shares to shareholders of ARC on the Record Date on the terms set out in Section 4.4 of this Prospectus. ARC Priority Offer Application Form means the blue priority offer application form accompanying this Prospectus relating to the ARC Priority Offer. ASIC means Australian Securities & Investments Commission. ASX means ASX Limited (ABN 98 008 624 691) or the Australian Securities Exchange (as the context requires). Board means the board of Directors as constituted from time to time. Business Day means a week day when trading banks are ordinarily open for business in Perth, Western Australia. Company or Hawk means Hawk Resources Limited (ABN 20 1 1 9 3 2 3 3 8 5 ). Constitution means the constitution of the Company. Corporations Act means the Corporations Act 2001 (Cth). Existing Directors or Directors m eans the directors of the Company at the date of this Prospectus. General Offer m eans the offer for investors to apply for 15,000,000 Shares with the Company having the right to accept oversubscriptions of up to a further 5,000,000 Shares as set out in Section 4.4 of this Prospectus. General Offer Application Form means the general offer application form accompanying this Prospectus relating to the General Offer. General Offer Closing Date means the closing date for receipt of application forms for the G eneral Offer under this Prospectus, being 5pm (WST) on 14 July 2008 or an extended date set by the Board. Hawk Priority Offer means the offer of 2,500,000 Shares to shareholders of Hawk on the Record Date on the terms set out in Section 4.4 of this Prospectus. Hawk Priority Offer Application Form means the green priority offer application form accom panying this Pros pectus relating to the Hawk Priority Offer. Listing Rules means the official listing rules of ASX.

Management Option means an Option issued on the terms and conditions set out in section 14.1.2 mmb means millions of barrels. New Standard Closing Date means the closing date of the New Standard Offer as set out in Section 17 of this Prospectus. New Standard Offer has the meaning given to that term in Section 4.8. NSE or New Standard Energy means New Standard Energy Limited (ABN 78 063 635 325). NSE Shareholder means the holder of a share in NSE. Offer means the offer of Shares pursuant to this Prospectus as outlined in Section 4.1 and includes both the General Offer, the ARC Priority Offer and the Hawk Priority Offer. Official List means the Official List of ASX. Official Quotation means official quotation by ASX in accordance with the Listing Rules. Option means an option to acquire a Share. Permits means permits set out in the Solicitors Report on Permits in Section 10 of this Prospectus. Priority Offers Closing Date means the closing date for receipt of the ARC Priority Offer Application Form and the Hawk Priority Offer Application Form under this Prospectus, being 5pm (WST) on 7 July 2008 or an extended date set by the Board. Promoter Option means an Option issued on the terms and conditions set out in Section 14.1.3. Proposed Directors means Gordon Hill, Sam Willis, Mark Hagan and Ian Paton. Prospectus means this prospectus. Record Date means the record date for determining entitlem ents to participate in the ARC Priority Offer to ARC Shareholders and the Hawk Priority Offer to Hawk Shareholders, being 5pm (WST) on 16 June 2008. Securities means Shares and Options. Share means a fully paid ordinary share in the capital of the Company. Share Registry or STR means Security Transfer Registrars Pty Ltd (ABN 95 008 894 488) Shareholder means a holder of Shares. WST means Western Standard Time, Perth, Western Australia.

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17
1.

OFFER TO THE S H A R E H O L DE R S O F NE W S T A NDA RD ENERGY LTD

Standard Shares to Hawk at its registered office c/o Level 16, 190 Queen St, Melbourne, Victoria, 3000 (Postal: GPO Box 2986, Melbourne VIC 3001) before the end of the Offer Period. 3.3 Hawk may in its sole discretion at any time deem any Acceptance Form it receives to be a valid acceptance in respect of your New Standard Shares even if a requirement for acceptance has not been complied with. 3.4 Once you have accepted this New Standard Offer, you will be unable to revoke your acceptance and the contract resulting from your acceptance is binding on you.

HAWK RESOURCES LIMITED ABN 20 119 323 385 OFFER TO THE SHAREHOLDERS OF NEW STANDARD ENERGY LIMITED ABN 78 063 635 325

T E R M S O F N E W STA N D A R D O F F E R GENE RAL TE RMS

1.1 Hawk Resources Limited (Hawk) offers to acquire 100% of your New Standard Shares on the terms and conditions of this New Standard Offer. 1.2 This New Standard Offer relates to all New Standard Shares which exist as at the Settlement Date. 1.3 The consideration offered by Hawk for the acquisition of 100% of your New Standard Shares is made up of shares in the capital of Hawk on the basis of 1.65 Hawk Shares for every 1 New Standard Share you own. The exact number of Hawk Shares you are entitled to is outlined in the Schedule to this agreement. 1.4 If you accept this New Standard Offer and Hawk acquires your New Standard Shares, Hawk will become entitled to any Rights in respect of your New Standard Shares. 1.5 Hawk will apply to ASX for quotation of the Hawk Shares to be issued pursuant to this New Standard Offer within 7 days after the date of this New Standard Offer, in accordance with the Prospectus attached with this New Standard Offer. However, ASX may impose escrow restrictions on the securities to be issued to you. 1.6 The Hawk Shares to be issued pursuant to this New Standard Offer will from their date of issue rank equally in all respects with the existing Hawk Shares currently on issue.

4.

T H E E F F ECT O F A C C E P TA N C E

By following the procedures set out in this New Standard Offer, you will be deemed to have: (a) accepted this New Standard Offer in respect of your New Standard Shares registered in your name to which this New Standard Offer relates (Purchased Shares) regardless of the number of New Standard Shares specified in the Acceptance Form; (b) agreed to transfer your Purchased Shares to Hawk; (c) authorised Hawk to complete the Acceptance Form by correcting any errors in or omissions from the Acceptance Form as may be necessary for the purpose of effecting acceptance of the New Standard Offer and registering the transfer of your Purchas ed Shares; (d) irrevocably authorised and directed New Standard to pay to Hawk or to the account of Hawk all Rights in respect of the Purchased Shares; (e) irrevocably appointed Hawk as your lawful attorney to execute on your behalf and in your name a Restriction Agreement in respect of that number of the Hawk Shares that are to be issued to you upon your acceptance of the New Standard Offers that ASX determines will be subject to escrow restrictions as provided for by Chapter 9 of the ASX Listing Rules (if any); (f) represented and warranted to Hawk that Hawk will ac quire good title to and beneficial ownership of all your Purchased Shares free from all mortgages, charges, liens, encumbrances (whether legal or equitable) and other third party interests of any kind;

2.

OFF ER PERIO D

2.1 Unless withdrawn due to the failure of any of the Conditions, this New Standard Offer will remain open for acceptance during the period commencing on the date of this New Standard Offer until the Closing Date.

3.

HOW TO ACCEPT THIS NEW STANDARD OFFER

3.1 You may only accept this New Standard Offer in respect of 100% (and not a lesser proportion) of your New Standard Shares. 3.2 In order to accept the New Standard Offer, you must complete and sign the Acceptance Form in accordance with the instructions on the Acceptance Form and deliver all doc um ents of title in res pect of your New

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(g) agreed to indemnify Hawk fully in respect of any claim, demand, action, suit or proceeding made or brought against Hawk and any loss, costs, expense, damage or liability whatsoever suffered or incurred by Hawk as a result of Hawk not receiving from you any certificates for your Purchased Shares; and (h) appointed Hawk or any nominee of Hawk as your agent and attorney to: (i) complete any and all documents to enable H a w k t o b ec om e t h e r e gi s t er e d h ol d er of y o ur Purchas ed Shares (including, if required, a share transfer form); and (ii) exercise all the powers and Rights attaching to your New Standard Shares and have agreed not to revok e that appointm ent during the period from the date of your acceptance of this New Standard Offer and the date on which Hawk is registered as the holder of your New Standard Shares.

8.

DEFINITIO NS

In this Section, defined terms have the same meaning given to them in Section 16 of the Prospectus, unless they are separately set out below: Acceptance Form means the acceptance and transfer form attached to or accompanying this Prospectus. ASX means ASX Limited (ABN 98 008 624 691). Closing Date means the date that is 4 months from the date of this Prospectus, in accordance with Section 724 of the Corporations Act. Conditions means the conditions set out in paragraph 6. Corporations Act means the Corporations Act 2001 (Cth) as am ended from time to tim e. Hawk Shares means a fully paid ordinary share in Hawk Resources Limited (ABN 20 119 323 385). Holding Lock has the meaning given to that term in ASTC Settlement Rules. Listing Rules means the Official Listing Rules of ASX, as am ended from time to tim e. New Standard means New Standard Energy Ltd (A B N 7 8 0 6 3 6 3 5 3 2 5 ). New Standard Offer mean an offer, referred to in paragraph 1, made or to be made by Hawk to acquire New Standard Shares on the terms set out in this document and New Standard Offers means any one or more of those offers. New Standard Shares m eans all fully pai d ordinary shares in New Standard held by a New Standard Shareholder, and all Rights attaching to those shares. New Standard Shareholder means a holder of fully paid ordinary shares in the capital of New Standard. Offer means the offer of Shares pursuant to this Prospectus as outlined in Section 4.1 of this Prospectus, namely the ARC Priority Offer, the Hawk Priority Offer and the General Offer. Offer Period means the period during which the New Standard Offers will remain open for acceptance as set out in paragraph 2 of this New Standard Offer. Prospectus means the prospectus issued by Hawk for the purpose of making the New Standard Offer. Restriction Agreement means an agreement substantially in the form set out in Appendix 9A of the ASX Listing Rules between the Company and the relevant New Standard Shareholder. Rights means all accretions to and rights attaching to the relevant New Standard Shares at or after the date of this New Standard Offer (including, but not limited to, all dividends and all rights to receive dividends and to receive or subscribe for shares, stock units, notes or options declared, paid, or issued by New Standard). Settlement Date means that date which is 2 business days after the date on which the last of the Conditions is satisfied. WST means Australian W estern Standard Time. $ m e a n s A u s tr a l i a n d o l l a r s .

5.

HAW K O B L I GAT I O N S I N R E S P E CT O F Y O U R N E W STA N D A R D S E C U R I T I E S A C Q U I R E D

Subject to this New Standard Offer, Hawk will provide the consideration for your New Standard Shares to you on the Settlem ent Date or an earlier date in Hawks discretion. A holding statement for the Hawk Shares to which you become entitled by accepting this New Standard Offer will be sent by pre-paid mail to your address as shown on the Acceptance Form.

6.

CONDITIO NS OF THE NEW STANDARD O FFER

6.1 This New Standard Offer and any contract that results from acceptance of this New Standard Offer are each conditional on: (a) the Company obtaining Shareholder approval for the matters referred to in Section 12.1 of this Pros pectus; (b) all New Standard Shareholders accepting the New Standard Offer; (c) the minimum subscription under the Offer being raised; (d) ASX granting conditional approval (on terms acceptable to the Company) for the Companys securities to be reinstatement to trading on the Official List following completion of the acquisition of New Standard; and (e) Shareholder approval for the issue of a total of 13,500,000 Management Options to Gordon Hill, Sam Willis, Mark Hagan and Ian Paton or their nominees. 6.2 Each condition in paragraph 6.1 is a separate, several and distinct condition, operates as a condition subsequent and is for the benefit of Hawk alone. Hawk may waive any or all of these conditions in its discretion.

7.

N O STA M P D U T Y O R O T H E R C O S T S

All costs and expenses of the preparation, dispatch and circulation of this New Standard Offer and any stamp duty payable in respect of the transfers will be paid by Hawk.

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S C H E D U L E P U R C H A S E C O N S I D E R AT I O N TO N E W STA N D A R D S H A R E H O L D E R S
New Standard Energy Shareholder Buru Energy Ltd Phoenix Properties Int Pty Ltd <The Wellington Property A/C> TC Investments Pte Ltd Seaswan Holdings Pty Ltd <The Hill Family A/C> Mr Alan Young Mr Robert Young <The Young Family A/C> Carossa Holdings Pty Ltd <Globetrotter Investment A/C> Mr Samuel John Corbin Willis & Mrs Catherine Meredith Willis <Willis Family Superfund A/C> Boongol Pty Ltd <McClements Family A/C> Cyberspace Investments Pty Ltd Venus B ay Pty Ltd <The Hagan Superfund A/C> Fundhost Limited <Cygnet Microcap Opp Fund A/C> Mr Richard James Harris & Mrs Susan Elizabeth Harris <Harris Family Superfund A/C> Mr Kee Khoo Seah Dominion Investments Pty Ltd Mr Dinh Quang Phan Mr Tung Thanh Nguyen Seivad Investments Pty Ltd Mr Craig Burton & Ms Katrina Burton <The Burton Superfund A/C> Katone Investments Pty Ltd FNL Investments Pty Ltd <Superannuation Plan A/C> Teston Investments Pty Ltd <Don Martin Super Fund A/C> Brownvalley Investments Pty Ltd <CAA A/C> Mr John Barker Mrs Nadine Gold Top Cat Promotions Pty Ltd <Croad Family A/C> Mr Peter Davies Rylet Pty Ltd Newangle Holdings Pty Ltd <The Angle Holding CMA A/C> Graden Project Management Pty Ltd <Graden Super Fund A/C> Mrs Nicki Farley Mr Fong Chong Hoon & Mrs Gaik Ean Hoon <Hoon Superfund A/C> Mr Robert Murray Raynes <Paros #2 Account> Mr Murray John Jacob & Mrs Sara Caroline Jacob <Aquatica Superfund A/C> Olivine Nominees Pty Ltd <CAA A/C> Rockpoint Holdings Pty Ltd <CAA A/C> Topspin Investments Pty Ltd Mr Steven Gelsi Mr Eric De Mori Mr Noel Porter & Mrs Gaylene Porter <Porter Staff CAA S/F A/C> Mr Alan McMaster <Grey Nomads Retire Plan A/C> Mr Geoffrey Langford <CAA A/C> M r A nt h ony J oh n P al am a < C A A A / C > Ms Caroline De Mori No. Hawk Shares to be issued 13, 749, 999 9, 405, 005 8, 250, 000 7, 581, 752 6, 905, 252 5, 775, 000 3, 349, 500 1, 980, 000 1, 815, 000 1, 650, 000 1, 650, 000 1, 485, 000 1, 237, 500 924, 000 495, 000 453, 750 453, 750 330, 000 330, 000 247, 500 165, 000 165, 000 165, 000 165, 000 165, 000 165, 000 165, 000 135, 300 128, 334 82, 500 82, 500 82, 500 82, 500 82, 500 66, 000 66, 000 64, 167 62, 700 46, 200 41, 250 41, 250 41, 250 41, 250 36, 300 70,405,509

* The table set out above is based on the assumption that no existing options are exercised.

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OFFER TO SH AR EH OL D ER S OF N E W S T A N DA R D E N E R G Y L T D
ACCEPTANCE AND TRANSFER FORM IN RELATION TO A PROSPECTUS PREPARED BY HAWK RESOURCES LIMITED ONLY COMPLETE THIS FORM IF YOU ARE A NEW STANDARD ENERGY LTD SHAREHOLDER (PLEASE PRINT) Title, Given Name(s) & Surname or Company Name

OF S tr e e t N u m b e r Street

Suburb/Town

State

P ost C ode

I/We, the person(s) named above (Sellers), being the holder(s) of fully paid, ordinary shares (Shares) in New Standard Energy Ltd (New Standard), a company incorporated in W estern Australian, accept the New Standard Offer contained in the Prospectus to which this Acceptance and Transfer Form is attached (Prospectus) in respect of my/our New Standard Shares and agree: to transfer to Hawk Res ources Limited (Buyer) all my/our New Standard Shares and accept the consideration as set out in the New Standard Offer; and to be bound by the terms and conditions of the New Standard Offer and the constitution of the Buyer, the Buyer agrees to accept the transfer of the Sellers New Standard Shares on the terms of the New Standard Offer. Signed this . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . day of . . . . . . . . . . . . . . . . . 2008 By: Individuals and joint holders
Signature Signature Signature

Companies (affix common seal if appropriate)

Director Director/Company Secretary Sole Director and Sole Company Secretary

Executed by Hawk Resources Ltd in accordance with Section 127 of the Corporations Act: Signature of Director Name of Director in full Signature of Director or Secretary Name of Director or Secretary in full 86

This page has been left intentionally blank

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GENERAL OFFER APPLICATION FORM

Applicants should read the Pros pectus in its entirety before completing this form. A person who gives to another person access to this application form, must at the same time and by the same means give that person access to the Prospectus. Identifying Stamp Only No of Shares applied for: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Application monies at 20 cents per Share: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Title - Given Names/Company Name

Surname/ACN

....................................................................................................... Joint applicants or account designation ....................................................................................................... .......................................................................................................

Postal Address City/Town Email Address Contact Name

.............................................................................................. ..................................... ..................................... Daytime Contact No. State ......... Postcode . . . . . . . . . . . . . . . . . . . . .

CHESS HIN

........................................ Applicant 2

Issuer SRN

....................................... Applicant 3

Tax File No/Exemption Category

..................................................................................................... Cheque Details Drawer ..................................... ..................................... DECLARATION By lodging this application form and a cheque for the application money the applicant hereby: a) b) c) d) applies for the number of Shares specified in the application form or such lesser number of Shares as may be allocated by the directors; agrees to be bound by the Constitution of the Company; authorises the directors to com plete or am end this application form where necessary to correct any errors or omissions; and declares that the prospectus has been received (in full) by the applicant and is fully understood and read in its entirety. Bank Branch Amount

.................... ................... $..................... .................... ................... $.....................

Cheques must be made payable to Hawk Resources Limited Subscription Account and be in Australian dollars.

88

NOTES 1. 2. 3. 4. 5. 6. Enter the number of Shares you wish to apply for. Applications must be for a minimum of 25,000 Shares and thereafter in multiples of 5,000 Shares. Enter the total amount of application monies payable. To calculate this amount, multiply the number of Shares you are applying for by the issue price for each Share (ie, 20 cents per Share). Enter the full nam e(s) of all legal entities that are to be recorded as the registered holders. Enter the postal address for all communications from the Company. Enter the name and telephone number of the person who should be contacted if there are any questions with respect to t his a p pli c at i o n. If you are CHESS sponsored, enter your Holder Identification Number (HIN). If you already own shares in the Company and you are issuer sponsored (ie, sponsored by the Company), enter your Security holder Reference Number (SRN). Otherwise leave this box blank and a SRN will be allocated to you on issue. Enter the tax file num ber(s) of the applicant(s) - this is not mandatory. Unless otherwise agreed by the Company, payment must be made to Hawk Resources Limited Subscription Account by cheque drawn or payable on a bank within Australia, crossed Not Negotiable and be in Australian dollars. Receipt of payment will not be acknowledged. This application form does not need to be signed. Return of this application form with the required application monies will constitute a subscription for that num ber of Shares stated on this form.

7. 8.

9.

If you have received an application form without a complete and unaltered copy of this prospectus, please contact the Company who will send you, free of charge, a printed or electronic version of this prospectus. Please note that if an application form is not completed correctly, or if the accompanying payment is for the wrong amount, it may still be accepted. Any decision of the directors as to whether to accept an application form, and how to construe, amend or complete it, shall be final. An application form will not be treated as havi ng offered to s ubscribe for m ore Shares than is indicated by the amount of the accompanying cheque. Please deliver the completed application form (accompanied by a cheque for the application monies) at any time prior to the Closing Date to our Registry. Security Transfer Registrars Pty Ltd: Delivery: 770 Canning Highway APPLECROSS WA 6153 Post: PO Box 535 APPLECROSS WA 6953

Please telephone the Companys Share Registry on (08) 9315 2333 if you have any questions with respect to this application form. CORRECT FORMS OF REGISTRABLE TITLE Note that only legal entities are allowed to hold sec urities. Application forms must be in the name(s) of a natural person(s), companies or other legal entities acceptable to the Company. At least one full nam e and the s urnam e is required for each natural person. Application forms cannot be completed by persons under 18 years of age. Exam ples of the correct form of registrable title are set out below:
Type of Investor Trusts Deceased Estates Partnerships Clubs/Unincorporated Bodies Super Funds Correct Form of Registrable Title Mr John David Brown <John David Brown A/C> Mr John David Brown < Est John David Brown A/C> Mr John David Brown and Mr Michael James Brown Mr John David Brown <ABC Tennis Association A/C> John Brown Pty Ltd <Super Fund A/C> Incorrect Form of Registrable Title John Brown Family Trust John Brown <Deceased> John Brown & Son Brown Investment Club or ABC Tennis Association John Brown Superannuation Fund

89

ARC PRIORITY OFFER APPLICATION FORM

Applicants should read the pros pectus in its entirety before completing this form. A person who gives to another person access to this application form, must at the same time and by the same means give that person access to the prospectus. This form should only be completed by those ARC shareholders on the ARC share register on the Record Date. To be a valid application this form must be completed in the same holding entity name as the current ARC shareholding is currently held to enable confirmation of your entitlement at the Record Date. Identifying Stamp Only No of Shares applied for: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Application monies at 20 cents per Share: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Title - Given Names/Company Name Joint applicants or account designation

Surname/ACN

....................................................................................................... ....................................................................................................... .......................................................................................................

Postal Address City/Town Email Address

.............................................................................................. ..................................... ..................................... Daytime Contact No . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . State ......... Postcode . . . . . . . . . . . . . . . . . . . . .

Contact Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

CHESS HIN

........................................ Applicant 2

Issuer SRN

....................................... Applicant 3

Tax File No/Exemption Category

..................................................................................................... Cheque Details Drawer ..................................... ..................................... DECLARATION By lodging this application form and a cheque for the application money the applicant hereby: a) b) c) d) applies for the number of Shares specified in the application form or such lesser number of Shares as may be allocated by the directors; agrees to be bound by the Constitution of the Company; authorises the directors to complete or amend this application form where necessary to correct any errors or omissions; and declares that the prospectus has been received (in full) by the applicant and is fully understood and read in its entirety. Bank Branch Amount .................... ................... $..................... .................... ................... $.....................

90

Cheques must be made payable to Hawk Resources Limited Subscription Account and be in Australian dollars. NOTES 1. 2. 3. Enter the number of Shares you wish to apply for. Applications must be for a minimum of 25,000 Shares and thereafter in multiples of 5,000 Shares. Enter the total amount of application monies payable. To calculate this amount, multiply the number of Shares you are applying for by the issue price for each Share (ie, 20 cents per Share). Enter the full nam e(s) of all legal entities that are to be rec orded as the registered holders. Note that the entity name entered must be exactly the same as the entity holding the ARC shares at the Record Date to ensure successful entitlem ent under the ARC Priority Offer Enter the postal address for all communications from the Company. Enter the name and telephone number of the person who should be contacted if there are any questions with respect to t his a p pli c at i o n. If you are CHESS sponsored, enter your Holder Identification Number (HIN). If you already own shares in the Company and you are issuer sponsored (ie, sponsored by the Company), enter your Security holder Reference Number (SRN). Otherwise leave this box blank and a SRN will be allocated to you on issue. Enter the tax file num ber(s) of the applicant(s) - this is not mandatory. Unless otherwise agreed by the Company, payment must be made to Hawk Resources Limited Subscription Account by cheque drawn or payable on a bank within Australia, crossed Not Negotiable and be in Australian dollars. Receipt of payment will not be acknowledged. This application form does not need to be signed. Return of this application form with the required application monies will constitute a subscription for that num ber of Shares stated on this form.

4. 5. 6.

7. 8.

9.

If you have received an application form without a complete and unaltered copy of this prospectus, please contact the Company who will send you, free of charge, a printed or electronic version of this prospectus. Please note that if an application form is not completed correctly, or if the accompanying payment is for the wrong amount, it may still be accepted. Any decision of the directors as to whether to accept an application form, and how to construe, amend or complete it, shall be final. An application form will not be treated as havi ng offered to s ubscribe for m ore Shares than is indicated by the amount of the accompanying cheque. Please deliver the completed application form (accompanied by a cheque for the application monies) at any time prior to the Closing Date to our Registry. Security Transfer Registrars Pty Ltd: Delivery: 770 Canning Highway APPLECROSS WA 6153 Post: PO Box 535 APPLECROSS WA 6953

Please telephone the Companys Share Registry on (08) 9315 2333 if you have any questions with respect to this application form. CORRECT FORMS OF REGISTRABLE TITLE Note that only legal entities are allowed to hold sec urities. Application forms must be in the name(s) of a natural person(s), companies or other legal entities acceptable to the Company. At least one full nam e and the s urnam e is required for each natural person. Application forms cannot be completed by persons under 18 years of age. Exam ples of the correct form of registrable title are set out below:
Type of Investor Trusts Deceased Estates Partnerships Clubs/Unincorporated Bodies Super Funds Correct Form of Registrable Title Mr John David Brown <John David Brown A/C> Mr John David Brown < Est John David Brown A/C> Mr John David Brown and Mr Michael James Brown Mr John David Brown <ABC Tennis Association A/C> John Brown Pty Ltd <Super Fund A/C> Incorrect Form of Registrable Title John Brown Family Trust John Brown <Deceased> John Brown & Son Brown Investment Club or ABC Tennis Association John Brown Superannuation Fund

91

HAWK PRIORITY OFFER APPLICATION FORM

Applicants should read the Pros pectus in its entirety before completing this form. A person who gives to another person access to this application form, must at the same time and by the same means give that person access to the Prospectus. This form should only be completed by those Hawk shareholders on the Hawk share register on the Record Date. To be a valid application this form must be completed in the same holding entity name as the current Hawk shareholding is currently held to enable confirmation of your entitlement at the Record Date. No of Shares applied for: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Application monies at 20 cents per Share: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Identifying Stamp Only

Title - Given Names/Company Name Joint applicants or account designation

Surname/ACN

....................................................................................................... ....................................................................................................... .......................................................................................................

Postal Address City/Town Email Address

.............................................................................................. ..................................... ..................................... Daytime Contact No . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . State ......... Postcode . . . . . . . . . . . . . . . . . . . . .

Contact Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

CHESS HIN

........................................ Applicant 2

Issuer SRN

....................................... Applicant 3

Tax File No/Exemption Category

..................................................................................................... Cheque Details Drawer ..................................... ..................................... DECLARATION By lodging this application form and a cheque for the application money the applicant hereby: a) b) c) d) applies for the number of Shares specified in the application form or such lesser number of Shares as may be allocated by the directors; agrees to be bound by the Constitution of the Company; authorises the directors to complete or amend this application form where necessary to correct any errors or omissions; and declares that the prospectus has been received (in full) by the applicant and is fully understood and read in its entirety. Bank Branch Amount .................... ................... $..................... .................... ................... $.....................

92

Cheques must be made payable to Hawk Resources Limited Subscription Account and be in Australian dollars. NOTES 1. 2. 3. Enter the number of Shares you wish to apply for. Applications must be for a minimum of 25,000 Shares and thereafter in multiples of 5,000 Shares. Enter the total amount of application monies payable. To calculate this amount, multiply the number of Shares you are applying for by the issue price for each Share (ie, 20 cents per Share). Enter the full nam e(s) of all legal entities that are to be rec orded as the registered holders. Note that the entity name entered must be exactly the same as the entity holding the Hawk shares at the Record Date to ensure successful entitlement under the Hawk Priority Offer Enter the postal address for all communications from the Company. Enter the name and telephone number of the person who should be contacted if there are any questions with respect to t his a p pli c at i o n. If you are CHESS sponsored, enter your Holder Identification Number (HIN). If you already own shares in the Company and you are issuer sponsored (ie, sponsored by the Company), enter your Security holder Reference Number (SRN). Otherwise leave this box blank and a SRN will be allocated to you on issue. Enter the tax file num ber(s) of the applicant(s) - this is not mandatory. Unless otherwise agreed by the Company, payment must be made to Hawk Resources Limited Subscription Account by cheque drawn or payable on a bank within Australia, crossed Not Negotiable and be in Australian dollars. Receipt of payment will not be acknowledged. This application form does not need to be signed. Return of this application form with the required application monies will constitute a subscription for that num ber of Shares stated on this form.

4. 5. 6.

7. 8.

9.

If you have received an application form without a complete and unaltered copy of this prospectus, please contact the Company who will send you, free of charge, a printed or electronic version of this prospectus. Please note that if an application form is not completed correctly, or if the accompanying payment is for the wrong amount, it may still be accepted. Any decision of the directors as to whether to accept an application form, and how to construe, amend or complete it, shall be final. An application form will not be treated as havi ng offered to s ubscribe for m ore Shares than is indicated by the amount of the accompanying cheque. Please deliver the completed application form (accompanied by a cheque for the application monies) at any time prior to the Closing Date to our Registry. Security Transfer Registrars Pty Ltd: Delivery: 770 Canning Highway APPLECROSS WA 6153 Post: PO Box 535 APPLECROSS WA 6953

Please telephone the Companys Share Registry on (08) 9315 2333 if you have any questions with respect to this application form. CORRECT FORMS OF REGISTRABLE TITLE Note that only legal entities are allowed to hold sec urities. Application forms must be in the name(s) of a natural person(s), companies or other legal entities acceptable to the Company. At least one full nam e and the s urnam e is required for each natural person. Application forms cannot be completed by persons under 18 years of age. Exam ples of the correct form of registrable title are set out below:
Type of Investor Trusts Deceased Estates Partnerships Clubs/Unincorporated Bodies Super Funds Correct Form of Registrable Title Mr John David Brown <John David Brown A/C> Mr John David Brown < Est John David Brown A/C> Mr John David Brown and Mr Michael James Brown Mr John David Brown <ABC Tennis Association A/C> John Brown Pty Ltd <Super Fund A/C> Incorrect Form of Registrable Title John Brown Family Trust John Brown <Deceased> John Brown & Son Brown Investment Club or ABC Tennis Association John Brown Superannuation Fund

93

Ground Floor, 30 Richardson St, West Perth WA 6005 PO Box 1542, West Perth WA 6872 T: +61 8 9481 7477 | F: +61 8 9486 7670 www.newstandard.com.au