TAO-1 Drilling Update

3 June 2014 TANGIERS PETROLEUM LIMITED TAO-1 Drilling Update Tangiers Petroleum Limited (ASX: TPT; AIM: TPET) ("Tangiers" or the "Company")is pleased to provide an update related to progress of its Moroccan operations. Fully Funded for Drilling of TAO-1 (dry hole case, trouble free) Tangiers is pleased to confirm that the dry hole cost for the drilling ofTAO-1, on a trouble free basis, is ~US$73m and in line with the previousestimate released to market. On this basis, Tangiers is fully covered for thedrilling by existing cash and receivables, including headroom for material costoverruns. Given the weather conditions, shallow water depth and well control inthe region, the Company does not expect overruns but cannot guarantee thatthese will not occur and cautions investors that operational risk can never befully mitigated. Spud Date Imminent The Company can confirm that the Ralph Coffman jack-up rig was successfullyloaded onto the heavy lift vessel MV Transshelf on the 25th May 2014 and is ontrack to deliver the rig nearby to the spud location on or about the 4th June2014. The rig will undergo final checks and kitting out before being towed tosite, where drilling is scheduled to commence on or about the 15th of June, inline with previous guidance for a mid-late June spud. The TAO-1 well is a potential company-maker for Tangiers with 190 millionbarrels* of net best estimate unrisked prospective resource (gross unriskedbest estimate 758 million barrels*). Cautionary Statement: The estimated quantities of petroleum that may bepotentially recovered by the application of a future development project relateto undiscovered accumulations. These estimates have both an associated risk ofdiscovery and a risk of development. Further exploration, appraisal andevaluation is required to determine the existence of a significant quantity ofpotentially movable hydrocarbons. Tangiers has a 25 per cent participating interest in the Tarfaya OffshoreBlock, which is being operated by Galp Energia who has a 50 per cent interest.The remaining 25 per cent interest is held by ONHYM (Morocco's National Officeof Hydrocarbons and Mines), who are carried through the exploration phase. The TAO-1 well is located within a proven petroleum system, adjacent to the CapJuby oil discovery, and is targeting three stacked objectives. Release of Bank Guarantee and Past Cost Reimbursement The Company would like to thank ONHYM and Galp for speedy release of the US$3mbank guarantee, which was secured against the work program but has beenreplaced by Galp. Tangiers can confirm that final preparations are underway fortransfer of both the US$3m bank guarantee and US$7.5m in back costs that formedpart of the farm-in deal executed with Galp in December 2012. Tangiers' Managing Director Dave Wall said "Tangiers would also like to thankinvestors for their support, through what has been a fast changing environmentthat has presented unique challenges, particularly in relation to funding. TheCompany is excited by the imminent drilling of the TAO-1 exploration prospect". About Tangiers Petroleum: Tangiers Petroleum is an Australian-based oilexplorer with assets offshore Morocco in shallow water. The Company isscheduled to spud the high impact TAO-1 exploration well in mid-late June,targeting best estimate net resource potential of 190mmbbl* of oil (gross758mmbbl, TPT 25%). Cautionary Statement: The estimated quantities of petroleum that may bepotentially recovered by the application of a future development project relateto undiscovered accumulations. These estimates have both an associated risk ofdiscovery and a risk of development. Further exploration, appraisal andevaluation is required to determine the existence of a significant quantity ofpotentially movable hydrocarbons. *Independently certified by NSAI as at 1 May 2011 - see NSAI Assessment ofProspective Oil Resources, market announcement dated 27 May 2011 The Prospective Resource estimates above have been reviewed by Mr BrentVillemarette who is an Executive Director of Tangiers. Mr Villemarette is areservoir engineer with over 30 years' experience and is a member of theSociety of Petroleum Engineers. Mr Villemarette has reviewed the informationand supporting documentation referred to in this announcement and considers theestimates to be fairly represented and consents to its release in the form andcontext in which it appears. IVA STEJSKALJoint Company Secretary Tangiers Petroleum LimitedLevel 2, 5 Ord StreetWest Perth WA 6005, AustraliaPh: + 61 8 9485 0990www.tangierspetroleum.com Contacts RFC Ambrian LimitedAs Nominated AdviserMr Oliver Morse / Ms Trinity McIntyre+61 8 9480 2500 As Corporate BrokerMr Charlie Cryer+44 20 3440 6800 Mr Ed Portman (Media and Investor Relations - United Kingdom)Tavistock Communications+44 20 7920 3150