TAO-1 Financial Position Update & Placement

23 September 2014 TANGIERS PETROLEUM LIMITED TAO-1 AND CASH POSITION UPDATE TAO-1 AND CASH POSITION UPDATE Tangiers Petroleum Limited ("Tangiers" or the "Company") advises that it hasfinalised its financial obligations in relation to the drilling of the TAO-1well, being a total of US$18.56m. This has been funded by the Company's cashposition and leaves Tangiers with a cash balance of approximately A$1.25m. The final cost of the TAO-1 well was in excess of the Company's internalbudget. This was largely due to factors not associated directly with thedrilling, which was completed safely and efficiently. Unfortunately, several ofthe costs were not fully quantified until after the well had reached totaldepth, at which time it was not possible for Tangiers to issue additionalequity. EXIT FROM TARFAYA OFFSHORE BLOCK After an internal strategic review, and as part of the finalisation of itsobligations, Tangiers has undertaken to exit the Tarfaya Offshore Block either:by assigning its 25% interest to Galp Energia (Galp), Tangiers' partner and theOperator of the block, for consideration of US$3.4m; or by withdrawal when thepermit expires in February 2015. Under an agreement with Galp, if the exit has not been completed within 6months (or 12 months at the discretion of Galp), Tangiers' Moroccan subsidiary,DVM International SARL (DVM), will be liable to Galp for a payment of US$3.4m.Given that the permit expires in February 2015, and that the intention of bothGalp and DVM is for DVM to assign the permit, the Board is confident that thecontingent liability in DVM has a low chance of realisation. Assignment orwithdrawal is subject to the normal approvals process by the MoroccanGovernment and the Office National des Hydrocarbures et des Mines (ONHYM). Tangiers thanks the Moroccan Government and ONHYM for the opportunity toexplore within Morocco. Tangiers has also agreed a payment to Galp of US$3.4m, in stock or cash, if themarket capitalisation of Tangiers exceeds US$50m within seven years of theagreement. This payment will also be required if Tangiers delists for anyreason, such as due to a change of control. NEW VENTURES Tangiers is currently assessing several new venture opportunities, which are atvarious stages of maturity; however, none of these opportunities haveprogressed to binding agreements at this time. The Company looks forward toupdating shareholders on these activities as they progress. CAPITAL MANAGEMENT AND COMPLETION OF PLACEMENT The Company has undertaken an internal overhead review, resulting in asignificant reduction in overheads of greater than A$2.5m per annum, includingcuts to staff salaries (greater than A$300k) and Director's fees (greater than A$200k). The Company has received firm commitments for a placement to raise A$1.2m at$0.006 per share to sophisticated investors in order strengthen its balancesheet, as announced on 19 September 2014. The placement will be managed by DJCarmichaels and is subject to shareholder approval. Tangiers' Managing Director, Dave Wall said "Whilst we are now starting from alow base, the Board is confident that we have the right ingredients in place tobuild a successful oil and gas business." This announcement, along with lodgement of the Half Year Accounts, lifts thesuspension on the trading of the Company's shares on both ASX and AIM. DAVID WALLManaging DirectorTangiers Petroleum LimitedLevel 2, 5 Ord StreetWest Perth WA 6005, AustraliaPh: + 61 8 9485 0990www.tangierspetroleum.com ContactsRFC Ambrian Limited As Nominated AdviserMr Oliver Morse / Ms Trinity McIntyre+61 8 9480 2500 As Corporate BrokerMr Charlie Cryer+44 20 3440 6800