Zephyr Energy plc provides the following operational update: Drilling crews at the State 16-2 well site have been operating around the clock since the December spud, and progress to date is fully in line with the Company's expectations. Following the spud of the State 16-2 well, the Company received the third USD 600,000 tranche of the USD 2 million grant funds allocated by the U.S Department of Energy and its National Energy Technology Laboratory (the "DOE") for the drilling of the well. The final balance of USD 200,000 will be received following the completion of drilling operations. While the safe and successful completion of the State 16-2 well drilling operation is the Company's top priority, the Company's key goal for 2021 is to establish production and positive cash flow, either through existing portfolio, via acquisition, or through a combination of both. The company aims to end 2021 with a balanced asset base, one that contains a mix of current production and substantial long-term development upside. Management continues to assess acquisition opportunities with the potential to deliver near-term cash flow at attractive valuations. Potential acquisitions under consideration have the following criteria which meet the Company's strategic profile: Oil and gas interests located in the greater Rocky Mountain region of the U.S.; Current or near-term production potential, in order to balance the significant long-term upside potential provided by the Company's Paradox project; Low-risk, low-entry cost assets located in core areas of established, historically prolific basins; Ability to generate near-term value from the Company's existing $15 million tax loss asset; and Proprietary acquisition angles (via land strategy, relationship, or unique view on upside opportunity). Related to the above criteria, the company continues to monitor progress on proposed working interest acquisition in the McCoy lease in the Denver-Julesburg Basin ("DJ Basin") in Weld County, Colorado, U.S. While the potential McCoy acquisition meets most of the Company's key criteria, the timeline for development has been delayed by the current operator of the project. Zephyr will continue to monitor progress on the project and will make an investment decision on whether to proceed once a firm development schedule is established. In the meantime, the period to close the potential transaction has been extended by mutual agreement until June 30, 2021, providing optionality to the Company at no additional expense. More details on the potential McCoy transaction can be found in the background section below (and which were also announced on 10 February 2020).