Burleson Energy Limited (BUR)Burleson Energy Limited (BUR)

August 2010August 2010Previous chalk acreage now sold.

BUR retains royalty interests

COLORADO COUNTY 3D SEISMIC PROJECT AREA36 to 38.5% Working Interest in ~25,000 acres Plus large Wilcox prospects in Wharton County

75+ targets identified – several of company-maker size3 DISCOVERIES

Including company-maker:HEINTSCHEL with -

59 Bcf gas + 1.1 mmb condensate(Mid Case Estimate)

This presentation contains some references to forward looking assumptions, representations, estimates budgets and outcomes. These are uncertain by the nature of the business and no assurance can be given by Burleson Energy Limited that its expectations, estimates, budgets and forecast outcomes will be achieved.Actual results may vary materially from those expressed herein. http://www.burlesonenergyltd.com

NEW 1000 square mile 3D SEISMIC LICENCE“1K3D” project

38% WI. Access to very large data base covering large area onshore USA, including Gulf Coast

Company-maker potential

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Corporate InformationCorporate InformationMarket Cap ~ A$16m at 8 cps, Cash at bank ~A$2.7 million (end June 10)Debt: convertible notes

1.45 million @ $1 (1.35 million held by Macquarie Bank)repay 31 Dec 2010 (if not converted) 10 cent floor, 25 cent cap

Revenue Royalties from 2 chalk wells drilled by others (~A$4k/month)First non-chalk well (Yegua reservoir) on production in late April generating revenue of ~A$17k per monthHeintschel and Joann gas and condensate sales on line in near future

Total shareholders ~ 1220Shares/options

Shares on issue: 206 million Options: 55.1 million listed (25 cents) and 2.5 million unlisted (15- 25 cents)

US partnership: key BUR assetUS partnership: key BUR assetBUR Director Dr Andy Kugler, heads AKG, operator of BUR’s assets

Geologist 40+ years industry experience international, onshore USA Professionally associated with M Sandy (Exec Dir) for 24+ years

AKG Energy includes Dr. Kugler’s three sons - all with degrees from the University of Texas and independent experience with major industry players.

Khib, business and geosciences (BUR director)Greigh, business and petroleum land management (landman)Karras, petroleum engineer.

All are BUR shareholders

The Board:Norm Zillman - Non Executive Chairman

Geologist with 40+ years experience in the energy industryJohn McAlwey – Non Executive Director

Lawyer with 30+ years experienceDr Andrew Kugler Jr. – Non Executive Director Khib Kugler – Non Executive Director Michael Sandy – Executive Director,

Geologist with 30+ years experience in the energy industry (including in the USA).

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Building a Production Portfolio onshore USABuilding a Production Portfolio onshore USA

2H 2008: decision to stop drilling Chalk wells. Subsequently sold 5 producing chalk wells.Retained 1 to 1.5% royalty in wells drilled by others in the leases (2 currently providing revenue)

2H 2009: Underwrote and acquired 119 square miles of 3D seismic in Colorado County, Texas38% WI in prolific province with seven proven reservoir horizons, 25,000+ acres of leases

January 2010: secured two new large Wilcox projects (36.5% to 38% WI)February 2010 : First well, Brasher #1 Yegua reservoir, gas discovery, on productionApril-June 2010: Three Wilcox reservoir tests, Heintschel#1 Moeller #1and Joann #1. June 2010: Acquired 38% WI in new licence for 1000 sq miles of 3D seismic (“1K3D” project)

JULY 2010: Heintschel #1 tested: confirmed new gas condensate fieldContains from 25.6 billion cubic feet (Bcf) and 0.465 million barrels of condensate (mmbc) to 87.7 Bcf and 1.6 mmbc (recoverable)

JULY 2010 : Joann #1 discovered gas and condensate field:Restricted flow of 2.1 million cubic feet of gas per day (mmcfd). Three other untested zones in well Field potential to be determined

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Regional map: Regional map: Colorado County. Colorado County.

Note numerous Note numerous Wilcox fields and 600 Wilcox fields and 600 Bcf Edwards Word Bcf Edwards Word Field along trend Field along trend from BUR project from BUR project

area.area.BUR Project area

Word Field

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Colorado County 3D Project AreaColorado County 3D Project Area

119 sq mi 3D

I 10

Austin TX

HoustonTX

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Colorado County 3D project area Colorado County 3D project area Immediate Immediate area is area is prolific for prolific for oil and gas oil and gas --especially especially from the from the WilcoxWilcox

119 sq mi 3D

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Large and varied drilling portfolioLarge and varied drilling portfolioRange from shallow low cost and low risk wells on relatively small (but valuable) targets…..

Sandstone reservoirs: Miocene, Frio, Vicksburg and YeguaWell depths ~ 5000 ft (1524m), well costs ~US$0.6 million, targets ~0.5 to 1 Bcf52 prospects identified to date (12 top tier)First Yegua well, Brasher #1, a discovery – producing at ~450 mcf/d

….through medium depth and cost low risk wells on high value Wilcox sandstone reservoir targets …….

Potential company makers, large prospects up to 88 Bcf gas plus 1.6 mmb condensate25 prospects identified to date (9 top tier), Well depths 7 to 12,000’ (2133 to 3657m), cost $US2 to 3 million, First and third Wilcox wells made gas condensate discoveries, one - Heintschel -is potentially of “company maker” size. …..to a well on a higher cost and risk very large, deep Edwards and Sligo reefal carbonate target.Another potential “company maker” with 600 Bcf potentialOn trend with existing producing 600 Bcf fieldWell depth 18-22,000’ (5486 to 6705m) , cost US$14 million+ 8

BUR Well Locations BUR Well Locations

119 sq mi 3D

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Drilling results to date Drilling results to date (status as of July 2010)(status as of July 2010)Month Well

(reservoir)Depth Cost

D&C (US$

million)

Potential Gas (Bcf)

Potential Condensate

(mmb)

Status WI

NRI

Feb 2010

Brasher 1(Yegua)

5,000 ft(1524 m)

0.6 0.5 - Gas sales,~0.4 mmcf/d

38%

29.77%April 2010

Heintschel 1(Wilcox)

11,500 ft(3505 m)

2.5 88 1.6 Large gas condensate discovery.

Awaits frac and sales hookup.

38%

29.77%

May2010

Moeller 1(Wilcox)

12,500 ft(3810 m)

2.9 Updip potential established.

Gas shows; Poss. reservoir

damage. Stimulating and

testing

38.5%

30.03%

June 2010

Joann 1 (Wilcox)

11,750 ft(3581 m)

2.5 To be determined Gas condensate discovery.

Flowed ~2.1 mmcf/d and ~40

bc/d. Awaits sales hookup

38%

30.73%

D&C = drill and complete, WI = working interest, NRI = net revenue interest

Well 2: Heintschel #1 = large discoveryWell 2: Heintschel #1 = large discoveryLocated within main Colorado County 3D area (BUR WI 38%, NRI 29.77%)Spud 4 April 2010Large gas and condensate discovery Much thicker hydrocarbon column and larger prospect area (4460 acres) than

expected Thin zones from basal sands flowed 1.2 mmcfd, 12 bcd without fracturing

Analogue reservoirs in the region require fraccing before they will flowRequires fracture stimulation (“fraccing”) to maximise flow rate282 feet (86m) of gross sands, 160 feet (49m) of net reservoir sands111 feet (34m) of net gas pay

Gas(BCF)

Condensate(mmbc)

Number of wellsto develop

Low case 25.6 0.465 4‐8

Mid case  58.9 1.07 6‐16

High Case 87.7 1.6 12‐24

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Heintschel Hydrocarbon Volumes StudyHeintschel Hydrocarbon Volumes StudyTechnical detail Technical detail

There are 5 separate gas charged reservoir sands in H#1 with additional younger sands likely to occur in the eastern part of the field. The most significant sand in terms of gas volumes is the middle sand and is denoted here as Sand C. No gas water contact was seen in Sand C in the H#1 well so the gas volumes within that sand across the structure are unknown at this stage.

AKG developed three cases based on the location of the gas water contact (GWC) for the C sand. The low case uses the volume of gas sand to the “lowest known gas” (LKG) in Sand C (i.e. it assumes there is no gas below that seen in the well). The next mid case assumes a GWC at the “spill point” for the gas in Sand C as mapped using the 3D seismic. The high case case, assumes additional sands occur in the high area in the east of the H field where an additional 170’ (52m) of section has been mapped. It assumes the same net-to-gross sand ratio as occurs in the H#1 well reservoir package. See cross section.

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Heintschel #1 schematic cross sectionHeintschel #1 schematic cross section

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Well 3, Moeller #1Well 3, Moeller #1Located to SW of Colorado County 3D area (BUR WI 38.5%, NRI 30.03%), Spudded 2 May 2010 Gas shows while drilling but tested water + minor gas from 110 ft (33m) thick,

high porosity, sand.Suspected reservoir damage so stimulating uppermost zone to determine if

commercial gas flow can be achieved M#1 reservoir in gas-water transition zone.

Significant potential 175 ft (53m) updip of M#1 location: 10.4 bcf and 0.24 mmbc

Moeller schematic cross section

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Well 4, Joann #1Well 4, Joann #1Located in Colorado County 3D project area (BUR WI 39.4%, NRI 30.73%) Spud mid June 2010 Gas and condensate discovery in Wilcox reservoir

Flowed 2.1 mmcfd of gas plus 38 b/d condensate Represents restricted flow through small choke.Anticipate higher rates when well opened up to sales.Measured flow from just one zone – 3 other untested gas zones in

the well.Operator AKG considering various options to complete the well and access

sales gas pipeline and bring well on productionReserves in the Joann accumulation to be determined

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Summary of Wells Drilled to DateSummary of Wells Drilled to DateProspect/ field Status BUR

NRIPotential

Gas (Bcf)

PotentialCond. (mmb)

Gas flow(mcfd)

Cond. Flow(bpd)

Brasher On production 29.77% 0.5 - 0.45 -

Heintschel Low Case

Awaits frac, sales hookup and

development.

29.77% 26 0.47 1.2(on test)

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Moeller “updip” Requires appraisal well

30.03% 10 0.24 - -

Joann Awaits sales hookup.

30.73% To be determined 2.1 38

Rough guide: value per Bcf gas in ground ~US$3m and per bbl condensate ~US$50, see last two slides Net Revenue Interest (NRI) is the % of revenue BUR receives from a producing well/field.

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Future drilling scheduleFuture drilling scheduleNear term focus on Heintschel appraisal and development to assess the potential of

the filed and to generate revenue to fund ongoing program.

Plan to drill 2 to 3 Wilcox wells prior to end 2010, plus a well on 600 bcf Woppa prospect (subject to farmout)

Anticipate active wildcat drilling program in 2011.

Wilcox Candidates:

Heintschel appraisal/development wells Number of wells depends on results of H#1 fraccing and flow testing

WH 4 Wharton County Wilcox prospects on additional acreage acquired in Jan 2010 Potential for 41 Bcf, BUR WI 36%

Numerous other prospects in Wilcox and shallower reservoirs , BUR WI 38%~21 “top tier" prospects in the Colorado County 3D seismic areaExpect many more prospects to be generated from the “1K3D” project.

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Candidates: Next Drilling CampaignCandidates: Next Drilling CampaignWell County

(Reservoir)BUR interest

WI(~NRI)

Potential Gas (Bcf) Potential Condensate.

(mmb)

Heintschel Mid Case

<incremental above Low Case > Colorado

(Wilcox)

38%(~30%)

59

<33>

1.1

<0.63>

Heintschel High Case <incremental

above Mid Case >

88

<29>

1.6

<0.5>

WH4 Wharton(Wilcox)

36% (~28%)

41 -

Woppa* Colorado(Edwards/

Sligo)

38%(~30%)

600 -

Numerous additional prospects

Colorado and others

(Wilcox and shallower)

38%(~30%)

? ?

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Summary: Summary: BUR has 89% Drilling Success RateBUR has 89% Drilling Success Rate

BUR now targeting conventional reservoirs with low cost wells, onshore Texas.Three of the four wells in just-completed drilling campaign made discoveries

First well, Brasher #1 on gas production at 0.45 mmcfdSecond well Heintschel #1 - new field discovery of “company-maker” size

Flowed 1.2 mmcfd on test before fraccingThird well Moeller #1 - gas shows but tested water and minor gas - may have reservoir damage.

Identified updip potential for future drilling.Fourth well, Joann # 1 - gas and condensate discovery

Flowed 2.1 mmcfd plus 38 barrels per day of condensate on test. BUR drilling track record now 89% success (8 from 9, including 5 chalk wells) Near term focus on appraisal/development of the Heintschel field …..

……followed by resumption of wildcat drilling Well planned on the potential 600 Bcf Woppa structure (subject to farmout). Existing Colorado County 3D seismic (120 sq miles) and new “1K3D project” (1000 sq miles) provide numerous future drilling targets.

Contact: Managing Director, Michael SandyEmail info@burlesonenergyltd.comWeb www.burlesonenergyltd.com

Registered Office LEVEL 6 , 9 BARRACK ST SYDNEY NSW 2000Phone +61 2 8252 6177

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Footnote: Petroleum Industry Terminology and a Guide to the Value to BUR of Gas and Condensate Reserves and Production

BUR is conscious that our industry can be quite complicated in terms of its use of terminology, units of measurement etc and that interpreting the results of activities, particularly drilling, and understanding the significance to BUR can be a challenge. Following is presented as a “rule of thumb” guide for those investors who are relatively new to the sector.

Terminology and units. BUR uses the US system of measurement. Some key units are:Thousand cubic feet of gas = mcf - gas prices are currently ~ US$5 per mcf. Million cubic feet of gas = mmcf – generally used for gas flows from wells e.g. Joann #1 flowed at 2.1 mmcf per dayBillion cubic feet of gas = Bcf (the US billion or 109) = usual measurement of volumes of hydrocarbons in a well or field

Gas can be “in place” or “recoverable”Oil terminology is simpler and is measured in barrels (denoted variously as b, bbl) the current oil price is ~$78 per barrel

Condensate is very light clear oil which is gaseous in the reservoir, it sells for about the same price as oil. Million barrels of oil = mmb or more correctly mmbbl, million barrels of condensate sometimes denoted as mmbc.

Working Interest (WI) is the % that BUR owns of a well or area. The Net Revenue Interest (NRI ) = Working Interest minus royalties ) is what % BUR receives of the revenues.

In the current projects BUR generally holds WI ~38% and the NRI is usually ~ 30% Assumptions

Medium term gas price predicted by BUR to be US$5-6 per mcf = U$5-6 million per BcfRough guide to future value per Bcf “in the ground” is to halve the price, in this case $3million per Bcf

Medium term oil/condensate price predicted by BUR to be U$75 to $100/ barrel Rough guide to value of condensate “in the ground”, as above = U$50/barrel 20

Rough Guide to Calculating Value of Reserves and Production

Reserves/Resources – to calculate approximate value to BUR should a particular project be successfulPotential value to BUR = (Total project recoverable gas in Bcf X BUR’s NRI X US$3 million ) + (Total oil

in mmb X BUR’s NRI X $50) gives the value in US$ million. Convert to A$ million. NB. current BUR shares on issue = 206m

Production – to calculate approximate revenue per month to BUR should particular production levels be achieved

This is a more accurate calculation than the one above as it uses actual current prices rather than an estimate of future valueApproximate value to BUR per day = (Daily gas production X BUR’s NRI X current gas price) + (daily oil production X BUR’s NRI X current oil price)Example, using hypothetical but realistic flow rates of 3 mmcf/day (= 3000 mcf/day) of gas and 60 barrels of condensate per day

Note that flow rates totalling 3.75 mmcf per day plus 50 bbl condensate per day have already been achieved from 3 wells (Brasher #1 is on production at 0.45 mmcf/d, with two wells awaiting hook up to sales which flowed on testing - Heintschel #1 at 1.2 mmcf/d (pre fraccing) and Joann #1 at 2.1 mmcf/d)

(3000 mcf/d X 30% X US$5/mcf) + (60 X 30% X $77/b) = US$4500 + US$1386 = US$5886/day = US$ 176,580 per month = approximately A$200,000 per month net to BUR

Note that BUR retains the large majority of these revenues as taxes are low (~7% for gas and ~4% for condensate) and operating costs per well are also low at ~U$2000/well/month

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