Interim Results 2009

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Interim Results for the period ending 30 June 2009

San Leon Energy, the AIM listed international oil and gas company with assets in Morocco, Italy, Poland, the Netherlands and the USA is pleased to announce its interim results.

Highlights:

• Completion of aeromagnetic survey on Zag reconnaissance paves way for upgrade of licence
• Award of prospective licences in Italy and Poland
• New oil shale project in Morocco: proven oil producing shale and exclusive new technology
• Completion of Gold Point Energy acquisition
• First commercial gas discovery in the US
• Placing raising £6.3 million to further develop the Company’s portfolio
• Seismic services agreement signed with PGS Ventures AS (“PGS”)
• PGS will provide up to US$50 million of seismic acquisition processing, interpretation & field evaluation over the Company’s European assets

Oisín Fanning, Chairman of San Leon commented:

“San Leon has completed some significant achievements to date this year. We have continued to build and develop an exciting portfolio of assets through which we believe we can deliver value to our shareholders.

With our portfolio, the success of our Placing as well as the agreement that we have signed with PGS; San Leon has a healthy foundation from which to further build and can very much to look forward to the future.”

30 September 2009

For further information contact:

Qualified person
Philip Thompson has over twenty five years experience in the oil & gas industry. He has an M.Sc. in Geophysics from Southern Methodist University and a B.Sc. in Geophysics from Texas A&M University.

Chairman’s Statement

San Leon Energy grows from strength to strength. The first half of 2009 is a testament to our mission to bring value to our shareholders and grow the company in a systemic and sustainable manner.

In February we completed the Aeromagnetic survey in Zag, Morocco. In March we were successful acquiring prospective licences in Italy and Poland. In May we commenced lab testing our in-situ oil extraction technique for our proposal to ONHYM in Morocco, which is now being prepared for site evaluation. In June we appointed new advisors and brokers and completed the acquisition of Gold Point Energy. In July we had our first commercial success in Texas.

It has been a busy year to date and in keeping with the planned development of our company.

Our enthusiasm has been further underpinned by the recent successful placing that raised £6.3 million pounds and the support of Petroleum Geo Services for our European programme.

Petroleum Geo Services, the international Seismic Services Corporation have not only invested in San Leon to mobilise a PGS team in Europe, they have also agreed to provide us with up to fifty million dollars worth of seismic acquisition processing, interpretation, and field evaluation exclusively over our European assets. PGS also possess the world’s most extensive multi-client data library. We have, so far, committed to draw down and mobilise $20 million dollars worth of services for scheduled seismic project work offshore in Italy and in Poland.

It has been a demanding and exciting year and our diary is full of more essential work to be done. I am grateful for the strength and expertise of the global team of experts we are fortunate enough to employ.

As I have said before, the future looks good and I am pleased to report that the company is in a healthy position and very much looking forward.

Oisin Fanning
Chairman
San Leon Energy

30 September 2009

The following financial information on San Leon Energy Plc represents the Company’s interim results for the 6 months ended 30 June 2009.

1. Consolidated Income Statement
For the six months ended 30 June 2009

2. Consolidated Balance Sheet
As at 30 June 2009

3. Consolidated Statement of Changes in Equity
As at 30 June 2009

4. Consolidated Cash Flow Statement
For the six months ended 30 June 2009

5. Notes to the Interim Financial Information

5.1 Segmental Analysis

The Group is engaged in one business segment only, oil and gas exploration therefore only an analysis by geographical segment has been presented. The Group has geographic segments in Africa, America and Europe in addition to the head office operation in Ireland.

The segment results for the period ended 30th June 2009 are as follows:

5.3 Loss per share

The calculation of basic loss per ordinary share is based on the loss per year and the average number of ordinary shares in issue during the relevant year as set out below. There is no difference between the diluted loss per share and the basic loss per share.

5.4 Intangible assets – Exploration costs

Expenditure on exploration activities is deferred on areas of interest until a reasonable assessment can be determined of the existence or otherwise of economically recoverable reserves. The directors are satisfied that this deferred expenditure is worth not less than cost and that the exploration projects described above have the potential to achieve production and positive cash flows. Whilst there are no current indications of impairment, the directors recognise that the future realisation of these exploration and evaluation assets is dependent on future successful exploration and appraisal activities and the subsequent economic production of oil and gas reserves. They have reviewed current and prospective plans for licence areas and are satisfied that future exploration and evaluation activities are appropriate.

5.5 Trade and other receivables

5.6 Trade and other payables (amounts due within one year)

5.7 Share capital

Details of the ordinary shares issued during the period are given in the table below:

6. Accounting policies

The Group interim financial information has been prepared in accordance with International Financial Reporting Standards adopted by the EU and Irish statute comprising the Companies Acts, 1963 to 2006.

Basis of preparation
The group financial information is prepared on the historical cost basis, except for available-for-sale assets, which are carried at fair value. The accounting policies have been applied consistently by group entities. The financial statements are presented in Euro.

The preparation of financial statements in conformity with EU IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources.

In particular, significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount recognised in the financial statements are in relation to the measurement of the impairment of intangible assets

Basis of consolidation
The financial information incorporates the financial information of the Company and entities controlled by the Company (its subsidiaries). The results of subsidiaries acquired or disposed of during the year period included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial information of subsidiaries to bring their accounting policies into line with those used by other members of the Group. All intra-group transactions, balances, income and expenses are eliminated on consolidation.

Segmental reporting
A segment is a distinguishable component of the Group that is engaged either in providing products or services (business segment), or in providing products or services within a particular environment (geographic segment), which is subject to risks and rewards that are different from those of other segments.

Inter-segment pricing is determined on an arm’s length basis. Segment results included items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

Intangible fixed assets – exploration costs
The Group applies the full-cost method of accounting under which all expenditure relating to the acquisition, exploration, appraisal and development of oil and gas interests, including an appropriate share of directly attributable overheads, is capitalised within cost pools. Capitalised costs are amortised on a unit of production basis. The Board regularly reviews the carrying values of intangible assets and writes down capitalised expenditure to levels it considers to be prudent. Costs pools are determined on the basis of geographical principles. The Group currently has two cost pools, being its exploration interests in Africa, Europe and North America. Expenditure incurred prior to obtaining the legal rights to explore an area is written off to the income statement.

Under the full cost based method of accounting, the Group capitalises exploration costs until it is capable of determining whether its exploration efforts were successful and, if they were successful,
whether any impairment charges may be required to bring the net book values of assets in line with their economic values.

Unproven oil and gas properties, including oil and gas licences which are acquired by the Group and which have finite useful lives, are stated at cost less accumulated amortisation and impairment losses.

Intangible assets acquired as part of an acquisition of a business are capitalised separately from goodwill if the fair value can be measured reliably on initial recognition, subject to the constraint that, unless the asset has a readily ascertainable market value, the fair value is limited to an amount that does not create or increase any negative goodwill arising on the acquisition.

Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation is provided at rates calculated to write off the cost less residual value of each asset over its expected useful life, the residual value is the estimated amount that would currently be obtained from disposal of the asset if the asset were already of the age and in the condition expected at the end of its useful life. The annual rate of depreciation for each class of depreciable asset is:

Office equipment 25% Straight line

The carrying value of tangible fixed assets is assessed annually and any impairment is charged to the income statement.

Financial assets
Financial assets are stated at fair value with gains and losses recognised in the income statement..

Impairment
The carrying amounts of the Group’s assets are reviewed at each balance sheet date and, if there is any indication that an asset may be impaired, its recoverable amount is estimated. The recoverable amount is the higher of its net selling price and its value in use.

Estimates on impairment are limited to an assessment by the Directors of any events or changes in circumstance that would indicate that the carrying value of the asset may not be recoverable.

Any impairment loss arising from the review is charged to the income statement whenever the carrying amount of the asset exceeds its recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

Taxation
Income tax expense comprises current and deferred tax. Income tax expense is recognised in profit or loss except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

Deferred tax is recognised using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of goodwill, the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that they probably will not reverse in the foreseeable future. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date.

A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

Foreign currencies
Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rates ruling at the balance sheet date, and revenues, costs and non-monetary assets at the exchange rates ruling at the dates of the transactions.

Profits and losses arising from foreign currency transactions and on settlement of amounts receivable and payable in foreign currency are dealt with through the income statement.

Monetary assets are monies held and amounts to be received in money; all other assets are non monetary assets.

Finance income
Dividend income from investments is recognised when the shareholder’s right to receive payment has been established.

Interest income is accrued on a time basis by reference to the principal on deposit and the effective interest rate applicable.

Ordinary shares
Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from equity.

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