22 NOVEMBER 2006

ANTRIM ENERGY INC. BILL NEWMAN 403.750.1297

BILL.NEWMAN@RESEARCHCAPITAL.COM
AEN-TSX: C$3.70, AEY-AIM: 169.00P — BU Y

Multiple High-Impact North Sea Wells Planned for 2007

Per Share Data (C$) EVENTS
Price $3.70 Shares O/S (mm): 84.9 ƒ Antrim closes a $48.7 million bought deal financing and closes the
Target Price: $6.85 FD Shares (mm): 97.8 acquisition of Block 21/28a located in the Central North Sea. We maintain
our BUY recommendation and target price of $6.85.
Projected Return: 85% Mkt. Cap ($ mm): $314.2
52-Wk High: $5.19 W.Capital ($ mm)*: $53.3 HIGHLIGHTS
52-Wk Low: $1.50 Ent.Value ($ mm): $260.8
*(Estimated working capital, post financing and Block 21/28a acquisition ) ƒ Fyne and Dandy, UK North Sea: On November 13, 2006, Antrim completed
the acquisition of a 75% interest in Block 21/28a from Eni, a large,
FY December 31 2005A 2006E 2007E integrated energy company headquartered in Italy. The block contains the
Fyne and Dandy oil fields, which have been delineated with eight wells
Production
(Figure 1). Three of the wells were production tested at rates ranging
Liquids (bbl/d) 568 681 1,100 between 1,240 bbl/d and 3,600 bbl/d. With submersible pumps and pressure
Gas (mmcf/d) 2.2 5.0 11.7 support, management expects production wells will exceed these rates. The
oil quality is a medium grade of between 21° and 25° API. The primary
Boe/d (6:1) 936 1,514 3,050
formation is the Middle Eocene-aged Tay Formation, found at a relatively
Equivalent Growth 92% 62% 101% shallow depth of approximately 1,340 metres. Antrim paid US$8.0 million to
Financial acquire its interest in the block and has agreed to pay an additional
US$10.0 million to Eni on approval of a Field Development Plan from the
Cash Flow ($ mm) $2.5 $7.7 $10.5
DTI. During 2007, Antrim plans to shoot a high-resolution seismic survey
CFPS (FD) $0.05 $0.12 $0.15 that will assist in the design of an optimal development drilling program.
After an intensive development drilling program, Antrim is targeting first oil
production by mid-2009. No reserve estimates were provided by Antrim.
However, based upon publicly available information, the Fyne and Dandy oil
pools are estimated to hold approximately 28 million of recoverable
reserves. If this is the case, Antrim acquired the reserves for less than
$0.65/bbl.

ƒ Causew ay, UK North Sea: In August 2006, Antrim announced the test
Courtesy of BigCharts.com
Profile
Antrim Energy Inc. (www.antrimenergy.com) is Canadian-based
ƒ Financing: Yesterday, Antrim announced the completion of a bought deal
oil and gas exploration and production company with operations
focused in Northern, Central and Southern Argentina, and the UK
North Sea.
results of the 211/23d-17z East Causeway. The well tested from the Tarbert
and Ness reservoirs at a combined 14,500 bbl/d. During 2007, Antrim will
attempt to prove up the western portion of the Causeway play by drilling up
to three more vertical or high-angle wells back-to-back. Yesterday, Antrim
announced that it has secured a drilling rig and the first well is scheduled to
spud in May 2007. The well will be drilled approximately 2 miles to the
southwest of the East Causeway discovery and will target the Jurassic-aged
Tarbert, Ness, and Etive reservoirs. Antrim believes that if it is successful
in proving up the entire Causeway play, the area has the potential to
produce at 40,000 bbl/d (26,300 bbl/d). First production could occur by
Q3/08. Antrim holds a 65.5% interest.
equity financing of 13.2 million shares at $3.70 per share for gross
proceeds of $48.7 million. Antrim has granted an over-allotment option,
exercisable for 30 days following the closing date, to purchase an
additional 1,975,000 shares at $3.70 per share. Post the Fyne and Dandy
(Block 21/28a) acquisition, and assuming the over-allotment is exercised,
we estimate that Antrim’s working capital position will be approximately $60
million. In addition, Antrim has 7.7 million of $3.00 warrants outstanding
that expire in March 2007, which could bring in another $22 million.

INVESTMENT CONCLUSION
ƒ With the completion of the financing and booking of a rig, Antrim is set for a
busy North Sea drilling season. With success at Causeway and the new
Fyne and Dandy Block, Antrim is targeting production of 30,000 boe/d by
mid-2009. We maintain our BUY recommendation and our $6.85 target
price, equivalent to our risked estimate of net asset value.
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UK NORTH SEA

Figure 1. Fyne & Dandy Prospects

Source. Company reports

ƒ Valuation: We assumed that the over-allotment option of 1,975,000 share at $3.70 per share is exercised, increasing Antrim’s
working capital position to approximately $60.6 million. Basic and fully-diluted shares outstanding would increase to 86.9 million
and 99.8 million fully dilutive, respectively. Assuming recoverable reserves of 28 million barrels (21 million barrels net) for the
Fyne and Dandy oil accumulations, applying an 80% chance of success and valuing at $5.00/bbl, we estimate a potential
increase to net asset value of $0.97/share. Adding our estimated potential value of the Causeway play and Antrim’s Argentina
reserves, our net asset post-financing is $7.63/ share or $6.82/fd share (Figure 2).

Estimated Net Asset Value

$ mm $/share
Reserves (December 31, 2005)
Proven 42.2 $0.49
Probable 17.2 $0.20
Total 59.4 $0.68
Undeveloped Land 2.1 $0.02
Positive Working Capital* 60.6 $0.70
Net Asset Value (Basic) 122.1 $1.41
* Post the Fyne and Dandy acquisition and exercise of overallotment.
NAV Including North Sea Potential Value
$ mm $/share
Potential Value: Causeway 441.5 $5.08
Potential Value Fyne and Dandy 84.0 $0.97
Potential Risked Value UK North Sea 525.5 $6.05
Risked NAV Basic 647.6 $7.45
Risked NAV FD 681.1 $6.82

Figure 2. Risked Net Asset Value

Source. Company reports, Research Capital

ARGENTINA
ƒ Tierra del Fuego, Argentina (25.78% W.I.): Antrim and partners have drilled 19 wells at Tierra del Fuego, of which 18 wells
have been cased as potential producers and only one well has been abandoned. The San Luis gas plant is at full capacity, with a
throughput of approximately 20 mmcf/d plus liquids. Antrim is currently expanding the plant to approximately 40 mmcf/d, which is
expected to be completed by August 2007.

ƒ Medianera Concession, Argentina (70% W.I.): In February 2006, Antrim acquired a 70% interest in the Medianera Block in the
 Page 3

Neuqune Basin in central Argentina. Current production of about 35 bbl/d (38° API) is only from the shallower horizons (950-
1,150 metres); however, Antrim believes that the deeper zones hold significant exploration potential. Early this year, Antrim
2
completed an 83 km 3D seismic program. The data has been processed and Antrim is currently interpreting the data. Subject to
rig availability, Antrim hopes to drill a well in Q1/07.

ƒ Capricorn (50% W.I.): In October 2006, Antrim entered into a farm-out agreement with Gold Point Energy Corp. Gold Point
committed to pay 50% of a $1 million 3D seismic program and 50% of a $2 million, 2,300-metre exploration well to earn a 25%
working interest in the Martinez del Tineo Oeste prospect (MTO prospect). Gold Point has already advanced $500,000 to fulfill its
seismic obligation. Discussions are underway to secure a rig and the well is expected to be drilled in the first half of 2007. Antrim
will pay 25% of the drilling costs to retain a 37.5% working interest in the prospect. Once the well has been drilled, Gold Point
2 2
will hold a 25% interest in 54 km of the 4,008 km Capricorn License. Gold Point has the option to earn a 25% interest in the
2
entire Capricorn licence by financing 50% of a 300 km 3D seismic program and 50% of two additional exploration wells.

ƒ 2
Puesto Guardian (40% W.I.): Antrim recently completed a 330 km 3D seismic program in the Puesto Guardian concession. The
data is being processed, which should lead to a drilling program in 2007.
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RELEVANT DISCLOSURES APPLICABLE TO: ANTRIM ENERGY INC.

LIST OF DISCLOSURE TERMS:

1. Within the last 3 years, Research Capital Corporation has managed or co-managed an offering of securities by the
subject issuer.
2. Within the last 3 years, Research Capital Corporation has received compensation for investment banking and related
services from the subject issuer.
3. The research analyst or a member of the research analyst’s household owns shares and/or options to acquire shares
of the subject issuer.

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