Faroe Petroleum plc

Company Presentation
Stockholm 4th May 2011

Disclaimer
These Presentation Materials do not constitute or form any part of any offer or invitation to sell or issue or purchase or subscribe for any shares in the Faroe Petroleum plc (the Company) nor shall they or any part of them, or the fact of their distribution, form the basis of, or be relied on in connection with, any contract with the Company relating to any securities. Any decision regarding any proposed acquisition of shares in the Company must be made solely on the basis of public information on the Company. The Presentation Materials are not intended to be distributed or passed on, directly or indirectly, or to any other class of persons. They are available to you solely for your information and may not be reproduced, forwarded to any other person or published, in whole or in part, for any other purpose. No reliance may be placed for any purpose whatsoever on the information contained in this document or on its completeness. Any reliance on this communication could potentially expose you to a significant risk of losing all of the property invested by you or the incurring by you of additional liability. No representation or warranty, express or implied, is given by the Company, its directors or employees, or their professional advisers as to the accuracy, fairness, sufficiency or completeness of the information, opinions or beliefs contained in this document. Save in the case of fraud, no liability is accepted for any loss, cost or damage suffered or incurred as a result of the reliance on such information, opinions or beliefs. Certain statements and graphs throughout the presentation are forward-looking statements and represent the Companys international projects, expectations or beliefs concerning, among other things, future operating results and various components thereof or the companys future economic performance. The projections, estimates and beliefs contained in such forward-looking statements necessarily involve known and unknown risks and uncertainties which may cause the Companys actual performance and financial results in future periods to differ materially from any estimates or projections. If you are considering buying shares in the Company, you should consult a person authorised by the Financial Services Authority who specialises in advising on securities of companies such as Faroe Petroleum plc. Neither this document, nor any copy of it, may be taken or transmitted into the United States, Canada, Australia, Ireland, South Africa or Japan or into any jurisdiction where it would be unlawful to do so. Any failure to comply with this restriction may constitute a violation of relevant local securities laws.

Company

Background
Portfolio-based exploration company
Formed in 1998 Substantial portfolio of ~ 40 licences Atlantic Margin, Norway and UK North Sea Only quoted independent oil company in both areas World class sub-surface capabilities Good reputation and track record of delivery Partners with Majors and Independents

Clear, focused strategy

Sustain drilling programme by leveraging expertise Target 5 material exploration and appraisal wells / year Monetise exploration success across value cycle Grow production to fund exploration programme

Significant upside potential

Resource potential*: 320 mill boe (risked), 1.84 bnboe (un-risked) Multi-well exploration and appraisal drilling - funded Four discoveries in a row (2009/2010)

Well funded
Strong cash position and debt facilities in place Benefit from Norwegian tax rebate for exploration Tax efficient production revenues

* Senergy CPR Effective Date 1/1/11

Company

Business model - building on success

Exploration success Glenlivet and Tornado in UK west of Shetland Fogelberg and Maria in Norway Drill wells & make discoveries Discoveries Monetise

Monetisation of successful exploration and appraisal Breagh (UK Southern North Sea) Trym (Norway) Maria swap with Petoro (Norway)

Growing production Recent acquisitions of Blane and Schooner New assets: Njord, Brage, Ringhorne East

Assembly of portfolio of 40+ licences Sustain / replenish drilling programme Eight new awards since October (UK 26th round, Norway APA round and 21st round) New interest in undeveloped Perth oilfield Win Licences Produce

Continuing drilling programme Targeting 5 material wells/year Multi-well funded programme in place to 2013 4

Drilling successes

Maria and Fogelberg, Norway

Maria (Faroe 30%) - 2010
Oil discovery - high quality oil - 40 API Excellent quality reservoir Sub-sea tie-back most likely development scenario Faroe (30%),Wintershall (25%, Op), Centrica (20%), Spring (15%), Concedo (10%) Pre-FDP work and appraisal underway
Fogelberg

Fogelberg (Faroe 15%) - 2010

Gas condensate discovery Excellent quality reservoir Most likely development sub-sea tie-back to sgard 18 kilometres away Faroe (15%), Centrica (28%, Op), EON (15%), Suncor (30%), North (12%) Further appraisal under evaluation
5

Maria

Drilling successes

Glenlivet and Tornado, West of Shetland

Glenlivet (Faroe 10%)
Gas discovery - high quality gas Excellent quality reservoir Faroe (10%), DONG E&P (80%, op), First Oil (10%) Several development routes potential Laggan tie-in Pre-FDP work underway

Tornado (Faroe 7.5% unitised)

Gas / oil discovery high quality dry gas/oil rim Excellent quality reservoir Faroe (7.5%), OMV (35%, op), Dana (30%), Dong (20%), & Idemitsu (7.5%) Several development routes under evaluation

Gas Line Route for LagganTormore

6
* Source: Senergy CPR

2011 wells in Atlantic margin

Lagavulin and North Uist

Firm

Lagavulin - currently drilling

High impact, sub-basalt prospect in deep water Faroe (10%), Chevron (60%, op), OMV (20%), Idemitsu (10%) Significant cost over-run due to drilling challenges and weather down-time Results expected in coming weeks
DRILLED FOUND HYDROCARBONS: AnneMarie(12.5%)

Lagavulin(10%) Drilling

Expected Drilled/Drilling

Cardhu/N.Uist (6.25%)2011

Fulla/Freya(50%)

North Uist scheduled for Q4

High impact Palaeocene structural anticline and Jurassic fault block in deep water Faroe (6.25%), BP (47.5%, op), Nexen (35%), Cieco (6.25%) Idemitsu (5%) Analogue between North Uist and Lochnagar

2011 wells in Atlantic margin

Fulla prospect scheduled for Q2

Fulla exploration prospect , close and on trend with Freya discovery and giant Clair development Faroe 50% and operator, Canadian Overseas Petroleum 50% To spud in Q2 2011, using Wilphoenix semi-submersible rig Potential to prove up significant resource

Exploration programme

Halten Terrace, Norway lower risk playground

Large potential
11.9 billion boe proven in Norwegian Sea (36% produced) NPD estimate 7.5 billion boe of undiscovered resources 20 years experience to build on
Cooper (30%) 2012 Manilow (30%) 2012

Significant infrastructure
Access to infrastructure more straight forward in Norway
T-Rex (30%) 2011

10 licences in Halten Terrace Two significant discoveries

Fogelberg and Maria Near term developments

Firm Expected Drilled / Drilling

3 - 4 additional wells in 2011 and 2012 Exciting and significant follow up potential

Santana (30%) 2012

2011 wells in Halten Terrace, Norway

T-Rex prospect PL431 scheduled for Q2

Light oil proved and flow tested from 40-50m Cretaceous sandstone reservoir above the Jurassic Smrbukk field Faroe 30%, Maersk (70%, Op) Well to spud in Q2 2011 with Transocean Winner Similar prospects in neighbouring licences Significant follow up potential

Existing seismic

Faroes seismic
10

Norway 2010 APA Round awards

Milagro and Grayling prospects

Milagro - Licence PL590
Faroe 30%, North Energy (operator) 40% and Wintershall Norge ASA 30%) Contains Milagro Prospect & several leads within the Grinda Graben Potential tie-back candidates to Maria

Grayling - Licence PL592

Faroe 50%, Centrica 50% (operator) Contains the Grayling Prospect within the Lower Cretaceous sands, analogous to T-Rex Prospect A discovery in this licence could be potential tie-back candidates to a Fogelberg development
11

Norway 21st Round awards

Kvalross prospect
Kvalross - Licence PL611
Faroe 40%, Wintershall (operator) 40% and Petoro 20% 2100 square kilometres largest single licence awarded within the Barents Sea in this round Kvalross Prospect: wedge of clinoforms contained within a large structural closure to the east of the recent significant Statoil discovery, Skrugard, and immediately adjacent to Faroe Petroleums Samson Dome licence

12

Drilling programme

17 wells to end 2013 fully funded

NB Total of 17 wells excludes Lagavulin

13

Drilling programme

Delivering tangible results

140.0

120.0

100.0

mmboe

80.0

60.0

40.0

20.0

Source: Senergy CPR (effect of Petoro swap not reflected)

nl iv et rn F o ad ge o lb er g M An ar ne ia M a La rie ga vu l in Ka T-R e lvk lu x Fu mp lla en /F re ya N . U Bu t M ist/C ch ar ar ia A p d hu pr ai sa l C la pt on C oo pe Sa r nt an a M Sa an m so ilow n D Fo om ge e lb er S E g Ap Tor pr ai sa l M ila gr G o ro us e To

Pre-drill unrisked resource Pre-drill cumulative risked resource Post drill cumulative risked resource

G le

14

Significant value and upside potential

Net un-risked resources in portfolio (mmboe):
1600 1400
200

Net risked resources in portfolio (mmboe):

250

1464

213

1200 1000

150

800 600 400

100

274 101 4
Reserves Contingent Resources Near Term Prospective Res Medium and Long Term Prospective Res
0 Reserves 50

47 4
Contingent Resources

56

200 0

Near Term Prospective Res

Medium and Long Term Prospective Res

Net risked value of portfolio (mm):

180 160 140 120 100 80 60 40 20 0 Reserves Contingent Resources Near Term Prospective Res Medium and Long Term Prospective Res

Summary

mmboe

156

157
Reserves 4 47 269

Valuation mm 41 156 246

89

Contingent Res. Risked Prospective Res. Total

41

320

443

Source Senergy CPR Effective Date 1/1/11 Effect of recent Petroro swap not included

Stand alone asset valuation at 1/1/11, oil: $85/bbl real(11), gas: $8/mscf real(11), US$1.6/GBP, US$5.6/NOK, inflation 2%, 10% discount factor, NPV reported for reserves & EMV for contingent and prospective resources

Finance - production

Growing production revenues

Cash flow to fund exploration programme Tax efficiency, leverage debt Maximise equity leverage in wells Targeting greater production Blane acquisition recent addition Acquisition from Eni 2010 18% working interest High quality, low opex oil field Acquisition due to complete mid 2011 Routes to further production growth Organic growth In-fill production wells Commercialisation of discoveries Acquisition/trade

16

Norway swap deal

Faroe and Petoro

Swap Transaction announced on 11th April 2011

Undeveloped resource (Maria) swapped for production (Njord, Brage and Ringhorne East) Forecast 7,300 boepd* of net 2011 production, with good upside Adds over 14 mmboe 2P reserves** Pure asset swap - no cash consideration Tax value of approximately NOK 400 m (45 m) from tax balances received (undiscounted) Commercial arrangements for fluid transportation and off-take secured on attractive terms Petoro to retain projected abandonment and decommissioning liability, capped at NOK 600m ( 67m) Effective date 1 January 2011
*operatorsestimates **Senergy CPR

Norway swap deal

Benefits to Faroe
Strategic
Crystallizes significant value for Faroe and proves portfolio business model Gives Faroe benefits of scale and strengthens platform for growth Avoids diversion of resources onto a major development project Meets stated strategy of efficiently building production & revenues Generates more money to pursue high impact exploration and appraisal

Financial
Near term cash flow significantly enhanced Reserves increase from 4 mmboe to over 18 mmboe (350% increase) Transfers Faroes est. 280m net share of Maria development CAPEX Significantly increases borrowing base debt capacity No capital gains tax payable on transaction

Norway swap deal

New production assets

Brage field area 14.3% in Brage unit 13.4% Brage Sognefjord

Njord field area 7.5% in Njord field 7.5% in Gygrid project Ringhorne East field area 7.8% Ringhorne East field 3% Jotun field

Norway swap deal

Significant Upside
Production (boepd) January 2011 Actual Njord Brage Ringhorne East (+Jotun) Total Njord Upside Multiple infill possibilities recognised by Operator (confirmed by Senergy) NW Flank gas condensate development project, approved, first oil in 2012 Gygrid (sub-sea tie-back) development project, FDP to be submitted in 2011 6.844 3.585 1.533 11.962 Production (boepd) Expected 2011 Average * 4.300 1.800 1.200 7.300 Reserves (mmboe) Senergy 2P 6.90 3.64 3.66 14.20
*operatorsforecast

Brage Upside Recent in-fill wells have been successful, further targets underway New 4D seismic committed, focus on firming up indentified in-fill targets

Ringhorne East Upside Stable long term production and high recovery achieved from strong regional aquifer Two in-fill wells in planning phase following a recent 4D seismic acquisition

Funding
Strong cash position
Cash balance at 31 December 2010: 132.2m

Facilities
Norwegian Exploration facility (BoS) funds 75% of Norway exploration
NOK 500m (approximately 52m); expires December 2012

Borrowing Base Facility (SocGen)

20m, currently undrawn; expires December 2014

Plan to extend facilities during 2011

Equity optimisation
Utilising Norway tax rebate

Adequate funding cover for 17 well drilling programme to late 2013

21

Summary

Significant value creation potential Well financed and sustainable Solid and proven business model delivering results

22

Presentation Team Executive team

Graham Stewart Chief Executive
Instrumental in founding Faroe Petroleum in 1998 Over 20 years experience in oil and gas technical and commercial affairs Previously finance director and commercial director at Dana Petroleum from 1997 to 2002 Experience with Schlumberger, DNV Technica, Petroleum Science & Technology Institute Offshore Engineering degree (Heriot-Watt University) and MBA (Edinburgh University)

Helge Hammer Chief Operating Officer

Joined Faroe Petroleum in 2006 Over 20 years technical & business experience, incl. Shell (Norway, Oman, Australia and Holland) Managing Director of wholly owned Norwegian subsidiary, Faroe Petroleum Norge Previously Asset Manager and Deputy Managing Director at Paladin Resources Economics degree (Institut Franais du Ptrole, Paris) Petroleum Engineering degree (NTH University of Trondheim)

Iain Lanaghan Finance Director

Joined Faroe Petroleum as full-time Group Finance Director in 2009 Former Finance Director of FirstGroup plc, Powergen International and Atlantic Power Limited Private equity experience at Atlantic Power and founder of German transport group, Abellio Broad range of experience in energy, transport and service sectors Chartered Accountant KPMG London & Frankfurt Economics and Accounting degree (Edinburgh University)
23
23