Kairiki Energy Limited (ASX:KIK) Quarterly Report For The Period Ended 31 December 2009

Perth, Jan 28, 2010 AEST (ABN Newswire) - Kairiki Energy Limited (ASX:KIK) (PINK:KAIRF) Directors wish to report the following activities for the quarter ended 31 December 2009.

Managing Director Appointment

Effective 1 December 2009, Kairiki announced the appointment of Dr Mark Fenton as Kairiki's new Managing Director. Dr Fenton has extensive experience in the oil and gas industry with over 24 years in operating oil and gas companies, including several years in executive management roles with extensive experience in both offshore and onshore oil field developments particularly in SE Asia and the Middle East.

Mark has held a range of technical, management and executive positions with international and Australian oil and gas majors as well as smaller ASX-listed oil companies during his career. Dr Fenton has a PHD in Geology and also a Bachelor of Science (Honours) in Geology from the University of Melbourne. Mark brings strong executive leadership and commercial experience as well as a wealth of international technical and operating skills in project development, exploration and project acquisition.

Pursuant to this appointment, Mr Laurie Brown, the current Managing Director, will remain as an Executive Director of Kairiki.

SC 54A

Tindalo Development

On the 11th December 2009 the SC 54A Joint Venture partners provided their Final Investment Decision (FID) approval for the development of the Tindalo oilfield.

Key development highlights:

- Tindalo-1 discovery well will be re-entered and completed for production;

- The Tindalo project will utilise a jack-up rig and a dynamically positioned storage vessel (FSO) to develop the field;

- All major approvals for the project from the Philippine government received;

- Estimated development cost is approximately US$20 million;

- Upon production, the operating costs will be approximately US$250,000 per day;

First oil scheduled 2Q 2010 with initial field production rate of 7,000-15,000bopd.

SC 54B

The SC 54B Joint Venture has continued to engage companies during the period with a view to farming-out the acreage and obtaining a partner to fund the drilling of the Gindara prospect.

As a result of the technical work completed in the third quarter of 2009, the Gindara prospect is now considered substantially de-risked following completion of the PSDM work and revised volumetrics. The prospect represents an outstanding high potential/low risk drilling candidate for the first well in SC 54B.

SC 54B Working Interests

Company                               Working Interest------------------------------------------------------Nido Petroleum PhilippinesPty Ltd (Nido) - Operator                     60%------------------------------------------------------Yilgarn Petroleum Philippines Pty Ltd,a wholly owned subsidiary ofKairiki Energy Limited (ASX:KIK)            40%------------------------------------------------------

Mineral Tenements

In the December 2009 quarter, Kairiki executed formal agreements to farm-out its minerals tenements to third parties as announced in the March 2009 quarter. The third parties will earn a 90% interest in the mineral tenements by funding 100% of the cost of all the exploration work required to maintain the tenements in good standing with the Department of Mines and Petroleum.

Kairiki will receive as consideration the following:

- 10% of the net proceeds on certain tenements up to a sum of A$250,000 and a 1% net smelter royalty thereafter; and

- for the remaining tenements, 10% of the net revenue after 5,000 ounces of gold has been produced.

Corporate Summary

Annual General Meeting

Kairiki held its Annual General Meeting on 26 November 2008 and the result of the resolutions were as follows;

1. Adoption of Remuneration Report Passed
2. Re-Election of Director - Mr P Fry Passed
3. Issue of Incentive Options to Ms Jyn Sim Baker or nominee Passed
4. Ratification of Placement - 29 June 2009 Passed
5. Ratification of Placement - 20 May 2009 Passed

Cash Position

At 31 December 2009, Kairiki had a cash balance of $11.45m. There was a net increase in cash during the quarter of $2.99m attributable to the following:

- Net proceeds from sale of 5% interest in SC 54A to Trafigura of $3.9m (US$3.6m);

- Payment of Interest on Convertible Note of $0.33 million;

- Development Costs of $0.20 million;

- General and administrative costs of $0.37 million.

Change in Substantial Shareholders

During the quarter, the only change in substantial shareholders was AMP reduced their holding from 27.85m shares to 27.4m shares.

For the complete Kairiki Energy Quarterly Report for the period ended 31 December 2009, please click the link below:

http://www.abnnewswire.net/media/en/docs/62163-ASX-KIK-478070.pdf

Contact

Dr Mark Fenton Managing Director Phone: +61-8-9388-6711 Fax: +61-8-9388-6744 Website: www.kairikienergy.com