• Diona-1 well stimulation program commenced with equipment on site
• Company raises $1.69 million via placement to fund operations and ensure adequate funding
• Placement to strengthen shareholder base with strategic investors

Xstate Resources Ltd has announced that the stimulation program for the Diona-1 well has commenced, with equipment arriving on the wellsite and preparatory operations underway. The company expects the stimulation program, to be conducted by Condor Energy, to commence by the end of the week, subject to operations proceeding to schedule. The company has also announced a capital raising via a placement to a small number of strategic investors and funds. The placement will raise $1.692 million (before costs) through the issue of 51,277,122 shares at $0.033 per share. The company will also issue 17,092,374 free-attaching options, exercisable at $0.06 per option by 30 April 2029, subject to shareholder approval. The funds raised will be used to fund any immediate capital requirements for extended production tests and to connect the Diona-1 well to the existing pipeline infrastructure, should the well be deemed commercially successful. The placement will also ensure the company is adequately funded should the stimulation operations run over budget.The company's Managing Director, Andrew Bald, commented that the company is very pleased to welcome the new strategic investors, who have a long and successful record in supporting junior companies like Xstate on their development path. He stated that if the flow rates from the Diona-1 well are commercial, the placement will allow the company to fund the connection to the valve approximately 1km to the west of the well pad, which will generate near-term revenue for the company. He described the next month as a very exciting time for the company.

The company believes that if the Diona-1 well is deemed commercial and can be connected quickly, the project could generate early operational cashflow for the company.