INTERIM MANAGEMENT STATEMENT

Sterling Energy Plc ("Sterling" or the "Company") is today issuing its Interim Management Statement for the period beginning 1 January 2012.

HIGHLIGHTS

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Cameroon

The Ntem concession area is a highly prospective deep water block, offshore Cameroon, in water depths ranging from 400 metres to 2,000 metres.

The Company holds a 50% non-operated working interest in the Ntem licence, following the introduction in 2011 of Murphy Cameroon Oil Co. Ltd, a wholly-owned subsidiary of Murphy Oil Corporation, a successful deep-water operator, as a 50 per cent working interest partner and operator.

The Ntem block remains in force majeure and the Company believes progress continues towards a resolution of the border dispute between the governments of Cameroon and Equatorial Guinea, but no specific timetable can be forecast.

Madagascar

The Ampasindava and Ambilobe blocks are highly prospective blocks located in the deep water basin to the northwest of Madagascar. The Company holds a 30% working interest in the Ampasindava license, containing the Sifaka prospect which is independently estimated to have gross un-risked best estimate prospective recoverable resources of 1.2 billion barrels, and 100% working interest in the Ambilobe license.

The incumbent government, formed by non-democratic means in March 2009, is engaged in a "roadmap", developed in co-operation with their African neighbours, towards the holding of democratic elections in 2012. After these elections, Sterling and ExxonMobil, our partner and the operator of the Ampasindava Block, expect to resume exploration activities.

The current exploration periods for both the Ambilobe and Ampasindava licences were due to come to an end in November 2010. Sterling and ExxonMobil continue in discussions with OMNIS, the state oil company of Madagascar, with regard to an extension of both licences.

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Mauritania

First quarter 2012 production from the Chinguetti field net to Sterling totalled 36,529 barrels, an average of 401 barrels of oil per day, compared to 629 bopd for the same period in 2011. Production in the period was reduced due to two operational interruptions to the supply of gas from the adjacent Banda field that is used for artificial lift in Chinguetti field production wells. Production was shut down in the period between 26 January and 11 February due to a hydrate blockage in the gas pipeline connecting Banda to Chinguetti; this blockage was cleared prior to re-starting production. Production was also shut down in the period 22 March to 30 March due to a failure in the subsea instrumentation controlling the operations of the gas well in the Banda field; the flow of gas from this well was re- instated on 31 March.

Production is stored on location in the floating production storage and offloading vessel (FPSO) until a suitable volume is accumulated which is then sold and transported away by sea tanker. A single cargo was sold in the period, with loading taking place in January 2012.

There are no approved plans for further development of the Chinguetti field.

New Ventures

Sterling continued to strengthen its technical team during the first quarter, and remains focused on expanding the existing exploration portfolio. The Company’s technical and commercial team has completed a preliminary screening of a number of opportunities and evaluated a smaller number in more detail.

Financial Position

In the first quarter of this financial year, Sterling reports the following unaudited results:

Revenue

Adjusted EBITDA

Profit/(Loss) after tax

Cash and cash equivalents at period end

Q1-2012 Q1-2011 (Unaudited) (Unaudited) $ ‘000 $ ‘000

(1) 6,575 346 (2) 4,906 569 3,099 (461) (3) 117,971 115,846

FY 2011 (Audited) $ ‘000

19,146 11,589 18,420

115,826

(1) Revenue is sourced from a partial cargo sold in the first quarter 2012 and from royalty incomes relating to interests in the Chinguetti field.

(2) EBITDA is earnings before interest (and other finance income and costs), tax, depreciation, depletion, amortisation and write-offs of oil & gas assets. Adjusted EBITDA is calculated before share based payments, charged to the income statement under IFRS 2 and pre-licence costs.

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(3) Cash balances at the end of Q1 2012 totalled $118.0 million, including $0.7 million of partner funds, (Q4 2011: $115.8 million, including $1.0 million pa