North Sea Energy Inc.: Independent Economic Evaluation Complete on 3 Prospects

North Sea Energy Inc. ("NSE" or the "Company") (TSX VENTURE:NUK) announced today
the results of an Independent Economic Evaluation ("IEE") for three of its UK
North Sea blocks. These include its 50% owned Badger prospect (block 12/30), its
50% owned Bobcat prospect (block 13/28b) and its 20% owned Norfolk prospect
(blocks 12/16b and 12/17b), all located in the UK North Sea. The IEE has been
completed by Acquidis Limited ("Acquidis"), a UK based consulting firm utilizing
the resource and geologic information developed by Sproule International Limited
("Sproule") and Senergy (GB) Ltd. ("Senergy"). The IEE reports the projects'
potential economics as follows: 




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                  Prospect Economic Analyses Summary                 
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Prospect Name               UK North                                 
                                 Sea                                 
                            Block(s)       WI %   Gross Economics $mm
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                                                       P50        P10
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Badger                        12/30.        50%        638       1091
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Bobcat                        13/28b        50%        243        664
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Norfolk                       12/16b        20%        756       2007
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Norfolk East                  12/17b        20%        310       1109
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Norfolk & Norfolk East      12/16b &                                 
 (combined) Light Oil         12/17b        20%       1028       2991
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                   Prospect Economic Analyses Summary                  
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Prospect Name                   Gross Prospective                      
                               Resources MMboe(1)                 IRR %
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                                   P50        P10        P50        P10
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Badger                              35         99       149%        84%
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Bobcat                              12         36        96%       101%
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Norfolk                             50        141        82%        73%
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Norfolk East                        13         49       770%       565%
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Norfolk & Norfolk East                                                 
 (combined) Light Oil               63        190        97%        91%
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                  Prospect Economic Analyses Summary                 
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Prospect Name                                     Net NSE Prospective
                          Net NSE Economics $mm       Resources MMboe
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                                 P50        P10        P50        P10
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Badger                           319        546         18         49
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Bobcat                           122        332          6         18
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Norfolk                          151        401         10         28
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Norfolk East                      62        222          3         10
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Norfolk & Norfolk East                                               
 (combined) Light Oil            206        598         13         38
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The following assumptions were used by Acquidis to compile these results:

General

All information is presented in US dollars not adjusted for inflation. An
assumed exchange rate of 1.60 US dollars for GBP 1.00 (British Pound Sterling)
for 2012 and all years onward was used. All resultant values are rounded and
this may cause minor discrepancies.


Oil Price

In all scenarios, the UK Brent crude forecast oil price in US dollars not
adjusted for inflation as estimated by Sproule International Limited as at June
30, 2012 was used.


Development Scenario and Production Profiles

Development scenarios, capital expenditure and field operating expense estimates
were supplied by North Sea Energy. The effective start dates of development and
production is based on a best efforts scenario. Undiscovered oil in place
prospective resource volumes and resultant production profiles used were
independently assessed in accordance with NI 51-101(2).


Tax Regime

The UK fiscal regime, which includes the 'Small Field Allowance' for prospect
resource volumes less than 50 MMboe, is applied in these analyses and is subject
to change and clarification by the UK government.


In the UK fiscal regime the only applicable tax which is applied to this
economic analyses is the corporation tax which is a 30% basic rate plus a
supplemental rate of 20% plus a fair fuel stabiliser rate of 10% (applied when
oil price is over US$75) for a total corporation tax rate of 62% which is set
against the taxable income which is calculated as revenue - operating expense -
capital allowance -small field allowance. 


Capital allowances in the UK are 100% offset in the year of expenditure.

The 'Small Field Allowance' is an allowance of GBP UK150 million split over a
five year period and is offset against the supplemental 32% tax rate applied to
volumes less than 45 MMboe. A sliding scale allowance is applied from 45 MMboe
to 50 MMboe on a prorated basis. Volumes greater than 50 MMboe do not qualify
for this allowance.


In this economic model the use of a UK tax pool is assumed for initial years of
tax calculations whereby tax allowances for capital investment that cannot be
offset in the first few years of development prior to production and revenue
generation can be offset against production revenue from other UKCS fields.


Tax calculations assume tax assessment the year following cost and income
occurrence.


Discounting



--  A discount rate for NPV calculation of ten per cent (10%) is used 
--  Mid-year discounting is applied to the discount factor (n) 
--  Discount factor: (1/1-dr) ^n. where "dr" is the discount rate and "n" is
    the mid-year of discount. 



Key Economic Indicators

Four key indicators were calculated in this analysis, Net Present Value (NPV),
Internal Rate of Return (IRR), Profitability Index (PI) and Capital Efficiency
(CE).




--  NPV is the sum of the discounted cash flow through the forecasted life
    of the project. It does not represent a fair market value. 



The after-tax net present value of North Sea Energy Inc.'s oil and gas
properties here reflects the tax burden on the properties on a stand-alone
basis. It does not consider the business-entity-level tax situation, or tax
planning. It does not provide an estimate of the value at the level of the
business entity, which may be significantly different. The financial statements
and the management's discussion & analysis (MD&A) of North Sea Energy Inc.
should be consulted for information at the level of the business entity.




--  IRR is the discount rate which makes the NPV equal to zero. 
--  PI is a ratio of the NPV/NPVCapex 
--  CE is NPV/NPVce (maximum negative cumulative cash flow exposure) 



These economic indicators should not be interpreted as, or do not represent, the
fair market value of the prospects.


Metrics

The following cost and value metrics are presented in these economic analyses:



--  Capex/bbl is a gross measure of the total capital expenditure over the
    field life divided by the prospective resource value; 
--  Opex/bbl is the total operating expenditure divided by the prospective
    resource value. 
--  NPV/bbl is a value metric that is a gross measure the net present value
    divided by the prospective resource value. 



Estimates of future prospect cash flows from future capital expenditures,
operating expense, estimates of future production and oil price scenarios as
well as other statements about future events or anticipated results are forward
looking statements. The forward-looking statements contained herein are based on
assumptions and are subject to known and unknown risks, uncertainties and other
factors. Should the underlying assumptions prove incorrect or should one or more
of these risks, uncertainties or factors materialize, actual results may vary
significantly from those expected.


About North Sea Energy Inc.

NSE (TSX VENTURE:NUK) is a UK-focused oil and gas exploration and production
("E&P") company listed on the TSX Venture Exchange. NSE is producing light oil
from the Jacky field, located in the Inner Moray Firth off the Scottish coast
and has acquired an interest in nine blocks in the North Sea.


As per CSA Staff Notice 51-327 initial production test results should be
considered preliminary data and such data is not necessarily indicative of
long-term performance or of ultimate recovery.


Although the Company believes that the expectations reflected in such
independent economic analysis and information are reasonable, it can give no
assurance that such expectations will prove to be correct. Since the report and
information addresses future events and conditions, by their very nature they
involve inherent risks and uncertainties. Actual results may differ materially
from those currently anticipated due to a number of factors and risks. These
include, but are not limited to, the risks associated with the oil and gas
industry in general such as operational risks in development, exploration and
production, delays or changes in plans with respect to exploration or
development projects or capital expenditures, the uncertainty of estimates and
projections relating to production rates, costs and expenses, commodity price
and exchange rate fluctuations, marketing and transportation, environmental
risks, competition, the ability to access sufficient capital from internal and
external sources and changes in tax, royalty and environmental legislation.


Certain information included in this material constitutes "forward-looking
statements". The words "expect", "will", "intend", "estimate" and similar
expressions or statements that certain events or conditions "may" or "will"
occur identify forward-looking statements. Forward-looking statements are
necessarily based upon a number of estimates and assumptions that, while
considered reasonable by management at the date the statements are made, are
inherently subject to significant business, economic and competitive
uncertainties and contingencies. North Sea Energy Inc. ("NSE" or the "Company")
cautions the reader that such forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause the actual
results, performance or achievements of the Company to be materially different
from the Company's estimated future results, performance or achievements
expressed or implied by those forward-looking statements and the forward-looking
statements are not guarantees of future performance. These risks, uncertainties
and other factors include, but are not limited to, risks associated with the oil
and gas industry such as government regulation, environmental and reclamation
risks, title disputes or claims, success of oil and gas activities, future
commodity prices, costs of production, possible variation in oil and gas
reserves, oil and gas resources, grade or recovery rates, failure of plant,
equipment or processes to operate as anticipated, accidents, labour disputes,
the timing of estimated future production, capital expenditures, financial
market fluctuations, requirements for additional capital, conclusions of
economic evaluations, limitations on insurance coverage, risks associated with
using third party contractors and inflation. The Company disclaims any intention
or obligation to update or revise any forward-looking statements whether as a
result of new information, future events or otherwise, except as required by
applicable law.


A prospect is an untested exploration target that is defined sufficiently to be
considered drill-ready. 


Prospective resources are those quantities of oil and gas estimated, as of a
given date, to be potentially recoverable from undiscovered accumulations by
application of future development projects. Resource categories are as defined
in the Canadian Oil and Gas Evaluation Handbook (COGEH).


There is no certainty that any portion of the resources will be discovered. If
discovered, there is no certainty that it will be commercially viable to produce
any portion of the resources.


"Bobcat" is a promote licence that expires on January 9, 2013 when a drill or
drop commitment has to be made to the Department of Energy and Climate Change
("DECC"). "Badger" is a promote license that expires on January 31, 2014 when a
drill or drop commitment has to be made to DECC. "Norfolk" is a traditional
license with a drill or drop commitment due at the end of initial license term
(4 years, February, 2016).


All Blocks are subject to conditions imposed by DECC and may be relinquished if
conditions are not met.


Net present value calculations do not represent the fair market value of the
prospects.


(1) Sproule International Limited, NI 51-101 reports for Bobcat and Norfolk and
Norfolk East Prospects as at July 31, 2011; Senergy (GB) Ltd, NI 51-101 report
for Badger prospect as at April 30, 2012. Refer to NSE press releases on
December 7, 2011, January 4, 2012 and May 15, 2012 for further disclosure.


(2) Sproule International Limited, NI 51-101 reports for Bobcat and Norfolk and
Norfolk East Prospects as at July 31, 2011; Senergy (GB) Ltd, NI 51-101 report
for Badger prospect as at April 30, 2012. Refer to NSE press releases on
December 7, 2011, January 4, 2012 and May 15, 2012 for further disclosure.